S Korean Trade, Diplomacy Trending Away From China


(MENAFN- Asia Times) South Korea is trending away from economic dependence on China and increasing its trilateral interactions with Washington and Tokyo. Thus far, Beijing appears unsure of how to respond, beyond calls for“cooperation” and encouragement for Seoul to pursue a non-aligned foreign policy.

A
significant measure
of the impact of South Korea's evolution in geopolitical orientation is reflected in the shift in South Korea's trade relations: The United States became South Korea's number one export destination in December 2023, surpassing China for the first time since 2004.

South Korea also recorded an US$18 billion trade deficit with China, the first bilateral deficit with China in 31 years. South Korean exports to China in 2023 dropped 20% year-on-year, to $124.8 billion, while imports from China dipped 8% year-on-year, to $142.8 billion.

Strong investment flows to the United States by South Korea's major conglomerates have resulted in a boost in South Korean car, automobile part and automotive battery exports. If such trends continue, South Korea in 2024 may have the distinction of being the only country adjacent to China for which China is not its number one trade partner.

Definitely affecting the bilateral relationship was
the December 2023 announcement by the Ministry of Trade, Industry and Energy of its 3050 Strategy initiative
designed to stabilize South Korea's supply chains and reduce dependence on China to less than 50% by 2030.

The trade ministry's effort to reduce dependence on China in its supply chains responds to a deeper realization in South Korea of that country's vulnerability to possible Chinese economic retaliation.

The impact of deepening geostrategic rivalry is clearly contributing to a reconfiguring of political and economic relationships in Northeast Asia.

South Korea appears to be drawing away from China's geoeconomic orbit as South Korean investment in the United States reinforces the geopolitical choices of the Yoon administration.

Meanwhile, Chinese diplomacy toward Seoul has sputtered forward, driven more by multilateral gatherings involving the two countries than any sense of strategic purpose.

Ministerial and working-level economic dialogues on issues such as supply-chain stability, export controls, and trade facilitation continued between China and South Korea, but these exchanges did not generate the traction necessary for substantive bilateral meetings.

Bilateral and trilateral foreign ministerial meetings in Busan between South Korean Foreign Minister Park Jin and counterparts Wang Yi and Kamikawa Yoko also failed to generate sufficient momentum to set a date for the resumption of China-Japan-South Korea summitry.

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