The Biden and Moon administrations do not see eye to eye on the best way to manage China’s growing economic, military, and diplomatic power. This gap is becoming increasingly apparent as the United States engages its allies and partners to address the challenges posed by Beijing’s agenda and the Moon administration strategically avoids taking sides. While the U.S.-South Korea alliance has historically been focused on staving off threats from North Korea, there is growing desire among U.S. policymakers to collaborate with Seoul as part of U.S. China policy.
For the U.S.-South Korea alliance to remain sustainable, the United States must remain cognizant of constraints on South Korea’s ability to join with partners to counter China, while also creating mechanisms that would allow South Korea to take greater risks in resisting China.
While this would not necessarily create alignment between the two countries, it would increase U.S. credibility and widen South Korea’s space to maneuver as it charts its China and alliance policies. This would ultimately strengthen the alliance.
Aligning on ChinaThe Biden administration describes itself as in “strategic competition” with China. There is growing consensus within the U.S. foreign policy community that aspects of Beijing’s behavior challenge U.S. interests. For example, the People’s Liberation Army (PLA) has enacted reforms and modernization efforts geared toward preventing U.S. intervention in regional crises. It is leveraging its economic influence around the world in ways that undermine state sovereignty, as well as providing state support to domestic companies in ways that undercut the economic competitiveness of U.S. companies. The PLA is also exporting and expanding its use of authoritarian surveillance tools and attempting to set global rules and norms that make the world safer for the Chinese Communist Party (CCP) and its governance model.
A key facet of Biden’s emerging China strategy is engaging with U.S. allies and partners, with emphasis on cooperation with fellow democracies, to push back against threats to the liberal international order. Some of these efforts have included basic diplomatic outreach. In the early months of the Biden administration, high-level officials traveled to allied nations to assert that “America is back.”

Other efforts have been multilateral. In the Indo-Pacific, for example, the Biden administration has ramped up cooperation with fellow “Quad” nations—Australia, India, and Japan—as they coordinate on COVID-19 vaccine provision, climate change responses, critical and emerging technologies, and military exercises.6 Meanwhile, in September 2021, the United States, United Kingdom, and Australia announced the creation of AUKUS, a trilateral security pact aimed to “preserve security and stability in the Indo-Pacific.”

The Moon administration has been circumspect in how it participates in these efforts. It is not a member of the Quad, and the May 2021 U.S.-South Korea leaders’ joint statement did not directly refer to China. This was in sharp contrast with the April 2021 U.S.-Japan joint leaders’ statement, which announced that U.S. President Joe Biden and Japanese Prime Minister Yoshihide Suga shared “concerns over Chinese activities that are inconsistent with the international rules-based order.”

After the Biden-Moon summit, the South Korean first vice foreign minister even said that he expected China would approve of the statement due to its lack of explicit reference to the country.10 Defense documents reflect a similar pattern: The joint communique from the 53rd Security Consultative Meeting—between the two countries’ defense chiefs—refers to Taiwan but not China. However, the joint statement from the Japan-U.S. Security Consultative Committee meeting, which brought together the two countries’ foreign affairs and defense leaders, explicitly lays out concerns emanating from Chinese behavior. While rhetoric does not necessarily equate to policy or behind-the-scenes actions, it does indicate South Korea’s reluctance to declare that its policy decisions are a response to Chinese behavior.

President Moon Jae-in’s reluctance is driven in part by the fear that Beijing will use tools of economic coercion against the South Korean economy. China is by far South Korea’s largest trading partner. In 2019, 25 percent of South Korea’s export revenue and 21 percent of its imports by value came from China. China has leveraged this economic influence, and the Moon administration has reason to fear further attempts at coercion.

In 2016, the United States and South Korea announced their decision to deploy a Terminal High Altitude Aerial Defense (THAAD) missile battery in South Korea. While the United States and South Korea justified this decision as a means of bolstering defense against North Korea, China protested the deployment out of concern that THAAD would be able to track China’s missile activity as well. In response, China deployed a range of economically coercive tactics against South Korea: It severely restricted Chinese tourism to South Korea, banned the sale of some South Korean products in China, closed a number of Lotte Mart stores, and restricted the South Korean entertainment sector’s access to the Chinese market.

According to the Korean National Assembly Budget Office, the loss of revenue in the tourism sector alone was approximately $6.8 billion in 2017. While the alliance went ahead with the THAAD deployment, the Moon administration later told China that it would not deploy additional THAAD batteries, be a part of the U.S. missile defense network, or establish a formal trilateral military alliance with the United States and Japan. Foreign Minister Kang Kyung-wha then clarified that the “three noes” were a statement of the Korean government’s position rather than an agreement with China but the episode highlighted the connection between economic coercion and security concessions.

