[New Year Special Commentary Series] ② Changes in U.S. Foreign Policy and the International Order in 2026

The International Order Being Reshaped by the Second Trump Administration

The international order is undergoing a seismic shift one year after the inauguration of the second Trump administration. The analysis that the U.S.-centric unipolar hegemonic order, maintained for over three decades since the end of the Cold War, is unsustainable has become firmly established. However, the transition to the next order and predictions about a new alternative order have become even more chaotic with the first year of the Trump administration. To what extent are the foreign policy of the Trump administration and the international order it is changing?

An international political order is composed of two pillars: organizing principles and operating principles. While organizing principles are the most fundamental pillar of the order, defining the basic constitutive relationships among actors, operating principles determine the distribution of power, norms, rules, and institutions among the units established by the organizing principles. The order of the U.S.-led post-World War II era was an order where the U.S.-led hegemonic liberal operating principles functioned on the organizing principle of the sovereign state system. Operating principles are intentionally constructed, maintained, and destroyed by actors, whereas organizing principles are constitutive principles where various forces and tensions, latent within the system, become actualized when they exceed a certain intensity. The existing order has been maintained for nearly 400 years based on the organizing principle of the Westphalian sovereign state system, and for the past 80 years, the operating principle of the so-called liberal rules-based order has been created and strengthened. The Trump administration is significantly weakening the liberal operating principles. The liberal operating principle is an operating principle that seeks to maintain an international order based on human rights and an open international economic order based on markets, underpinned by various principles of state sovereignty, including territorial integrity, non-interference in internal affairs, compliance with international law, and multilateralism. This operating principle was made possible by the hegemony of the overwhelming power of the United States, which played a role in providing order by producing and supplying various public goods for the international order to prevent its failure.

The Trump administration is weakening most of the principles of the liberal operating order, prioritizing U.S. national interests and proposing alternative operating principles of transactional pragmatism and coercive hegemony. It is too early to determine whether the policies of the past year are an attempt to readjust the liberal operating principles or a pursuit of new operating principles by abandoning the liberal ones. The success of the policies pursued by the Trump administration over the remaining three years, the emergence of alternative policies to those of the Trump administration, the outcome of the presidential election three years from now, and above all, the judgment of the American people on the pursuit of hegemonic national interests will be crucial variables. If the weakening of the liberal operating principles leads to changes in the existing organizing principles, there is a possibility that the fundamental principles of the sovereign state system could also be weakened. This is because the operating principles chosen by actors can influence the forces within the international order, potentially affecting the formation process of new, latent organizing principles, thus realizing a macro-level 역구성 (reverse causality) process.

Changes in U.S. Grand Strategy

The Trump administration's shift in U.S. foreign strategy was demonstrated through the publication of the "National Security Strategy" on December 5th and the outline of the defense strategy explained by Secretary of Defense Hagerty in a speech at the Ronald Reagan Presidential Library on December 6th.[1] The U.S. has presented the concept of grand strategy, which articulates the most fundamental objectives of its foreign strategy. Examining the characteristics of the Trump administration's grand strategy concept based on the content to date reveals the following. First, the "National Security Strategy" does not provide a conceptual definition of the changing world order. While it discusses the content of U.S. grand strategy and core U.S. interests, it lacks a clear blueprint for the current international order and the order to be constructed in the future. It only presents a vague concept of an international order where U.S. interests are realized. Because the current international order is diagnosed without theoretical support regarding its status, transition process, and future alternative orders, it is unclear how the Trump administration perceives the current world.

Second, while it elaborates on U.S. interests, it omits the definition of threat actors. Previous "National Security Strategy" documents have specified the changing international order and named the actors threatening U.S. interests. These threat perceptions were important elements that were either shared with other countries or provoked backlash. This contrasts with the Biden administration's "National Security Strategy," which clearly identified China, Russia, North Korea, and Iran, as well as terrorist groups, as explicit threats. U.S. allies each have their own perceptions of security threats, making it difficult to ascertain whether the U.S. shares these threat perceptions. It is unclear whether China, Russia, Iran, and North Korea, typically defined as threats, are viewed by the U.S. as threats or as potential partners for negotiation.

