The 20-year anniversary of diplomatic relations between China and South Korea may provide a pretext for more active diplomacy to meet a growing list of potential disputes in the relationship. Presidents Hu Jintao and Lee Myung-bak have held two summits this year and there has been increased interaction among other senior leaders as well. These exchanges have sharpened focus on the prospects for the partnership. Meanwhile, high-level contacts between China and North Korea have stalled.  Beijing renewed calls for restraint following North Korea’s failed launch of an “earth observation satellite” and a UNSC President’s Statement strongly condemning it. This has dampened China’s hopes for regional engagement.

China and South Korea have designated 2012 as a year of friendship to mark 20 years of diplomatic relations. The anniversary may provide a pretext for more active diplomacy to meet a growing list of potential disputes in the relationship, including China’s handling of North Korean refugees, illegal fishing in Korean territorial waters, territorial claims, and mutual suspicions regarding approaches toward North Korea. All of this is occurring in a period of political transition in both countries, as South Korea prepares for December elections while China works out a complex leadership transition later this year. Presidents Hu Jintao and Lee Myung-bak have held two summits this year, in Beijing in January and in Seoul on March 26 on the sidelines of the Nuclear Security Summit.  On his state visit to China from Jan. 9-11, Lee also met Premier Wen Jiabao and top legislator Wu Bangguo. Foreign Minister Yang Jiechi met President Lee and ROK counterpart Kim Sung-hwan on March 2 during his visit to Seoul for annual inter-ministerial consultations.  The two foreign ministers also met in Ningbo, China, on April 8 for the sixth China-ROK-Japan Foreign Ministers Meeting. Sino-South Korean diplomatic exchanges have sharpened attention on the prospects for the bilateral partnership in the aftermath of Kim Jong Il’s death.

Meanwhile, high-level contacts between China and North Korea have stalled since December.  Beijing made renewed calls for restraint on the Korean Peninsula following North Korea’s failed launch of an “earth observation satellite” on April 13 and a UN Security Council (UNSC) President’s Statement on April 16 strongly condemning the launch.  The incident has dampened China’s hopes for regional engagement that were raised by a series of bilateral consultations in Beijing among US, PRC, and DPRK special envoys in February.  Marking the 100^th birthday of Kim Il Sung, the launch was made two days after Kim Jong Un’s appointment as First Secretary of the Workers’ Party of Korea (WPK) on April 11.

China-South Korea “friendly exchange”

Receiving President Lee Myung-bak in Beijing within weeks of the Dec. 19 announcement of Kim Jong Il’s death, Hu Jintao affirmed that “China will continue to support the improvement of relations, through dialogue, between the DPRK and ROK.”   Some Chinese analysts saw the January summit as a “keystone for further development” in both China-ROK and inter-Korean ties given mutual pledges of “consensus” on stability and denuclearization as “shared goals” on the peninsula.  Yet the apparent positive tone for future cooperation masks limited achievements on core security issues.  Lee’s January visit was only his second state visit to China since taking office in 2008, when the two sides elevated ties to a “strategic cooperative partnership.” Since then, the relationship has confronted its greatest strategic challenges since normalization.  The January summit produced a nine-point statement largely reiterating the comprehensive goals that Hu and Lee established in 2008.

Two longstanding contentious issues that have re-emerged at the center of recent diplomatic strains include territorial-related clashes in the Yellow Sea and China’s handling of North Korean refugees as “illegal economic immigrants.” Lee’s visit to Beijing in January came amidst public outrage in South Korea over Beijing’s “unapologetic” response to the killing of a ROK Coast Guard officer in a clash with Chinese fishermen suspected of illegal fishing in the Yellow Sea in December.  The stabbing death of the officer who had detained Chinese fisherman on Dec. 12, 2011, drew attention to the growing number of Chinese vessels entering South Korean waters and the inadequacy of Korean enforcement measures, which has become more complicated with the introduction of tactics and technology developed to thwart enforcement efforts by the Korean Coast Guard.

