As the United States redirects its strategic focus from Europe to the Indo-Pacific region, Washington has set its sights on China, the sole peer rival on the world stage. This shift in focus marks a pivotal moment, following a period of near full-spectrum domination that the United States enjoyed after the end of the Cold War and the disintegration of the Soviet Union in 1991.
Amidst the recent shift in the geopolitical landscape, we are witnessing the emergence of a new multipolar world. This order is a complex and uncertain one, where middle powers like South Korea are increasingly grappling with immense geoeconomic challenges against the backdrop of the relative decline of U.S. hegemony.
Under such circumstances, “geopolitical swing states” – the countries with outsized influence in global supply chains, disproportionate capital, and well-positioned for offshoring/friendshoring – are playing an increasingly instrumental role in international affairs. South Korea is one such state.
Seoul is a globally recognized player in the battery, shipbuilding and semiconductor industries. This means South Korea possesses sufficient capacity to act as a reliable middle power, unhindered by the suspicions of hegemonic intent (which both China and the United States have been accused of).
Moreover, Seoul can play a mediating role in consolidating the multilateral trade regime. While the global headlines have been dominated by U.S. President Donald Trump’s tariff war, other regional actors have resolved to uphold the principles of openness, multilateralism and free trade. Indeed, the U.S. leader’s unpredictability has compelled China, Japan, and South Korea to revisit the hitherto stalled trilateral free trade pact.
The cynics may counter that the harsh reality of the international system (witness how the European Union has succumbed to U.S. demands in recent trade negotiations) constrains the diplomatic leverage of non-major powers, let alone for a middle power like South Korea.
But, is the U.S. as formidable as it is claimed to be? In her recent article for Foreign Affairs, American international relations scholar Kori Schake offered a more sobering view of her country’s power, attributing Trump’s foreign policy to “a significant overestimation of American power.”
Schake’s analysis gains credibility when we consider the recent decision by the U.S. Commerce Department to issue licenses allowing Nvidia to export its H20 chips to China, reversing an April ban on selling these chips to Beijing. While Washington’s flip-flop may reflect Trump’s negotiating style, the U.S. leader has (so far) failed to persuade China to end energy imports from Iran and Russia, despite the ongoing standoff between the two superpowers over a trade deal.
Then there are growing doubts about the credibility of the U.S. dollar as the global reserve currency. This skepticism is rooted in the ever-increasing U.S. debt, which, as economist Kenneth Rogoff has argued in recent years, has contributed to sharp rises in long-term interest rates on ten- and 30-year treasury bonds. While the short-term status of the dollar may not be under serious scrutiny, global policymakers (including those in South Korea) would have to hedge their bets in the coming years.
As the recent summit between Presidents Lee Jae-myung and Trump has revealed, Seoul has little appetite for “derisking” from Washington (and no desire to ). At the same time, irrespective of South Korea’s earnest desire for a close economic and technological partnership with the U.S., Washington remains eager to reduce its external dependence on major technologies like chips, which U.S. policymakers view as a “strategic necessity.”
In his “Rethinking Geopolitics,” Jeremy Black noted that each state tends to understand its domestic politics, including geopolitics, but not those of other states. The same cardinal rule should also apply to South Korea. Given Trump’s transactional approach and imperial tendencies in foreign policy, Seoul will need a more nimble approach in the country’s geoeconomic statecraft, which will enhance South Korea’s status as a key middle power.
As one expert explained, South Korea has shown its intent to navigate the intense competition between the two superpowers through strategic engagement, especially amid increasing doubts about the U.S. commitment to the region (not to mention tariffs).
The early signs are promising; during his recent summit with the Vietnamese leader, Lee Jae-myung committed to strengthening economic ties with Vietnam (a fellow middle power), leading to memorandums of understanding on nuclear and renewable energy, finance, energy, and technology.
Then there’s Indonesia. The Strait of Malacca, according to the U.S. Energy Information Administration (EIA), is one of the world’s most vital strategic chokepoints. It is a strategic area located in one of the most contested maritime zones (and also encompasses the Indonesian island of Sumatra) between China and the United States. Coincidentally, South Korea has formed a close partnership with Indonesia especially in defense.
Amid Washington’s concern over Beijing’s expanding influence in the Indo-Pacific, South Korea can point to its cooperation with Vietnam and Indonesia as clear examples of a force multiplier. By supporting the defense needs of regional countries, the nation can help bring much-needed stability to the Indo-Pacific region by bridging the gaps in Southeast Asian states’ defense capabilities against the rising hegemonic power, China.
In so doing, Seoul is well-positioned to leverage its newly-gained status as a “force multiplier,” capable of shaping the geopolitical calculations of the two superpowers.