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Josh Ye

Beijing has imposed unofficial sanctions against South Korea over its deployment of a missile defence system, but the effectiveness of the measures is questionable given China’s heavy reliance on Korean components to support its manufacturing industry, according to analysts.
China has not announced any formal punitive measures after Seoul decided to deploy the US-developed missile defence system. But it has allowed state-controlled media to stoke anger and resentment against South Korea and stepped up scrutiny of Korean consumer products.
This led to some Chinese consumers boycotting South Korean products and businesses. Group tours to South Korea have been called off and flights to its airports reduced.
Despite these headline-grabbing moves, experts believe China’s ability to punish South Korea is limited.
Chinese school kids join South Korean boycott over missile shield row
Less than 5 per cent of South Korea’s exports to China are consumer goods – the easy target for Chinese boycotts. Most are raw materials and manufacturing components and equipment.
Rajiv Biswas, chief economist in the Asia-Pacific region for IHS Global Insight, said South Korea was an important source of electronics exports to China.
A quarter of China’s imported integrated circuits, key components to make television sets and mobile phones, are from South Korea, he said.
Andrew Gilholm, director of analysis for China and North Asia at the consultancy Control Risks, said China was behind “unofficial, non-explicit, regulatory harassment of certain Korean companies”.
But the boycott against firms did not alter the fact that China relied on South Korea in some areas, he said. “Chinese companies need cooperation with technology from Korean companies to achieve those industry upgrading goals,” he said.
Trade between the two nations has been booming. South Korean exports to China surged 28.7 per cent in February, compared with the same month a year earlier, the strongest growth since late 2010.
The Korean International Trade Association said that if China were to continue with its “unofficial” sanctions, the economic losses for South Korea would be, at most, US$14.76 billion, or 1.07 per cent of GDP.
China readying countermeasures against missile defence shield in South Korea, retired PLA general says
Seoul is deploying the Terminal High Altitude Area Defence missile shield amid fears over North Korea’s nuclear weapons programme, but China says the system poses a threat to its own security.
Analysts said Chinese consumers’ boycotts of South Korea products would only push Seoul further into Washington’s orbit.
China could also find itself poisoning a critical relationship that has thrived in recent years based on booming trade and investment, a shared resentment of Japan and its alleged lack of atonement for wartime aggression and the common goal of dismantling North Korea’s nuclear weapon programmes.
“If Chinese economic pressure goes too far, it will only increase the Korean people’s patriotism and nationalism,” said Lee Jung-nam, a professor at the Asiatic Research Institute at Korea University. “This would also damage China’s image. If China wants to become a leader in Northeast Asia, it shouldn’t leave such negative impressions on its neighbours.”
The Chinese authorities have whipped up nationalist sentiment before to serve diplomatic ends, although the boycotts and protests often proved short-lived. 
Some Chinese consumers boycotted the French supermarket chain Carrefour in 2008 after the Beijing Olympics torch relay was interrupted by Tibetan pro-independence activists in Paris.
Japanese cars were boycotted by some Chinese consumers in 2012 during a flare up in tensions between the two nations over the disputed Diaoyu Islands in the East China Sea, known as the Senkakus in Japan. The fast food outlet KFC was also briefly targeted last year amid anti-US sentiment over Washington’s critical stance on Beijing’s assertive claims to much of the South China Sea.
3,300 Chinese cruise passengers stage boycott at South Korean resort amid missile shield row
Jin Meihua, the deputy head of Northeast Asia Research Centre in Jilin province, which borders North Korea, agreed that China’s boycott would have a limited impact on the South Korean economy, but added it could create hostility among ordinary South Koreans towards the Chinese.
Jin said South Koreans had previously seen Beijing fan anti-Japan sentiment, with little result.
“China also boycotted Japan because of the Diaoyu Island dispute, but then Japanese companies moved on to invest in Southeast Asia and now the number of Chinese tourists to Japan is growing hugely,” said Jin.
Beijing’s economic pressure on South Korea would have no impact on the instillation of the missile defence shield, according to Richard Hu Weixing, head of the Department of Politics and Public Administration at the University of Hong Kong. “Actually, they are going to speed up the deployment,” he said.
Additional reporting by Kristin Huang and Liu Zhen