The stabbing sparked violent demonstrations near the Chinese Embassy in Seoul and a retaliatory incident involving a metal ball that hit the South Korean Embassy in Beijing.  As a result, Seoul has pledged to redouble availability of resources and arms for the Korean Coast Guard to increase the effectiveness of its enforcement work against Chinese fishermen. Measures include a planned increase in the number of high-speed ships patrolling the Yellow Sea from 18 to 27, the use Special Forces to detain Chinese fishermen found in South Korean waters, and consultations with Beijing to strengthen curbs on illegal fishing.  Although the management of such issues was raised on the summit agenda, the PRC Foreign Ministry on April 19 rejected South Korea’s “unilateral application of the EEZ law” after the Incheon District Court issued the Chinese captain a 30-year prison sentence and a 20 million won ($17,738) fine.  The ROK Ministry for Food, Agriculture, Forestry and Fisheries filed a protest to the consul general of the PRC Embassy in Seoul in another Yellow Sea incident on April 30 that injured four ROK Coast Guard officials.

There is also a latent territorial issue between China and Korea that could flare up, over Ieo-do, an uninhabited rock formation in the Yellow Sea that lies in an overlapping area of the EEZs of both countries.  South Korea has built an ocean and weather research station on the rock, which China protested in 2006.  Although South Korea has claimed that Ieo-do is not disputed territory since it is a submerged rock, China has continued to protest Korean activity in and around the rock, including efforts to retrieve a Korean bulk carrier that sunk nearby. Meanwhile, China’s National Marine Data and Information Service classified Ieo-do a “Chinese territory” on its website.  While Ieo-do is no Tok-do, it does present the leading edge of a dispute that could be inflamed by nationalism on both sides.

China’s handing of DPRK refugees is a second issue that has captured public attention in South Korea and has escalated into a diplomatic confrontation.  Reports of Beijing’s detention and planned repatriation of 30 refugees in February led to weeks of public protests in Seoul and public calls from President Lee urging China to follow “international norms.” After the breakdown of low-key talks with Beijing, the ROK Foreign Ministry on Feb. 21 announced plans to seek support from the UN Human Rights Council. The PRC Foreign Ministry spokesperson responded by criticizing the Korean media’s tendency to “emotionally play up and politicize” the issue.  When the issue was raised in talks between the two foreign ministers on March 2 in Seoul, Foreign Minister Yang Jiechi expressed hopes that Seoul would “take seriously” China’s position. Activists in South Korea have claimed that Pyongyang has toughened its punishment of defectors as Kim Jong Un seeks to assert control as new leader.

The South Korean media described the mood surrounding both Hu-Lee summits this year as “far from amicable.”  At the April 3 opening ceremony of the 2012 year of friendship, the two sides were represented by vice ministers of culture, prompting public South Korean accusations that Beijing gave “the cold shoulder” to the event rather than having President Hu attend following the Nuclear Security Summit.  The launching of what China has dubbed the “Year of Friendly Exchange” drew little attention from the Chinese media and paled in comparison to the opening of Sino-DPRK Friendship Year in March 2009 during a five-day visit to China by Premier Kim Yong Il and a 100-member delegation.  Some South Korean observers noted Beijing’s growing unease over the situation in North Korea as well as recent political incidents with Seoul have aggravated ROK public sentiment toward China.

North Korea’s rocket launch and Chinese regional diplomacy

Pyongyang’s April 13 rocket launch appeared to test China’s capacity and willingness to engage with the new DPRK leadership under Kim Jong Un.  The night Pyongyang announced its plans to launch the satellite PRC Vice Foreign Minister Zhang Zhijun met DPRK Ambassador to China Ji Jae Ryong in Beijing to express China’s “concern.”  According to Chinese Foreign Ministry officials, PRC Special Representative for Korean Affairs Wu Dawei met DPRK Vice Foreign Minister Ri Yong-ho on March 19, while senior diplomats expressed China’s “stance and concern to all sides” including ambassadors of Six-Party Talks member states in Beijing.  Foreign Minister Yang Jiechi held separate talks by phone with US, ROK, and Japanese counterparts after the failed launch on April 13, affirming China’s “clear and consistent” position on peninsular and regional peace and stability, and pledging to continue diplomatic coordination.

