China’s sudden application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) in September 2021 has broad implications for South Korea’s economic relations with China, Japan, and the United States.

As China moves to deepen its ties to regional partners, Korea needs to follow suit, complementing the ongoing implementation of the Regional Comprehensive Economic Partnership (RCEP) with negotiations to join the CPTPP and participation in the US-led Indo-Pacific Economic Framework for Prosperity (IPEF).

Like its Asian partners in the RCEP and the CPTPP, Korea has substantial trade and investment ties with both China and the United States. Decoupling from either economic partner is both impractical and undesirable. Indeed, Korea already is in the process of deepening ties with China via the implementation of RCEP, which entered into force in January 2022 and is designed to strengthen regional supply chains linking production in the 15 member countries. At the same time, Korean President Yoon Suk-yeol has welcomed the IPEF, which promises to promote greater collaboration among its (non-Chinese) participants in developing a new architecture for governing the digital economy and the nexus of trade, labor, environmental issues as well as promoting US-Korea collaboration on semiconductors and electric vehicle batteries. The challenge for Korean policymakers is to balance ongoing implementation of Asian economic integration pacts with the new US-led initiative in the Indo-Pacific region.