Does China Have an Opportunity to Advance Ties With Japan and South Korea?

As the United States upped its tariff war with, essentially, the entire world – remember, even the 90-day pause in “reciprocal tariffs” quietly left in place a 10 percent tariff hike on all U.S. imports across the board – attention turned to how China could capitalize on the economic pain to advance its diplomacy with traditional U.S. partners. With Xi Jinping’s April visit to Southeast Asia and receptive signals from Europe, there’s much to discuss. But underneath the radar, China is also reaching out to the United States’ closest and most capable security allies in East Asia: Japan and South Korea.

At the end of March, the trade ministers of China, Japan, and South Korea met in Seoul – the first such trilateral meeting in over five years. That followed a meeting of their foreign ministers in Tokyo just a week prior.

Both meetings came against the backdrop of the then-looming announcement from the United States introducing massive tariffs on its trade partners, expected on April 2. Sure enough, on that day President Donald Trump declared “large and persistent annual U.S. goods trade deficits” to be a “national emergency.” Speaking from the White House Rose Garden, he announced 10 percent baseline tariffs, plus sweeping “reciprocal tariff” hikes on nearly every U.S. trade partner.

According to the original April 2 announcement, Japanese exports would be hit with a 24 percent tariff, South Korea with 25 percent, and China with 34 percent.

As of the end of April, thanks to a 90-day “pause” on the reciprocal tariff, Japan and South Korea had seen their tariffs on most goods lowered to “just” 10 percent. For China, however, Trump – outraged that Beijing had retaliated with tariffs of its own – raised the rate to an astronomical 145 percent.

Many analysts pointed out that the Trump administration’s initial approach didn’t bother to separate out friend from foe. In a White House factsheet explaining the tariffs, China, Japan, and South Korea (along with Germany) were lumped together as countries that “have pursued policies that suppress the domestic consumption power of their own citizens to artificially boost the competitiveness of their export products.”

The later decision to single out China helps address that issue, but doesn’t entirely erase the risk of economic damage for U.S. allies. While Japan and South Korea received some relief from the 90-day pause, that doesn’t apply to sector-specific tariffs on automobiles (where Trump has specifically slammed Japan and South Korea for a lack of market access), steel, and aluminium – all of which are critical industries for both Tokyo and Seoul. As this issue of The Diplomat went to press, a threatened announcement on semiconductor tariffs was also stoking concern in Japan and South Korea

While the trade war brings difficulties for China, Beijing was also quick to see the opportunity to forge closer ties with the United States’ most important allies in East Asia. With U.S. trade prospects uncertain, to say the very least, Japan and South Korea will be looking to China for alternative markets – and that might force governments in both Tokyo and Seoul to backpedal on the hard-line China policies they have adopted in recent years.

At the trilateral trade meeting in Seoul, China’s Commerce Minister Wang Wentao sought to drive home the potential benefits of a rapprochement. “China is committed to high-quality development and expanding high-level openness,” Wang said, adding that China promised “to share opportunities with all nations, including the Republic of Korea and Japan.”

In an implicit critique of Trump-style tariffs, the ministers’ joint statement also expressed their countries’ support for “the rules-based, open, inclusive, transparent, non-discriminatory multilateral trading system with the World Trade Organization at its core.”

The big takeaway from the meeting was a verbal agreement to “speed up” negotiations on a trilateral free trade agreement (FTA). Talks on the China-Japan-South Korea FTA began in 2012 and have made little progress since, although all three countries are linked by their membership in the Regional Comprehensive Economic Partnership (RCEP), which also includes the 10 ASEAN member states, Australia, and New Zealand.

As the next China-Japan-South Korea leaders’ summit takes shape – the previous one was held in late May 2024, and there’s interest in returning the event to its annual status – progress on the long-elusive trade deal will be closely watched. The FTA talks, in a sense, will be a litmus test for how far the China-Japan-South Korea trilateral can go. While there’s a sense of cautious goodwill at the moment, with all of the three wanting good relations with their neighbors amid the uncertainty stemming from Washington, whether that will actually lead to a breakthrough in long-entrenched issues is another question.

On the economic front, China’s use of non-market practices to both restrict access to its market and artificially support its own companies rankles Japan and South Korea, albeit not quite to the same extent as it irks Europe and the United States. And then there’s the political optics of forging a trade deal with China to consider. Beijing is immensely unpopular in both Japan and South Korea – China is viewed negatively by 87 percent of Japanese and 71 percent of South Koreans, according to a July 2024 Pew survey report.

Part of the reason for this negativity is that both countries have been on the receiving end of China’s economic coercion in recent memory. Even as the U.S. steps up its own version of economic coercion, Japan and South Korea will be incentivized to avoid recreating an overdependence on China.

Beyond economics, both countries see China as a security threat. For Japan, China poses a direct threat, especially seen through the lens of the sovereignty dispute over the Senkaku/Diaoyu Islands, which Japan administers but China claims. Beijing has been sending mixed signals to Japan with its military actions, increasing the frequency and length of the China Coast Guard’s presence near the Senkaku/Diaoyu Islands, but also reducing the number of Chinese aircraft approaching Japanese airspace (as you’ll read later in this issue). As long as Tokyo perceives China as the main threat it needs to guard against, a true reconciliation remains distant.

For South Korea’s part, its relationship with China is more nuanced – but Beijing’s refusal to hold North Korea accountable for rapid advances in its missile testing means that Seoul largely considers China part of the problem, not part of the solution, to the Korean Peninsula issue.

And maritime issues are another complicating factor. While South Korea and China have no territorial disputes, they have not been able to agree on the demarcation line separating their Exclusive Economic Zones (EEZs). Earlier this year, even as the China-Japan-South Korea ministerial meetings were in full swing, China deployed a maritime structure in waters claimed by South Korea – and forcibly blocked access by South Korean researchers who wanted to inspect the installation.

The concerns Japan and South Korea have about China are independent of the United States – as much as Beijing tries to paint Washington as the ringleader of the “anti-China coalition.” These worries are thus unlikely to be impacted by Trump, unless the trade war incentivizes China to compromise in search of a good faith bargain to these outstanding issues with Japan and South Korea.

Until then, the China-Japan-South Korea dynamic will remain a microcosm of China’s general “neighborhood diplomacy.” While Beijing is trying hard to position itself as a safe haven during tumultuous time, regional countries have their own concerns about China and will only want to get so close. China might have to content itself with watching the U.S. tear down its alliances without repeating the direct benefits of a closer relationship itself.