Third, it offers a comprehensive critique of U.S. foreign grand strategy during the post-Cold War era over the past three decades. It criticizes both neoconservatism within the Republican Party and liberal internationalism within the Democratic Party as grand strategies detrimental to U.S. interests. It argues that pursuing a global hegemonic policy, establishing democracy worldwide, and conducting liberal trade on a global scale are not only impossible but also contrary to U.S. interests. This can be considered a fundamental critique of the liberal operating principles. The "National Security Strategy" criticizes the importance of the U.S.-led order and the foreign grand strategy that focused on providing order through hegemony, describing it as an pursuit of "permanent American domination of the entire world," which is an interesting point.

Fourth, U.S. documents label the Trump administration's grand strategy as "flexible realism" or "pragmatic realism." It emphasizes the importance of prioritizing U.S. national interests and clearly defining policy priorities to protect core interests. Unlike the past, when the U.S. pursued 전방위적 (all-directional) intervention across the globe, it now sets non-intervention as a baseline and will only intervene when U.S. core interests are clearly defined. In particular, regarding military intervention, Secretary Hagerty has presented a so-called "new Weinberger Doctrine," clearly stating the intention to pursue overseas military intervention only when core U.S. political interests are at stake and military victory is evident.

The World the Trump Administration is Building

Based on this grand strategy, the international order envisioned by the Trump administration can be depicted as follows. Above all, the U.S. places its own security at the center. It considers strict management of immigration across the Mexican border and strengthening border security to be crucial. It is prepared to use military force to detect and combat drug trafficking and so-called drug terrorists.

The issue is that the scope of homeland defense extends beyond mere border security to intervention in the "near abroad." The Trump administration argues that establishing influence and spheres of influence in Central and South America and the Arctic is central to homeland defense. It perceives the Western Hemisphere as the foundational space for U.S. survival, national security, industry, currency, and immigration control. Military operations in Venezuela are ongoing, and pressure on the Maduro regime is intensifying. The strategy for the Western Hemisphere outlined in the "National Security Strategy" involves maintaining close relationships with Central and South American regimes that serve U.S. interests. This is a strategy of "enlistment," aiming to bind local countries as order managers to execute U.S. strategic objectives. It envisions the entire Western Hemisphere as a U.S.-led sphere of security, industry, supply chains, and capital, advancing the operational principles of the "Trump Corollary to the Monroe Doctrine." The "near abroad" is not limited to Central and South America but may extend to Greenland and the Arctic. Canada may also face pressure from the U.S. in this process.

The U.S. proposed near-abroad strategy has the potential to weaken the traditional concept of state sovereignty. This is because it leaves room for intervention in the substantive sovereignty of Central and South American countries if they do not adopt policies favorable to the U.S. This implies the ability to pressure the policies of these countries to prevent the expansion of influence not only from immigration and drugs but also from non-Western Hemisphere countries. The policy of spheres of influence inherently involves operating principles that limit the substantive sovereignty of middle and small powers within a great power's sphere, thus conflicting with the principles of territorial integrity, respect for the sovereignty of other nations, sovereign equality, and non-interference in internal affairs, which are emphasized by the liberal operating principles.[2] Of course, violations of these norms have also existed under the liberal operating principles, so the operating principles of spheres of influence could be seen as a matter of degree compared to the liberal operating principles. However, there is a clear difference in that it is explicitly presented, as in the Monroe Doctrine.

Second, U.S. policy toward regions outside the Western Hemisphere is shifting towards a strategy of non-military intervention as a baseline, but with structural intervention through economic, diplomatic, and alliance realignments in areas where core interests are involved. The "National Security Strategy" re-categorizes Europe, the Middle East, and Africa not as traditional centers of intervention but as regions for burden-shifting and selective management. Southeast Asia and Central Asia are also integrated not as independent strategic spaces but as sub-battlegrounds for U.S.-China competition and supply chain competition. Europe's cultural and civilizational critique and burden-shifting for defense, the Middle East redefined as an energy and technology hub, and Africa designated as a zone of resource and investment competition demonstrate the U.S.'s transition from a global intervener to a selective hegemonic power focused on hubs and resources.

