[By Guancha Network Columnist Shen Zhenqun]
May 12, 2025, saw a breakthrough in the China-US economic and trade negotiations. According to the "Joint Statement of the Sino-US Geneva Economic and Trade Talks," the US side committed to canceling 91% of the additional tariffs imposed on China, suspending 24% of the "reciprocal tariff" for 90 days; while China reciprocally canceled 91% of its countermeasures and suspended 24% of its tariff measures.
This result marks the complete failure of Trump's administration's strategy of "forcing talks through confrontation." Through precise countermeasures, China forced the US to make concessions, demonstrating its determination to uphold multilateral rules while exposing the essence of the Trump administration's "bullying the weak and fearing the strong"—its "tariff stick" ultimately became a self-harming tool.
China's phased victory in the negotiations with the US is likely to have a significant impact on the allies of the United States, particularly Japan and South Korea, which are both military allies and trading partners of the US—the feeling that Trump was "submissive externally but aggressive internally" was too deep.
Currently, Japan has lost over $10 billion due to the US imposing a 25% tariff on auto parts, and South Korea's semiconductor exports face downward pressure due to supply chain chaos. Moreover, the US recently included South Korea on the "sensitive country list," further widening the cracks in the US-South Korean relationship. Although both countries have engaged in trade negotiations with the US in the past month, their differences remain prominent, and short-term results are unlikely.
Meanwhile, there are other developments in regional economic and trade multilateral cooperation among Japan and South Korea. On May 4, the 28th ASEAN Plus Three (APT) Finance Ministers and Central Bank Governors Meeting was held in Italy, where the joint statement warned that the rise of protectionism would exacerbate economic fragmentation and reaffirmed support for a rules-based free and fair multilateral trading system. Japanese Finance Minister Taro Aso changed his previous ambiguous stance at the meeting, clearly supporting the joint statement and actively discussing the establishment of a "de-dollarized" payment system with China and ASEAN. Kyodo News reported that the statement, to some extent, constrains the spillover effects of US high tariffs policies, reflecting the consensus among Asian countries to promote free trade.
It is evident that when the US wields the tariff "stick" to disrupt the global trade landscape, trilateral cooperation in China, Japan, and South Korea is becoming an anchor point for responding to the impact. Faced with unilateral pressures from the US, Japan and South Korea have no choice but to reassess the significance of their economic and trade cooperation with China to diversify risks and stabilize exports. This is not only a short-term passive response but may also foreshadow long-term structural adjustments.
May 4, the ASEAN Plus Three (APT) finance ministers and central bank governors meeting was held in Milan, Italy. Kyodo News.
How to understand Japan’s hard-line stance under Prime Minister Ishiba's cabinet?
The Japanese approach includes rapid responses, leader-to-leader phone calls, and two rounds of negotiations, highlighting its clear position and relatively firm stance in maintaining the free trade order and national export interests. According to reports by Kyodo News, the Japanese government "holds an open attitude toward possible countermeasures." On April 3, former Defense Minister Shigeru Ishiba publicly stated that the US actions would "have serious negative impacts on bilateral relations and the global multilateral trading system," clearly expressing opposition. The media described his call with President Trump on April 7 as "frank and constructive," but from Trump's subsequent complaints on social media, it appears that the call did not achieve the desired effect, especially with severe divisions persisting on the two core trade issues: automobiles and agriculture. The two rounds of negotiations on April 16 and May 2 maintained communication channels but made no substantial progress, particularly with significant disagreements remaining on automotive and steel-aluminum issues.
Compared to Abe Shinzo's era, Japan's current tougher stance can be understood from three aspects: historical experience, real leverage, and domestic politics.
