Korea-U.S. Trade Talks: A High-Stakes Gamble

South Korea's trade negotiations with the U.S. are plagued by political uncertainties. Concerns are mounting over the potential fallout, including a possible financial crisis, if demands lead to a costly investment or no deal. President Lee's calls for a currency swap have yet to ease investor worries.

South Korea's trade negotiations with the Trump administration are fraught with increasing political uncertainties, unnerving investors who fear Seoul may end up with an unfavorable deal or none at all.

The Korean won hit a critical level against the dollar this week, leading to apprehensions of further depreciation. This slide accelerated following President Lee Jae Myung's remarks on the necessity of a currency swap with the U.S. as Seoul contemplates investing $350 billion in America.

Concerns of a repeat financial crisis, reminiscent of 1997, and the potential collapse of trade agreements loom large. With Seoul and Washington deadlocked on structuring an investment fund, the tensions echo in the pressure on the won, dictated by global and political challenges.

(With inputs from agencies.)