North Korea’s launch interrupted the momentum for dialogue led by a series of US-DPRK talks since February, including consultations in Beijing between US Special Representative for DPRK Policy Glyn Davies and DPRK First Vice Foreign Minister Kim Kye-gwan on Feb. 23-24, and subsequent U.S.-DPRK food aid talks on March 7.  Wu Dawei also met Davies in Beijing on Feb. 24 and Japanese envoy to the Six-Party Talks Sugiyama Shinsuke on Feb. 22, strengthening Chinese calls for the resumption of dialogue.  But even the Chinese official media noted skepticism about the substance of dialogue efforts on North Korea, describing the US-DPRK talks in February as “more symbolic than practical.”  Jin Canrong of Renmin University saw the US-DPRK consultations as having “limited” influence on promoting regional talks since the two Koreas “have great differences on the nuclear issue.”

A strain on current Chinese diplomacy toward North Korea is the apparent impasse in China’s high-level contacts with Pyongyang since Kim Jong Il’s death, which suggests Beijing’s limited communication with the DPRK leadership on such decisions as the launch. However, it is harder to say whether there might be active unofficial communications with North Korean leaders via China’s well-connected embassy in Pyongyang.  Some South Korean analysts indicate that Beijing’s concerns over the launch were unlikely to have been expressed at the highest levels since active channels of communication with China are primarily with working-level North Korean officials.  China showed its displeasure with the launch by allowing a strongly worded UNSC President’s Statement warning Pyongyang of the likely imposition of new sanctions in the case of another launch of a long-range rocket or a nuclear test.

Chinese economic stabilization efforts in North Korea

China’s first high-level contact with Pyongyang since December was Vice Foreign Minister Fu Ying’s February visit to the North for aid talks with DPRK counterpart Kim Sung Gi.  The PRC Foreign Ministry spokesperson confirmed the visit on Feb. 27, a week after it occurred, stating that “China welcomes giving various forms of assistance to Chosun.”  In a Jan. 8 interview with Xinhua, Assistant Foreign Minister Liu Zhenmin stated that “China will continue to provide support and assistance within its capacity to the DPRK.”  In response to reports in March on Chinese food aid to North Korea, the Foreign Ministry spokesperson indicated that “China has been providing assistance to the DPRK as its capacity allows.”  However, no authoritative reports of the scope of Chinese assistance have been made available.

On Dec. 20, Chinese state media noted that “immediate measures must be taken to push the DPRK’s economy forward.”  Chinese sources estimate North Korea’s total grain production is 4.74 million tons, short of the 6 million annual minimum needed, as estimated by food experts, and contradicting Pyongyang’s claims last year that the DPRK “is at the highest tide of its development ever in history.”  In January, Japanese media began reporting on Beijing’s decision to send significant amounts of food and fuel aid to the North immediately following Kim Jong Il’s death and to be continued through Kim Il Sung’s birthday celebrations in an effort to ensure a successful power transition.  ROK sources in May estimated that North Korea would spend $2 billion on the April 15 celebrations, one third of its annual state budget, plus an additional $850 million to build a three-stage rocket and launch pad for the event.

Chinese economic assistance appears to be a critical source of support for Pyongyang’s efforts to honor the dying wishes of Kim Jong Il, who pledged to build a strong and prosperous nation by 2012.  According to the Korea Trade-Investment Promotion Agency (KOTRA), China-DPRK bilateral trade reached a historic high of $5 billion in 2011, triple the volume in 2005. Major Chinese exports to the North are minerals, machinery, and cars.  At the same time, there are mixed reports on the status of bilateral investment projects established at the end Kim Jong Il’s rule.  South Korean media in mid-January claimed that Beijing has rejected North Korea’s law announced in December 2011 on developing the Hwanggumphyong and Wihwa islands as a joint economic zone, due to a “lack of business-friendly elements.”

China’s uncertain friendship with North Korea under Kim Jong Un

North Korea’s rocket launch was conducted two days after Kim Jong Un’s appointment as first Secretary of the Workers’ Party of Korea (WPK) at its fourth conference on April 11, and preceded national celebrations of Kim Il Sung’s 100^th birthday on April 15.  President Hu sent a congratulatory message to Kim Jong Un on April 11 affirming support for DPRK efforts “to build a strong and prosperous state under the leadership of Kim Jong Un.” Hu also sent a message of support at the end of last year when Kim was designated as top military commander of the Korean People’s Army. But that message was conveyed under Hu’s capacity as General Secretary of the Communist Party of China (CPC) Central Committee and Chairman of China’s Central Military Commission rather than PRC President, possibly reflecting that Kim Jong Un’s most senior title at the time of Kim Jong Il’s death was through his role as a vice chairman of the Worker’s Party of Korea Central Military Committee..

