Key Points
On November 14, 2025, President Lee Jae-myung of South Korea and the U.S. government finalized a landmark Joint Fact Sheet. Core components include cooperation on nuclear-powered submarines and expanded authority for nuclear fuel reprocessing. This agreement signals a new phase for deterrence posture and industrial capacity across shipbuilding, nuclear energy, and advanced defense manufacturing. However, the plan requires extensive legal frameworks, IAEA oversight, and domestic political consensus.
Background — Why Now?
Intensifying North Korean nuclear threats, shifting regional military balances, and global geopolitical realignment have pushed Seoul and Washington to strengthen deterrence mechanisms and expand strategic technology cooperation. The U.S. seeks greater allied capability under its Indo-Pacific strategy, while Korea aims to enhance strategic autonomy and industrial competitiveness. The Fact Sheet represents the intersection of these needs.
Fact Sheet Highlights (Summary)
- Nuclear-powered submarine cooperation — Joint review of reactor-based submarine development, associated fuel infrastructure, and technology transfer parameters.
- Expanded reprocessing rights — Framework for advanced fuel-cycle autonomy and IAEA verification protocols.
- Nuclear & shipbuilding industrial collaboration — Component localization, joint R&D, maintenance partnerships.
- Governance & safety commitments — Strengthened non-proliferation safeguards and nuclear material management systems.
Note: Detailed clauses should be cross-checked with official documents once published.
Military Implications
Nuclear-powered submarines dramatically enhance long-endurance patrol capability, survivability, and maritime presence. Yet the program raises unresolved issues: operational command arrangements, nuclear material controls, and the geopolitical reaction from China, Japan, and regional stakeholders. Escalatory dynamics and arms-race effects will require diplomatic guardrails.
Economic & Industrial Impact
The agreement directly affects shipbuilding (submarine platforms), nuclear engineering (fuel cycle technologies), high-performance alloys, control systems, and the wider defense manufacturing ecosystem. Large-scale infrastructure investments and long-term service contracts are expected, alongside export opportunities. However, heavy initial capital expenditure and international regulatory constraints pose non-trivial risks.
Legal & Non-Proliferation Issues
Reprocessing and nuclear material handling must comply with the NPT and stringent IAEA guidelines. Korea may require legislative amendments related to nuclear safety, radioactive materials, and parliamentary approval depending on final operational scopes. Transparent oversight is crucial to maintain international trust and avoid proliferation concerns.
Regional Response & Global Impact
China is likely to express strategic concerns; Japan may respond by upgrading its own defense posture. Russia and other regional powers may issue diplomatic warnings or reinforce military readiness. Heightened regional tension is expected unless transparency and diplomatic engagement proceed in parallel.
Practical Guidance — What Stakeholders Should Prepare
- Government: Publish verification mechanisms early, engage IAEA, and ensure transparent communication with civil society.
- Industry: Conduct capability assessments, build strategic partnerships, and invest in regulatory compliance readiness.
- Investors: Evaluate policy risk, diversify portfolios, and monitor regulatory timelines.
- Civil Society: Demand open disclosure of safety documents and oversight structures; promote independent monitoring mechanisms.
Frequently Asked Questions
A1. No. A nuclear-powered submarine uses a reactor for propulsion and does not imply nuclear warhead capability. However, fuel handling is subject to strict non-proliferation oversight.
A2. Technically possible, but only under rigorous IAEA supervision and bilateral agreements. Civilian fuel-cycle autonomy does not automatically equate to weapons-related activities.
A3. No immediate physical risk arises from the agreement itself. Safety frameworks must accompany any fuel-cycle facilities.
A4. Shipbuilding, nuclear engineering equipment, advanced materials, and defense services may benefit. Investors should assess regulatory volatility carefully.
A5. Expect diplomatic pushback, stronger export controls, and verification demands.
A6. Refer to the President’s announcement, the full Joint Fact Sheet, and official releases from Korea’s Ministry of National Defense, Ministry of Foreign Affairs, and the IAEA.
