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Political Analysis
South Korea's Foreign Policy

Author: Dr. habil Bernhard Seliger

In the emerging new global Cold War, South Korea is in a very exposed situation in the Indo-Pacific, with the fragile armistice with North Korea, China’s new assertiveness, and new alliances, in particular military cooperation between Russia and North Korea. Amid these challenges, can South Korea become a global responsible power in this situation?

South Korea and the Indo-Pacific – from closer (trade) integration to a new Cold War

In recent times, the Indo-Pacific region (formerly mostly described as East Asia) saw huge geo-political shifts. Two decades ago, it seemed that East Asia had a chance to move towards greater integration along a path similar to Europe’s experience: there was closer integration in Southeast Asia (ASEAN), and new formats like “ASEAN plus 3 (China, Japan, Korea)” which seemed to be able to overcome former Cold War divisions in the region. Trade seemed to trump political differences. But, alas, this did not happen. Instead, a more assertive China, disputes in the Taiwan Strait and the South China Sea, a global Chinese outreach through the “Belt and Road initiative” and the nuclear crisis on the Korean Peninsula, as well as new alliances in the wake of the Russian aggression in Ukraine meant that instead of closer integration, we can now observe a Cold War 2.0 in the region. While for Germany, the focus has clearly been on its relation with China – economically indispensable, but politically highly risky – all states in the region had to realign their strategies. South Korea probably saw the greatest changes: over  the past three decades, it has emerged as a rising economic power, now among the world’s top twelve export nations, but politically solely focused on solving the problem of the divided Korean Peninsula. However, neither the Sunshine Policy – i.e. engagement with the North – nor a policy of sanctions and strength in alliance with the US could prevent North Korea from going nuclear and escalating tensions year by year.

The new administration of conservative president Yoon Seok-Yeol, who took office in 2022, has for the first time prioritised South Korea´s global status and engagement over the  unification with North Korea. This led to an unprecedented overture vis-à-vis Japan, to a cold shoulder toward North Korea and a very cautious policy vis-à-vis the big neighbour, China. In the case of the Russian aggression, South Korea, after initial hesitation, clearly became a supporter of the case of Ukraine. While many Western governments supported this stance and praised President Yoon for his courage, the South Korean population did not necessarily approve these policy decisions and handed the president an unprecedented defeat in the National Assembly election in April 2023. This raises the question if the new, global course, which goes beyond military cooperation, will be sustainable, or if it will be merely an interlude in a Korea still fixated on the problems of the past, such as Japanese colonialism and territorial division. This paper will delve into into the challenges South Korea faces on the Peninsula and in the Indo-Pacific, examine Korea´s new position on the global stage, and analyse the relation of foreign and economic policies of the country.

Challenges on the Korean Peninsula

The Korean Peninsula, divided since 1945 and having experienced the fratricidal Korean War from 1950-1953, has since lived with a fragile armistice agreement, often disrupted by provocations, mostly from North Korea. Unification has been the paramount national policy goal for both North and South Korea, each presuming the own country would dominate the neighbour.

For a long time, South Korea subordinated all foreign policies to the situation on the Korean Peninsula. In particular, the left-wing governments from 1998-2007 and from 2017-2022 under the Presidents Kim Dae-Jung, Roh Moo-Hyun and Moon Jae-In tried to harness foreign relations to further their engagement agenda.

Already under President Kim Young-Sam (1993-1998), but more so under his successor Kim Dae-Jung, new relations to the former socialist countries were set up to facilitate transformation in North Korea. North Korea, however, despite undergoing a severe famine in the early 1990s, did not flinch and, on the contrary, started to develop nuclear weapons and an ambitious missile programme. The world community, with some tacit support from China and Russia, responded with ever-increasing sanctions, but could not prevent the development of nuclear weapons and sophisticated missiles by impoverished North Korea. The last great chance for unification came through the unprecedented high-level diplomacy under US President Donald Trump. However, after a short-blossoming honeymoon phase, in April 2019 negotiations about denuclearization broke down in Hanoi, leading to a sharp deterioration in relations. North Korea felt betrayed by President Moon Jae-In, who, despite promising sanctions relief, remained committed  to UN sanctions.

