[EAI-MBN Korean Diplomacy 2021 Outlook and Strategy] Xi Jinping Government's Seven Major Diplomatic Initiatives and Korea's Strategy

YouTube Link: https://www.youtube.com/watch?v=H8jvw26wEE8

The East Asia Institute (EAI) has planned the "EAI-MBN Korean Diplomacy 2021 Outlook and Strategy" expert interview series to provide policy recommendations for South Korea's diplomacy and security ahead of the 20th presidential election. This series presents seven major tasks facing the South Korean government amidst the variables of the new US administration and COVID-19, and offers visions and outlooks for Korea's diplomatic strategy and the new year as seen by experts in each field.

As the second installment of the "EAI-MBN Korean Diplomacy 2021 Outlook and Strategy" expert interview series, we are publishing "Xi Jinping Government's Seven Major Diplomatic Initiatives and Korea's Strategy" by Director Lee Dong-ryul of EAI's China Research Center (Professor of Chinese Language and Chinese Studies at Dongduk Women's University). For more detailed expert commentary, please check the link below.

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EAI aims to provide timely and in-depth analysis of current issues through Q&A sessions with experts in relevant fields. The content of this interview represents the personal opinions of the interviewed expert and does not reflect the position of the East Asia Institute. Please cite the source when quoting this interview video.

• Managed and Edited by: Baek Jin-kyung, EAI Director of Research

Inquiries: 02 2277 1683 (ext. 209) | j.baek@eai.or.kr

Video Script

Hello everyone. I am Jung Kwang-je, head of the Foreign Affairs and Security Team at Inven Politics. Do you know what year 2021 is? It is the year the Communist Party of China celebrates its 100th anniversary. The founding anniversary is on July 1st. Today, we will discuss the past 100 years of the Communist Party of China and its future impact on China-Korea relations with Professor Lee Dong-ryul, Director of the China Research Center at EAI. As China rises, the challenges it faces are growing.

For example, the newly launched Biden administration, in its full-fledged competition with China, is increasingly viewing China as a significant challenger and is taking steps to contain it. This is a continuation of what happened during the Trump administration, but the Biden administration is more systematically approaching it. How is China responding to this? Well, the Trump administration essentially viewed what China considers its core interests, its 'red lines,' as the ultimate limit. Their stance was that as long as these core interests, related to sovereignty and territory, are not infringed upon, China can coexist with the US. The Biden administration's approach is a continuation of this, and it has led to increased instability in China's system.

Yes, with the advent of the Biden administration, China seems to have mixed feelings. On one hand, there are high expectations, but on the other hand, the Biden administration is emphasizing solutions through democracy, human rights, and freedom, which could expose China's vulnerabilities. This is a concern for China. One of China's core interests is the 'One China' principle. The US is also seen as provoking China on issues related to Taiwan, especially in the later stages of the Trump administration. There is an agreement between the US and China on the 'One China' principle, established in 1979 when diplomatic relations were normalized. However, the US has maintained unofficial relations with Taiwan, refraining from high-level exchanges. During the Trump administration, there were instances of high-ranking US officials visiting Taiwan for the first time since the normalization of relations. This was seen as a strategic move by the US to pressure China, making it a very sensitive issue.

Yes, the US and China had an agreement when normalizing relations in 1979. However, the US has maintained unofficial relations with Taiwan, refraining from high-level exchanges. But during the Trump administration, there were instances of high-ranking US officials visiting Taiwan for the first time since the normalization of relations. This was seen as a strategic move by the US to pressure China, making it a very sensitive issue. Furthermore, Taiwan is currently led by a president from the Democratic Progressive Party, which emphasizes independence. This, combined with the US policy, creates a sense of instability.