Sources & Official Documents
- President Lee’s Announcement (Nov 14, 2025)
- U.S.–Korea Joint Fact Sheet (Original)
- Ministry of National Defense – Press Release
- Ministry of Foreign Affairs – Press Release
- IAEA Guidelines & Safeguards
[Full Text] U.S.–Korea Joint Fact Sheet on Tariffs and Security Cooperation
[Full Text] U.S.–Korea Joint Fact Sheet on Tariffs and Security Cooperation
The joint explanatory document (Joint Fact Sheet) outlining the results of tariff and security consultations between the Republic of Korea and the United States was finalized on the 14th. President Lee Jae-myung officially announced the confirmation of the fact sheet at a press briefing held at the Yongsan Presidential Office in Seoul earlier in the day.
The White House released its own version of the fact sheet around the same time.
The following is the unofficial Korean-to-English translation of the full text.
『Joint Explanatory Document of the Meeting between President Lee Jae-myung and President Donald Trump
President Lee Jae-myung of the Republic of Korea welcomed the state visit of President Donald J. Trump of the United States on October 29. This marks the first time in Korean history that a state visit was received in Gyeongju, following the two leaders’ first meeting in Washington on August 25. Notably, it is also the first instance in which Korea has received the same foreign head of state twice as a state guest.
Reflecting President Trump’s historic victory in the 2024 U.S. presidential election and President Lee’s own election, which reaffirmed the resilience and strength of Korean democracy, the two leaders declared a new chapter in the Korea–U.S. alliance, which remains the cornerstone of peace, security, and prosperity on the Korean Peninsula and across the Indo-Pacific region.
▲ Rebuilding and Expanding Core Industries
President Lee and President Trump reaffirmed the historic “Korea Strategic Trade and Investment Agreement” announced last July, which reflects the strength and durability of the Korea–U.S. alliance.
ㅇ The leaders welcomed Korea’s investments to advance economic and national security interests across various sectors—including shipbuilding, energy, semiconductors, pharmaceuticals, critical minerals, AI, and quantum computing, among others.
ㅇ The agreement includes Korea’s U.S.-approved $150 billion investment in the shipbuilding sector (approved investment).
ㅇ The agreement also includes an additional $200 billion investment by Korea in connection with the signing of a forthcoming Memorandum of Understanding (MOU) on strategic investments.
ㅇ Under Executive Order 14257 dated April 2, 2025, and its amendments, the United States shall apply, for mutual tariff purposes, the higher of (i) the tariff rate under the Korea–U.S. FTA or U.S. MFN rates, or (ii) 15% to Korean-origin goods.
ㅇ The United States will reduce Section 232 tariffs on Korean-origin automobiles, auto parts, raw timber, lumber, and wood products to 15%. For Korean-origin goods where the applicable KORUS FTA or MFN tariff rate is at least 15%, no additional Section 232 tariffs shall be imposed. For goods with tariff rates below 15%, the combined rate (FTA/MFN + Section 232) shall be adjusted to total 15%.
ㅇ For pharmaceuticals subject to any Section 232 tariffs, the United States intends to ensure that the tariff rate for Korean-origin goods does not exceed 15%.
ㅇ For semiconductors (including semiconductor equipment) subject to Section 232 tariffs, the United States intends to extend conditions no less favorable than those to be provided in future agreements covering semiconductor trade that exceed Korea’s current semiconductor trade volume.
ㅇ The United States intends to eliminate additional tariffs imposed under Executive Order 14257 (and amendments) on specific goods listed under the “Potential Tariff Adjustments for Aligned Partners,” including generic pharmaceuticals, active ingredients, chemical precursors, and certain natural resources not produced domestically in the U.S. The U.S. will also eliminate tariffs on designated Korean-origin aircraft and aircraft parts under Executive Order 14257 (and amendments), Proclamation 9704 (and amendments), Proclamation 9705 (and amendments), and Proclamation 10962.