South Korean politicians recognize that they are caught in a challenging position. On picking between the United States and China, former speaker of South Korea’s National Assembly Moon Hee-sang said, “We cannot abandon economy for the sake of security, and we cannot abandon security for the sake of economy.” Likewise, during his 2021 New Year’s press conference, President Moon emphasized that South Korea’s relationships with China and the United States are both important. The need to hedge between the two is driven in part by the perception that the United States failed to support South Korea while it was targeted by Beijing’s economic coercion in 2017. A reluctance to be “tough on China” may also be related to Moon’s desire to maintain a relationship with China because he believes the nation plays a key role in fostering peace on the Korean Peninsula.

Furthermore, South Korea’s security policy is largely focused on North Korea, and policy elites are split on whether China actually poses a threat to South Korea. This presents a contrast with Japan, the other U.S. ally in Northeast Asia, which has been more willing to take a rhetorical and policy stand in support of a U.S.-led security coalition. Finally, South Korean politicians in the democratic era have historically vacillated between full-fledged support for the U.S. alliance and a desire to maintain its sovereignty and autonomy in foreign policymaking.

Thus, hedging between the United States and China is not about “picking” China, but rather asserting South Korea’s right to manage its foreign policy and further its own interests, including by creating pathways to reduce China’s influence in the country. Moon’s New Southern Policy (NSP) is a way of decreasing the country’s exposure to the side effects of great power competition by strengthening South Korea’s economic, diplomatic, and security ties to India and ASEAN member states. Since taking office in 2017, the Moon administration has also raised the defense budget by an average of 7.4 percent annually, whereas Moon’s immediate conservative predecessors only raised the budget between 4 and 6 percent annually. Moreover, the May 2021 lifting of the Revised Missile Guidelines, which limited the range and payload of South Korean missiles, allows Seoul to develop ballistic missiles that can strike China—among other countries further afield than North Korea.

In some cases, South Korea tacitly supports certain U.S. objectives or initiatives without explicitly endorsing them. While the May U.S.-South Korea leaders’ joint statement did not explicitly mention China, rhetoric about Taiwan and shared values are linguistic workarounds to acknowledge concerns about Chinese behavior. Even though the Moon administration has avoided endorsing the notion of a free and open Indo-Pacific, it has found ways to collaborate with the United States under the guise of the U.S. Indo-Pacific Strategy (under the Trump administration), the U.S. vision for a free and open Indo-Pacific (under the Biden administration), and the NSP. Taken together, the Biden and Moon administrations seem to be having active conversations about cooperative efforts that advance both countries’ interests while leaving space for Moon to stave off retaliation.

Domestic debates on China
The lack of alignment between the United States and South Korea on China is not necessarily a fixed state there are active debates in both countries about how best to respond to China’s growing assertiveness. While not necessarily sharing the same motivations, concerns held by some liberals in South Korea about picking sides or fueling great power competition mirror qualms held by some U.S. progressive groups about Biden’s policy toward China. These groups are concerned that anti-China rhetoric has contributed to the rise in violence against members of the Asian, Asian American, and Pacific Islander communities in the United States and have asked the Biden administration and Congress to tone down messaging and policies that they believe villainize China or propagate the notion of a “new Cold War.” There are also progressives that believe focusing on competitive elements of the U.S.-China relationship restrict possibilities for cooperation on climate change. Nearly 50 progressive groups signed a letter calling for the Biden administration to “eschew the dominant antagonistic approach to U.S.-China relations” and instead focus on diplomacy with China in order to address the climate crisis.

The debate over how to prioritize climate change in the U.S.-China relationship is also taking place within the administration. John Kerry, the special presidential envoy for climate, has reportedly clashed with national security adviser Jake Sullivan in calling for improved U.S.-China ties in exchange for cooperation on climate. Skeptics believe that Kerry is misguided and that China will not reduce its emissions based on improved U.S.-China ties, as this emphasis on the role of improved U.S.-China ties in fighting climate change downplays Beijing’s culpability in undermining the global climate agenda.

China is the largest emitter of greenhouse gases in the world: It is responsible for more than half of the world’s coal consumption—and its consumption will not peak until 2025—and was instrumental in pushing for the Glasgow Climate Pact to include a commitment by signatories to the “phase down” rather than the “phase out” of coal, among other actions that demonstrate a lack of urgency in addressing climate change.

Elite progressive sensibilities calling for U.S. efforts to reduce tensions with China could generate public pushback and political vulnerabilities. Indeed, 73 percent of Americans hold a negative view of China.33 Shortly after Biden took office, Americans were split on their faith in his ability to handle China: 46 percent had no confidence in him to “deal effectively with China” while 53 percent had confidence a greater percentage of Americans had confidence in his ability to handle other foreign policy issues such as improving relations with allies or fighting terrorism. This lack of confidence disproportionately came from Republicans, which suggests the concern is not that Biden is too harsh on China but rather not harsh enough. Therefore, if Biden shifts his China policy toward a less confrontational approach, he also risks generating ammunition for political opponents eager to call him “weak on China.” With Democrats holding a narrow majority in Congress as the United States heads into a midterm election year, Biden is unlikely to take risks in shifting his China rhetoric.