So, under the Biden administration, are the US-China relations expected to be bumpy, similar to the Trump era? Yes, in many respects, the US views China as a challenger due to its rise. There is definitely a competitive aspect to this relationship. This trend is likely to continue. The specific areas of conflict will depend on how the Biden administration chooses to exert pressure. While China may have some expectations that the Biden administration will be different from the Trump administration, there are also concerns. The Biden administration has outlined four priority tasks, one of which is the pandemic, and the other three are related to economic recovery and climate change. These are areas where China believes there is room for cooperation with the US. China is proactively signaling its willingness to cooperate with the Biden administration on these issues. This suggests a high expectation for cooperation. Conversely, China is facing significant domestic challenges, especially at this critical juncture. Therefore, it wishes to avoid escalating conflicts with the US, or at least delay them. China has been consistently sending this message.

Yes, China has been consistently sending this message. What is China's basic perception of the Korean Peninsula and its policy towards it? China is a country that has the most neighboring countries in the world, bordering 14 countries. It also has a vast coastline. Unlike the US, which has formal alliances, China does not have many countries that can be considered close partners in the traditional sense. Apart from North Korea and perhaps Pakistan, its relationships with most neighbors are complex or even strained. Therefore, stabilizing its surrounding environment is a top diplomatic priority. The Korean Peninsula is important in this context. Historically, the Korean Peninsula has been a gateway for maritime powers, including the US and Japan, into China. Therefore, its geopolitical significance is even greater.

China's persistent engagement with the North Korean issue, despite its burdens, stems from its traditional geopolitical considerations. As competition with the US intensifies, the geopolitical value of North Korea to China only increases. Stability, in this context, means maintaining the status quo without change. Given that the Korean Peninsula is divided, China likely views this proximity as a critical factor. China is the only one among the four major surrounding powers that maintains formal diplomatic relations with both South and North Korea. This situation, where the status quo is maintained, is not necessarily unfavorable for China. Any change could introduce instability. Therefore, China's basic policy is to maintain the status quo, often referred to as the 'Two Koreas' policy. This approach also allows China to leverage the situation effectively. It is arguably China's most prudent policy for the Korean Peninsula. However, the North Korean variable introduces fluidity, as North Korea is difficult for China to control, and at times, sudden inter-Korean or US-North Korea talks emerge.

From China's perspective, maintaining friendly relations with South Korea, not just North Korea, is of significant importance. At a minimum, even if not a close partnership, it is crucial to prevent South Korea from actively participating in US-led anti-China international alliances. This could be considered China's minimal policy for the Korean Peninsula, aiming for neutrality. South Korea, being in a sensitive position between the US and China, faces these dilemmas. Considering the ongoing US-China conflict, what is South Korea's position? The US-China relationship is currently at its worst since the normalization of diplomatic ties.

This is how it is evaluated, with competition and conflict occurring in various domains. This makes South Korea's situation more challenging. South Korea faces unique geopolitical circumstances, including division, nuclear issues, and domestic political polarization. These complex factors present significant challenges. How to overcome these challenges wisely has been a subject of consideration since the rise of China began about a decade ago. While the US and China are in intense competition and conflict, their global influence is diversifying. Unlike the Cold War era, the US and China are interdependent, and their spheres of influence are not as clearly defined. The means, justifications, and norms for establishing clear spheres of influence, as seen in the Cold War, are not as strong.

Consequently, the space for a 'middle ground' is expanding. Many countries, unlike during the Cold War, face a dilemma in choosing between the US and China. They wish to cooperate with both nations rather than choose one. This presents a significant opportunity for South Korea to navigate international relations. However, South Korea also faces unique constraints, as previously mentioned. It is possible that South Korea, unintentionally, is being drawn into the US-China competition on the Korean Peninsula. This is an area where proactive management is necessary. For any administration, issues like unification and the North Korean nuclear program are crucial. However, resolving these issues requires the assistance of both the US and China.