▲ Foreign Exchange Market Stability
The two governments held extensive discussions regarding the potential impact of the MOU commitments on Korea’s foreign exchange market. Both sides shared the understanding that the commitments under the MOU should not cause market instability. As trusted partners, the two sides agreed that Korea shall not be required to procure more than USD 20 billion in any given year. Korea will make best efforts to minimize market impact by procuring funds through means other than purchasing U.S. dollars directly on the market. If Korea anticipates that fulfilling the commitments under the MOU may cause market instability—such as irregular fluctuations in the won—Korea may request adjustments to procurement amounts or timing, and the United States will duly consider such requests in good faith.
▲ Strengthening Commercial Ties
The leaders welcomed a series of commercial commitments in strategic sectors that reflect the private sector’s confidence in the strong economic partnership between the two nations.
ㅇ The leaders welcomed the announcement made in August that Korean firms will invest a total of USD 150 billion in direct investment in the United States during President Trump’s term. Both nations commit to ensuring smooth execution of the investment.
ㅇ The leaders welcomed Korean Air’s announcement in August of its purchase of 103 Boeing aircraft equipped with GE Aerospace engines. Valued at USD 36 billion, the order includes Boeing 737 MAX jets, 787 Dreamliners, 777X passenger aircraft, and freighters. This will bring Korean Air’s total Boeing orders in 2025 to over 150 aircraft.
ㅇ Korea and the United States welcomed the “Buy America in Seoul” initiative, under which Korea, in cooperation with U.S. state governments, will host annual exhibitions featuring U.S. companies—including SMEs—to promote exports of U.S. products to Korea.
▲ Promoting Bilateral Trade
The leaders confirmed that the recently announced agreements reflect the shared objective of expanding mutually beneficial trade and investment. In line with the spirit of these agreements, Korea and the United States will discuss non-tariff barriers and formalize commitments to promote bilateral trade within the KORUS FTA Joint Committee by the end of this year. Key areas of discussion include:
ㅇ Korea will eliminate the cap of 50,000 units on U.S.-origin automobiles compliant with Federal Motor Vehicle Safety Standards (FMVSS), allowing additional imports without modification. Korea will also ease regulatory burdens by refraining from requiring documents beyond those submitted to U.S. authorities for emissions certification.
ㅇ Korea will collaborate with the United States on non-tariff barriers affecting food and agricultural trade. This includes ensuring compliance with existing bilateral agreements and protocols, streamlining regulatory approval procedures for agricultural biotechnology products, resolving delays in U.S. applications, establishing a dedicated “U.S. Desk” for U.S. horticultural product requests, and maintaining market access for U.S.-origin meat and cheese using designated terms.
ㅇ Korea and the United States commit to ensuring that U.S. companies do not face discrimination or unnecessary barriers regarding digital service laws and policies, including network usage fees and online platform regulations. They also commit to enabling the seamless cross-border transfer of information, including data on location, reinsurance, and personal information. Furthermore, both countries support the permanent extension of the WTO moratorium on customs duties for electronic transmissions.
ㅇ Korea commits to introducing additional procedural fairness measures in competition-related proceedings, including recognition of attorney–client privilege.
ㅇ Korea and the United States will cooperate to protect intellectual property rights. Korea will continue taking necessary steps toward accession to the Patent Law Treaty.
ㅇ Korea and the United States commit to ensuring robust protection of internationally recognized labor rights. The two nations will cooperate globally to combat all forms of forced labor, including measures to prevent the importation of goods produced by forced labor.
ㅇ Korea and the United States reaffirm the importance of ensuring that environmental protection measures do not distort trade or investment. Korea commits to effectively enforcing domestic environmental laws, including faithful implementation of the WTO Agreement on Fisheries Subsidies.