The Covid era saw  North Korea in complete isolation. For four years, no one, including North Korean citizens abroad, could enter the country and the few foreigners gradually left the country, except for a minimal rest, mainly Chinese and Russian diplomats.

When President Yoon took office, he ended all attempts to reach out to North Korea and answered the many North Korean provocations with a display of South Korean military strength. By now, economically, South Korea had become a top global player, but was still plagued by feverish growth curves and problems like youth unemployment. Young voters in particular – who had no personal ties or sympathy for North Korea, which for 75 years had been hermetically closed to the Southern people – were rather scared of unification, seeing it as a potentially large economic burden. In January 2024, North Korea announced in an unexpected and complete detour of policy, that it would no longer consider peaceful unification with South Korea a goal. Instead, North Korean leader Kim Jong-Un repeatedly called his military to prepare for  war. South Korea remained unfazed and, though not giving up on unification, considerably downsized the Unification Ministry, which under left-wing governments had been one of the most powerful ministries. Instead, South Korea actively strengthened diplomatic relations with the US and Japan, forming a “triple alliance” to counter North Korean aggressions. South Korea’s new economic and political clout became evident when it suddenly announced diplomatic relations with socialist Cuba, formerly one of the most loyal allies of North Korea. Also in Africa, where North Korea closed many embassies due to lack of funding, and in other world regions South Korea´s diplomatic preponderance is clearly visible.

The current situation on the Korean Peninsula somewhat resembles divided Germany in the 1970s and 1980s: the poorer East Germany denied it ever wanted unification and rather spoke of two (a socialist and a capitalist) nations, while the West formally desired unification, but did not really champion it. However, East Germany’s “two states theory” at least helped  normalising relations, whereas  North Korea ratcheted up its war rhetoric after dropping the unification goal. While North Korea, despite its harsh rhetoric, might not be able to successfully start, let alone end a full-scale war on the Korean Peninsula, the risk of provocations remains high. South Koreans remain calm, as they have grown accustomed to these threats: a few years ago, missiles launches into the East Sea of Korea (Sea of Japan) made headlines and affected the stock market. Today, such events are relegated to minor news briefs, buried in the back pages of newspapers. Many of these provocations are routine military tests by North Korea, but sometimes they are carried out mainly to send a political message. This year, in the wake of the US presidential election, many experts fear a larger, and potentially more deadly, provocation. In particular, outlying islands in the West Sea (Yellow Sea), Yeongpyongdo and Baegnyeongdo, located only a few kilometres away from the North Korean mainland, but far from South Korea, have been singled out as a potential target. While the Demilitarized Zone (DMZ) has been mutually agreed upon, the border in the West Sea, the so-called Northern Limit line, has been drawn up by the US and was never recognized by North Korea. And while every South Korean dead soldier would be a national tragedy, North Korea might  accept huge losses, as long as its strategic position is not compromised. Therefore, while South Korea strives to become a true global player, it cannot escape from  worrying about the Korean Peninsula dimension of its foreign policy.

Bernhard Seliger; HSS

Challenges for South Korea in the Indo-Pacific

The new global Cold War structure, marked by a largely blocked UN Security Council, and increasing confrontation between the US and its allies on the one side and China and Russia and their allies on the other side, also affects South Korea´s position in the Indo-Pacific. China’s growing assertiveness, while a bigger problem in conflicts with Japan and Southeast Asian countries, is also an issue for South Korea: territorial disputes about a largely submerged rock called Iedo in Korean, crucial to define exclusive zones and rights, as well as constant violations of South Korea´s Air Defence Identification Zone (ADIZ)  heighten the risk of maritime and aerial clashes . Furthermore, the clear alignment of North Korea with Russia in its war on Ukraine has been a shock for South Korea. North Korea’s massive ammunition deliveries to the Russian army were not only exchanged for food and other necessities, but most likely also for  Russian missile and satellite expertise.