The Indo-Pacific is a particularly important region, with the U.S. clearly defining it as a space of core national interest in terms of security, economy, and technology. Unlike the exclusive sphere of influence the U.S. seeks to establish in the Western Hemisphere, it adopts a stance of not recognizing China's regional hegemony in the Indo-Pacific. This is a logic of anti-hegemonic power balance that does not permit any single country to dominate the region. The U.S. positions itself not as a hegemon in this region but as a structural intervener preventing China's hegemony. The Trump administration's Indo-Pacific strategy aims for a U.S.-led asymmetric power balance. To this end, it rejects China's military superiority or maritime control within the first island chain and seeks to build military and alliance structures that can eliminate China's dominance and interdiction capabilities throughout the region.

In this regard, it is difficult to define the U.S. grand strategy as a single sphere of influence strategy. While the U.S. asserts an exclusive sphere of influence in the Western Hemisphere, it denies the formation of a Chinese sphere of influence in Asia and shows a stance of effectively tolerating Russia's limited sphere of influence in parts of Ukraine. This reflects a complex sphere of influence order applied differentially based on great power hierarchy and threat perceptions, rather than an order based on the universal principles of sovereignty and territorial integrity. In this structure, China is likely to perceive that the U.S. applies double standards, selectively allowing and denying spheres of influence to maintain its own hegemony.

Third, while the U.S. does not recognize the spheres of influence of other great powers, it does not rule out the possibility of a cooperation system among great powers. This is because, unlike the division of spheres of influence which fundamentally negates the existing liberal operating principles, a cooperation system among great powers does not necessarily do so. It is possible to improve the rules-based order through coordination among great powers while maintaining the core principles of the existing operating principles. The "National Security Strategy" argues for adjustment based on interests, without discussing the domestic political systems of other great powers in the context of flexible realism. This means that even if other great powers do not maintain liberal democratic systems, negotiations and coordination can pursue common operating principles if their foreign policies reach an agreement. Of course, new operating principles could be similar to the principle of dividing spheres of influence, but it is also possible to achieve coordination and agreement while maintaining existing principles.[3]

If the Russia-Ukraine war definitively ends, a sustainable security system is established in Europe, and an economic coordination and cooperation system is achieved in the Indo-Pacific region based on a military balance of power between the U.S. and China, the existing operating principles could evolve through improvement rather than fundamental change. Of course, the U.S. must restore its national strength to maintain the liberal international order and pursue strategic adjustments while continuously coordinating with China, Russia, Europe, and others. However, cooperation among great powers does not necessarily have to lead to the division of spheres of influence.

Fourth, the U.S. acknowledges the importance of alliances as long as they align with its national interests. Secretary Hagerty argues that U.S. allies possess strong national capabilities, can defend themselves, and should contribute more to U.S. core security interests. Particularly in the security strategy against China, the U.S. pursues peace through strength, not conflict, based on a strategy of denial and deterrence. In this process, key allies such as South Korea, Japan, and Australia are important, with South Korea being cited as a model ally. The "National Security Strategy" also emphasizes the regional roles of East Asian allies, including South Korea, to counter China's dominance in the first island chain.

The importance of economic and technological alliances, not just security alliances, is also emphasized. While traditional alliances were determined by geopolitical distance, they are now being reshaped by geo-economic and geo-technological distance. The U.S. is pursuing economic policies such as re-industrialization, securing defense industry manufacturing bases, acquiring critical minerals, and reorganizing supply chains around the U.S. to achieve economic revitalization. Technologically, while pursuing its own technology ecosystem to secure a technological advantage over China, it is also focusing on advanced technology cooperation with allies, securing critical resources, and ensuring energy supply. Because it emphasizes that future U.S. strength will be secured through economic and technological superiority, alliances will be re-evaluated not only in terms of security but also in economic and technological dimensions, and the distance of alliances with the U.S. will be realigned.

