From a European long-haul perspective, South Korea appears not too often in the news and we still know little about that country. And two of the recent news, the knife attack on US-Ambassador Mark Lippert and the “nut-case” against Korean Air’s Cho Hyun Ah, did not really trigger our curiosity. What is interesting though is the working-relation between South Korea and China - since they share a difficult history with some skeletons in the cellar.
The Korean War, 1950-1953, was when China sent their ‘Volunteer Army’ to North Korea to fight the South and their allies. Following that conflict, South Korea remained long one of the poorest countries in the world. And there was hardly any relation with China until May 1983, when a hijacked Chinese civilian airline landed in Seoul. But formal relations were only established in 1992 when family members divided between the two countries were able to visit each other. Now, nearly 800’000 PRC-citizens live in South Korea (a large percentage of them are ethnic Koreans) and 430’000 South Koreans (2009) reside in China. Yet, significant barriers to good relations still persist, since Beijing politically stands closer to North Korea. Nevertheless, trade between the two countries now increase continuously.
South Korea, of course, is a success story. In 1960, its GDP per capita was $79 and so lower than some sub-Saharan African countries. Then, parallel to Japan’s economic rise, growth started powerfully and all the way until the Asian Financial crisis in 1997; with the subsequent shutdown of a third of all Korean banks. Business was never the same since.
Confucius in the way
For South Korea, good relations to the USA are important, since the country has more than enough unsolved issues with neighbouring Japan and North Korea. And ‘North Korea’ means, of course, China. Yet, since 4 years now, the Ministry of Foreign Affairs and Trade is working on a Free Trade Agreement with China, which would formalise at least the export/import matters. It is a very difficult and slow process, because so emotional. Both countries, like Japan, have their limitations in straight-up and open communication abilities. Confucius is still calling his values.
But, both sides talk, and that’s good. Yet complicated. South Korea established teams of China experts in an effort to strengthen diplomacy. An analytical team will report on political, economic and foreign affairs developments in China, and a monitoring team consisting will report on public sentiment in China. The Institute of Foreign Affairs and National Security (IFANS) also launched a centre dedicated to China affairs, which will act as a hub to collate research on China. Complicated indeed.
Complicated indeed
And every word and gesture on both sides is measured carefully and widely analysed in the public. For example: in July 2014 Xi Jinping, the President of the People's Republic of China, visited both Korean nations, but he did stop in Seoul first. Everybody then tried to understand the importance of that gesture, and analysts from Tokyo to Washington made their interpretations. To make the matter more complicated, during that meeting, both leaders expressed their concerns over the values and behaviours of Japan’s Prime Minister Abe. For example about the reinterpretation of the powers of the Self-Defence Army; the famous Article 9 of the Japanese Constitution. Or about other hot issues such as the Yasukuni Shrine, the so-called comfort women, and the Japanese history textbook controversies.
There are enough reasons for South Korea to establish best-possible business relations with China. And their common interest against Japan is just another tool. So, finally, the leaders of China and South Korea have reached a basic understanding about an FTA that would allow Korean firms enhanced access to China’s huge markets. Xi Jinping and South Korean’s President Park Geun-hye signed the outlines of a deal and plan to reach a final agreement this year. Funny enough, or so very typical, the Chinese officials called it “the conclusion of substantive negotiations” rather than a final agreement. My guess is, it will take a bit more time until the ink on the paper will be dry. But Mr Xi said also that the agreement was evidence of their countries’ strategic partnership and that it “will promote the integration of the Asia-Pacific region.” Not something the US particularly enjoys hearing. And it will further guarantee the Americans strong “involvement” in Japan, in order to have at least one secure ally in the Far East.
In that region, it sometimes looks like a Monopoly game with, as amazing this might sound, North Korea as the balancing element in the middle.
Sources: IECONOMICS, MOTIE, MOFAT
© Daniel Tschudy; March 21, 2015