President Donald Trump has announced that South Korea has agreed to a sweeping economic and defence package with the US.

"South Korea has agreed to pay the USA 350 Billion Dollars for a lowering of the Tariffs charged against them by the United States," he said on his Truth Social platform on Thursday.

Additionally, he said South Korea agreed to buy US oil and gas "in vast quantities" and investments into the US by South Korean companies and businessmen will exceed $600 billion.

"Our Military Alliance is stronger than ever before and, based on that, I have given them approval to build a Nuclear Powered Submarine, rather than the old-fashioned, and far less nimble, diesel-powered Submarines that they have now," he added.

On Wednesday, during his meeting with President Lee Jae-myung in South Korea, Trump said that an elusive trade deal with South Korea has been "pretty much finalised", but stopped short of saying the leaders came to terms on a final deal.

Later on Thursday, Trump is expected to meet with his Chinese counterpart, Xi Jinping, who is in South Korea for the Asia-Pacific Economic Cooperation (APEC) summit. Trump will not attend the regional meeting.