(MENAFN) South Korea and the United States finalized a memorandum of understanding (MOU) on Friday, formalizing Seoul’s "$350 billion investment pledge" in return for reduced US tariffs, according to the South Korean Ministry of Trade, Industry and Resources.

The MOU was signed digitally by South Korean Industry Minister Kim Jung-kwan and US Commerce Secretary Howard Lutnick, a news agency reported.

This agreement follows discussions held during US President Donald Trump’s recent visit to South Korea, where both nations reached consensus on major trade conditions.

As per the arrangement, South Korea will allocate $200 billion through cash installments, limited to $20 billion annually, alongside $150 billion dedicated to bilateral shipbuilding collaboration. In exchange, Washington will lower reciprocal tariffs on South Korean imports to 15%, as had been agreed in July.

Additionally, the US approved South Korea’s initiative to construct nuclear-powered submarines on Thursday, pledging close cooperation with Seoul to fulfill the shipbuilding project’s requirements, including strategies for fuel acquisition.

Meanwhile, Washington and Seoul are in discussions regarding the joint development of nuclear submarines, a media outlet reported Friday, citing sources familiar with the matter.

Officials from both countries are currently considering a Korean-led joint production approach, potentially spanning facilities in both nations, the report noted.

The plan could start with US-class submarines, whose designs are highly secured, before transitioning to indigenous South Korean designs.

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