South Korea warns that the agreement with the United States could trigger a financial crisis.

2025-09-22 05:07:06

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South Korean President Lee Jae-Myung warned that the trade agreement with America could trigger a financial crisis similar to the 1997 Asian crisis. America requires Seoul to invest 350 billion USD in exchange for a tax reduction on South Korean exports.

Mr. Lee emphasized that such money transfers could destabilize the economy, especially if there is no USD swap agreement supporting the won. South Korea only agrees to feasible trade projects with appropriate safeguards, rejecting America's control over investment allocation.

Negotiations are stalled due to disagreements, America demands commitments first, while Seoul wants flexible management of capital flows. Besides trade, tensions are rising due to incidents affecting Korean workers in America, which could hinder future investments. Mr. Lee calls for caution to avoid repeating the 1997 crisis.

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