Behind South Korea’s New Northern and Southern Policy

Indonesia-South Korea relationship has entered a new episode. During President Moon Jae In’s recent visit to Indonesia, South Korea declared the New Southern Policy. The two countries also affirmed their commitment to strengthen their cooperation by increasing their level of cooperation to Special Strategic Partnership.

South Korean President Moon Jae In (source)

What does it mean for Indonesia? What is behind South Korea’s decision to declare the New Southern Policy in Indonesia while at the same time established Special Strategic Partnership level of cooperation?

During President Moon Jae In’s latest visit to Indonesia on November 2017, Indonesia and South Korea agreed to strengthened the cooperation between the two countries in four sectors, namely security, economic, people-to-people exchange, and also cooperation in regional and global level.

But why Indonesia?

President Moon Jae In wants South Korea to have a closer relationship with Southeast Asian countries, especially through ASEAN. South Korea wants to elevate the cooperation with Southeast Asia to the level of South Korea-China’s current cooperation. South Korea chooses Indonesia because Indonesia has a strategic position and role in ASEAN.

On the other hand, Indonesia and South Korea have a very broad complementarity. Indonesia, with its growing economy needs foreign investment to continuously boost its economic development. South Korea, with its manufacturing industries, needs raw materials in which Indonesia is very rich of it.

Why Southeast Asia?

Southeast Asia has a young demographic that is very attractive for South Korea. South Korea can make Southeast Asia’s young population as the market of South Korean product.

Given that China is South Korea’s number one trading partner, South Korea is very dependent upon China.

So what? Is being dependent upon China bad for South Korea?

During the last deployment of United States’s Terminal High Altitude Area Defense (THAAD) in South Korea, China felt uncomfortable. China cut off various trades with South Korea, and this seriously damages South Korea’s economy.

Now that South Korea realizes how dependent South Korea from China, South Korea tries to find another partner by diversifying its economic relations. However, South Korea does not want to displease China in the meantime due to its huge dependence on China today.

Diversifying? Does that mean South Korea need to cooperate not only with its southern neighbors?

Yes. South Korea has actually declared its New Northern Policy in Russia just several months before it declared its New Southern Policy in Indonesia.

These two new policies are complementary to each other. While the New Southern Policy aims to forge cooperation with Southeast Asian countries and to elevate the level of cooperation to South Korea-China’s current level of cooperation, the New Northern Policy aims to improve South Korea’s relations with Russia (and some other East Asian countries such as Mongolia) in energy.

South Korea also tries to improve cooperation with several Chinese province as part of its New Northern Policy. What does this mean?

As mentioned before, South Korea is trying to please China. By including several Chinese province in South Korea’s New Northern Policy, South Korea wants to be seen as not really distancing itself from China. To put it simply, South Korea wants to play safe.

But why does South Korea plays a wait-and-see game with United States’ Indo-Pacific Initiative? Doesn’t the initiative try to contain China as well? Isn’t the initiative perfect for South Korea that is trying get away from China?

I would say that South Korea tries to play it cool. South Korea wants to play safe by not offending China by openly supporting United States’ Indo-Pacific Initiative.

Now that the condition is this complicated, what’s in it for Indonesia? What’s at stake?

Indonesia, which is chosen by South Korea to declare its New Southern Policy, is a country that South Korea finds attractive to elevate the relationship into a Special Strategic Partner. With Indonesia’s current bargaining position, Indonesia can advocate the right of its citizen in South Korea (especially those of workers), easier access and application process for South Korean visa for Indonesian citizens, or even share of best practices for Indonesian industries.

Now that South Korea is torn between its biggest trading partner (China) and its traditional ally (US), a strategic move has to be taken by players in Asia-Pacific (or now the so-called Indo-Pacific).

South Korea might say that it will wait-and-see United States’ Indo-Pacific Initiatives, it seems that South Korea will not choose China over the United States — seeing from the fact that the whole South Korea’s New Northern Policy and New Southern Policy is all directed to decrease South Korea’s dependence on China — because the United States is South Korea’s traditional ally after all.