The summit between U.S. President Donald Trump and Chinese President Xi Jinping in Beijing transcends typical diplomatic engagement, serving as a critical test for a new international order marked by conflict over war, supply chains, energy, and technological supremacy. Particularly in the context of the prolonged conflict in the Middle East, this meeting underscores the urgent need for both nations to manage potential clashes.
While tariffs, investment, semiconductor issues, and Taiwan appear to be the primary agenda items, the real focus of the discussions is likely to center on how to navigate the destabilized global economy and security landscape following the war in Iran. The U.S. is expected to leverage China's position as the largest buyer of Iranian oil to pressure for cooperation. Conversely, China may seek to project itself as a 'stability manager' to prevent soaring international oil prices and a global economic downturn, rather than aligning directly with U.S. pressure on Iran.
For President Trump, there are practical considerations at play. As the conflict in the Middle East drags on, international oil prices and inflation are likely to rise, which could ultimately burden American consumers and financial markets. With the midterm elections approaching in November, the Trump administration may find it politically and economically advantageous to maintain a stable relationship with China rather than engage in a full-blown confrontation. Similarly, China is likely to want to avoid exacerbating trade uncertainties with the U.S. amid its own economic slowdown and export challenges. Thus, both countries seem inclined to manage the costs of strategic competition rather than seek to dominate each other.
However, this does not imply a fundamental improvement in U.S.-China relations. Instead, the summit is more about recalibrating the rules of competition. The U.S. will likely maintain its stance of containing China in advanced semiconductors, artificial intelligence, and security, while also seeking to expand practical benefits through increased trade in agricultural products, aircraft, and energy. China, on the other hand, may focus on reducing the intensity of U.S. pressure regarding Taiwan and technology sanctions.
A key concern is the anxiety felt by allies and neighboring countries during this process. Recent U.S. military asset relocations to the Indo-Pacific region in response to the Middle East conflict and discussions about defense cost-sharing have raised significant alarm among South Korea, Japan, and Taiwan. The New York Times reported that Asian nations are worried about the possibility of the U.S. adjusting its security commitments for economic transactions.
For South Korea, the implications are particularly complex. A severe deterioration in U.S.-China relations could directly impact the South Korean economy through exports, exchange rates, and financial markets. Conversely, if the two nations establish a stable management system, it could alleviate market uncertainties in the short term. In fact, recent global financial markets have reacted sensitively to the potential easing of the Middle East conflict and expectations of U.S.-China stability.
However, South Korea must be cautious of a new balance of power that could emerge under the guise of 'stability.' As the U.S. expands strategic transactions with China, China's influence in Asia is likely to grow. This is not merely a diplomatic issue; it connects to semiconductor supply chains, advanced technology standards, maritime logistics, and energy security. South Korea, which is economically intertwined with China while relying on the U.S. alliance for security, is one of the countries most directly affected by changes in U.S.-China relations.
In this context, what is needed is not emotional partisanship but a realistic and sophisticated strategy centered on national interests. South Korea should maintain the U.S.-South Korea alliance as the cornerstone of its security while enhancing its diplomatic and economic buffer through supply chain diversification and technological independence. At the same time, expanding cooperation with Southeast Asia, India, the Middle East, and Europe to reduce dependence on specific countries will become increasingly important.
This Beijing summit is unlikely to change the world order overnight. However, it has the potential to be a significant turning point in how the U.S. and China manage their competition and the positioning of allies and middle powers in that process. South Korea should focus on expanding its strategic space in the evolving international order rather than being swept away by short-term market expectations or partisan narratives.
* This article has been translated by AI.
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