Firstly, from a historical perspective, the US-Japan trade friction during Trump's first term has become an important reference for Japan's strategy toward the US. At that time, Trump criticized the severe imbalance in US-Japan goods trade, demanding Japan open its agricultural market and limit car exports to the US. The eventual compromise was Japan making concessions on agriculture while the car tariff issue was temporarily shelved. In terms of form, Trump refused multilateral negotiations and conducted US-Japan bilateral trade talks to more effectively pressure Japan. Now, this隐患 has re-emerged, and Japan knows that Trump's pressure logic is difficult to change; the only way is to proactively negotiate and stabilize the pace. In 2024, Japan's automobile exports to the US exceeded 6 trillion yen, accounting for nearly 30% of total exports to the US—if automobile exports are restricted, the impact on Japanese companies will be extremely severe. Moreover, agriculture and automobiles are once again being used by Trump as bargaining chips; Japan has already made concessions once during Trump's first term, leaving little room to retreat; if it makes further concessions, the "tariff stick" will hit Japan's economic lifeline—automobile exports—harder than ever.
Secondly, from a practical standpoint, Japan does possess certain negotiation tools.
Firstly, Japan has always been a staunch supporter of multilateral trade mechanisms. Not only has it actively participated in the Regional Comprehensive Economic Partnership (RCEP), but it also led the conclusion of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Compared to the Trump 1.0 period, Japan now has stronger voice and rule-making capabilities within the multilateral system, and the benefits it gains are richer, which helps it use rules to respond to unilateral pressure.
Secondly, in recent years, Japan has continuously increased its defense budget. Since the publication of the "New Security Three Documents" in late 2022, the defense budget for fiscal year 2025 has reached 1.8% of GDP and plans to gradually approach 2%. Additionally, the current negotiations have indicated that the issue of US troop expenses in Japan will not be linked to trade conflicts, which maintains the high stability of the US-Japan alliance, making it difficult for the US to sacrifice Japan's geopolitical strategic value due to economic disputes.
Thirdly, although Japan's Finance Minister Taro Aso quickly denied on May 4 that "selling off US treasuries" is a negotiation tactic, Japan indeed holds the world's largest US treasury bond holdings. By issuing a declaration of "not increasing US treasury purchases," Japan intends to release expectations of depreciation of US treasuries, thereby potentially exerting financial leverage against the US.
Finally, from a domestic political perspective, Prime Minister Ishiba's cabinet was formed through compromises among factions and has a weak foundation. The ruling coalition has fewer seats than the opposition parties in the Diet (220 seats vs. 241 seats), creating a typical situation of "the ruling party losing out to the opposition." The Upper House election is just around the corner in July, urgently needing diplomatic achievements to boost support rates. Liberal Democratic Party member Koike Shinsuke has openly called on the government not to "succumb to US coercion." Unlike Abe Shinzo, Ishiba lacks the diplomatic skills of someone who can maneuver skillfully, and his initial visit to the US received a rather cold reception, suggesting an early sign of diplomatic setbacks.
Specifically regarding the agricultural issue, it touches the nerves of Japanese politics. The "National Federation of Agricultural Cooperatives" (JA) holds a stable monopoly position and is an important vote base that the LDP has long relied on; it is even rumored that JA influences 30% of the Diet seats. If the Ishiba government compromises on this issue with the US, it could anger JA and weaken its already precarious political foundation.
In summary, Japan's firm stance has reasonable motivations, but these motivations not only drive it to actively negotiate but also exacerbate the differences between the US and Japan, leading to a deadlock in negotiations. It can be foreseen that Japan may make limited concessions in areas such as energy and agriculture, such as increasing US liquefied natural gas imports, relaxing car certification requirements, or making minor adjustments to agricultural tariffs. However, as long as the US insists on touching Japan's vital points—automobile exports—the US-Japan negotiations are unlikely to break through in the short term. Japan is caught in a dilemma of unwillingness to abandon its core interests but needing to maintain the narrative of the "golden age of US-Japan relations."
