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South Korean President Moon Jae-in has made much of economic cooperation with Northern countries. Not long after taking office, he decided to assemble the Presidential Committee on Northern Economic Cooperation (PCNEC).

 

In late August 2017, Moon appointed Song Young-gil as head of the PCNEC. Moon announced his New Northern Policy at the third Eastern Economic Forum, which kicked off in September 2017 in Vladivostok, Russia. 

 

In an interview in April with HK01, a Hong Kong-based media outlet, Song said that Moon mentioned the New Northern Policy during his visit to China, proposing stronger cooperation between China and South Korea on areas such as trade and investment. Also, he suggested the Belt and Road (B&R) initiative and the New Northern Policy should be jointly directed at cooperation in infrastructure construction and Super Grid connection, to get other neighboring countries on board.

 

According to the HK01 report, the joining of the two strategies can be divided into two parts:

 

First, the New Northern Policy will link the Northeastern provinces in China and also connect with the China-Mongolia-Russia economic corridor. To be specific, as to the solution of the North Korean nuclear issue and a better North-South relationship, South Korea could build a multilateral relationship with China, North Korea and Russia by restarting the Rajin-Khasan-Hunchun logistics project or promoting the Tumen River development plan.

 

Second, the transcontinental rail network, an important plank in the B&R initiative, the China-Central Asia-West Asia economic corridor together with the New Northern Policy will combine to promote economic cooperation with Russia, Mongolia and Central Asia. This combination will improve communication between South Korea and the other countries on this route. 

 

What's the substance of the New Northern Policy? Will it create synergy with the B&R initiative? How should China respond to it? 

 

The US-South Korean alliance is the cornerstone of South Korea's foreign policy. Any external economic cooperation will be secondary to it. Even Moon's program for international economic cooperation was released after his visit to Washington in June. 

 

The New Northern Policy is part of the New Economic Map initiative that was made public internationally in July 2017 at the Korber Foundation. But Moon published documents with the same name before he became president.

 

The New Economic Map has been his consistent proposition. The main idea is to strengthen economic cooperation between North and South Korea, and build an H-shaped economic structure through cooperation with neighboring countries such as Russia, Japan and China. The goal is to forge the Korean Peninsula into the focal point of common prosperity in Northeast Asia. 

 

Better North-South relations and closer economic cooperation lie at the core of this concept. Moon's economic blueprint has similarities with the 10-year economic development plan drawn up by North Korea, and North Korea highly trusts Moon. The plan is very likely to progress, especially to facilitate the restarting of the Kaesong industrial region and the Kumgang Mountains tourist program.

 

The foreign economic policy of Moon has two main focuses, both of which are intended to push forward cooperation between the two Koreas: the New Northern Policy and the New Southern Policy. 

 

In November 2017, Moon proposed the New Southern Policy in Indonesia targeting the Association of Southeast Asian Nations (ASEAN). He has tried to include South Asia, especially India. 

 

The main connection with the B&R initiative is in joint development of the Southeast Asian market. The New Southern Policy sets a trade goal with ASEAN of $200 billion by 2020, which would be nearly equal to the $220 billion in trade between China and South Korea in 2017. 

 

The New Northern Policy covers all countries in the Commonwealth of Independent States, with China and Mongolia on board as cooperative partners. But Russia is its primary partner. 

 

Moon even chose Russia as a site to release the New Northern Policy, and he has shown great interest in developing Russia's Far East region with Moscow. 

 

 China is the next most important partner after Russia. Three factors have held South Korea back: the US-Korean military alliance, the North Korea nuclear issue, and the already close bilateral economic relationship which does not have much room left for improvement. 

 

Russia seems more appealing to South Korea. But the economic cooperation between China and South Korea has potential and is going to a deeper level. South Korea has greatly benefited from it. China will play a constructive role in welding the North and South. Thus, South Korea would like to link the New Northern Policy and the B&R initiative. 

 

In Northeast Asia, security issues - North Korea's nuclear issue in particular - clash with economic development and cooperation from time to time. However, no country alone can significantly improve the regional security situation.

 

Nonetheless, South Korea is still China's key partner in the region, especially on the economic front. It is crucial to promote the joining of the B&R initiative and the New Northern Policy, and even the New Southern Policy.

 

South Korea has done thorough research on the B&R initiative. But there has been insufficient study of the New Northern Policy in China. China needs to study the list of cooperation items more carefully. Some projects can even involve North Korea. After all, the denuclearization of the Korean Peninsula and cooperation of the two Koreas are both essential parts of the Chinas Peninsula policy.

 

This piece was published on GLOBAL TIMES on May 8, 2018.  Here is the linkage: http://www.globaltimes.cn/content/1101348.shtml 

 

 

 

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国际政治学博士,中国社会科学院世界经济与政治研究所国际战略研究室主任、研究员,中国南海研究院兼职教授。研究领域:中国对外战略、中国外交,海洋问题、能源政治,近期比较关注南海问题与“一带一路”。出版专著2部,主编2部,在《世界经济与政治》《国际政治研究》等国内代表性国际关系刊物上发表学术论文数十篇,在海内外报刊杂志上发表时事评论文章约200篇。

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