South Korean President Moon Jae-in began a week-long tour of Central Asia on Tuesday, in an effort to shore up support for ambitious energy deals and move the Country beyond its diplomatic and economic reliance on the US and China.
But while Moon seeks to buffer Seoul against turmoil between Washington and Beijing, his plans in Central Asia might inevitably link him to China’s Belt and Road Initiative.
Meeting with the leaders of Kazakhstan, Uzbekistan and Turkmenistan from April 16 to April 23, Moon will hope to further his New Northern Policy, an economic scheme with the ultimate goal of connecting South Korea by pipeline to natural gas deposits in Turkmenistan and Russia, and to the rest of the Eurasian land mass by Rail.
“Moon wants to improve railroad linkage with Central Asia and Russia. It requires huge investment,” said Yu Hong, a Senior Researcher at the National University of Singapore’s East Asian Institute.
“I think here China and South Korea can find some room for collaboration”
Political uncertainties in Central Asia mean Moon could soon be scouting flush partners to help fund his plans. China, with its state development bank and experience in the region, would make an obvious choice.
But Moon may be wary of overly cosy economic ties with Beijing, especially where Washington is involved. Seoul saw the risk of being caught between the two in 2016 when it allowed the US to install the THAAD (terminal high-altitude area defence) system on its land. THAAD is intended to shoot down North Korean missiles, but employs a powerful radar system that Beijing says can penetrate deep into its territory and spy on its activities.
In retaliation, Beijing took aim at the tourism industry, unofficially banning the sale of group tours to Seoul and costing South Korean businesses an estimated US$15 billion over a single year, according to the Hyundai Research Institute.
“Trade with China is always a double-edged sword,” said Lee Jeong-yeon, professor of international economics and dean of Yonsei University’s graduate school of international studies. “As we saw in the episode of THAAD, China is not necessarily playing within the boundaries of existing multilateral rules.”
At the height of the feud in 2017, Moon revealed that strengthening ties with ASEAN nations was also part of his plan of “diversifying export markets and thus reducing economic dependence on China”.
Tensions have cooled since Moon took office. But while he may be looking to rely less on China, their goals are becoming increasingly aligned, as both seek energy deals in the region.
“Chinese economic and political influence in the Central Asian region is impressive at the moment,” said German Kim, head of the department of Korean studies at Al-Farabi University in Kazakhstan.
Moon’s plan has become all the more urgent as South Korea battles some of the highest air pollution levels in the developed world. During a visit to Turkmenistan, which has vast deposits of natural gas, Moon is likely to promote his plan to intensify gas imports as a cleaner alternative to coal.
“The gas in Turkmenistan is much cheaper than Russian Gas,” said Kim.
Roadblock: North Korea
But an obvious roadblock remains in Moon’s plans: North Korea, under heavy sanctions for its nuclear programme, is banned from the kind of economic and infrastructure deals that Moon envisions.
Last March when hopes were high for a breakthrough in US-North Korean talks, Moon’s New Northern Policy was touted as a path to peace on the Korean peninsula, since the gas pipelines and railways that form the centrepiece of the plan would run through North Korea, drawing on Pyongyang’s cooperation while bringing it economic benefits.
Now that diplomacy with North Korea has faltered again after the failure of a summit between US President Donald Trump and North Korean leader Kim Jong-un in Hanoi, Moon’s trip to Central Asia may be a way of shoring up support and putting the pieces in place in case of a breakthrough.
“This project is blocked by UN sanctions. But the network, all the infrastructure to the border of Russia and North Korea, should be prepared,” said Kim of Al-Farabi University.
In dealing with North Korea, Moon probably understands the need to play the long game. But as China’s influence in the region grows, the further ahead he looks, the more likely he is to see Beijing and its well-funded belt and road.
Seoul’s troubles could come full circle if engagement with the belt and road riles the hawks in Washington, which is hardly a fan of China’s growing influence in the region. The US could try to pressure Seoul into avoiding the belt and road, as it did in 2014 when the Obama administration urged it not to join China’s Asian Infrastructure Investment Bank (AIIB).
In the end South Korea ignored the pleas of its US ally and chose to join China’s bank, delivering a huge diplomatic defeat to Washington. “The US pressure is there, but South Korea is a sovereign country. They will implement their foreign policy in their own way,” Yu Hong said.
Moon is under fire at home for his failure to grow the economy. Despite his intentions to diversify trading partners, China’s growing sphere of influence will be hard to ignore.
As he heads to Central Asia to test the waters on energy deals and a push into Eurasia, while looking for ways to open up North Korea, his decisions are likely to come down to who in the region can best help realise his plans for long-term growth.
“China is already the largest economy in Asia” said Yu Hong. “South Korea certainly cannot resist.”