The Peninsula

What is South Korea’s Place in the Trump-centric World Order?

South Korea’s newly elected President Lee Jae Myung will hold his first meeting with President Donald Trump on August 25 at the White House. Over the past eight months, President Trump has attempted to reframe the global economic and security order to an “America First” system with himself at the center through transactionalism, the unilateral application of tariffs, and efforts to end numerous conflicts around the world. As a result, South Koreans are perceiving some setbacks to their influence and standing with President Trump, especially compared to previous U.S. administrations’ values-based prioritizing of alliance partners such as South Korea.

The first indicator of South Korea’s diminished influence under the Trump administration has been the fact that no close Trump associate or prominent political figure has been appointed to serve as U.S. ambassador to South Korea. The best Trump connection South Korea has mustered is a relationship between the chairman of a major South Korean department store and Donald Trump Jr., which was enough to get in to Mar-a-Lago but not the White House. The only South Korean CEO to meet with President Trump in the Oval Office was Hyundai Chairman Chung Eui-sun, during which Hyundai pledged over USD 21 billion in investments in the United States. Despite this, two days later, President Trump effectively nullified the U.S.-Korea Free Trade Agreement (KORUS FTA) on “Liberation Day” and threatened the imposition of heavy tariffs on South Korean exports of automobiles and steel to the United States. In this regard, the Lee-Trump summit meeting in the Oval office provides an opportunity to reset South Korea’s role and status in President Trump’s hierarchy.

Meanwhile, President Trump makes regular public references to Kim Jong Un, the North Korean leader with whom he hopes to rekindle a relationship. The president’s focus on Kim at the expense of South Korea shows where South Korea stands in Trump’s worldview. As a U.S. alliance partner, President Trump has criticized South Korea as a security “free rider” and a “money machine,” foreshadowing efforts to rebalance both the economic and security relationship.

South Koreans have long known that they would be vulnerable to President Trump’s transactionalist pressures on both the economic and security front. The shifting U.S. focus from free trade to fair trade has been a bitter pill to swallow, given South Korea’s heavy reliance on exports for economic growth. South Korea was no doubt grateful that the 15 percent tariff rate it earned through negotiations ensured no disadvantages to South Korean companies against European and Japanese competitors.

But the U.S.-South Korea trade deal sacrificed a slight advantage South Korea had enjoyed under the KORUS FTA and involved astronomical pledges of energy purchases and future investments by South Korean companies in the United States, including pledges of support to “Make American Shipbuilding Great Again” through USD 150 billion in investments and technology inputs into the U.S. shipbuilding sector. Given the vagueness of the Trump administration’s trade deals, it is hard to say whether South Korea has overpaid or underpaid compared to European and Japanese counterparts for the privilege of a matching tariff on South Korean goods.

President Trump’s demands for a reappraisal of security contributions under the rubric of “modernizing the alliance” are also not surprising to South Korean interlocutors. But the changes to the security hierarchy of U.S. allies in the Indo-Pacific, alongside President Trump’s transactionalism, generate greater doubts in South Korea about the credibility of U.S. defense commitments. At the same time, demands for greater payment for those commitments appear to be rising. The absence of a visit to South Korea by Secretary of Defense Pete Hegseth in his initial trips to the Indo-Pacific region and his downgrading of South Korea as a security partner in favor of Japan, Australia, and the Philippines during his Shangri-La speech suggest that South Korea’s status as an ally has diminished.

The impact of the United States’ reordering of regional priorities to emphasize China is both understandable and ongoing to South Korea, having cooperated closely with the United States to issue an Indo-Pacific Strategy and enhanced policy coordination toward China on both security issues and supply chain resiliency. But perceptions that the United States is off-loading responsibilities for South Korea’s defense against North Korea or failing to closely coordinate diplomatic openings to the North may lessen South Korea’s commitments to the United States—at a moment when South Korea is well-positioned as a partner, provider, and producer to meet critical needs in the defense industrial supply chain.

South Korea’s ability and willingness to be a valuable partner to the United States is based on the past credibility of U.S. security assurances, including shared regional security threats and common values. This would be the wrong moment for the United States to take South Korea for granted or to send signals that demean the value of that partnership, especially as South Korea retains the capacity and will to sustain the partnership against a wide range of common external threats. If the value of the partnership is diminished from within, it will become increasingly difficult for the alliance to be sustained, regardless of the clear mutual benefits it generates for both sides.

 

Scott Snyder is President and Chief Executive Officer of the Korea Economic Institute of America (KEIA), an organization registered under the Foreign Agents Registration Act and funded by the government of the Republic of Korea. He is also author of The U.S.-South Korea Alliance: Why It May Fail and Why It Must Not.

Photo from The White House via Flickr.

KEI is registered under the FARA as an agent of the Korea Institute for International Economic Policy, a public corporation established by the government of the Republic of Korea. Additional information is available at the Department of Justice, Washington, D.C.