Against this backdrop, cooperation with China is gradually becoming one of Japan's strategic options in its game with the US. Since Premier Li Qiang's meeting with Prime Minister Ishiba last October, the signs of the resumption of the "strategic mutually beneficial relationship" between China and Japan have become increasingly evident, indicating that Japan has realized that there are practical common interests between the two countries in jointly addressing US trade protectionism. At the end of April, leaders of China and Japan exchanged letters regarding the US tariff issue, sending out positive signals of restarting dialogue and stabilizing relations amidst complex external circumstances. As the "long side" of the trilateral cooperation among China, Japan, and South Korea, the progress in Sino-Japanese relations lays a constructive foundation for the reconstruction of trilateral cooperation.
South Korea, mired in internal chaos and without clear leadership, lacks the ability to withstand Trump's pressure.
In stark contrast to Japan's relatively firm and autonomous response strategy, South Korea's handling of the US tariff policy can be summed up as "chaotic": its response attitude is vague and accommodating, specific measures are inconsistent, and the coordination rhythm of policies is severely lagging behind.
On April 3, then Acting President Han De-suk merely stated that he would "take all necessary measures to respond," but just six days later, he clearly negated the possibility of "joining China and Japan in countering tariffs"—fearing offending the US. Specifically regarding the negotiation process, South Korea did not send Economic Vice Premier Choi Sang-moo and Industry and Resources Minister An Duck-gun to the US for the "2+2" consultations until April 24, although they confirmed four major topics including tariffs, investment, economic security, and exchange rates, but no joint communiqué was issued; the agreement timelines publicly stated by both sides after the meeting were contradictory, with the US claiming the deal could be reached in May while South Korea said it would drag until the July 8 deadline.
Why is South Korea's response still submissive despite the fact that Yoon Suk-yeol is no longer in power? Why is the communication so chaotic between the two sides?
Firstly, "small surprises" in the ROK-US relationship continue to fester. On March 14, the US Department of Energy publicly listed South Korea as a "sensitive country," restricting South Korean researchers' participation in energy projects. Although the US emphasized that this move "has nothing to do with diplomacy," its symbolic meaning and actual impact have already undermined trust between the two countries and affected the foundation of their technological and energy cooperation.
Notably, South Korea was listed as early as January but was not officially informed until March, revealing serious defects in the two countries' diplomatic communication mechanism. As pointed out by The Diplomat magazine, the Trump administration might well have used this policy as leverage to force South Korea to make additional concessions during trade negotiations, further compressing South Korea's bargaining space in the negotiations.
Secondly, South Korea's bargaining chips are inherently insufficient compared to Japan. In the economic field, expanding liquefied natural gas imports and strengthening shipbuilding cooperation are among the few "chips" South Korea has. However, last year's US trade deficit with South Korea was as high as $55.7 billion, and Trump's focus in the trade field is certainly on semiconductors, automobiles, and pharmaceuticals, which account for the highest proportions. It is hard to say that simply expanding energy imports or "enhancing shipbuilding cooperation" would meet Trump's demand for trade balance.
Moreover, South Korea's voice in the international economic and trade system is far weaker than Japan's. Even though both are export-oriented economies highly dependent on the multilateral trading system, Japan can be seen as the lead country of the CPTPP and a core member of the G7, whereas South Korea cannot yet claim to lead any regional economic and trade mechanism.
More crucially, geopolitical factors have intensified South Korea's dependence on the US. The situation on the Korean Peninsula leaves South Korea highly reliant on the US for security, even if it increases its defense budget, it cannot fully replace the critical role of the US's "wartime operational command authority." This makes South Korea always in a disadvantaged position in any negotiation with the US.
Local time on May 12, 2025, in Goyang, Gyeonggi Province, South Korea, the announcement board of the Central Election Management Committee showed the registration status of presidential candidates.
Finally, South Korea's domestic politics has reached a critical juncture of extreme chaos. After the first round of consultations, Choi Sang-moo said that "trade agreements will be led by the next government," revealing the government's helplessness. The power transition of this government has been dramatic: when the negotiation task force was established, Acting President Han De-suk resigned to run for office on May 1, transferring duties to Choi Sang-moo, who subsequently announced his resignation, and the presidential responsibilities transferred to Social Affairs Deputy Prime Minister Lee Ju-ho, with Deputy Minister of the Ministry of Finance Kim Bum-seok becoming the temporary head of the US negotiations. Such frequent personnel changes have left the South Korean government in a state of "no clear leader."
