Shifts In U.S. Trade In Asia: Key Agreements From President Trump's October 2025 Asia Trip – Part II: East Asia

Capping off a highly eventful week in Asia at the end of October, President Donald J. Trump has further reshaped the landscape of U.S. trade with the Asia-Pacific region through a series of new agreements. This latest round of negotiations includes new reciprocal trade deals and market access commitments across Cambodia, Thailand, Malaysia, Vietnam, China, South Korea, and Japan. Some of these agreements build upon the foundation laid by Executive Order 14346 (Sept. 5, 2025). That order provided for zero percent tariffs on products listed in Annex III, once a qualifying trade deal was announced.[1] With some agreements now in place, Annex III of the EO is being actively implemented.

Last week, we highlighted the key terms and commitments made under these new agreements for the Southeast Asian countries (Vietnam, Malaysia, Cambodia, and Thailand).

Now, with the release of the long-awaited South Korea Joint Fact Sheet, we now discuss the agreements with the East Asian countries (China, South Korea, and Japan) in Part II of this post.

We also include an updated summary table for quick reference.

China

The Agreement between the United States and China, as outlined in the China Fact Sheet, signifies a one year truce amidst escalating trade tensions.

China has made a range of commitments, including suspending new export controls of rare earth minerals, granting general licenses for the export of rare earths under its existing export control regime, restricting the shipment of fentanyl related precursor chemicals to North America, and lifting export controls on legacy Nexperia chips. China has also agreed to suspend retaliatory tariffs placed on U.S. goods since March 4, 2025, retaliatory export controls against U.S. entities, port fees on U.S. vessels imposed in retaliation for Section 301 duties on China-built vessels, and various price discrimination and anti-dumping investigations into U.S. semiconductor companies. Separately, China will extend the market-based tariff exclusion process for U.S. imports through 2026, and has committed to purchasing 12 million metric tons (MMT) of U.S. soybeans during the remainder of 2025, and at least 25 MMT per calendar year from 2026 through 2028.

The United States has agreed to reduce its current fentanyl-related IEEPA tariff rate on all Chinese goods from 20% to 10%. The reciprocal IEEPA tariff rate on China remains temporarily lowered at 10%, but this rate is set to increase back to 34% on November 10, 2026. As a result, the baseline IEEPA duty rate for China will be 20%.

The United States has also extended certain Section 301 tariff exclusions, and suspended implementation of Section 301 duties on the Chinese maritime sector. These suspended measures include USTR port fees that would otherwise apply to specific Chinese-built vessels, as well as fees on vessels owned or operated by Chinese entities. The suspension also covers fees on foreign-built vehicle carriers that call at U.S. ports.

Further, the United States has suspended the Bureau of Industry and Security (BIS) “50 percent rule”, which previously expanded export restrictions to entities 50% or more owned by entities on the BIS Entity List. Under the terms of the current agreement, each of these actions will remain in effect until November 10, 2026.

Japan

The Agreement between the United States and Japan memorializes the Framework Agreement reached on July 22, 2025, and marks another milestone in Japan's increasing alignment with the United States.

Under the Agreement, as outlined in the Japan Agreement Fact Sheet, Japan has agreed to make various investments in the United States. These include up to $332 billion in investments to support Small Modular Reactor (SMR) development, other energy related infrastructure investments, AI infrastructure investments, and electronics supply chain investments, among others. Japan also committed to accept U.S. vehicle safety certifications without further testing, increase imports of U.S. rice by 75%, and purchase $8 billion of U.S. agricultural products.

Additionally, Japan agreed to invest in an ammonia and fertilizer facility and a copper smelting and refining facility in the United States. The United States and Japan signed a separate Framework on October 28, 2025 aimed at increasing cooperation with regards to the mining and processing of critical minerals and rare earths.

The United States had previously capped the EEPA reciprocal tariff rate on Japan's goods at 15% under Executive Order 14345 (Sep. 4, 2025), in accordance with the Framework Agreement.

South Korea

The agreement between the United States and South Korea, as outlined in the South Korea Joint Fact Sheet (Nov. 13, 2025), marks a significant development in bilateral relations, and addresses not only trade issues but also defense and security matters.

Under the deal, South Korea will invest $150 billion in U.S. shipbuilding, with a further $200 billion in investment committed. South Korea also committed to reducing non-tariff barriers to U.S. imports, including dropping the annual 50,000 cap on U.S. vehicles permitted to enter South Korea without modifications. South Korea also committed to reducing barriers for U.S. agricultural products, recognizing attorney-client privilege in competition proceedings, and opposing customs duties on electronic trade.

The United States agreed to maintain the current IEEPA tariff rate of 15% on South Korean goods. However, if the good's applicable U.S.-Korea Tree Trade Agreement or U.S. Most Favored Nation tariff rate is higher than 15%, that rate would apply instead. Additionally, the United States reduced its Section 232 duty rates for automobiles, auto parts, timber, lumber, and wood derivatives (each currently 25%) to 15% for South Korean products. The United States also committed to removing duties on some South Korean products listed in Annex III, including generic pharmaceuticals, aircraft, and aircraft parts.

The deal also contained notable security provisions which hold trade implications. South Korea committed to raising defense spending to 3.5% of GDP and purchasing $25 billion in U.S. military equipment by 2030. The United States also gave approval for South Korea to build nuclear attack submarines, and source nuclear fuel.

As outlined in the separate South Korea Investments Fact Sheet, the United States and South Korea reached a technology deal aimed at enabling U.S. AI exports to South Korea, while various South Korean companies agreed to purchase U.S. aircraft and natural gas. Additionally, South Korean companies also committed to investing in U.S. power-grid infrastructure, rare earths refining, uranium enrichment, and shipyard expansion and modernization.

Per the Office of the United States Trade Representative's South Korea Fact Sheet, the United States and South Korea will complete domestic procedures for implementation in the coming weeks and convene a Joint Committee dedicated to the agreement.

Trade Agreements Table

Footnote

1. See Annex III “Potential Tariff Adjustments for Aligned Partners” starting on page 38. Annex III is an a-la-carte menu of reciprocal tariffs that the president may lift in the event of a trade deal or agreement with a country.

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