▲ Safeguarding Economic Prosperity
The leaders acknowledged the need to strengthen economic and national security cooperation to maintain competitiveness and ensure secure supply chains. This includes collaboration to prevent tariff evasion, complementary measures to address unfair or non-market policies and practices, and improvements in foreign and outbound investment regulations. Both parties will ensure that international public procurement obligations benefit countries that accept equivalent commitments.
▲ Modernizing the Korea–U.S. Alliance
The United States underscored its commitment to the defense of Korea through the continued stationing of U.S. forces on the Korean Peninsula.
ㅇ The United States reaffirmed its commitment to extended deterrence using the full range of capabilities, including nuclear. The leaders agreed to strengthen cooperation through consultative mechanisms, including the Nuclear Consultative Group (NCG).
ㅇ President Lee shared Korea’s plan to increase defense spending to 3.5% of GDP as soon as legally feasible, and President Trump welcomed this commitment.
ㅇ Korea also committed to spending USD 25 billion on the purchase of U.S.-origin military equipment by 2030 and to providing USD 33 billion in comprehensive support for U.S. Forces Korea, consistent with Korea’s legal requirements.
ㅇ The two leaders agreed to continue alliance-level cooperation for the transition of wartime operational control (OPCON). With U.S. support, Korea committed to accelerating its efforts to enhance the military capabilities necessary to lead combined conventional defense against North Korea. This includes acquiring advanced U.S. weapon systems and expanding bilateral defense-industrial cooperation, including advanced weapons systems.
ㅇ Korea and the United States will strengthen U.S. conventional deterrence posture against all regional threats to the alliance, including those posed by North Korea. Both sides reaffirmed related understandings dating back to 2006. They will maintain close consultations and report progress to their respective leadership.
ㅇ Korea and the United States committed to expanding cooperation in cyberspace and outer space. The leaders also reaffirmed their intention to continue cooperation related to artificial intelligence (AI) in military domains.
▲ Cooperation on Korean Peninsula and Regional Issues
The leaders reaffirmed their commitment to peace, stability, and prosperity on the Korean Peninsula and across the Indo-Pacific region.
ㅇ They reaffirmed their commitment to the complete denuclearization of North Korea and peace and stability on the Korean Peninsula, and agreed to cooperate to implement the 2018 Singapore Joint Statement.
ㅇ They agreed to maintain close coordination on North Korea policy and urged North Korea to return to meaningful dialogue and comply with international obligations, including the abandonment of its weapons of mass destruction (WMD) and ballistic missile programs.
ㅇ They reaffirmed their intention to strengthen trilateral cooperation with Japan.
ㅇ They reaffirmed their commitment to safeguarding freedom of navigation, overflight, and other lawful uses of the seas. They reiterated that all maritime claims must be consistent with international law, including the UN Convention on the Law of the Sea (UNCLOS).
ㅇ They emphasized the importance of peace and stability in the Taiwan Strait, encouraged the peaceful resolution of cross-strait issues, and opposed unilateral changes to the status quo.
▲ Advancing Maritime and Nuclear Cooperation
The United States welcomed Korea’s commitment to modernizing and expanding U.S. shipbuilding capabilities through investments in U.S. shipyards and workforce development. Korea welcomed U.S. support for Korea’s civil and naval nuclear programs.
ㅇ Korea and the United States agreed to advance cooperation through a shipbuilding working group, including maintenance, repair, workforce development, shipyard modernization, and supply chain resilience.
ㅇ These initiatives will help increase, as quickly as possible, the number of U.S. commercial vessels and combat-ready naval vessels, including the potential construction of U.S. commercial ships in Korea.
ㅇ The United States expressed support for Korea’s pursuit of procedures that could lead to civilian uranium enrichment and spent fuel reprocessing, consistent with the Korea–U.S. Atomic Energy Agreement and U.S. legal requirements.
ㅇ The United States approved Korea’s construction of nuclear-powered submarines. The U.S. will work closely with Korea, including on fuel procurement, to advance the requirements of this shipbuilding project.
[Provided by Yonhap News]
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