Attempting to resolve these complex issues in the short term can inadvertently draw the US and China into the Korean Peninsula issue, especially when seeking their cooperation. This is particularly sensitive in the current tense US-China climate. Regarding strategic alignment, the US does not want South Korea to participate in China-led initiatives. Conversely, China might view South Korea's participation in programs like the THAAD missile defense system unfavorably. In economic and technological spheres, China is not necessarily at a disadvantage and tends to emphasize openness. Therefore, it is difficult for China to rigidly insist that countries only participate in China-led initiatives. However, China's primary concern lies in security. From a security perspective, South Korea's participation in US-led anti-China initiatives, such as strengthening the US-ROK alliance and forming a US-Japan-ROK alliance, could be perceived as a security threat. To prevent this, China's strategy is to leverage economic means. By strengthening economic dependence on South Korea, China aims to deepen bilateral economic ties, thereby preventing South Korea from leaning too heavily towards the US in security matters. Understanding China's perception of the Korean Peninsula, particularly South Korea, can help in formulating effective diplomacy towards China. What are your thoughts on this?

From South Korea's perspective, there has been an implicit understanding since the establishment of diplomatic relations with China. Despite differences in systems and values, cooperation has been possible because both China and South Korea prioritize economic relations. For the past two decades, economic competition has been the driving force behind the development of South Korea-China relations. While economic cooperation has the potential for further development, we are currently in a transitional phase. As China's industrial structure becomes more sophisticated, South Korea's inability to adapt to these changes has led to a contraction in areas of cooperation. This has become a problem. In other areas, such as security and values, there is a mutual acknowledgment of differences. This understanding forms the basis of cooperation. Therefore, pursuing economic cooperation should not lead to South Korea's system or values being influenced by China, nor should it mean South Korea imposing its values on China. This is a rational approach. However, there is the issue of the ROK-US alliance. From the perspective of the ROK-US alliance, the US undoubtedly has expectations.

While it is an important issue, it is ultimately difficult to resolve without the help of the United States and China. In the process of trying to resolve complex issues in the short term, there are cases where the US and China are inadvertently drawn into cooperation as they are repeatedly asked for help. Especially in the current tense situation, it is necessary to be cautious. Regarding the passport, the US does not want South Korea to strategically participate in the RCEP led by China, and China may not consider South Korea's participation in the LTP, etc. In the economic and technological spheres, China is relatively not losing and emphasizes openness. Therefore, it is difficult for them to insist that we only participate in RCEP led by China.

However, what China is wary of is security issues. From a security perspective, if South Korea participates in the US-led anti-China offensive on the front lines, such as the formation of a South Korea-US-Japan alliance, China may perceive it as a security threat. Their minimum policy is to prevent this. To prevent this, the only means China can use is economic leverage. By strengthening economic sanctions against South Korea and deepening economic dependence, they can prevent South Korea from leaning too much towards the US in terms of security. This is likely their stance. Understanding China's perception of South Korea, especially the Korean Peninsula, will also be helpful in determining our approach to diplomacy with China. From South Korea's perspective, there has been an implicit premise agreed upon since the establishment of diplomatic relations with China. That is, despite differences in systems and values with China, cooperation was possible because both China and South Korea prioritize economic development. This is so-called functional cooperation. In fact, economic competitiveness has driven the development of South Korea-China relations over the past two decades. Therefore, economic cooperation between South Korea and China should be further developed, but we are currently in a transitional period where competitiveness itself is also in flux. As China's industries become more advanced, and we fail to adapt to these changes, the scope for cooperation is shrinking.

This has become a problem. In other areas such as security and values, there is a kind of coexistence between South Korea and China. This is because we start by acknowledging our differences. Therefore, if we increase economic cooperation, it is rational to avoid the perception that our system or values are influenced by China, or that we will influence China's system or values. However, we have the South Korea-US alliance. From the perspective of the South Korea-US alliance, the US will have clear expectations.

As an ally, we must fully fulfill our obligations to the United States. At the same time, it is necessary to continuously make China understand that fulfilling these obligations is not aimed at targeting or containing China. Perhaps the THAAD issue that arose in 2016-2017 was a test case arising from the relationship between South Korea as a US ally and China as South Korea's largest trading partner. It is difficult to say that we passed that test well. At that time, we delayed the deployment of THAAD due to consideration for China. However, when we were eventually forced to choose deployment for security due to North Korea's nuclear tests, if there had been sufficient mutual understanding between the two countries regarding the situation before and after, China, from its perspective, would have seen THAAD as a tool for the US Forces in Korea.