Problems with the Trump Administration's Foreign and Security Grand Strategy

Can the world order the Trump administration seeks to build be established without contradictions and backlash? Is this world order truly in line with U.S. national interests? First, the U.S. "National Security Strategy" and other related documents have been part of a narrative strategy and declarative strategy, sharing the desirable international order proposed by the U.S. with allies and the international community. Historically, strengthening relations with the U.S. was based on belief in the content of U.S. leadership, the theoretical coherence underlying it, and the importance of the public goods provided by the U.S. However, as discussed earlier, the Trump administration's "National Security Strategy" generally lacks a vision for the world and focuses primarily on U.S. interests, leaving allies, strategic partners, and the international community with profound skepticism about U.S. leadership. If the U.S. exerts economic coercion without providing consistent and reliable security commitments and public goods to its allies, allies are likely to re-evaluate the net benefits of the hegemonic order that the U.S. has provided. The fact that this "National Security Strategy" has formalized the U.S.'s potential behavior as a great power prioritizing non-intervention and transactional dealings, rather than as a hegemonic power, is a factor prompting allies to fundamentally reconsider their existing strategies toward the U.S.

The invocation of the Monroe Doctrine in the early 19th century also highlights another problem. At that time, Central and South American countries were newly independent, the possibility of re-intervention by European powers was real, and international politics was fragmented by region. In contrast, today's Central and South America consists of sovereign states deeply integrated into international law, multilateral organizations, global finance, and supply chains, with economic relations with external powers already structured. In this environment, if the U.S. establishes the Western Hemisphere as an exclusive sphere of influence and forces a reduction in economic relations with China, it will inevitably be perceived not merely as a security measure but as a direct restriction on the economic sovereignty and policy autonomy of other nations. In reality, China is the largest trading partner and a key investor for many Central and South American countries, deeply involved in ports, energy, and telecommunications infrastructure. Attempts to establish spheres of influence that ignore these realities risk negating the growth strategies and sovereign choices of these nations. If attempts to manage the Western Hemisphere as a U.S. security space go beyond border defense to include coercive economic control and diplomatic exclusion, it signifies a shift in the order where sovereignty is transformed from an equal right into a conditional right granted differentially based on spheres of influence. Resistance to this is likely to intensify not only in Central and South America but also throughout the international community.

If the current U.S. "America First" policy and efforts for domestic economic revitalization are understood as a strategy of hegemonic readjustment stemming from the burdens of existing hegemony, there is room for understanding. The past 30 years have not only been an era of unipolarity but also a period marked by environmental crises, health crises, various challenges from the Global South, and the expansion of public bads due to globalization—issues that are difficult for a single hegemonic power to manage alone. Throughout this process, the burdens of U.S. hegemony have manifested in various ways, evidenced by the astronomical national debt of the U.S. The prospect of whether the U.S. will choose a path of restoring its national strength through the economic contributions of other countries and regaining leadership is a key indicator in defining its relationship with countries today. The Trump administration's grand strategy for foreign affairs makes this prospect even more uncertain.

Second, the question remains whether the Trump administration's foreign strategy will truly benefit U.S. interests. The way a hegemonic power pursues national interests typically differs from how other great powers do. It involves obtaining long-term, structural benefits through structural contributions to the international community. The privileges granted to a hegemon include the monopoly of the reserve currency and nuclear weapons, and the unilateral operation of multilateralism. As the issuer of the reserve currency, it secures immense authority in economic policy; by monopolizing nuclear weapons and providing nuclear extended deterrence to allies, it gains political advantage. While creating many multilateral institutions, the U.S. has reserved the freedom to operate them according to its own interests. If the U.S. ceases to exercise this leadership, many countries will lose trust in the dollar as the reserve currency, nuclear non-proliferation, and U.S.-led international institutions, and will move towards securing their own national interests. Allies and partners will increasingly seek risk-diversification strategies regarding the stability of the dollar system, the nuclear umbrella, and U.S.-led institutions, and will have incentives to concurrently build alternative payment networks, regional currencies, their own military capabilities, and plurilateral cooperation mechanisms. While this trend may increase U.S. leverage in the short term, it ultimately erodes the foundation of the hegemonic and structural benefits the U.S. has enjoyed over the long term. The erosion of these hegemonic and structural benefits is inevitable, and the current strategy of the Trump administration is accelerating this critical point.

