South Korea, THAAD, and the Limits of China’s Influence

July was a rough month for China-South Korea relations. On July 8, the United States and South Korea formally announced an agreement to deploy the Terminal High-Altitude Area Defense (THAAD) system in South Korea. China had been trying for months to talk Seoul out of taking this step, arguing that the missile defense system jeopardizes China’s own national security.

A few days later, on July 12, the Permanent Court of Arbitration issued its final award in the case brought by the Philippines against China’s claims in the South China Sea. The tribunal ruled against China in every meaningful respect, leading to an outpouring of statements urging China to respect the ruling – and pressure from South Korea’s major ally, the United States, for Seoul to join the chorus.

One day later, on July 13, South Korea and the United States issued a statement announcing that THAAD would be deployed in Seongju, Gyeongsangbuk-do Province.

All in all, it’s hard to imagine that less than a year ago, Chinese President Xi Jinping was extolling the virtues of the China-South Korea relationship, which he described as “the best-ever national relationship in history.”

The downward trend started, predictably enough, with North Korea – the major cause of nearly every rift between Seoul and Beijing. After North Korea’s nuclear test back in January 2016, there was major concern in Seoul over the reaction – or lack thereof – in Beijing. Reportedly, South Korean President Park Geun-hye wasn’t even able to get ahold of Xi on the phone – this after six face-to-face meetings in less than three years. To some, that was a sharp signal that Park’s strategy of wooing China in the hopes of corralling Pyongyang was a dead end.

Mixed in with the ever-present triangular relationship between China and the two Koreas, China –U.S. relations have been growing ever tenser. For South Korea, this meant an awkward tug-of-war between its major economic partner (China) and major security partner (the United States) – just at the time when Seoul itself felt most threatened from Pyongyang. And when push came to shove, Seoul chose its security interests – THAAD – over Chinese objections.

What does this mean for China? Looking at South Korea’s diplomatic response to the recent flashpoints (THAAD and the South China Sea ruling), two fundamental points are clear. First, China will not be able to use economic or even political leverage to talk U.S. security partners out of pursuing what they see as vital national interests. Second, what leverage China does have with U.S allies is also, surprisingly, found in the security field – not the economic ties, Beijing has long touted as its ticket to global influence.

On the question of THAAD, China’s objections were met with a sharp rebuke from the South Korean side that Beijing should not interfere in questions of South Korea’s domestic security. There was also more than a little schadenfreude in Seoul’s response – to South Koreans, after all, Beijing bears quite a bit of responsibility for Pyongyang’s continued misbehavior. If South Korea’s response to the North makes China uncomfortable, all the better, from Seoul’s point of view.

When the decision was made, China made sure its objections were heard loud and clear. The government summoned the ambassadors of both South Korea and the United States to lodge representations. Foreign Ministry spokesperson Hong Lei told reporters that deployment of THAAD “will gravely sabotage the strategic security interests of regional countries including China… China strongly urges the U.S. and the ROK to halt the process of deploying the system and refrain from complicating the regional situation or undermining China’s strategic security interests.”

But the process moved ahead nonetheless. When THAAD’s location was announced on July 13, South Korea’s Deputy Defense Minister Yoo Jeh-seung made it clear that “the authorities take national security and the people’s safety as top priorities, more than anything else,” according to a news release from the Blue House.

China responded with an ominous statement, from another Foreign Ministry spokesperson, that “China will take all necessary measures to safeguard its interests.”

THAAD was a hard blow for China, which has been counting on its warm economic relationship to help it eventually supplant the U.S.-led security order in Asia. In 2014, Xi announced China’s intention to found “a new regional security cooperation architecture” where “the people of Asia… run the affairs of Asia, solve the problems of Asia and uphold the security of Asia.”

South Korea’s decision put a wrench in China’s hopes. But to China’s relief, the decision to go with THAAD did not mean Seoul was giving up on its relationship with China to cast its lot entirely with the United States. Instead, South Korea continued to walk a delicate tightrope act on the South China Sea, where its larger partners have vital interests but South Korea does not.

The United States, though it did not initiate the arbitration case, has become one of its most vocal backers. Immediately after the ruling, a U.S. State Department statement said in no uncertain terms that “the Tribunal’s decision is final and legally binding on both China and the Philippines. The United States expresses its hope and expectation that both parties will comply with their obligations.”

Washington’s other major regional allies – Australia and Japan --  both also called on China and the Philippines to abide by the ruling, noting the judgment was binding (a point China strongly disputes). South Korea, however, was a notable exception.

The statement from Seoul’s Foreign Ministry merely said that South Korean government “takes note of the arbitration award… and hopes, following the award, that the South China Sea disputes will be resolved through peaceful and creative diplomatic efforts.” In other words, Seoul did not join the U.S. and its other major Asia-Pacific partners in calling for China to respect the judgment.

For Chinese policymakers, this was a success. South Korea made no mention of the binding nature of the ruling, and not even a mention of UNCLOS or international law more generally, simply an appeal for disputes to be “resolved in accordance with relevant agreements, non-militarization commitments, as well as internationally established norms of conduct.” So a victory for China on the South China Sea, but a setback on THAAD. What’s going on?

The examples of Japan and Australia – which, like South Korea, count China as their top trading partner – provide a useful counterpoint here. The reason for South Korea’s relative neutrality on the South China Sea issue is instructive: not because of its economic partnership with China, which would also sway Japan and Australia, but because of its security concerns vis-à-vis China. Despite its robust economic ties with Beijing, Seoul continues to view that partnership largely through a security lens – as a means to the ultimate end of altering North Korea’s belligerent behavior.

In other words, in both choosing to deploy THAAD and keeping its head low on the South China Sea, South Korea was making a strategic decision motivated by its security concerns. Alienating China, the potential key to the North Korean issue, over the South China Sea does not make not good policy sense for Seoul. But when it comes to THAAD deployment, and the defense of South Korean soil from an imminent threat, Chinese objections were overruled. Australia and Japan, meanwhile, made their own strategic calculations, and reached a different conclusion on the South China Sea.

This proves what should have been obvious to Chinese policymakers from the beginning: China’s economic leverage will only get it so far. When states see their own core national security at stake – whether through North Korean missile tests or through Chinese encroachments in an exclusive economic zone, as is the case for Manila – Beijing won’t be able to sway its neighbors. Those choices will instead be made in conjunction with the United States, which remains the security guarantor of choice for most of the region.

For now, when it comes to getting its way on regional security issues, China remains very much what David Shambaugh termed a “partial power.”