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(EDITORIAL from Korea Times on Aug. 7)

Editorials from Korean Dailies 07:01 August 07, 2019

Entering dark tunnel
US-China rivalry poses enormous challenges

The United States has officially designated China as a currency manipulator ― a dramatic escalation of the ongoing trade war between the world's two largest economies.

The U.S. decision, which heralds more trade sanctions on China, will put the global economy deeper into a vicious cycle. China will surely not sit idle. It may respond with its own measures against American goods. The free trade is in danger of collapsing.

The escalating trade protectionism will be more damaging to the export-driven Korean economy. China and the U.S. are our top two trading partners. What makes it worse is the worsening trade dispute with Japan, our third-largest trading partner.

It is not exaggerating to say that Korea Inc. is in a state of an unprecedented crisis. We have just entered a dark tunnel. We don't know how long it is.

We should note that this is not limited to an economic problem. The escalating U.S.-China rivalry and Japan's "weaponization" of key industrial materials Korean firms need may bring a sea change to the security environment on and around the Korean Peninsula as well.

Imminently, the U.S. hopes South Korea will provide a site for the deployment of its mid-range missiles, which are presumably aimed at China and Russia. Last week, Washington formally pulled out of the Intermediate-Range Nuclear Forces (INF) Treaty with Russia, signed in 1987, citing the latter's violation of the treaty. This means the U.S. now can test and deploy such mid-range missiles around the world.

If something goes wrong, a terrible arms race can take place in Northeast Asia.

Speaking at a news conference following bilateral defense talks in Sydney, Australia, Sunday, U.S. Secretary of Defense Mark Esper said the U.S. is looking to deploy new ground-launched, intermediate-range missiles in Asia. Esper said the deployment of such weapons would be aimed at deterrence and done with the "full cooperation" of allies in the region.

Being well aware of the volatile nature of this issue, Australia was quick to say that it won't host such U.S. missiles. It is not difficult to guess where the U.S. wants to deploy these missiles. South Korea and Japan will be on top of the U.S. list of candidate sites.

China and Russia already vowed stern responses over the U.S. missile plan. The U.S defense chief is currently on an Asian tour that will also take him to New Zealand, Japan, South Korea and Mongolia. In Seoul, he will hold a bilateral meeting with Defense Minister Jeong Kyeong-doo, Friday.

If South Korea learned lessons from the deployment of the U.S. Terminal High-Altitude Area Defense (THAAD) missile defense system in 2016, the answer it can give to the U.S. would be quite clear. The THAAD deployment triggered China's huge economic retaliation against South Korea, and it still remains the biggest stumbling block in their bilateral relations.

But things are much more complicated than seen now. We are facing unprecedented economic and security challenges all tangled up together. Daunting tasks lie ahead for Korean leaders and diplomats.
(END)

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