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kim and cha • between a rock and a hard place
South Korea as the third country after Chile and Peru, and the largest
economy thus far, to have concluded FTAs with the world’s three largest
economies: the United States, the European Union, and China. However,
the agreement is not as high quality in scope as the Korea-U.S. Free Trade
Agreement, and the potential economic benefits are limited. For example,
the agreement covers only 70% of agricultural products and also excludes
key products such as rice, steel, and auto parts from tariff elimination, which
are points of sensitivity for both countries. The conclusion of negotiations
acts more as a political boost for ties between Beijing and Seoul because the
FTA adheres to the earlier summit agreement of the two countries’ leaders
to strike a deal by the end of 2014.
As South Korea becomes increasingly economically dependent on China,
however, South Koreans also have begun to perceive China as an economic
threat. The number of South Koreans who view China as an economic threat
has increased sharply from 52.7% in 2012 to 71.9% in 2014, even though their
favorable view of China was consistently high during this period. 21 Equally
notable is the fact that more South Koreans perceived China as an economic
threat than a military threat (66.4%). 22 Thus far, this trend has not translated
into any sort of action or had any policy implication in South Korea. Yet there
are underlying tensions and serious concerns emerging in the country about
China as both a major economic competitor and a rising economic influence. 23
The North Korea Dilemma
North Korea lies at the heart of South Korea’s strategic engagement
with China. Given decades of confrontation and deadlocked negotiations
between South Korea and North Korea as well as the latter’s isolation and
faltering economy, China’s political ties with North Korea as that country’s
only ally and largest trade partner have given Beijing enormous leverage over
the North Korean regime. As a result, China’s cooperation has long been
regarded as key to resolving the current nuclear standoff with North Korea
and achieving Korean reunification. In a public opinion survey in December
2013, almost 50% of South Koreans responded that China is the country
21 Kim et al., “South Korean Attitudes on China,” 22.
22 Ibid.
23 Ibid.
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