Since the appearance of President-elect Donald Trump, tensions between China and the U.S. have been climbing. Following the U.S. government’s refusal to recognize China’s “market economy” status within the World Trade Organization, Trump has tried to disturb the 1937 “One China” policy by speaking with Tsai Ing-wen, the president of Taiwan. Trump stated that the U.S. does not have to stick to its long-standing position that Taiwan is part of “One China.” However, China’s counterattack is also tough. China is launching a WTO case against the U.S., charging it for its failure to honor the pledge to regard China as a “market economy.” Furthermore, as the largest holder of U.S. Treasury securities worth $1.16 trillion, China has warned the U.S. about selling off its debt holdings, which would cause the demand for dollars to plummet. It’s clear that China is not willing to concede.
The problem is that the deterioration of U.S.-China relations can take a toll on us, South Korea. Some have already pointed out that China can use North Korea to deal with pressure from the United States. If China decides to strengthen aid or economic relations with North Korea, it will severely hinder international cooperation efforts to resolve the North Korean nuclear issue. It is also worrisome that China might inhibit the spread of Korean tourism, Korean companies, and the Korean Wave, as retaliation for the deployment of the Terminal High Altitude Area Defense missile-defense system on the Korean Peninsula.*
The opposite may also be true. If U.S.-China relations reach an extreme, the U.S. may call South Korea to the frontlines to pressure the public. Also problematic would be the decline of China’s exports to the U.S. due to retaliatory tariffs and quota restrictions. If China’s exports to the U.S. decline by 10 percent, South Korea’s exports will fall by .36 percent. Furthermore, strengthening sanctions on Chinese export companies will also affect South Korean companies that have entered China. It seems that the recent anti-dumping duties that the U.S. imposed on South Korea’s washing machines run along the same lines.
For us as South Koreans who are already suffering from national insecurity and economic downturn, this scenario would be yet another horror. But there are no signs of improvement in U.S.-China relations. Trump’s “U.S. First” policy could only make the situation worse. This is why we need to observe the relationship between the two countries more closely than ever and focus on using our diplomatic abilities to remind the U.S. and China that the North Korean nuclear issue is separate from their relationship with each other. Even when sandwiched between two major powers, we must try as hard as we can to salvage their relationship.
*Editor’s note: The Korean Wave refers to the phenomenon of Korean entertainment and popular culture rolling over the world with pop music, TV drama and film.