Third, U.S. rivals will raise objections to the U.S.'s complex sphere of influence strategy and strengthen narratives presenting more legitimate alternative international orders. As discussed earlier, the U.S. presents an exclusive sphere of influence operating principle for the Western Hemisphere, a power-balance operating principle based on military superiority in the Indo-Pacific region, and a transactional operating principle through negotiation with Russia in Europe. From the perspective of China and Russia, this structure will be perceived as a hierarchical hegemonic order that applies different rules by region while solidifying U.S. strategic superiority. They can leverage discontent within U.S. alliances and the multi-dimensional solidarity strategies of Global South countries to intensify diplomatic and discursive offensives aimed at undermining the legitimacy of the U.S.-led order. Of course, it is difficult to argue that the orders proposed by China and Russia offer better solutions to the problems of the current international order. Russia is explicitly pursuing policies that infringe upon the formal sovereignty of other nations, and while China speaks of respecting sovereignty, its great power diplomacy and actions to alter the status quo also raise concerns among other nations. However, as the U.S.-centric vision of the international order presented by the Trump administration lacks consistency in global leadership, it is likely to become increasingly vulnerable to criticism from status quo-challenging states. The "National Security Strategy" presents the U.S. as superior in soft power, but the current strategy reveals vulnerabilities in this area.

U.S. Foreign Policy in 2026: A Strategy Focused on Domestic Politics

Based on the Trump administration's grand strategy outlined above, U.S. foreign policy in 2026 is expected to manifest in various forms across different domains. The three most important variables are the U.S. domestic political variables, defined by President Trump's personal policies and[4] the midterm elections scheduled for November 3rd, the variable of U.S.-China strategic competition, and the variable of advanced technologies, particularly artificial intelligence.

The U.S. midterm elections in November will be a crucial variable, serving as a public assessment of the policies pursued by the Trump administration over the past two years and determining the domestic foundation for future U.S. foreign policy. If the Democratic Party secures a majority, even in the House of Representatives, the House, which controls budgets and legislation, will be able to place various checks on the Trump administration's foreign policy. The domestic political changes in the U.S. over the past year can be characterized not merely as policy shifts but as a structural reorganization of the nation's operating methods. It has also shown signs of systemic transition, with the operating principles of the constitutional order and national identity undergoing change. From his inauguration, President Trump has simultaneously pursued policies to fundamentally reconstruct the existing institutional balance across immigration, the administrative state, the judicial system, the role of the military, economic governance, and the scope of presidential power. The most prominent feature over the past year has been the dismantling of the administrative state and the concentration of presidential power. Large-scale adjustments and restructuring of federal bureaucracy, independent agencies, the Department of Justice, and intelligence agencies signify a transition to a state operating system based on political loyalty, beyond mere efficiency improvements. Immigration policies and the elimination of DEI (Diversity, Equity, and Inclusion) policies are structurally redefining American identity. Immigration control is moving beyond curbing illegal immigration to reducing the immigration and refugee systems themselves, with institutional discrimination against non-white immigrants intensifying. The complete abolition of DEI policies, the retreat of civil rights protections, and the contraction of research and education on race and gender discrimination indicate a shift in the U.S. from a multi-ethnic, civil rights nation towards an exclusive nation-state.

In this process, the Trump administration's foreign policy is likely to result in policies that secure domestic political support. The core supporters of Trump's policies are the so-called MAGA (Make America Great Again) forces. The most significant characteristic of Trump's second-term foreign policy is that American Firstism has become not just a slogan but the operating principle of diplomacy. For them, international norms or multilateralism are not orders valuable in themselves, but rather means that can be maintained only as long as they increase American interests. They have a strong perception that the United States should withdraw from wars and interventions not directly related to the security of the American homeland, rather than playing the role of a hegemonic power managing conflicts around the world. What they call diplomatic success is not territorial expansion or regime change, but ending wars and preventing new ones. The method of conducting diplomacy is also closer to transactional diplomacy than traditional value-based diplomacy.

