President Lee Jae-myung salutes the national flag at the official welcoming ceremony for U.S. President Donald Trump held at the Gyeongju National Museum in Gyeongju, Gyeongbuk Province, on October 29, 2025. [Photo=Yonhap News]

The question President Donald Trump of the United States posed when he abruptly announced an increase in tariffs on South Korea on the 27th was clear.

"Why has the South Korean National Assembly not ratified this agreement?"

However, the response from the South Korean government and the ruling party to this question took different directions.

The Blue House emphasized the 'will to implement' the tariff agreement, while the ruling party explained the schedule for submitting and reviewing the Special Act on Investment in the U.S.

Instead of 'ratification,' which President Trump explicitly raised as an issue, the government and the ruling party presented 'special act implementation,' a completely different issue, to the forefront.

This direction cannot be dismissed as mere message confusion.

Synthesizing the repeated statements and responses, it is natural to interpret that the Lee Jae-myung administration has chosen to evade the judgment of defining this agreement as subject to ratification.

Ratification and Implementation: A Decisively Different Choice

Ratification is the process by which the National Assembly approves treaties or international agreements equivalent to treaties under the Constitution.

Once recognized as subject to ratification, the agreement acquires legal status and becomes subject to parliamentary oversight and judicial review. Subsequently, the same standard applies to similar trade, security, and financial agreements.

On the other hand, implementation is closer to an executive policy choice.

Implementation legislation allows for adjustments in speed, scope, and method, and can be modified or supplemented according to changes in the political and diplomatic environment. In other words, implementation can be managed, but ratification is final. This difference is at the heart of the current controversy.

The Question the Government Did Not Answer

The question posed by President Trump's remarks is clear: Is this agreement subject to ratification or not? If it is subject to ratification, the next question is inevitable.

If so, why did the government not submit the ratification motion to the National Assembly?

The moment this question is answered, the responsible party shifts from the National Assembly to the executive branch.

The legal basis for treating the agreement as an 'inter-governmental promise' rather than a treaty, its relationship with Article 60 of the Constitution, and an assessment of the large-scale financial, trade, and security burdens become unavoidable.

However, the government has not presented a clear stance on this question. Instead, it has repeatedly emphasized its 'will to implement' and the 'progress of the special act.'

This is less an answer to the question and more a response that attempts to shift the question itself to another issue.

Assemblyman Jung Tae-ho's Remarks Leave Room for "Reversal"

The remarks by Assemblyman Jung Tae-ho of the Democratic Party of Korea, the whip of the ruling party's Strategy and Finance Committee, further clarify this government judgment.

Regarding the tariff controversy, Assemblyman Jung stated, "The government's request was to submit and pass the Special Act for the Management of Strategic Investment between South Korea and the U.S. by February." He explained that the approach assumed a certain amount of time, not an immediate or urgent passage.

This highlights that the government did not rush to legally finalize the agreement, even in a situation where tariff risks could materialize.

Especially considering that judicial review regarding the president's tariff authority is underway in the United States, it is highly plausible that this is a strategic choice to remain in the implementation phase, which allows for reversal by observing the situation, rather than to finalize the agreement through ratification.

Avoiding ratification means leaving the possibility of reversal open. President Trump is certainly aware of this.

Trump's Concern is Not Just "Automobiles"

What is noteworthy is that President Trump's remarks were not limited to automobile tariffs.

He announced an increase in "all mutual tariffs," including South Korean automobiles, lumber, and pharmaceutical products, from 15% to 25%.

This is less a measure targeting a specific industry and more a challenge to the overall legal status of the South Korea-U.S. trade agreement.

Interpreting the issue solely in terms of automobile tariffs narrows the scope of Trump's remarks.

His message comprehensively expressed dissatisfaction with how South Korea is handling the agreement within a legal framework, rather than focusing on individual items.

The Issue Dodged by the "Federal Register" Explanation

The government explained that "tariff increases must be published in the Federal Register to take effect."

While this is a factual explanation of administrative procedure, it does not answer the question raised by President Trump. Whether tariffs are published in the Federal Register is a matter of when the tariffs will take effect.

In contrast, Trump's question is why tariffs were raised again, and why the agreement was not ratified.

By emphasizing the Federal Register, the issue of the Constitution and treaties is shifted to a matter of timeline management. This is an explanation that sidesteps the issue rather than explaining it.

Even if the U.S. Supreme Court invalidates the basis for certain tariffs, President Trump still has various tariff tools at his disposal.

The legal avenues for imposing tariffs are multifaceted, including Section 301 of the Trade Act, Section 232 of the Trade Expansion Act, short-term import restriction provisions, and anti-dumping and countervailing duties.

The reason President Trump repeatedly raises "ratification" is clear.

He desires a legal finalization that binds his opponent once and for all, rather than a continuous battle over new legal bases for imposing tariffs. If there were a ratified agreement, tariffs would become a means of implementation rather than a bargaining chip.

At this point, the South Korean government's "reversal strategy" directly clashes with Trump's demand.

If a 25% Automobile Tariff Becomes a Reality

Especially if a 25% tariff on automobiles is actually imposed, the shock is likely to spread beyond the industry to the entire financial market.

The foreign exchange market may interpret this not as a single-item issue, but as a signal that South Korea's export structure to the U.S. and its trade risks are being reassessed.

If the automobile industry, which has a large export proportion to the U.S., is directly hit, expectations for current account improvement will decrease, which could lead to downward pressure on the won and increased exchange rate volatility.

During this process, foreign capital is more likely to move towards a halt in new inflows and a period of observation rather than a rapid outflow.

Since automobile tariffs can set a precedent that could spread to other strategic industries such as steel and semiconductors, the market will reflect this as an increase in the risk premium for the entire South Korean economy.

In the stock market, valuation adjustment pressure could be applied not only to automobile and parts stocks but also to large-cap stocks with a high proportion of foreign ownership.

The bond market may see increased expectations for interest rate cuts due to concerns about economic slowdown. However, a volatile situation could arise where foreign capital inflows do not simultaneously increase due to vigilance over exchange rate volatility.

Ultimately, a 25% automobile tariff could act as a shock that simultaneously shakes the balance of exchange rates, stock prices, and interest rates, rather than a simple decrease in exports.

Strategy or Misjudgment?

Synthesizing the statements from the Blue House and the ruling party, they have replaced the question of 'ratification,' which President Trump clearly asked, with another issue by preemptively presenting 'special act implementation,' which President Trump did not ask about.

The reason is simple: ratification is an irreversible decision.

The problem lies in the cost of that choice.

While the Lee Jae-myung administration's 'reversal strategy,' chosen by avoiding ratification, may secure flexibility in the short term, it is difficult to rule out the possibility that it could be a misjudgment that amplifies risk, considering Trump's response with multiple tariff cards in hand.

And the damage from that misjudgment will first be borne by businesses, workers, and consumers, and then by the public, and the political responsibility for that decision must be borne by the administration.

The essence of the tariff dispute is not the tariff rate itself. It is the choice of how much to finalize the agreement. And the results of that choice will be recorded.

By Reporter Kim Young