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China-South Korea relations
ChinaDiplomacy

Why South Korea needs China even as it teams up with US on chips and more

  • The US’ ‘full-scale suppression’ of China seen to leave Seoul and Tokyo with no leeway to balance ties with the two rival powers
  • The ‘China threat theory’ presents a dilemma for South Korea, as the ‘China market is so critical’ to its economy, observers say

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Illustration: Lau Ka-kuen
Orange Wang
South Korea is on track for its first annual trade deficit with China this year, marking a historic shift since the two countries formally established diplomatic ties 31 years ago.
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This comes as Beijing’s focus on manufacturing self-sufficiency cuts imports from Korea and more Korean companies move their supply chains out of China, while intense US-China rivalry continues to shape the geopolitical dynamics in Northeast Asia.

China has made no secret of its frustration at Japan and South Korea’s increasing tilt towards Washington, repeatedly blaming US strategic containment for the dramatic souring of ties with its two key trade partners.

However, trade and investment links – widely regarded as the foundation for Beijing’s harmony with the two US treaty allies – started undergoing a transformation long before the heightened friction of recent years.

Widening gaps in economic power and a shifting international industrial landscape were among the “largest” catalysts for the growing discord between the three countries, analysts said.

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Ties are likely to become even more fraught when China moves further up global value chains and challenges the status of Japan and South Korea, they said.

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China restricts critical metal exports following Western semiconductor curbs in latest trade war

China restricts critical metal exports following Western semiconductor curbs in latest trade war
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