Looking ahead to next month's elections, despite Lee Jae-myung leading in support, Han De-suk's sudden resignation and secret dealings with the People Power Party have added uncertainty to the election outcome; even if Lee Jae-myung wins, a government that rises to power amidst such chaos will raise questions about its negotiating ability and governing stability with the US.
South Korea's core interests are similar to Japan's, i.e., to seek tariff exemptions as much as possible, but its negotiations with the US are chaotic due to political instability and diplomatic missteps, putting it in a state of internal and external difficulties. One possible ideal scenario is that Lee Jae-myung wins the election within a month, which could push South Korea to strengthen its coordination mechanism with China in responding to US trade protectionism, providing realistic options for gaining more initiative in tariff negotiations.
However, from the current situation, the outcomes of Japan and South Korea's negotiations with the US are converging, and neither country can break through the US's high-pressure tactics to achieve substantive progress. This predicament exposes the "crisis" in Japan and South Korea's relations with the US while also providing new "opportunities" for deepening trilateral cooperation among China, Japan, and South Korea and building a united front to uphold multilateralism.
America's overestimation, underestimation, and misjudgment have brought new opportunities for China, Japan, and South Korea.
From the foreign ministers' meeting in March to the 28th ASEAN Plus Three (APT) Finance Ministers and Central Bank Governors Meeting in May, the "disorderly governance" of the Trump administration has prompted China, Japan, and South Korea to take a clear common position. Economically, China, Japan, and South Korea account for 24% of the global economy, and their economic interdependence is very tight, with cultural similarities—these are the advantages of China-Japan-South Korea cooperation compared to other regions in the world.
However, when talking about trilateral cooperation among China, Japan, and South Korea, external factors involving the US and security differences cannot be ignored. Looking back, whether it was the once-proposed "Asian Yuan Zone" concept or the "East Asia Community" vision by Junichiro Koizumi, they represent the heights that China-Japan-South Korea regional cooperation has reached. Nevertheless, both China, Japan, and South Korea as well as external countries have noticed America's high vigilance and dissatisfaction towards China-Japan-South Korea cooperation. This is why the events of the Diaoyu Islands and THAAD, which determined the direction of Sino-Japanese and Sino-South Korean relations, were both related to US pressure. By creating political frictions to increase mutual distrust among the three countries and reinforcing Japan and South Korea as strategic pawns to contain China's rise, the reality of the long-term freeze in trilateral trade negotiations shows that the US has partially achieved its strategic goals.
However, the US overestimated its own "superiority"; underestimated the resilience of China-Japan-South Korea regional cooperation; and completely misjudged China's determination to break through—these three misjudgments will bring rare opportunities for China-Japan-South Korea cooperation.
The best example of the US overestimating itself is Trump's appearance. Currently, Trump's unilateral actions indiscriminately harm global trading partners, and Japan and South Korea, as its security allies, are no exception, let alone Ukraine, which has been "put on the table." The US government's "makeshift team" has repeatedly made a fool of itself, reducing its strategic credibility to zero.
Secondly, the US underestimated the resilience of China-Japan-South Korea regional cooperation. For instance, in 2024, Samsung's total exports to China had already surpassed its exports to the US, proving that the US export control rules in the semiconductor sector have begun to reverse-push further integration of the China-Japan-South Korea semiconductor industry. More specifically in manufacturing, while China, Japan, and South Korea seem competitive, their industrial chains are deeply integrated and highly complementary. Besides the semiconductor industry mentioned earlier, China, Japan, and South Korea are highly complementary in new energy vehicle batteries, hydrogen energy, cross-border e-commerce, and other fields, possessing natural conditions for coordinated development.
