Some US protectionist policies like IRA undermine Biden's 'friend-shoring' initiatives

By Kim Yoo-chul

Tensions across the Taiwan Strait are now at the highest level in years, raising concerns that any unexpected policy mistake by either side risks dragging the United States into a potential direct military confrontation with China.

Since the previous Moon Jae-in administration, South Korea's stance towards the issue of the Taiwan Strait hasn't changed much, because the incumbent Yoon Suk-yeol administration has also indicated its stance of favoring the United States over China when it comes to cross-Strait issue, which political analysts view as a departure from Seoul's longtime stance of ambiguity.

Clearly, unlike the North Korean nuclear issue, when it comes to the Taiwan Strait, South Korea's political elites and mainstream media have yet to show a high level of attention as the issue is mainly being raised by security experts.

While this is understandable given Seoul's limited position, however, there are some possibilities of the North finding the diversion of Washington's attention to the Strait as a chance for more military provocations against the South.

Zack Cooper

As a move to show off its position of strength, North Korea is set to conduct another nuclear test next month at the earliest, said U.S. security experts and intelligence sources in South Korea. North Korea conducted six nuclear tests between 2006 and 2017. On a related note, the Biden administration responded heavily to the North's latest long-range ballistic missile launched over Japan and landing in the Pacific Ocean.

The key question is if the conflict in the Taiwan Strait deepens further, could the situation touch off a complicated situation on the Korean Peninsula because of Seoul's backing of Washington on the issue?

"In the case of a major conflict between China and Taiwan, it is possible that North Korea could escalate against South Korea while the international community (and potentially the United States) are focused on the Taiwan Strait," Zack Cooper, a senior fellow at the American Enterprise Institute (AEI), who previously served on staff at the National Security Council and the Department of State, said in a recent interview with The Korea Times.

Citing the Yoon administration's U.S.-favoring stance towards the Taiwan Strait issue, Cooper said South Korea and the United States should be prepared for potential contingencies.

"I suspect that U.S. ground forces in Korea would remain focused on deterring North Korea, but U.S. air and naval forces might be tasked with multiple missions. Nonetheless, the high degree of proficiency of South Korea forces should give us confidence that the alliance would be able to respond to any provocation," added Cooper, an adjunct assistant professor in the Security Studies Program at Georgetown University.


Within that context, he said he doubts North Korea has any intention of pursuing complete denuclearization.

"North Korea has little reason to give up its nuclear weapons and neither Seoul nor Washington can provide security guarantees sufficient to eliminate Pyongyang's concerns while Kim's brutal dictatorship continues. I doubt that complete denuclearization of North Korea is possible, at least while the Kim regime remains in power," he said.

Since former President Donald Trump's summit with Kim Jong-un in Hanoi ended with no deal, talks aimed at dismantling Pyongyang's nuclear programs have been stalled as Washington's top focus has shifted towards the situation in Ukraine and its bitter rivalry with China. U.S. think tanks and security experts view the North's recent passage of a law authorizing preemptive nuclear strikes as its intention to attain an irreversible nuclear capability.

"Talks toward denuclearization are unlikely to be successful, although arms control or confidence-building efforts could help to decrease ― or at least manage ― tensions. North Korea may use a nuclear test to gain attention and force its way back to the negotiating table, but its negotiating partners should remain highly skeptical of any North Korean offers," Cooper said, recommending Washington and Seoul officials to avoid spending too much time debating the division of defense spending and devote more time to the division of responsibilities.

Regarding ideas for South Korea to have its own nuclear capabilities as growing regional threats make the nuclear question increasingly relevant, Cooper said it would be better both for Washington and Seoul to work together on extended deterrence arrangements rather than South Korea developing a nuclear program.

President Joe Biden attends an event to support legislation that would encourage domestic manufacturing and strengthen supply chains for computer chips in the South Court Auditorium of the White House in Washington, March 9. AP-Yonhap

"The United States needs to ensure that South Korean leaders are confident in U.S. extended deterrence guarantees. That may require closer integration, more information sharing, and perhaps even new strategic mechanisms. Developing nuclear weapons would be a financially costly and politically difficult path for South Korea (and one that would at best duplicate existing alliance capabilities)," said Cooper, who was previously a senior fellow for Asian security at the Center for Strategic and International Studies (CSIS).

Concerns over US' protectionist trade policies

He said the United States has to defend the best interests of its like-minded allies, as the lowering of Washington's protectionist policies is an important factor in accelerating Biden administration's "friend-shoring" initiatives.

South Korean businesses are expressing their dissatisfaction over the $430 billion Inflation Reduction Act (IRA), as top-tier South Korean car manufacturers ― Hyundai and Kia ― will not be eligible for the federal tax credits. Before the IRA was signed, Hyundai Group's car brands were eligible for federal tax credits of up to $7,500 and U.S. President Joe Biden himself hailed the South Korean automotive group for its decision to invest heavily in electric vehicle (EV) factories in the United States. But the IRA requires vehicles assembled in Mexico, Canada or the U.S.

While some homegrown exporters that already possess U.S. manufacturing facilities, such as LG Energy Solution (LGES), are set to benefit the most from the IRA, some South Korean politicians and high-ranking government officials are calling the move a betrayal of the bilateral trust between Washington and Seoul.

"It would be wiser for the United States to embrace 'friend-shoring' by relying more, not less, on key allies like South Korea. I hope that Seoul's appeals can help Washington understand the damage that these protectionist policies are doing abroad. South Korea and other U.S. allies and partners are right to be frustrated by the protectionist parts of the IRA," Cooper said.

"The Biden administration talks frequently about the need to tighten U.S. alliances and partnerships, particularly on critical supply chains. But these provisions undermine the U.S. ability to assure friends that the United States is going to be a reliable partner in this regard."

He pointed to the Chip 4 as a valuable opportunity for South Korea to show its leadership.

"About the Chip 4, for example, it is also worth noting that South Korea is not a formal member of a number of other minilateral groups such as the G7, Quad, Five Eyes or AUKUS," he said. "South Korea needs to find a space in which it can show leadership on the global stage, and I think Chip 4 presents a valuable opportunity."