When President Yoon took office in 2022, one of the first and most visible policy changes were his overtures to Japan. Relations between both nations had been strained since the colonization of the Korean Peninsula by Japan (1910-1945). Historical grievances, such as forced prostitution in World War II (the so-called “comfort women”), forced labour for Japan, the unresolved conflict of both sides about the Dokdo islets in the East Sea (Sea of Japan) and potential war reparations could not be resolved after Japan and South Korea re-established diplomatic relations in 1965. At that time, Japan gave a preferential loan to South Korea, which was crucial for the subsequent take-off of the impoverished country to become one of the world´s leading industrial nations. For Japan, this settled the question of war reparations. However, South Korean critics argue that the agreement did not include private claims and claims against corporations, and South Korean courts have several times ruled in favour of these cases.

Politicians on the left often stirred anti-Japanese sentiments and supported “boycott Japan” campaigns. Despite several attempts to improve relations, and numerous apologies from Japan for the inflicted harms, the left-wing factions in South Korean politics considered these insincere and demanded a rectification of history, before any positive relations could be re-established. President Yoon put aside these considerations and initiated renewed high-level diplomacy with support of the United States. This led to a new US-Japan-South Korea triple-alliance focused on sharing data, conducting joint military exercises and coordinated policy responses to North Korea.

Nevertheless, relations remain sensitive, not only due to decade-old issues, like Japanese ceremonies at the Yasukuni war shrine, where alongside the war dead also war criminals are honoured, but also due to new issues, like a recent data security breach involving a South Korean company in Japan. Left-wing opposition leader Lee Jae-Myong, a strong contender for the next presidency, already announced a much more hostile policy toward Japan. Following the tradition of left-wing governments, he subordinates relations to the big neighbours Russia and China to the goal of Korean unification. In particular, he opined that the issue of Taiwan was an internal issue of China and advised against any support for Taiwan. Given the strong, “imperial” presidency system of South Korea, with a single-term limit for presidents, it remains open if the new policies under President Yoon will survive the end of his now troubled presidency – he began as a lame duck with a hostile National Assembly severely restricting his policy initiatives, and will also end his term as one. Although the recent elections in April 2024 focused mainly on domestic issues, certainly the electorate did not feel too happy about his international agenda, either. 

President Yoon and the international community – a South Korean Gorbachev?

Western diplomats and analysts mostly approve of Yoon´s diplomatic activities: he has made great strides in mending relations with Japan, one of the few other democratic states in Northeast Asia. He also established diplomatic relations with NATO, positioned South Korea clearly against Russian aggression in Ukraine and was eager to engage in other global agendas, including policies on climate change, a steady expansion of development aid led by the state agency KOICA (Korea International Cooperation Agency), and securing important trade routes like the Strait of Hormuz and the Horn of Africa. However, the international applause is not necessarily echoed at home. In this, Yoon resembles Michael Gorbachev; another leader who was highly praised abroad but at home faced extreme criticism for perceived and real shortcomings of his policies.

While for the first time Korea´s foreign policies are truly global, and not only pivoted by the situation on the Korean Peninsula, the resilience of this policy remains uncertain. For now, Yoon settles on an immediate tangible goal, namely a permanent position in a “G 7 plus” framework, where South Korea becomes, if not a member, at least a permanent invitee to this exclusive club. Economically, this is certainly warranted. However, if a new South Korean president again adopts a left-wing nationalist policy stance,  coordination would become much more difficult. When the American top diplomat Kurt Campbell recently proposed Japanese Prime Minister Kishida and South Korean President Yoon for the Nobel Peace prize, he had a compelling argument: indeed, both in Japan  and in South Korea, the policy of closer engagement is not too popular, and both politicians carried it out in spite of public opinion. In this regard, they might be considered pioneers for reconciliation, as the founding fathers of the European Communities were for Europe. This does however not guarantee that their domestic popularity is positively affected – indeed, both leaders are currently suffering from the worst approval ratings ever.