Take the automotive industry as an example. Despite competition in the terminal market, the midstream supply chain of new energy vehicles has formed deep collaboration. South Korea's major battery giants have large-scale investments in China, relying on China for key mineral raw materials. LG Energy's cumulative investment in Nanjing has exceeded $8 billion, SK On's动力电池 factory in Yancheng, Jiangsu is its largest single plant, and Samsung Battery has been operating in Xi'an and Tianjin for over a decade, launching an expansion project worth more than 1.1 billion yuan at the beginning of 2025. By 2024, 50% of South Korea's rare earth imports came from China, and its reliance on China for critical rare earth materials like dysprosium and terbium required for electric vehicle motors exceeded 80%.
Japanese automakers continue to rely on the Chinese market while actively seeking to leverage China's technical density and rapid iteration advantage in the new energy vehicle market to accelerate the pace of electrification and avoid being left behind by the market. In recent years, Toyota and BYD, Mazda and Changan have successively established joint technology companies to jointly develop new energy vehicle products, enhancing competitiveness in the intelligent electric vehicle track.
This full-chain complementarity from raw material supply to technology research and development not only strengthens the collaborative risk resistance capability of industries in the three countries but also provides a solid foundation for jointly responding to US tariff blackmail. In other words, China, Japan, and South Korea already possess the "supply chain resilience" that the US attempted to enhance when initiating the US-Japan-Korea cooperation, and it has nothing to do with the securitization of economic issues.
Lastly and most importantly, the US has completely misjudged China's strength. No matter how much the US tries to blockade China or sing its decline, China's performance domestically and internationally is evident to all countries. Contrary to Trump's unreasonable behavior, China has shown the steadfast position of a responsible major power when facing unreasonable US containment, uncompromising and firmly retaliating, demonstrating its determination to uphold multilateralism. The fact proves that China has the courage and strength to retaliate against the US's "tariff hegemony." On May 12, the successful cancellation of reciprocal retaliatory tariffs in the China-US negotiations was the initial victory of China standing firm under pressure and rational retaliation, also proving the inevitable defeat of Trump's arbitrary wielding of the tariff stick.
Reality has shown that the longer Japan and South Korea "bow down" to the US, the more concessions they make in trade, and the more severe the impact on their own economies. Especially when an unpredictable person says "you don't have any cards," the outcome is bound to be laughable.
Although the structural dependence of Japan and South Korea on the US in the security domain remains unchanged, and the strategic trust deficit among China, Japan, and South Korea is still severe, this does not hinder them from realizing one thing: America's unilateral bullying is neither reasonable nor justified, and cooperation between China, Japan, and South Korea is not without底气or impossible. Geographically close and economically interconnected, Japan and South Korea should clearly recognize that cooperating with China to jointly address unreasonable US measures is the wise choice to maintain international trade stability and mitigate the risks and uncertainties brought by the Trump administration.
Of course, the renewed mutual trust between China, Japan, and South Korea stems from the US government's breach of faith with its allies and trading partners—therefore, this mutual trust itself is difficult to sustain. Thus, even if it is difficult to completely eliminate the trilateral estrangement and form collective negotiations with the US in the short term, China, Japan, and South Korea must quickly transcend basic topics such as humanities and education, gradually restoring and strengthening the institutionalization level of cooperation based on topic cooperation.
Most crucially, promoting the institutionalization and normalization of the trilateral leaders' summit mechanism. Once mature international mechanisms are formed, they have path dependency effects and are not easily interrupted by external interference. Under the current circumstances, achieving institutional arrangements as soon as possible can help weaken the US's policy traction on Japan and South Korea and buffer the uncertainty brought by fluctuations in Japan and South Korea's political situations. By underpinning with mechanisms, guiding with topics, and laying groundwork for cooperation, China, Japan, and South Korea can "turn crisis into opportunity," gradually bridging the trust deficit and strategic differences, and injecting institutional rigidity and strategic resilience into cooperation.
In summary, trilateral cooperation among China, Japan, and South Korea has been activated due to external pressures and practical needs. In the foreseeable future, functional cooperation may proceed steadily; however, if trilateral cooperation wants to move beyond the "shallow waters," it still requires breakthroughs in political mutual trust among the three countries.
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