By Jihoon Lee and Ju-min Park
GYEONGJU, South Korea (Reuters) -Chinese President Xi Jinping will wrap up his three-day visit to South Korea on Saturday with a state visit hosted by President Lee Jae Myung, the newly elected U.S. ally who has pledged to balance Seoul’s ties with Beijing.
The stakes are high for Lee who assumed office in June following the ouster of his hawkish predecessor over a failed attempt to impose martial law. Lee faces the dual challenge of protecting South Korea’s export-driven economy and lowering tensions with North Korea amid rising China-U.S. competition.
Earlier this week, Lee also hosted U.S. President Donald Trump for a rushed state visit, showering him with gifts and praise before announcing a surprise trade deal aimed at lowering U.S. tariffs in return for billions of dollars in South Korean investment in the United States.
The South Korean president is set to hold similar events for Xi on Saturday on the sidelines of the Asia-Pacific Economic Cooperation (APEC) forum in Gyeongju, including a summit meeting and state dinner. It is the first time in 11 years that Xi has visited South Korea.
Xi also met with Trump on Thursday ahead of the APEC summit, striking a deal that includes lower U.S. tariffs on Chinese goods in exchange for Beijing’s crackdown on illicit fentanyl trade, the resumption of U.S. soybean purchases and continued flow of rare earths exports. The Chinese president held talks with the leaders of Japan, Canada, and Thailand as well.
Lee’s office has said that he and Xi will discuss the denuclearisation of the Korean peninsula, a diplomatic phrase used to refer to North Korea’s nuclear weapons, which are banned by United Nations Security Council resolutions.
In response, Pyongyang, a military and economic ally of China, dismissed the denuclearisation agenda as an unrealisable “pipe dream.”
Trump had offered to meet with North Korean leader Kim Jong Un during his visit to South Korea, but Pyongyang did not issue a public response.
Seoul is a key U.S. military ally in Asia, hosting thousands of American troops and relying on the U.S. nuclear umbrella for protection from nuclear-armed North Korea.
Yet its economy is heavily reliant on not just the U.S., which has been imposing tariffs and pushing for investment to offset trade imbalances, but also China, which has grown increasingly challenging for South Korean companies and wields influence over North Korea.
CHARM OFFENSIVE?
As Trump skipped this week’s APEC leaders’ summit, Beijing positioned itself as the predictable champion of free and open trade, a role the U.S. has dominated for decades.
John Delury, senior fellow at the Asia Society, said China has yet to launch a charm offensive toward U.S. allies like South Korea, amid pressure from Trump’s tariffs and uncertainty over U.S. military commitments.
“I think Beijing is in a phase one approach where they are sitting back a little bit and letting the Trump administration do damage on its own,” he said.
“We have not seen China launching big charm offensives to try to capitalize on some of that damage,” he added.
A second phase could include more outreach, but it could also see Beijing ramp up pressure of its own, he said.
South Korea has voiced concerns about the impact of China’s controls on rare earth exports and called for the swift removal of Chinese sanctions on five U.S.-linked units of South Korean shipbuilder Hanwha Ocean. Beijing said the sanctions were related to security risks stemming from the company’s cooperation with U.S. investigations.
Seoul is also hoping that Xi’s visit may lead to Beijing relaxing years-long restrictions on South Korean entertainment content, effectively banned after the 2017 deployment of the U.S.-led Terminal High Altitude Area Defense (THAAD) missile defence system in South Korea.
South Korea has also expressed concerns over structures placed in disputed waters between the two countries, which China claims are for fishing purposes.
An APEC official told Reuters on Friday that member states were “working around the clock” to negotiate a joint declaration on free trade.
(Reporting by Ju-min Park, Joyce Lee, Jihoon Lee, and Eduardo Baptista; Writing by Josh Smith; Editing by Himani Sarkar)
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