The dispatch of Vice Minister Kim Yong Il to Beijing on April 21-23 provided an opportunity for the first high-level consultations following the rocket launch and included a rare meeting with Hu Jintao, during which he presumably called for North Korea not to proceed with a third nuclear test or other provocations.  During his meeting with Kim, President Hu vowed to maintain high-level contact between the ruling parties, promote practical cooperation and friendship, strengthen communication and coordination on major regional and international issues, and emphasized joint efforts to maintain peninsular and regional peace and stability. In addition to meeting Hu Jintao, Vice Minister Kim met State Councilor Dai Bingguo, and Chinese Communist Party (CCP) Organizational Department head Li Yuanchao, and held a “strategic dialogue” with CCP counterparts led by International Department head Wang Jiarui. There are media reports from these meetings regarding two potentially significant issues in the relationship raised during Kim Yong Il’s visit.  First, Kim Yong Il reportedly requested the repatriation of Kim Jong Un’s outspoken older brother, who had criticized the generational succession last January in a book published by a Japanese journalist with whom he had corresponded for several years.  Second, the two sides reportedly discussed the possibility of a visit to Beijing by Kim Jong Un later this year.  No doubt both issues have critical political and economic ramifications for North Korea’s regime consolidation.

Another notable exception to an otherwise remarkably quiet period of high-level interaction between China and North Korea was the visit of   Maj. Gen. Qian Lihua, director of the Foreign Affairs Office of the PRC Ministry of National Defense.  Qian led a People’s Liberation Army (PLA) delegation to Pyongyang on April 5-6, the first visit by a PLA delegation since Kim Jong Il’s funeral, and met Kim Yong Chun, vice chairman of North Korea’s National Defense Commission and minister of the People’s Armed Forces.  The meetings follow the two political parties’ strategic dialogue held in Pyongyang in June 2011 and produced mutual pledges of a continued commitment to promoting the traditional friendship.

China-ROK asymmetric economic interdependence

The commemoration of ROK-PRC diplomatic relations has underscored the rapid growth in bilateral trade, the driving force in the relationship since normalization in 1992.  Total trade reached $220 billion in 2011, a 34-fold increase from $6.4 billion in 1992.  According to South Korean sources, China has accounted for almost 80 percent of overseas ticket sales for the Yeosu Expo that will open on May 12, an event that is anticipated to further the joint achievements of the 2010 Shanghai Expo.

But a rising concern among South Koreans is the growing asymmetry in the Sino-ROK economic relationship.  South Korean exports to China account for 30 percent of total exports while China’s exports to South Korea account for less than 5 percent of China’s total exports.  China’s trade deficit with South Korea reached a record $70 billion in 2010; South Korea’s trade surplus stood at $40 billion.  President Lee continued his push for expanding ties to newly-emerging sectors during his January visit to Beijing, when he emphasized cooperation beyond manufacturing to such sectors as energy, the environment, and services.   Lee’s meeting with Premier Wen Jiabao also focused on accelerating negotiations on a bilateral free-trade agreement and promoting regional economic integration.

South Korean concerns about the changing structure of economic relations have also influenced Chinese assessments of South Korea’s approach to China. According to Dong Xiangrong of the Chinese Academy of Social Sciences, “the crux” of the problem in current bilateral ties is Seoul’s “fears that China will turn the asymmetric economic interdependence into political leverage.”  Some analysts see these concerns as driving Seoul’s reluctance in promoting the China-ROK FTA in favor of FTAs with the United States and European Union which “reduce its economic dependence on China.”  Yet, South Korea has finally decided to open Sino-Korean FTA talks, despite concerns about the potential impact on South Korea’s domestic economy. South Korean observers suggest that Seoul “needs to grasp China’s tendency to put priority on practical interests,” arguing that South Korea “may be missing a critical point” in China’s focus on pragmatism. For example, Beijing “balanced the forced repatriation” of North Korean refugees by allowing 4 of 11 defectors to go to the South in early April.