All these diplomatic lines are closely intertwined with economic nationalism. Tariffs and trade pressure are not mere trade policies but core tools of diplomatic negotiation, with the protection of domestic industries and the recovery of the middle-class base set as the ultimate goals of diplomacy. Decoupling from China, supply chain reorganization, and competition over technology and industry are not separated from military and diplomatic issues but are integrated into a single national strategy. Ultimately, MAGA-style diplomacy can be seen as aiming for a new form of American-centric order that treats norms, alliances, security, and the economy as "tradable assets." The Trump administration is currently buoyed by optimistic economic performance reports from government agencies such as the Department of Commerce released late last year. The U.S. economy in 2025, defying much of the pessimism about economic slowdown and policy uncertainty, saw its real GDP increase by 4.3% in the third quarter. This figure, showing growth driven by increased consumer spending, exports, and government spending, reinforces the narrative that the U.S. economy, while shaken, has not collapsed, at least in the short term. Tariff revenues for fiscal year 2025 are also projected to surge to approximately $195 billion, with estimates suggesting revenue generation of $200 billion. Data from the Bureau of Economic Analysis (BEA) indicate a 5% increase in nominal wages over the past 12 months, meaning real wages increased by about 2% even after accounting for inflation (approximately 2.8-3%), which can be interpreted as statistical evidence supporting the perceived "real income growth" by voters.

While the U.S. economy has shown stronger-than-expected resilience through 2025, structural instabilities toward 2026 are also growing. Tariffs, supply chain fragmentation, and intensifying U.S.-China competition are likely to increasingly constrain foreign policy options, contrary to short-term growth indicators. U.S. foreign policy in 2026 stands on a strong economy, but the foundation itself is becoming increasingly politicized and unstable. Tariff policies provide revenue and leverage but also create countereffects such as price increases and reduced consumption. Over time, as costs absorbed by businesses are passed on to consumer prices, the pace of real income improvement may slow.

In pursuit of victory in the midterm elections, the Trump administration will seek to maximize economic performance and pursue a foreign policy aligned with the banner of American Firstism. Trump's diplomacy in 2026 will inevitably be driven by a strategy of reducing overseas intervention for domestic prosperity and resolving necessary negotiations transactionally.

U.S. Foreign Policy in 2026: Strategy Toward China

In this context, the Trump administration's strategy toward China is crucial. Ahead of the midterm elections, the Trump administration's strategy toward China is likely to prioritize the adjustment of economic relations between the U.S. and China, as outlined in the National Security Strategy, over security containment. U.S.-China competition will increasingly take the form of economic and technological confrontation aimed at protecting the U.S. economy, rather than a contest of ideologies or orders. Tariffs, supply chain reorganization, and productivity gains through AI are likely to be used as key tools to widen the gap with China and secure long-term advantages for the U.S. middle class. If U.S.-China competition intensifies, China's retaliatory measures and supply chain disruptions, particularly concerning rare earths, could simultaneously pressure U.S. high-tech industries and price stability. If even alternative import channels are restricted, costs and inefficiencies could escalate.

The primary goals of the Indo-Pacific economic strategy outlined in the National Security Strategy can be summarized as reducing trade deficits, stabilizing supply chains, protecting key technologies, and forming economic blocs with allies. However, to achieve these goals simultaneously within the political schedule of the midterm elections, a certain level of economic adjustment and performance with China will be necessary, rather than a full-scale confrontation. Consequently, a U.S.-China summit, expected in early 2026, particularly around April, is likely to pursue an economic truce rather than strategic reconciliation. The core objective the Trump administration seeks through such a meeting is to secure conditions that prevent China from burdening U.S. economic recovery and price stability, likely focusing on reducing trade deficits, managing China's overcapacity exports, increasing imports of U.S. products, and mutual restraint of retaliatory measures.

