When it appears that Donald Trump's favorite Korean is North Korean dictator Kim Jong-un, the government in Seoul has reason to worry about the possible re-election of the former U.S. president in November.
The Yoon Suk Yeol administration should follow the example of many other governments and prepare for this eventuality, a process known as "Trump-proofing."
It is important to understand the reasons for a Trump victory to help guide Seoul in responding to what is likely to happen in a second Trump presidency. Opinion polls in the United States point to one main election issue: the state of the American economy.
On the surface, Americans should be happy about how their economy is performing. It is growing at a faster rate than any other advanced economy, the stock market is hitting record highs, and the unemployment rate is low. What's there not to like?
But Americans are worried about high government debt levels, the worst inflation rate in years and illegal immigration. At least 60 percent of households are living from paycheck to paycheck, credit card debt is at record levels, food prices remain stubbornly high and housing prices are no longer affordable for many.
Trump has successfully tapped into this anxiety, and he has offered solutions that are likely to hurt most of America's traditional allies, including Korea.
Trump's proposals to reduce the U.S. trade deficit would hit Korean industry particularly hard. He wants a 10 percent across-the-board tariff on all goods entering the U.S. There is also talk that Trump plans to devalue the U.S. dollar to boost exports while making imports more expensive.
One way to counter this threat is for Korean companies to build more production plants in the U.S. to overcome trade barriers. Korean carmakers Hyundai Motor and Kia have done this for years in response to two decades of auto trade disputes with Washington.
Korean chipmakers are now following suit to take advantage of subsidies being offered by the Biden administration to persuade chipmakers to expand cutting-edge production in the U.S. In April, it was announced that Samsung Electronics would receive $6.4 billion from Washington to build semiconductor fabs in Texas.
But it is uncertain whether a second Trump administration will retain the CHIPS and Science Act, which authorized these subsidies. Even if it does so, analysts suggest that it would require any foreign chipmaker not to invest in China as a condition for receiving U.S. subsidies. This would particularly affect Samsung and SK Hynix, which have invested an estimated $35 billion in China since 2020.
If Trump decides to raise tariffs and restrict imports, it could set off an inflationary spiral that would significantly weaken the U.S. economy and make it a less desirable export market for Korea. Last year, the U.S. emerged as Korea's biggest overseas market for the first time in two decades, overtaking China.
Addressing these challenges will require a whole-of-government approach in Seoul when there are deep divisions between the ruling administration and the National Assembly. They must cooperate to identify new export markets and the development of new export industries, such as defense equipment.
Meanwhile, Trump is also focusing on U.S. military allies to pay more for their own defense rather than relying on Washington to shoulder most of the defense burden in an effort to reduce government debt. Already in his first term, Trump wanted Seoul to triple the amount it spends on supporting U.S. troops in Korea to $5 billion, while also suspending joint military exercises.
Korea is hiring consultants and lobbyists in Washington as part of an exercise to determine what will be Trump's policy toward Seoul in a second term by reaching out to his possible foreign policy advisers. The biggest fear is that Trump will pull out some or all of the 28,500 U.S. troops in Korea. That would leave South Korea in a vulnerable position when North Korea is building up its nuclear and missile arsenal.
As he has hinted, Trump could also seek to sign a nuclear arms control deal with North Korea that would leave South Korea without the protection of America's nuclear umbrella. Seoul might respond by pursuing its own nuclear deterrent, an option that enjoys wide public support.
Another way to achieve safety without resorting to nuclear weapons would be for Yoon to stitch together security alliances with other regional powers, including Japan, Australia and the Philippines.
This would be a key test of Yoon's goal of making Korea into a "global pivotal state" that would play a greater role regionally and globally. A Trump presidency might yet prove to be the biggest foreign policy challenger during the three remaining years of Yoon's term.
John Burton (johnburtonft@yahoo.com), a former Korea correspondent for the Financial Times, is a Washington, D.C.-based journalist and consultant. He is a guest editorial writer at The Korea Times.
'Trump-proofing' Korea
84
0
22.05.2024
When it appears that Donald Trump's favorite Korean is North Korean dictator Kim Jong-un, the government in Seoul has reason to worry about the possible re-election of the former U.S. president in November.
The Yoon Suk Yeol administration should follow the example of many other governments and prepare for this eventuality, a process known as "Trump-proofing."
It is important to understand the reasons for a Trump victory to help guide Seoul in responding to what is likely to happen in a second Trump presidency. Opinion polls in the United States point to one main election issue: the state of the American economy.
On the surface, Americans should be happy about how their economy is performing. It is growing at a faster rate than any other advanced economy, the stock market is hitting record highs, and the unemployment rate is low. What's there not to like?
But Americans are worried about high government debt levels, the worst inflation rate in years and illegal immigration. At least 60 percent of households are living from paycheck to paycheck, credit card debt is at record levels, food prices remain stubbornly high and housing prices are no longer affordable for many.
Trump has successfully tapped into this anxiety,........
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