China and South Korea have continued to make progress in trilateral mechanisms with Japan in such areas as disaster relief and the environment, launching the first trilateral meeting between agriculture ministers on Jeju Island on April 15.  Such achievements are notable given the unprecedented number of bilateral political disputes with China that both South Korea and Japan have confronted during the same period over such vital interests as territorial issues.  South Korean analysts acknowledge that while some disagreements with China are “inevitable” amid deepening ties, the relative lack of high-level communication channels has served to “amplify” bilateral strains.  A South Korean survey in December 2011 indicated a decline in favorable attitudes toward China since 2005 from 20 to 12 percent, and an increase in unfavorable attitudes from 24 percent to 40 percent.  According to the East Asia Institute, favorable Chinese attitudes toward South Korea declined from 73 to 53 percent between 2006 and 2011.

Conclusion: China’s post-Kim Jong Il debate

Beijing’s calls for diplomatic coordination for “ensuring security on the Korean Peninsula” since Kim Jong Il’s death fueled a short-lived public debate in China on the likely course of North Korea’s transition under Kim Jong Un and the implications for regional security dynamics.  In a Dec. 19 interview with China’s Global Times, North Korea expert Han Zhenshe of the Chinese Academy of Social Sciences recognized that “Kim Jong Un faces great pressure in maintaining domestic stability,” but envisioned a “practical power transition” without “social shake-ups.”  According to Han, prospects for reform and opening as well as external goals of inter-Korean and regional dialogue on denuclearization remain limited “within this key transition period” since Pyongyang’s priority lies in maintaining social stability and government legitimacy.  A China Daily article on Dec. 20 conveyed Chinese views on the “limited impact” of Kim’s death.  Zhang Tingyan, China’s first ambassador to South Korea who also spent time as a diplomat in Pyongyang, indicated that “a peaceful transition” is likely in North Korea, although “we can’t rule out contingencies.”  Liu Jiangyong of Tsinghua University saw “the future path of DPRK politics” as “fairly clear” given the arrangements for the post-Kim Jong Il power transfer made prior to his death.  But China reportedly tightened up on public commentary regarding North Korea’s future, providing further evidence both of its commitment to North Korea’s stability and a genuine concern over the predictions of some Chinese analysts that North Korean instability, public unrest, or a coup d’etat might be in the offing.

By January, Chinese commentary appeared to be offering a collective sigh of relief.  Jin Linbo of the China Institute for International Studies argued that “some might have cited the youth of Kim Jong Un as a concern, but … things will remain stable for a while.” Zhang Yushan of the Jilin Provincial Academy of Social Sciences noted that “if there was any instability in North Korea, China, South Korea and Japan should all share the concern.”  Under the surface, China has deep concern about prospects for North Korean instability and its implications for the strategic balance on the Korean Peninsula. The Chinese government clearly would regard Korean reunification as a setback, and seems set on buying time and guarding its influence to either delay Korean reunification or shape it according to Chinese interests. An immediate crisis is not welcome in Beijing, especially given the enormous stakes surrounding China’s own leadership transition set for later this year.

The future of PRC-ROK relations will bear greater strategic weight in the future, having been driven primarily by economic considerations for its first two decades.  Zhang Lianggui of the Party School identifies political trust, North Korea, and trade as the biggest priorities in the PRC-ROK relationship.  Dong Xiangrong attributes “Seoul’s distrust of Beijing” to “differences in political systems, asymmetric economic interdependence, and different security priorities,” arguing that “in this critical period, both leaders can do more than just meet and shake hands.”

Despite joint pledges to promote DPRK stability and regional dialogue since December, South Korean analysts emphasize a “difference between Seoul and Beijing in their approach to tension.” While Zhang has noted that “Lee certainly hopes China exerts influence on the DPRK,” Chinese state media has stressed that China “has limited influence and is unwilling to interfere too much in the domestic affairs of the DPRK.”  Given these circumstances, one of the most consequential issues for the new leadership in China and South Korea will be how the two countries move forward to address an agenda that is increasingly filled with strategic challenges.  New South Korean and Chinese presidents might provide an opportunity to “reset” the relationship, but to what end?  This question should draw close attention from strategic thinkers in Seoul and Beijing, and should also not escape careful scrutiny from observers in Pyongyang, Tokyo, and Washington.