A realistic agreement would involve China offering substantial concessions in politically acceptable areas. China could provide immediate political gains to the Trump administration by expanding purchases of U.S. agricultural products such as soybeans, corn, and wheat, as well as energy sources like liquefied natural gas, crude oil, and refined fuels, and some aircraft and industrial equipment. This directly aligns with an electoral strategy targeting agricultural states in the Midwest and the energy industry. In return, the U.S. may consider limited deferrals or refunds of tariffs on certain consumer-sensitive items from China, and China might reciprocate by easing tariffs on U.S. consumer goods and agricultural products. Simultaneously, China is likely to commit to managing export volumes in key industries such as steel, batteries, electric vehicles, and solar panels, and to voluntarily regulate transshipment exports through Mexico or Southeast Asia to some extent. These measures, rather than a complete structural shift, are intended to provide a political message that the Trump administration has secured tangible concessions from China.

However, separate from these economic adjustments, the United States is unlikely to ease pressure on the security and technology fronts. As stated in the National Security Strategy, export controls to China and technological bloc formation with allies will continue in key technology areas such as artificial intelligence, semiconductors, and quantum technology, and the strategy to block China's formation of military dominance along the first island chain is also likely to be maintained. This represents a dual structure that separates economic transactions from military deterrence, allowing the U.S. to secure economic benefits without permitting strategic power transfer.

From China's perspective, such an agreement would serve as a tactical delay rather than strategic capitulation. This is because China's core interest lies in maintaining leverage over supply chains, including rare earths, while avoiding U.S. tariff hikes. Therefore, China will seek to ease short-term tensions through agricultural and energy purchases, while maximally separating technology and security issues from economic negotiations. Ultimately, U.S.-China relations throughout the year are likely to unfold with a tense deterrence in the military sphere, parallel limited transactions and managed conflict in the economic sphere, and continued decoupling and containment in the technological sphere. This state of managed strategic competition, neither reconciliation nor full-scale conflict, is precisely the kind of U.S.-China relationship the Trump administration, facing midterm elections, will most desire.

U.S. Foreign Policy in 2026: Advanced Technology Strategy

Finally, advanced technologies centered on artificial intelligence will be a core focus of U.S. foreign policy this year. Last year, Jensen Huang of Nvidia delivered a shocking forecast that China could win the U.S.-China AI race. Huang defines the competition in the five-layer AI stack—energy, chips, infrastructure, models, and applications—as one where U.S. technological superiority still exists, but China's pace of catching up is structurally threatening. According to him, China already surpasses the U.S. in energy supply capacity and expansion speed, providing a critical structural advantage for the expansion of data centers and AI factories that require massive amounts of electricity. In contrast, the U.S. is at a disadvantage because it has not sufficiently utilized energy as a strategic asset. While the U.S. maintains technological leadership in semiconductors and core chips, China is employing an industrial strategy that offsets the technological gap with price and speed through government subsidies, infrastructure support, and national discounts on energy and labor costs. In terms of infrastructure, China possesses the organizational capacity and mobilization power to build large-scale AI infrastructure, including data centers, in a short period, demonstrating that the AI race is a competition of national resource mobilization beyond mere technological development. In the model segment, the U.S. leads in cutting-edge commercial models, but China is rapidly expanding the base of technological diffusion and innovation centered on its open-source ecosystem. At the application stage, China leads in the speed of converting technology into productivity and power through its social experimentation capabilities in rapidly applying AI across industries and administration.

Above all, the U.S. concern is the unpredictable outcome of full decoupling in the field of artificial intelligence. As Jensen Huang warns, abandoning the Chinese market could structurally weaken the long-term competitiveness of U.S. companies. If China completes its independent technological stack and disseminates it globally, the U.S. risks becoming not a technological leader but a consumer of Chinese technology. Therefore, the U.S.-China AI competition cannot be won through export controls alone; without a combination of re-industrialization, energy independence, and infrastructure expansion, U.S. hegemony could be eroded by China's manufacturing capabilities, human resources, and technological diffusion strategy. This demonstrates that technological competition is, in essence, a competition of national systems.

