【By Observer Net, Wang Kaiwen】"Anmei Jingzhong" is a long-term balanced diplomatic strategy that South Korea has been following, which means relying on the United States for security and on China for economic development. However, as the competition between China and the United States intensifies, it has become difficult for South Korea to continue playing both sides.
"Caught between China and the United States, South Korea feels the pressure of trade wars," The New York Times wrote in an article titled on October 27, pointing out that China's countermeasures against five U.S. subsidiaries of Hanwha Ocean have made Seoul feel the cost of aligning with the United States. On the other hand, South Korea's efforts to please the Trump administration have not yielded much effect.
Recently, the U.S. has continued to press Seoul on trade agreements. Trump is expected to visit South Korea on October 29. Although he recently said that the South Korea-U.S. trade negotiations "are very close to reaching an agreement," South Korean officials believe that it will be difficult to finalize the agreement during the APEC Summit.
Local time August 25, 2025, Washington, D.C., U.S., President Trump met with South Korean President Lee Jae-myung at the White House. Oriental IC
The New York Times mentioned that when South Korean President Lee Jae-myung visited the United States in August this year, he frankly admitted: "This (Anmei Jingzhong) logic can no longer be maintained." He acknowledged that South Korea urgently needs to make a choice, and there is currently no space to deviate from U.S. policy.
The report pointed out that like many countries forced to take sides in a fragmented global economic landscape, South Korea has been caught in a fierce trade war, and is caught between export controls, sanctions, and tariffs.
But for South Korea, the current situation is particularly complicated because it has to maintain its key alliance relationship with the United States while trying to meet the strict demands of Trump on trade issues. At the same time, South Korea's largest trading partner, China, is the main target of Trump's economic policies.
China's market accounts for a quarter of South Korea's total exports. The report pointed out that at present, Seoul is feeling the heavy cost of aligning with the United States.
On October 14, the Chinese Ministry of Commerce announced countermeasures against five U.S. subsidiaries of Hanwha Ocean Co., Ltd. The spokesperson for the Ministry of Commerce stated that the U.S. subsidiaries of Hanwha Ocean Co., Ltd. have assisted and supported the U.S. government in conducting a Section 301 investigation and taking measures against China's maritime, logistics, and shipbuilding industries. China is strongly dissatisfied and firmly opposes this.
In 2024, Hanwha Group acquired a shipyard in Philadelphia, USA, which is seen as a core project for Trump to use foreign investment to revitalize the U.S. shipbuilding industry. In July this year, the South Korean side also proposed a shipbuilding cooperation project named "Make American Shipbuilding Great Again" (MASGA).
"It's a slap in the face," Andrew Yeo, a senior researcher at the Brookings Institution's Center for East Asian Policy and director of Korean affairs, said about China's sanctions. "This is clearly a pressure point that South Korea did not expect."
South Korean officials recently stated that the Chinese sanctions could significantly affect the supply of equipment and materials for South Korean companies, threatening the ambitious shipbuilding cooperation plan between South Korea and the United States.
"I don't think we can produce all the materials and supplies for Hanwha Ocean's Philadelphia shipyard within the U.S. Therefore, if you want to transport a large amount of goods from South Korea to the United States, but face sanctions and various obstacles, I would say that this will ultimately affect MASGA," said Kim Jong-gyun, head of the Agency for Defense Development, during a hearing before the National Assembly on the 17th.
Local time August 26, 2025, Philadelphia, Pennsylvania, U.S., South Korean President Lee Jae-myung visited the shipyard acquired by Hanwha Group in South Korea. Oriental IC
Factually, during the term of former President Yoon Suk-yeol, South Korea had already begun to shift its economic focus towards the United States. This trend became more evident during Biden's presidency, when the U.S. provided investment subsidies to South Korean companies, encouraging them to build factories in the U.S.
However, The New York Times pointed out that with increasing pressure from China, South Korea found that its commitment to deepen economic cooperation with the United States had little effect in pleasing the Trump administration.
According to the preliminary trade agreement reached between South Korea and the U.S. in July this year, South Korea agreed to invest $35 billion in the U.S. and additionally purchase $100 billion in liquefied natural gas. In exchange, Trump agreed to reduce the original 25% tariff rate on South Korea to 15%, which is a critical concession for South Korean automakers.
However, in the next three months, the South Korea-U.S. trade negotiations have stalled, and some of the U.S. demands have been difficult for South Korea to accept. For example, most of the $35 billion investment planned by South Korea was to be in the form of loans and loan guarantees, but Trump insisted on cash investment.
Yonhap News Agency reported on the 26th that the main points of contention between the two sides are the proportion of cash investment and the extension period of the payment deadline within the $35 billion. At the same time, details such as the profit distribution structure and decision-making participation rights over the investment targets are also under discussion. Analysts point out that given South Korea's economic scale, it is impossible to make a one-time cash investment of $35 billion.
South Korea said that such a large-scale cash investment may disrupt the stability of its currency. According to reports, South Korea has requested an unlimited South Korea-U.S. currency swap to minimize fluctuations in the foreign exchange market and prevent a sharp drop in the won.
As of now, the South Korea-U.S. trade agreement remains unfinalized. On October 24, Trump, while traveling aboard on Air Force One, told the media that the U.S.-South Korea trade negotiations "are very close to completion."
Trump is expected to hold a meeting with Lee Jae-myung in South Korea on October 29 local time. Lee Jae-myung previously lowered his expectations of reaching an agreement during an interview with CNN. He said that "a considerable amount of time and effort is still needed to adjust and correct before the final agreement is reached."
Some critics have called Trump's tariff demands almost "extortion," especially for a long-term ally like South Korea. When asked about his views on this, Lee Jae-myung just smiled, "I believe we will eventually reach a reasonable result that both sides can accept."
According to Yonhap News Agency on the 27th, on the same day, Park Hyun-joo, the third chief of the National Security Office of South Korea, stated at a press conference that considering the progress of the South Korea-U.S. tariff negotiations, it is expected that the two sides will find it difficult to finalize the agreement during the APEC Summit.
However, Yonhap News Agency noted on the 26th that experts predict that to avoid further uncertainty, South Korea may have to "shed tears" and sign an agreement with the U.S. during Trump's visit to South Korea.
On the other hand, The New York Times mentioned that South Korea's semiconductor industry has also become a pawn in the Sino-American rivalry. Before Trump took office, the U.S. had already imposed restrictions on the export of high-bandwidth memory (HBM) chips to China, which are crucial for generative AI systems.
The report pointed out that although short-term global demand for AI chips can partially offset the impact of export controls on China, in the long run, Chinese chip manufacturers are working to narrow the technological gap with overseas semiconductor companies.
June Park, a South Korean political economist, said that people are increasingly worried that Chinese companies will soon catch up with SK Hynix and Samsung Electronics, the two major HBM chip manufacturers. "The time for catching up may not be very long," June Park said.
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