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President Joe Biden should take advantage of growing U.S. investment ties with South Korea as a means to deepen the longstanding alliance across multiple dimensions.
That’s a word of advice from Mark Lippert, who formerly advised President Obama on matters related to South Korea as ambassador to the country from 2014-17.
“I think there is a real opportunity on the trade and investment front,” Mr. Lippert said.
Mr. Lippert joined another U.S. envoy to Korea, Kathleen Stephens (2008-11), last week for a wide-ranging World Affairs Council of Atlanta conversation backed by the Korea Economic Institute, which provided perspective on the recent presidential summit between Mr. Biden and Korea’s Moon Jae-in.
During a trip to the U.S. that included a White House visit, Mr. Moon also visited Georgia, where Korea-based SK Innovation is building a $2.6 billion battery plant to help power what Mr. Biden hopes is a coming electric-vehicle revolution in the country.
The Southeast U.S., indeed, was the epicenter of the new Korean investments, giving it an outsized role in the future conversations on economic and trade ties. Though much of it was already planned, stacked together the announcements came to an “impressive” number — about $40 billion — sending a “strong signal” that Korea sees investment as a key part of the alliance, Mr. Lippert said during the conversation with World Affairs Council President Charles Shapiro.
Hyundai-Kia said it would put $7.4 billion into its U.S. EV transformation, which presumably will involve its plants in Alabama and Georgia. SK has pledged a second phase that would bring its total investment to more than $5 billion. LG Energy Solution, SK’s rival, is working with General Motors on a Tennessee battery plant that will constitute $2.3 billion, while Samsung said it would increase U.S. semiconductor production to the tune of $17 billion.
All this is vital in light of the rising U.S. imperative, embraced by both parties, to bolster supply chains and domestic manufacturing for critical technologies as a buffer against reliance on China.
Korea, meanwhile, finds itself perpetually caught between the U.S., its strongest security ally and umbrella against North Korean nuclear aims, and China, its top trading partner in spite of divergent government systems and values.
The Trump administration’s transactional approach to the stationing of U.S. forces in Korea was misguided, Ms. Stephens said, because it betrayed a lack of understanding about Korea’s own substantial military capabilities, including its growing navy, while also placing the emphasis in the wrong place. It’s exactly the values side of the equation that be further cultivated, she added.
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“The Koreans are all in on democracy and a rules-based trading order and those things,” Ms. Stephens said in her own hypothetical word of advice to Mr. Biden. “They are natural partners in this, and we shouldn’t underestimate that. So I would say, keep remembering the values part of this equation.”
On the trade front, Mr. Biden could start winding down the executive actions initiated under Mr. Trump to investigate alleged unfair trade actions by Korea. While it won’t be easy to solve them all, priority should be given to sectors like steel and shipbuilding, where Korea faces a threat from China’s manipulations of free markets.
“There’s a real big bucket of issues that could be beneficial for the Korean population. It’s going to be politically sensitive and difficult, so it’s going to take some skillful negotiation and give-and-take, but there’s enough gives and puts on both sides I think to wrap that up,” Mr. Lippert said.
The effect could be helping U.S. firms enter the South Korean market, which in turn could knit the countries together better and ameliorate rising “under- and unemployment” in Korea as powerful conglomerates known as chaebols hire less and less, he said.
“Let’s figure out a way to get U.S. money flowing into Korea as well, in terms of (foreign direct investment), in terms of more bilateral trade. And the reason I say that is because Korea has great natural advantages in terms of a highly educated population, great infrastructure, great geographic location. The problem Korea has is a very difficult regulatory environment that keeps a lot of small and medium-sized enterprises out,” Mr. Lippert said.
Mr. Trump sought to rectify some imbalances by renegotiating the KORUS free-trade agreement, which was done during his term, but the confrontational approach included slapping damaging steel and aluminum tariffs on one of the staunchest U.S. allies in the world, let alone the important Asia region.
The Korean presidential election next March could serve as a distraction at home, meaning it’s all the more important to shore up the alliance before politics shrink the space for dialogue on foreign affairs.
Mr. Moon’s progressive Democratic Party lost big in April municipal and provincial elections and faces a challenge from the more conservative People Power Party and emergent parties critical of his handling of North Korea and broader macroeconomic challenges, both ambassadors said. Mr. Moon, who became the first South Korean leader to visit the North in 10 years, has focused on dialogue, causing some to criticize him as an apologist for dictator Kim Jong Un.
Whoever emerges as the leader after Mr. Moon’s single five-year term is up, Korean lawmakers should focus on forging consensus on issues like North Korea to help the international community calibrate their respective approaches to the rogue nation, Ms. Stephens said. Mr. Lippert said the same about Korea’s stance on China’s market-distorting policies, adding that it should abandon using ties with China as a “hedging strategy” in its dealings with the rest of the world.
In its future conversations with the Biden administration, Ms. Stephens noted that the Koreans should respect the U.S. president’s sincere aim of harnessing foreign policy in support of growing the middle class at home.
“Think about what that means in terms of means for Korean diplomacy, reaching out and understanding what’s going on in the ” she said.
The country’s outreach in the Southeast U.S. continues through the arrival of new Consul General Yoon-joo Park, who settled into Atlanta just two weeks ago as the successor of forme Consul General Young-jun Kim.
“It is truly the honor of a lifetime to be given the opportunity to serve as Korean consul general in this state,” Mr. Park said during the World Affairs Council call,
He added that he received a warm welcome in the South on the heels of the presidential visit, which underscored the bilateral partnership in “cutting-edge technologies,” Mr. Park said, noting that more than 200 Korean companies now operate in the six states that Mr. Park covers from the consulate in Atlanta.
He called the ambassadors “celebrities in our country” for the way they engaged directly with the Korean people during their respective tenures.
Learn more about the World Affairs Council of Atlanta at www.wacatlanta.org.
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