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Why China stoking up anger over South Korea missile system is doomed to fail

A picture supplied by the US Department of Defence showing the Terminal High Altitude Area Defence missile shield system in action. Photo: EPA

A woman stands in an almost empty Lotte Mart in Shanghai on March 13, 2017. The store remained open but dozens of other Lotte stores in China have been closed, as diplomatic rows over a controversial US missile system sparked boycott calls against Seoul. Lotte has faced growing opposition in China since signing a deal to provide land to host the Terminal High-Altitude Area Defense (THAAD) system loathed by Beijing. / AFP PHOTO / Johannes EISELE

This handout photo from the US Forces Korea (USFK) taken on March 6, 2017 and released on March 7, 2017 shows the first elements of the US-built Terminal High-Altitude Area Defense (THAAD) arriving at Osan US Air Base in Pyeongtaek, south of Seoul. The US military has begun deploying an anti-ballistic missile defense system to South Korea, following a string of missile tests by North Korea, the US Pacific Command said on March 6. / AFP PHOTO / US FORCES KOREA / Handout / RESTRICTED TO EDITORIAL USE - MANDATORY CREDIT "AFP PHOTO / US FORCES KOREA (USFK)" - NO MARKETING NO ADVERTISING CAMPAIGNS - DISTRIBUTED AS A SERVICE TO CLIENTS

North Korea fails in new missile test, US military says

South Korea’s Yonhap news agency said the missile may have exploded as it was launched, before reaching an altitude at which it could be detected by South Korean radar

US Secretary of State Rex Tillerson (R) is briefed by US Gen. Vincent K. Brooks, commander of the United Nations Command, Combined Forces Command and United States Forces Korea as a North Korean soldier (R) takes a photograph through a window at the UN Command Military Armistice Commission meeting room at the border village of Panmunjom, which has separated the two Koreas since the Korean War, on March 17, 2017. Washington's top diplomat visited the Demilitarised Zone dividing the two Koreas to gaze on the North for himself on March 17, a day after he declared 20 years of efforts to denuclearise it had failed. / AFP PHOTO / POOL / Lee Jin-man

TOPSHOT - This undated picture released by North Korea's official Korean Central News Agency (KCNA) on March 19, 2017 shows North Korean leader Kim Jong-Un (R) inspecting the ground jet test of a newly developed high-thrust engine at the Sohae Satellite Launching Ground in North Korea. North Korea has tested a powerful new rocket engine, state media said on March 19, with leader Kim Jong-Un hailing the successful test as a "new birth" for the nation's rocket industry. / AFP PHOTO / KCNA VIA KNS / STR / South Korea OUT / REPUBLIC OF KOREA OUT ---EDITORS NOTE--- RESTRICTED TO EDITORIAL USE - MANDATORY CREDIT "AFP PHOTO/KCNA VIA KNS" - NO MARKETING NO ADVERTISING CAMPAIGNS - DISTRIBUTED AS A SERVICE TO CLIENTS THIS PICTURE WAS MADE AVAILABLE BY A THIRD PARTY. AFP CAN NOT INDEPENDENTLY VERIFY THE AUTHENTICITY, LOCATION, DATE AND CONTENT OF THIS IMAGE. THIS PHOTO IS DISTRIBUTED EXACTLY AS RECEIVED BY AFP. /

Earlier this month, North Korea fired four ballistic missiles into the sea off Japan’s northwest coast, angering South Korea and Japan. File photo: Reuters

News

China

Diplomacy

Encouraging boycotts of South Korean goods won’t stop Seoul deploying the defence shield, but will sour an economically valuable relationship, observers say
