ROKG ON CHINA: U.S. ALLIANCE IS VITAL

C O N F I D E N T I A L SEOUL 001681

SIPDIS

E.O. 12958: DECL: 08/25/2018
TAGS: PGOV PREL KS KN ZO
SUBJECT: ROKG ON CHINA: U.S. ALLIANCE IS VITAL

Classified By: Classified By: POL M/C Joseph Yun. Reasons 1.4(b/d)


1. (C) Summary: In a round of August 18 meetings on the
state of ROK-PRC relations, Ministry of Foreign Affairs and
Trade (MOFAT) officials, the Korea Institute for Defense
Analyses (KIDA),the Korea Research Institute for Strategy
(KRIS),and academics told poloffs that 1) the U.S.-ROK
alliance is the pillar of the ROK's foreign policy and vital
to ROK security, 2) closer ROK-PRC ties are inevitable, but
3) ROK-U.S. and ROK-PRC relations are not a zero sum game.
End Summary.

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Importance of U.S.-ROK Alliance
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2. (SBU) The Embassy's interlocutors, without exception,
emphasized the centrality and importance of the ROK-U.S.
alliance to Korea's foreign policy and its security. A theme
consistent throughout the discussions was that Korea's
independence and economic vitality depend on the U.S.
security umbrella and America's success in assuring regional
stability. What Koreans see as the U.S. motivation for
engagement in the region, i.e., commitment to democracy and
market economy ideals, are values that Koreans share deeply.
Because of these shared values and the benefits the U.S.
provides, Korea has no substitute for the U.S.-ROK alliance.

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Closer ROK-PRC Ties
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3. (SBU) At the same time, due to history, geography,
cultural affinities, and China's rise as a regional power,
Korea has no choice but to develop closer ties to China.
China's rise and the deepening ROK-PRC ties are challenges
for Korea to manage. Korea and China have a centuries-long
history which on the surface has usually been "brotherly" but
in reality "threatening" if not "repressive." Korea's
strategic imperative, our interlocutors said, is to steer
ROK-PRC relations in a mutually beneficial direction which
preserves Korea's security and prosperity.


4. (U) Since establishing diplomatic ties with China in 1992,
the ROK-PRC relationship has undergone tremendous
development.

-- China is the ROK's biggest trading partner and the ROK is
China's third biggest trading partner. Total bilateral trade
last year totaled $145 billion and is growing at an annual
rate of 20%. The ROK's annual bilateral trade with the U.S.
and Japan combined is approximately $165 billion.

-- China is Korea's most popular tourist destination. Last
year 5 million Koreans visited China and 1 million Chinese
traveled to Korea.

-- Korean students comprise the largest number of foreign
students in China, totaling more than a third of all foreign
students.

-- Between Korea and thirty Chinese cities, there are on
average 113 flights per day.


5. (U) PRC President Hu Jintao is visiting Korea August
25-26. It will be the third meeting since May between Hu and
President Lee. MOFAT officials said the frequency of
meetings is unprecedented in the history of ROK-PRC relations
and symbolizes the increasingly closer ties between the two
countries. Lee paid an official visit to Beijing in May and
met Hu again when Lee was in Beijing for the Olympics. It
will be Hu's second state visit to Seoul, the first being in
2005 during the Roh Moo-hyun administration. In the past,
the ROK could expect only one visit in a PRC president's
ten-year term.

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Northeast Asia Regional Issues
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6. (C) MOFAT Director General of the Northeast Asian Affairs
Bureau Cho Taiyoung sees an ROK-Japan-China trilateral
framework as being a helpful vehicle for strengthening
cooperation between the three countries and ensuring
stability in the region. This group has met since 1997 on
the margins of the ASEAN summit. This year the three leaders
had agreed to meet separately in Tokyo, but, because of the
ROK-Japan dispute over Dokdo (Liancourt Rocks),the ROK has
not decided whether it will participate.


7. (SBU) Asked what Korea's likely response would be in the
event China exercised its military option against Taiwan, all
of our interlocutors expressed a strong hope that Korea would
never be put in the position of having to refuse a U.S.
request for assistance in Taiwan. The risk of alienating
China is so great that Koreans would strongly resist
supporting the U.S. against China over Taiwan.

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ROK-PRC Economic Challenges
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8. (SBU) The Chinese market is a big opportunity for Korean
businesses. But, as Chinese products move up the value
chain, competition with China will also increase. Already,
Korea is dealing with the problem of technology transfers to
China. China is of the opinion that if it buys a controlling
stake in a Korean company that it has the right to transfer
the technology to China; Korea disagrees. Nonetheless,
Korea's position, according to MOFAT officials, remains that
gains in the Chinese market still outweigh the potential
losses in the form of technology transfers.


9. (C) A ROK-PRC FTA is unlikely in the foreseeable future
according to MOFAT Director General Cho due to seemingly
insurmountable differences over agricultural issues and
popular opinion in China that would oppose a deal with Korea.

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North Korea
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10. (C) It is in the ROK's interest for China (and Japan) to
invest in North Korea because any investment made now in
North Korea will only lessen the ROK's burden in the event of
reunification, Cho told poloffs. With regard to
reunification, however, he noted that China's stated policy
is not unconditional. China's policy is that reunification
must be peaceful, gradual, and free from outside
interference. China's response to a reunification scenario
that is not peaceful or gradual is an open question.

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China's Military Build-up
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11. (C) By 2020, the ROK projects that China will have
developed capabilities to project power 1,000 miles from its
coasts, threatening the ROK, Japan, and Southeast Asia. The
goals of China's defense build-up, according to KIDA
analysts, are to deny access to the Chinese mainland, develop
capabilities to project power, and deploy a missile defense
system. The current level of China's capabilities is
sufficient to cover contingencies in Taiwan, which is the
immediate focus of China's planning.

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Comment
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12. (C) Similar to other East Asian countries, Korea has yet
to come to grips with the rise of China. Of course, what
makes the Korean situation different are the ROK's security
ties with the United States and the fact that the ROK and the
U.S. faced off the DPRK and the PRC in the 1950-1953 Korean
War. Still, Beijing and Seoul have a cooperative arrangement
that has worked well, especially on the economic side, and,
more recently, on denuclearizing North Korea. Historically,
the Koreas are completely used to living in China's shadow.
Things are, however, different now. Koreans have a much more
prosperous economy and freer society. Therefore, just
beneath the surface of Korea's excitement at the
opportunities afforded by closer ROK-PRC ties is a real
anxiety about the political, economic, and military threats
China poses to Korea. Because of these threats, as Korea
forges closer ties to China, ties that in many ways are
historically much deeper than its ties to the U.S., the
U.S.-ROK alliance becomes more important to the ROK's
long-term strategic plans.
VERSHBOW