On Jan. 1, President Lee Jae-myung completed a visit to China, his first in about eight years, drawing assessments that Korea-China relations have entered a new phase. In Beijing, Lee held successive talks with President Xi Jinping, Premier Li Qiang, and Zhao Leji, chairman of the Standing Committee of the National People's Congress, and expressed a strong commitment to fully restore bilateral relations in 2026. Chinese state media previously assessed that the relationship had moved into an intensive cooperation phase beyond simple trade.
But the U.S. view on this is mixed. Victor Cha, the Korea Chair at the Center for Strategic and International Studies (CSIS), warned in Foreign Affairs on the 22nd that such rosy projections are closer to a temporary phenomenon and will not hold indefinitely. China can always pull out the economic retaliation card against Korea, he said, and derisking can only be achieved through coordination with partners such as the United States and Japan.
ChosunBiz sought suggestions on the Lee Jae-myung administration's diplomatic strategy and its future direction in a video interview with Victor Cha. The following is a Q&A with Cha.
— You said the strategy of "security with the United States, economy with China" is no longer valid.
"When Korea and China first established diplomatic ties in 1992, the so-called 'security with the U.S., economy with China' strategy had plausibility. Korea was far ahead of China in technology and industry, and the two economies formed a complementary structure. For example, Korea supplied advanced components and capital, while China provided a massive production base and consumer market. But the situation is different now. In most core advanced sectors—semiconductors, batteries, electric vehicles, and information and communications—China has emerged as a direct competitor to Korea.
The relationship with the United States has also evolved well beyond security. Over roughly the past decade, Korean corporations have concentrated investment in battery plants, semiconductor foundries, critical minerals, and high-tech sectors in the United States rather than China. They judged the U.S. to be a more predictable investment destination given legal and institutional stability and the long-term security environment. While the United States carries uncertainty on tariffs and other issues under President Donald Trump's second term, the core pillars of future strategic industries will inevitably be reorganized through cooperation with the United States. Taken together, the division-of-labor strategy that clearly separates the economy and security—assigning them to China and the United States respectively—is no longer feasible. It is time for Korea to redesign its relations with both."
— Korea-China relations have recently shown signs of improvement. Even so, why could China reprise its "quiet sanctions" on Korea?
"Even if there is an apparent easing trend, China can restart unofficial economic retaliation at any time if it deems it necessary. China's quiet sanctions tend to take cunning forms that do not violate World Trade Organization (WTO) rules, such as ▲ customs clearance delays ▲ tougher hygiene and environmental regulations ▲ restrictions on tourist visas ▲ stepped-up tax and fire inspections targeting specific corporations. During the deployment of THAAD (Terminal High Altitude Area Defense) in 2016–2017, China sanctioned the entertainment, cosmetics, and tourism industries, and in Oct. 2021 it halted exports of urea solution, expanding discontent over specific issues into the economic domain. China has already built tools that can impose tangible pressure on counterpart countries' corporations and industries while minimizing legal liability.
In particular, Korea is pursuing the acquisition of nuclear-powered submarines, which is likely to serve as a trigger for China to repeat sanctions. The same applies if the Korea-U.S. shipbuilding cooperation project "MASGA" gains momentum. China can send messages of improved relations on the surface while selectively pulling out pressure cards—a dual-track strategy. A warmer tone in bilateral messaging does not mean structural risks have disappeared. Separate from diplomatic rhetoric, Korea should prepare safeguards to reduce economic vulnerabilities by diversifying supply chains and strengthening coordination with friendly nations."
— How do you assess the Lee Jae-myung administration's China policy?
"The president is pursuing a far more pragmatic direction on China policy than expected. In Washington, there had been predictions that, as someone from the progressive camp, the president would take a more conciliatory stance toward China, but in practice the prevailing view is that he is maintaining strategic closeness with the United States while managing balance. Indeed, in the recent Korea-China summit, the president declared a restoration of relations and agreed to broaden cooperation in areas such as consumer goods and services, but the scale of investment and the industrial scope appear far more limited compared to the United States. Investment in core sectors like semiconductors, batteries, and nuclear power is proceeding within a framework of cooperation with the United States, which seems a choice based on national interest and structural conditions rather than ideology.
Some argue that the president should take a tougher stance on China, but issuing strong criticism on the surface is not always a good strategy. The president is calibrating diplomacy by maintaining stable Korea-China relations while in practice deepening the Korea-U.S. alliance, a strategy that appears more likely to modulate China's sense of alarm and secure a favorable diplomatic position."
— Unlike the president, Japan's Prime Minister Sanae Takaichi is taking an aggressive stance toward China.
"China's rash sanctions in response to Prime Minister Takaichi's remarks that Japan could intervene if China invades Taiwan were a strategic miscalculation by Beijing. By sanctioning Japan, China actually elevated Takaichi's political stature, consolidated her base, and helped bring about a hard-line conservative cabinet. Had China let Takaichi's remarks pass, the situation could have been quite different. Before the sanctions, Takaichi did not have as solid a footing in Japan's political landscape as she does now. China's immediate sanctions, in effect, strengthened Takaichi."
