Read the full story in the “Korea JooAng Daily.”

The past few weeks have been ripe with diplomatic development in East Asia.

Korean DMZ

Since President Trump agreed to meet with North Korea, every superpower in the region has jumped to meet with the North as well, starting with China this past March. Japan has also expressed interest in a bilateral summit. The agreement to have a direct phone line between the North and South of Korea is the latest development in this diplomatic flurry. The Korea JooAng Daily reports that the meeting took place in the town of Panmunjom, close to the border, and that the South intends to adopt proper diplomatic protocol for these interactions. Although the countries have been working towards increasingly normalized relations, the meeting with the POTUS has certainly acted as a catalyst for development.

Normalized relations between the North and South are not necessarily a bad thing at all. More often than not, these sorts of developments only help to ease diplomatic tension by increasing efficiency of communication, as shown by the direct phone line established between Washington D.C. and Moscow following the Cuban Missile Crisis. Although the phone line is rarely used, even one instance of circumventing a disaster speaks to its merit (such as the Six Day War – when Lyndon B. Johnson informed the Soviet Union of his plans with the Air Force). In the larger scope of international diplomacy, though, normalized relations with North Korea on a global scale is not as promising.

Kim Jong-un shakes hands with Xi Jinping

For a country like North Korea, relevance is survival. Relevance is really what is at the heart of the North’s nuclear program. For a nation on such precarious footing, the ability to stay in a position of notoriety is paramount – whether that be through arms capability, economic power, or diplomatic protection. In securing a meeting with the world’s most powerful office, Kim Jong-un has propelled his international clout in a way that the DPRK has never seen before. The risks of such a meeting going awry aside, at the very least this meeting will serve to validate North Korea in a way that is not in the best interest for global security – not to mention the 10 million people living within 35 miles from the DMZ. One can only hope that the Trump Administration does not underestimate Kim Jong-un, or the implications of this meeting.

Read the full story in The Korea Times

Nobody really ever wins in a trade war, and they have collateral damage just the same as conventional warfare. In the developing conflict between China and the United States, South Korea will certainly be caught in the crossfire.

Korea is a nation heavily dependent on trade and exports, so a downturn in global trade could be devastating to the nation’s economy. Unfortunately this is getting closer and closer to the reality of the situation, as more tariffs are imposed and more trade agreements pulled out of every day by the world’s superpowers that have the ability to sway the international economy. The Trump administration continues to declare tariffs on China in hopes to the square the United States’ trade deficit, and they are not going unanswered by Beijing. This doesn’t only hurt China and the United States though, because as their economies lag so do their imports, and by extension Korea’s exports.

The Korea Times writes this piece from an angle of concern about the Korean economy. These concerns do seem substantiated though, and are backed up with pertinent export and import statistics. One the stands out is that Korea exports 29% of its intermediate goods to China. That is an awfully large chunk of the national economy to be put in jeopardy.  They also note that because Korea does not export the same kinds of goods as China or the United States, they will not benefit from any “trade diversion.” This article does not seem heavily politicized as it is about foreign administrations, and the majority of statistics are referenced.

Read the full story in “The Korea Times”

The plot thickens for Korean manufacturers navigating the Trump administration. Last week, President Trump declared new tariffs on foreign steel and aluminum that is causing controversy domestically and abroad. Imported steel will have a 25% tariff, and aluminum will have a 10% tariff. This is following an advisory from the US Commerce Department. Although this will certainly hurt Korean manufacturers, especially mid-tier players, they avoided the worst case scenario – a 53% tariff on 12 countries including Korea – that was also proposed as a solution by the Commerce Department.

This move has been met with much criticism, even from US manufacturers, who despite benefitting the most from it still are not sure if it will be a net gain amidst worries that prices will rise too high. Some worry that US manufacturers wont be able to meet the needs of the market. All that is for sure from this move is that the US is further distancing itself from trade partners, and no one is quite sure whether this will help.

This article does a great job explaining the rationale for this decision and discussing the possible outcomes, from a diplomatic and economic point of view. It is always interesting to read about these issues from another country’s media, given how much it is discussed in the states. This will certainly be a story to follow.

http://www.koreatimes.co.kr/www/biz/2018/03/367_245020.html

https://www.google.com/search?q=korean+steel&source=lnms&tbm=isch&sa=X&ved=0ahUKEwj31MeRstTZAhWs5oMKHRU_DaIQ_AUIDCgD&biw=1231&bih=703#imgrc=8zCgRdXRPQ66qM:

Read the full story in “The Korea Herald”

GM Korea is in dire straits. The American automaker is only continuing its downward trend, as the Korea Development Bank is set to begin a full review of the company’s finances.  According to the latest account, GM’s market share in the region is only 7% – a number deemed too low by those in the industry. This is apparently stemming from a “misallocation of cars,” rather than an inferiority of the vehicles themselves. Following the falling prices of oil in South Korea, consumers are erring towards luxury and larger vehicles, yet GM Korea has continued to increase the production of smaller cars.

The Korean government will decide wether to give GM Korea a subsidy depending on the findings of the financial review. This decision will have a large impact on future of GM’s business in Korea. Amidst these troubles, the upper management has announced it will cut certain employee benefits and possibly shut down an entire plant, something that has been met severe pushback from the labor unions: “We cannot accept the responsibility made by the poor management.”

Ji-hye, Shin. “KDB to Start Review of GM’s Financial Records This Week.” The Korea Herald , 25 Feb. 2018, www.koreaherald.com/view.php?ud=20180225000205.