The Trump administration's second term has viewed artificial intelligence not as an industrial policy but as the core of a national strategy integrating foreign policy, security, and economic hegemony, leading to the presentation of "America's AI Action Plan" and Executive Order 14320 last year. This strategy aims to accelerate a new international cooperation strategy that simultaneously promotes the global diffusion and control of U.S.-made AI technology stacks. This strategy is a two-track approach that prioritizes providing comprehensive technology packages—encompassing chips, models, software, data, cloud, and standards—to allies, while implementing a containment system combining blockade and real-time monitoring for competitors like China. It is an attempt to reorganize AI as the central axis of U.S.-led technological alliances and supply chain order. This year, the Trump administration will seek to create a new AI order combining selective openness, precise containment, and alliance-centric cooperation. Key allies, including South Korea, will emerge not merely as recipients but as entities requiring strategic choices across supply chains, data centers, semiconductors, model development, and standard setting within this technological bloc formation process.

Challenges Posed by the Trump Administration's Strategy to South Korea

The reinforcement of sphere-of-influence politics and the strategy of selective engagement pursued by the United States in 2026 present fundamental challenges to South Korean diplomacy. As U.S. foreign policy shifts towards a default of non-intervention coupled with intensified selective engagement centered on core allies, the strategic importance of alliances becomes even clearer than in the past. The ROK-U.S. alliance must be restructured beyond a framework of mere security dependence, integrating enhanced defense capabilities, institutionalization of extended deterrence, and contributions in advanced industrial sectors such as AI, semiconductors, and energy. What the U.S. demands from its allies is not simply burden-sharing, but capabilities and assets that can genuinely enhance U.S. strategic competitiveness. South Korea must actively build its position as a key partner that meets these demands.

Concurrently, South Korea must pursue a middle-power strategy that balances alliance dependence with diplomatic autonomy. The U.S. focus on the Western Hemisphere and selective engagement in the Indo-Pacific can increase volatility in the regional security environment. South Korea should expand cooperation with like-minded countries, including Japan, Australia, and the Philippines, and strengthen multilateral networks in areas such as functional security, maritime security, cybersecurity, and supply chain stability. In its relations with China, South Korea should enhance pre-coordination mechanisms with the U.S. considering the potential for transactional adjustments between the U.S. and China, while maintaining cooperation with the U.S. in supply chains and technology, seeking areas of cooperation with China, and reducing the volatility of conflict through efforts in social, cultural, and human exchanges. Through such a multi-layered strategy, South Korea can secure both diplomatic stability and strategic options in an environment of reinforced sphere-of-influence politics. ■

[1] The White House. 2025. National Security Strategy of the United States of America. Washington, DC: The White House, November; Hegseth, Pete. 2025. “Remarks at the Reagan National Defense Forum.” Reagan Institute, Simi Valley, CA, November.

[2] Susanna Hast, Spheres of Influence in International Relations: History, Theory and Politics(Farnham, Surrey: Ashgate, 2014).; Hanna Samir Kassab, Weak States as Spheres of Great Power Competition(New York: Routledge, 2018).

[3] Stacie E. Goddard, 2025. “The Rise and Fall of Great-Power Competition.” Foreign Affairs, January/February; Jeon Jae-seong, "An International Institutional Analysis of the 19th Century Concert of Europe: From the Perspectives of Realist and Constructivist Institutionalism," Korea and International Politics 15, no. 2 (1999): 33-60.

[4] Stacie E. Goddard, and Abraham L. Newman. 2025. “Further Back to the Future: Neo-Royalism, the Trump Administration, and the Emerging International System.” International Organization 79 (Supplement): S12–S25.

■ Jeon Jae-seong_EAI Director, Professor of Political Science and International Relations, Seoul National University.

■ Contact and Editing: Lee Sang-jun_EAI Researcher
    Inquiries: 02 2277 1683 (ext. 211) | leesj@eai.or.kr