— You proposed organizing a collective pact with the United States, Japan, Australia, and the G7 to deter China's economic aggression. Is this realistically achievable?
"If a pact were concluded akin to NATO's Article 5 mutual defense clause—'coercion against one country should be considered coercion against all, triggering automatic retaliation'—it would be possible to counter China's economic bullying. European countries already share an EU-level Anti-Coercion Instrument (ACI), but no such mechanism exists yet in Northeast Asia and the Indo-Pacific. If Korea leads this effort with the United States and Japan, and links up with middle powers such as Australia around the G7, it could strengthen deterrence. This will not be easy, but it is not impossible either. In particular, as the United States will chair the G7 summit in 2027, it could take the lead in establishing a cooperation framework there. President Trump is constantly looking for opportunities to build leverage against China.
Of course, hurdles are expected. Given each country's varying economic dependence on China and domestic political situations, building a strong joint response system at the risk of Chinese retaliation may be difficult. But there is, in effect, no alternative to confronting China. Without a collective deterrent, Korea, Japan, the Philippines, and others will remain vulnerable to China's economic pressure at any time.
— The United States has been ratcheting up pressure on allies. Is the U.S. a reliable partner?
"It is true that U.S. risk has increased with the launch of the Trump 2.0 administration. Threats to raise tariffs are a source of anxiety for allies, and the fact that President Trump does not follow the traditional diplomatic and national security bureaucratic process in decision-making also adds uncertainty. It would be premature to assert that the United States is a completely stable and consistent partner.
However, it is undeniable that the United States is Korea's most important security ally and the central pillar of cooperation in future strategic industries. The Korean government should identify the lights and shadows of the Trump administration and adopt a strategy that minimizes risks while maximizing opportunities. For example, initiatives on shipbuilding cooperation and nuclear-powered submarines could serve as opportunities to qualitatively elevate the Korea-U.S. alliance.
EU countries such as the United Kingdom and France, on the surface, are checking the rise of 'Donroeism' (Donald Trump + Monroeism) in the United States and have recently shown moves to get closer to China, but this appears more like strategic hedging. While U.S. uncertainty has grown, meaningful results can still be achieved by finding opportunities in the gaps."
— Recently, Korea and the United States have clashed over tariff talks and the Coupang case.
"Last month, the Trump administration urged swift investment in the United States and warned it would raise the agreed tariff rate from 15% to 25%. At the center of the controversy is the delay in executing Korea's promised investment fund for the United States. There has not been sufficient concrete coordination on which industries and corporations Korea's funds would target, and delays in passing related legislation in the Korean National Assembly have amplified concerns that promises are not being kept. In Japan's case, by contrast, coordination on the use of investment funds was clearly reached, and interagency discussions proceeded quickly.
Some point to the Coupang case as another factor behind the tariff hike, but I think it is unlikely to have been a decisive variable on its own. Since the Korea-U.S. FTA, some U.S. corporations have accumulated complaints that Korean regulations are being applied unfavorably to U.S. corporations; in that context, when discussions of sanctions against Coupang emerged, the U.S. administration likely interpreted them in connection with those preexisting concerns."
— If U.S. President Donald Trump visits China in April, what items will be on the agenda?
"The core agenda will be trade and Taiwan. President Trump is expected to press hard to reduce the U.S.-China trade imbalance, pushing China to purchase more items that directly benefit U.S. manufacturing and agriculture, such as U.S.-made aircraft and soybeans. These are the most direct cards for showing tangible results to U.S. farmers and industry. For China, Taiwan will be the most sensitive issue. Chinese President Xi Jinping is expected to focus on eliciting remarks from Trump that could weaken the U.S. commitment to Taiwan's defense or shake strategic ambiguity.
By contrast, North Korea will likely be mentioned but not rise to a core agenda item. From China's perspective, the North Korean nuclear issue or U.S.-North Korea contacts could dilute the summit's focus, so it likely will not be addressed proactively. The Trump administration's recent approval of sanctions exemptions for humanitarian projects toward North Korea is closer to a flexible signal to gauge Pyongyang's reaction and does not, in my view, signify a retooling of North Korea policy."
— What is the most urgent diplomatic task facing the Korean government now?
"Executing investment in the United States is most urgent. Korea must clarify which sectors will receive priority from the planned $20 billion annual investment fund. If the Korea-U.S. joint fact sheet announced last year is implemented, the alliance could pursue qualitative change, but if it does not lead to tangible outcomes, bilateral trust issues will arise. The Korean government should make every effort to realize what it has already agreed with the United States."
(This interview was conducted on the 20th, before the U.S. Supreme Court's reciprocal tariff ruling.)