As an ally, we must fully fulfill our obligations to the United States. At the same time, it is necessary to continuously make China understand that fulfilling these obligations is not aimed at targeting or containing China. Perhaps the THAAD issue that arose in 2016-2017 was a test case arising from the relationship between South Korea as a US ally and China as South Korea's largest trading partner. It is difficult to say that we passed that test well. At that time, we delayed the deployment of THAAD due to consideration for China. However, when we were eventually forced to choose deployment for security due to North Korea's nuclear tests, if there had been sufficient mutual understanding between the two countries regarding the situation before and after, China, from its perspective, would have seen THAAD as a tool for the US Forces in Korea.

As an ally, South Korea must fulfill its commitments to the US. However, it is crucial to continuously communicate to China that these commitments are not aimed at targeting or containing China. Perhaps the THAAD deployment issue in 2016-2017, which you mentioned, was a test case arising from the complex relationship between South Korea, as a US ally and China's largest trading partner. It is difficult to say that we handled this situation well. At that time, South Korea delayed the THAAD deployment, considering China's concerns. However, when faced with the North Korean nuclear threat, South Korea ultimately had to choose to deploy THAAD to protect its security. If there had been sufficient communication and understanding between the two countries regarding the preceding circumstances, China might have understood that THAAD was deployed against North Korea, not China, and South Korea's rationale was based on the nuclear threat. While conflicts are inevitable when pursuing national security interests, the situation might not have escalated to the extreme level seen after the THAAD deployment. What happens when a more significant issue, in terms of its nature, arises between the US and China, compared to the THAAD issue? As demonstrated by the THAAD case, this often involves security matters. In the context of alliances, the US is increasingly strengthening cooperation with its allies, particularly in the Indo-Pacific region, to counter China. However, it is becoming increasingly difficult for us to continuously accept the US's demands, given our alliance obligations. China, as mentioned earlier, implicitly agreed to South Korea's alliance with the US when establishing diplomatic relations.

Yes, the US-ROK alliance was implicitly acknowledged by China when diplomatic relations were established. However, the crucial point is that the ROK-US alliance should not be directly aimed at China. From our perspective, while fulfilling our alliance obligations, we have no reason to antagonize China. China's economic importance to us is significant, and China is aware of this. Therefore, when we take actions, there needs to be sufficient strategic communication with China to manage the situation and prevent escalation, even if we are compelled to make security choices due to US demands. Despite 28 years of diplomatic relations, there has been a lack of such strategic trust and communication.

Yes, this is currently the biggest problem in South Korea-China relations. To summarize South Korea-China relations in a nutshell, it is 'economic interdependence.' Over the past 28 years, there has been remarkable growth, particularly in economic exchanges. However, there has not been a corresponding development in strategic trust and mutual understanding between the two systems. Inter-state relations can be unstable and face crises. A system or mechanism to resolve and foster understanding during such times would lead to the accumulation of trust in bilateral relations. The absence of such a process, and an over-reliance on external economic competitiveness, represents a significant vulnerability. Some in the US worry that South Korea is becoming too close to China, a concept known as 'China fatigue.' Is China actually concerned that South Korea is getting closer to us?

Currently, the governments of South Korea and China are making sincere efforts to cooperate on issues like pandemic response. However, public sentiment in both countries does not view the relationship favorably. It is difficult to describe the current South Korea-China relationship as good. A good relationship, as repeatedly mentioned, is driven by economic competitiveness. However, economic cooperation is currently on a downward trend. This is partly due to the THAAD deployment, but also because the overall economic situation has deteriorated, weakening the foundation for cooperation and shrinking the space for collaboration. Therefore, South Korea-China relations are at a crossroads. The US is strengthening its alliances, and China is concerned about the ROK-US alliance being used to exert pressure on China. Given that South Korea-China relations are at a crossroads, we sincerely hope for a guiding compass. Thank you.

Thank you very much.