Trade Drives Shifting Alignments Of Northeast Asia

LET US LOOK at President Xi Jinping’s visit to Seoul and Japan’s embryonic rapprochement with Pyongyang in the hard light of commerce. To this Bystander, it is that more than politics that is reshaping the alignments of the region.

China has been South Korea’s leading trade partner for the past decade. It now accounts for a quarter of South Korea’s trade, and a larger share than that of the U.S. and Japan combined. China-South Korea trade will if anything grow, as a result of a forthcoming free trade agreement between the two countries and a new agreement to make more yuan and won directly convertible.

In raw numbers, China-South Korea trade is more than 40 times greater than China’s trade with North Korea, $247 billion vs. $6.6 billion, even though the latter has trebled since 2007 as Beijing has sought to ease Kim Jong Un’s regime back from the brink of Beijing’s nightmare — an economic collapse of the North triggering a flood of refugees across the border into Jilin and Liaoning provinces.

A new generation of leaders in Beijing views Pyongyang differently than its predecessors. More than half a century on from the end of the Korean War, unwavering support of comrades-in-arms just seems outdated and especially now China, South Korea and Japan have become economic powers in their own right. Beijing wants to distance itself from Pyongyang, though not by so much it allows room for Tokyo and increasingly Moscow to step in. It is telling that Xi’s recent visit to Seoul was his fifth meeting with his strongly pro-U.S. South Korean counterpart Park Geun-hye since becoming president though he has yet to visit Pyongyang.

Japan’s latest promise to ease some minor sanctions against North Korea in return for Pyongyang re-investigating abductions of Japanese nationals by North Koreans in the 1970s and 1980s is a sign of how Tokyo is working the new folds in the regional landscape. Continuing concerns about Pyongyang’s nuclear programme in the unpredictable hands of Kim Jong Un will limit how far Tokyo will want to carry its rapprochement, and Washington won’t let it go too far for the same reason.

The North’s nuclear ambitions remain the elephant in the room for China, too. Xi is unlikely to push Kim as hard on this as Park would like. In Seoul, he avoided any sign of support for Park’s criticism of the programme and stuck to Beijing’s line of calling for the denuclearization of the peninsula.

Nor will the U.S. want relations between one of its two main Asian allies and China to become too cosy. On that front, it will take some comfort in the fact that Park rejected Xi’s proposal of a joint celebration of next year’s 70th anniversary of Korea’s liberation from Japan at the end of World War II. Every leader in the region has a middle against which he or she needs to play two ends. In contrast to the dangerous eddies of northeast Asian geopolitics, the course of commerce runs swiftly and truer.

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