Bernhard Seliger; HSS

Economic resilience, supply chains issues and new growth engines for South Korea

Since authoritarian leader Park Chung-Hee took the helm of a then impoverished South Korea in the early 1960s, economic growth has been the overarching domestic policy goal. This focus led to the worldwide highest growth rates from the 1960s to 1980s, South Koreas entry into the  OECD in 1993, and its rise to the top twelve of world exporters. To reach this goal, South Korea´s position as a small open country in an increasingly integrated world economy was important. The confidence in the resilience of this system was however put to a test with the 2017 “THAAD crisis”. THAAD, a US-developed anti-missile system was installed in South Korea mainly against the North Korean missile threat, but China felt implicitly targeted by the system, too. China reacted with  brutal economic retaliations: “K-contents” (K-pop, K films, K food and other cultural items), which enjoyed a huge fan base in China, were blocked from entering the country. Companies like Lotte, which had invested billions in factories and the retail sector, were targeted by special audits and withdrew from China, while Chinese tour agencies stopped offering hugely popular tours to neighbouring South Korea. Overall, this cost the South Korean economy billions of USD. Also other, unexpected challenges questioned the openness of South Korea’s economy: President Trump’s demand for a fourfold increase of the South Korean contribution to the stationing cost of the US military in the country was a shocking affront of one of the USA’s closest allies; there are still 27.000 US soldiers in South Korea. In addition, the outbreak of the Covid-19 pandemic revealed the vulnerabilities of being suddenly cut-off of supply chains.

In response, South Korea, where the government still plays an important role in investment decisions of companies, initiated strategies on “de-risking” and “de-coupling”. With notable success: after more than a decade with China as the main trading partner, the US overtook China in 2022  and  has since become the more important market. Strategic support for key industries like semiconductor production is growing: in Yongin, South of Seoul, the government supports a 30-year-plan for establishing 17 new semiconductor factories, aiming  to become the largest semiconductor cluster in the world. South Korea also views the challenges of the new global order as a chance for new export industries: increased military spending bolstered growth of South Korean defence companies like Hanwha, LiG and KAI, which by now possess cutting edge technology in certain areas and are internationally competitive. The Russian war on Ukraine provided a great chance to “replenish” European arsenals and in particular, develop a close defence partnership with Poland. In 2023, South Korean arms exports accounted for almost $14 billion. But, these industries are highly cyclical, political and not without risk: for example, a much-touted defence contract with Indonesia was suddenly cut to one third by Indonesia due to budget concerns. Nonetheless, South Korea has emerged as a significant global economic player.

Outlook – from an industrial giant to a global cultural power, but are the foundations solid enough?

Under President Yoon, South Korea has solidified its status as a global and accepted international partner, especially for the West, which desperately needs allies against Russian and Chinese aggressiveness. Also the cultural power of South Korea steadily increased throughout the last two decades. The image of a far-away, cheap labour market is long gone. South Korea is a country with cutting-edge technological and sophisticated cultural products. The “Korean wave” not only captivated neighbouring Japan and China, the US, Southeast and South Asia, but also became a fixture in Europe and Latin America.

However, it is not clear how solid the foundations of this near-miraculous transformation are. Military analysts wonder, if, despite a huge budget advantage over North Korea, South Korea could effectively fend off North Korean provocations. A coordinated military drone incursion from North to South Korea early in President’s Yoon tenure showed the lack of preparedness. No one knows what might happen if the next president reverses the current administration’s policies.

How can South Korea gain trust in such a situation? The key issue is the lack of a national consensus on goals and instruments of foreign policies. In West Germany, changes in government – most notably in 1982 – brought changes, but not a complete reversal of former foreign policy positions. “Pacta sunt servanda”, treaties have to be fulfilled, was a standard response of Franz-Josef Strauß to critics, who lamented that the new government in 1982 did not completely scrap  its predecessor’s “Ostpolitik”. Unfortunately, South Korea lacks this basic consensus – which would need to include a clear commitment to liberal democracy over the dream of a North-South confederacy. Consequently, times remain uncertain and changes of foreign policies are likely to occur more frequently in South Korea.

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Editorial office: Global Perspectives
Editorial office:  Global Perspectives