Moreover, while some U.S. progressives are calling for the Biden administration to take a less anti-China stance, there are those in South Korea asking for more pushback against China. The South Korean population’s views of China are becoming increasingly negative. In spring 2015, 37 percent of the South Korean population held a “somewhat” or “very” unfavorable view of China by summer 2020, this figure had risen to 75 percent—comparable to the United States.35 Lee Jun-seok, the head of the conservative opposition People Power Party (PPP), said that South Korea needs to “fight against the enemies of democracy” and push back against Chinese “cruelty.”36 Meanwhile, Yoon Seok-youl, the PPP candidate in the March 2022 South Korean presidential election, chided China—something the Moon administration has avoided doing—when defending the 2017 THAAD deployment. Yoon stated that China should withdraw its own long-range radars located in its border regions before calling for South Korea to withdraw THAAD, and he has not closed off the possibility of upgrading THAAD systems.37 However, this rhetoric does not mean that Yoon is fully open to pushing back on China he has also met with Beijing’s ambassador to South Korea, saying he will do his best to upgrade bilateral ties if elected.38 Finally, Lee Jae-myung, the nominee from the liberal Democratic Party of Korea, appears to be continuing in fellow party member Moon’s vein, stating that there is no reason to take sides, which would reduce South Korea’s room to maneuver.

With that, there appears to be some political space for policy change in South Korea should Yoon win the March 2022 presidential election. However, even if there is a change of government in South Korea, it does not affect whether China could once again wield its economic might against the country, as it has recently done against Australia and Lithuania. South Korea’s rhetoric toward China could shift in the near term, but the extent to which it will implement a substantial policy shift depends on political elites’ willingness to take a risk on the South Korean economy. Very few people dissatisfied with the Moon administration attribute that dissatisfaction to foreign policy. In a survey conducted at the end of November 2021, real estate policy was the most-raised source of dissatisfaction with the Moon administration, and a desire for change in government was the most-raised reason for supporting Yoon. Because China policy is not a salient issue in the current election, responding to the populace’s anti-China sentiment while potentially harming their higher-priority economic interests could generate backlash.

The United States must take proactive measures to reduce South Korea’s economic risk if it wants to create space for South Korean support for both U.S.-led initiatives and unilateral South Korean efforts. The Biden administration appears to be taking some steps in this direction. In October 2022, President Biden announced that the United States would work with partners to develop an Indo-Pacific economic framework centered around “trade facilitation, standards for the digital economy and technology, supply chain resiliency, decarbonization and clean energy, infrastructure, worker standards, and other areas of shared interest.” While not a unilateral U.S.-South Korea initiative, a comprehensive U.S. regional economic engagement plan would demonstrate U.S. credibility and commitment to the region. In November 2022, U.S. Trade Representative Katherine Tai traveled to South Korea to discuss the Korea-U.S. Free Trade Agreement (KORUS FTA) and new approaches to shared trade challenges, including in the areas of supply chains, emerging technologies, and digital issues.

However, improving U.S.-South Korea trade ties and U.S. economic integration will not be enough. The United States must also work to develop strategies to support South Korea, among other allies and partners, when they encounter direct economic retaliation. The United States must also be willing to support unilateral South Korean efforts to diversify the South Korean economy, even if it does not mean that U.S. companies and workers will be the immediate beneficiary. There is opportunity here in conversations surrounding supply chains and digital economic transformation to share best practices and resources.

While South Korean public opinion on China is worsening, the country’s economic dependence on China creates risk when it comes to translating negative sentiment into policy action. Therefore, there are limits to U.S.-South Korea security cooperation on China, and the two countries seem to be doing what they can to provide regional public goods together without South Korea running afoul of China. However, if the United States does desire a more active or visible South Korean presence in institutions or initiatives that China perceives as a threat, it must develop methods of supporting South Korea—along with other allies and partners—when it is the victim of economic coercion and retaliation. This must involve rebuilding trust in the United States as an economic partner, in addition to building mechanisms to blunt the damage caused by economic coercion.

This issue brief is the second in a series of publications from the Center for American Progress addressing a progressive vision for the U.S.-South Korea alliance. It was written based on consultations and conversations with a network of progressive U.S. and South Korean foreign policy thinkers, including but not limited to Jessica Lee, senior research fellow at the Quincy Institute for Responsible Statecraft. This brief, however, does not represent their views nor those of their organizations. The Center for American Progress thanks the Korea Foundation for its support of this project.

Tobias Harris is a Senior Fellow, Abigail Bard is Policy Analyst for Asia, and Haneul Lee is Research Assistant.