The South Korean cabinet approved a presidential decree on Tuesday as part of the process of allowing $350 billion in strategic?investments to be made in the United States under the terms of the trade agreement signed between the two countries last year.

The investment plan included a number of terms and conditions, such as "commercial reasonableness" which will be used to determine the amount of $200 billion that can be invested directly in U.S. strategic industries.

South Korea also agreed to invest 150 billion dollars in shipbuilding related cooperation in exchange for more favourable tariffs.

Seoul defines a commercially feasible project as one which can generate enough revenue to cover the principal and interest costs during the project period.

Washington will negotiate the duration of the projects, according to a statement.

Seoul will create an investment corporation backed by the state, which will operate?for a period of 20 years.

South Korea pledged its investment plan as part of a trade agreement with Washington in exchange for a reduction in U.S. duties on South Korean goods, including automobiles.

In January, U.S. president Donald Trump warned that he would raise tariffs on South Korean goods?to 25%. He said Seoul had not yet enacted the trade framework which had capped U.S. levy at 15%.

In March, the?National Assembly adopted a'special bill on investment with bipartisan backing in a plenary meeting. Reporting by Heejin Lee and Joyce Lee Editing By Ed Davies

(source: Reuters)