South Korea–U.S. Trade Talks Slow Over Currency Swap Dispute

Negotiations between South Korea and the United States on a $350 billion investment framework have hit delays. Officials in Seoul want a standing currency swap line with the U.S. Federal Reserve, while Washington has been cautious to commit.

The investment plan was first announced in July, covering areas such as semiconductors, clean energy, and other advanced industries. It was billed at the time as a sign of deeper economic ties, but technical talks since then have not moved quickly.

Seoul argues that a permanent swap line would help protect the won when markets are unstable. The U.S. has generally avoided giving that kind of arrangement outside a few partners. Right now, Japan, the eurozone and the UK have access to such deals. Korea does not, and the gap has become more visible in recent weeks.

Currency swaps matter because they allow central banks to supply each other's money during financial stress. Korea turned to temporary swap lines in earlier downturns, most notably in 2008. A permanent arrangement has never materialized.

Talks are expected to continue in Washington, but there is little detail on when or how they might end. The investment plan remains on the table, while the swap request sits unresolved.