President Lee Jae-myung’s foreign policy signals a pragmatic shift: balancing US ties, managing China, engaging India, and redefining South Korea’s role as a strategic middle power in the Indo-Pacific.
South Korea has recently undergone a significant power transition, with Lee Jae-myung taking office as President, signaling a potential recalibration of its foreign policy. This change in leadership could usher in a long-anticipated reshaping of how Seoul navigates an increasingly complex geopolitical landscape.
Traditionally, South Korea has prioritized its alliance with the United States. Still, under Lee’s presidency, questions arise about how this approach might evolve, particularly concerning China, Japan, and the broader Indo-Pacific strategy.
Will President Lee Favor the United States or China More?
Lee’s election comes at a critical juncture for South Korea’s foreign policy, with the return of Donald Trump, or Trump-style transactionalism in the US, posing a serious challenge. Under the previous administration, Seoul followed Washington’s lead closely.
However, Lee is unlikely to be a “yes-man” and aims to navigate a more independent path centered on pragmatic diplomacy.
As it appears from the days of his campaigning, President Lee is likely to take a firm stance in trade negotiations with the United States, particularly in pushing for a reduction of the 25 percent tariff imposed on Korean imports. With South Korea’s economy facing significant headwinds, adjusting these tariffs will be a key component of Lee’s foreign policy, though it remains unclear how he will navigate the “Trump fear.”
From a broader perspective, it is important to note that the United States is currently falling behind in the global semiconductor race, a sector where South Korea excels. This presents a unique opportunity for Seoul to step in and fill the gap. The question is whether Lee can effectively harness this moment or whether other regional players like India, Japan, and China, despite ongoing trade tensions, will outpace South Korea in seizing the advantage.
To secure its economic future, South Korea must double down on its competitive strengths in sectors like semiconductors and shipbuilding while expanding strategic partnerships beyond its traditional allies. Strengthening ties with the US remains crucial.
However, parallel engagement with Asian powers such as Japan, India, and China will be essential for building a resilient, multipolar trade and innovation network central to Seoul’s future economic graph as a trading power.
At the same time, China looms as a far more enduring geopolitical and economic concern. Despite growing military assertiveness and regional tensions, China remains South Korea’s largest trading partner. This forces Lee to adopt a delicate balancing act: managing the US–China rivalry without compromising national interests. Trump may bring volatility, but China represents a structural, long-term challenge to South Korea. That must encourage Lee Jae-myung to consider India a critical partner in Asia.
China and Russia Do Not Want Peace on the Korean Peninsula
Not to overlook, the regional environment around South Korea has been highly volatile for a long time. The Korean Peninsula remains unstable not only because of North Korea’s persistent ballistic missile tests but also because of the rising chemistry between Pyongyang, Beijing, and Moscow. Despite the increasing concern, Lee has expressed willingness to pursue diplomatic dialogue with Pyongyang, advocating for peace, dialogue, and cooperation on the Korean Peninsula.
Lee hopes to revive the 2018 Inter-Korean Comprehensive Military Agreement and is more optimistic about engagement than his predecessor, Yoon. Yet, North Korea’s unpredictability means Seoul must stay cautious.
Meanwhile, China’s growing economic competition, particularly in semiconductors, UAVs, and LNG carriers, encroaches on South Korea’s industrial strengths.
The 2023 trade deficit with China underscored this shift. In 2024, China’s net foreign trade volume stood at 43.85 trillion yuan, and South Korea alone accounted for 2.33 trillion yuan, making it the second-largest trading partner. Further, as Russia pivots closer to China, the balance in Northeast Asia becomes even more complex. Lee must coordinate policies that reduce overdependence on Beijing and Moscow while hedging against North Korea’s provocations.
Will President Lee Change His Foreign Policy Soon?
The Indo-Pacific remains central to South Korea’s foreign policy, but the approach seems to be shifting. Under Lee, the emphasis will likely be more on multilateral and diversified partnerships, rather than aligning too tightly with any one bloc.
While the US-ROK-Japan trilateral alliance will likely be maintained, new avenues with countries like India and ASEAN members (including a comprehensive engagement with the EU) may gain traction. In other words, engagement with the Indo-Pacific may continue to figure highly under the Lee administration via a stronger preferential engagement with India and ASEAN in the region.
Furthermore, South Korea holds the potential to emerge as a leading strategic middle power in the Indo-Pacific. However, weakened institutions and policy inconsistencies have hampered domestic growth and international trade. Lee’s leadership could mark the beginning of a much-needed foreign policy reset, but whether he can translate vision into action remains to be seen. In other words, today’s Indo-Pacific is a theater of tension, with China’s assertiveness, US-China rivalry, and instability across the Taiwan Strait to the South China Sea. Lee’s government must stabilize South Korea’s economy while playing a constructive regional role without being caught in geopolitical crossfire.
Will South Korea Form a Better Relationship with India?
South Korea is becoming more engaged in the Indo-Pacific, especially in the economic and technological spheres. Bilateral ties with India are deepening, particularly in the shipbuilding and semiconductor sectors. With India aspiring to become one of the top 5 shipbuilding nations by 2047, a partnership with South Korea is mutually beneficial. India’s 25,000-rupee crore maritime development fund could be a game-changer for South Korean shipbuilders facing labor shortages and backlog issues.
South Korea needs to collaborate with foreign companies to accelerate its production capacity and technological capabilities. Seoul has been in ongoing discussions with New Delhi for some time, as India aims to become a major player in the global shipbuilding industry. By forging agreements with India while preserving significant diplomatic and strategic ties, South Korea could challenge Beijing’s dominant position and strengthen its economy.
Similarly, Seoul has opportunities to partner with Tokyo and New Delhi in the semiconductor sector. This trilateral cooperation could generate significant economic benefits for all three nations. These multipolar alignments are more likely to emerge under Lee’s leadership, as he would seek to reduce Seoul’s dependency on the United States and align the country with the evolving norms of a multipolar world order.
Lee’s foreign policy signals that Seoul no longer wants to be seen as merely an appendage to Washington’s strategy. Instead, it aims to emerge as a nimble, middle power that engages bilaterally and multilaterally on its terms. In this sense, South Korea is becoming a more active and credible Indo-Pacific partner. Suppose an extra-territorial actor like the EU today can have an active Indo-Pacific strategy. In that case, it only becomes natural for a resident actor like South Korea to think, strategize, and live in the Indo-Pacific.
Will President Lee Achieve His Foreign Policy Goals?
President Lee inherits a nation burdened with domestic economic stagnation and surrounded by a rapidly shifting geopolitical landscape. His focus on pragmatic diplomacy, multilateral trade partnerships, and economic revitalization holds promise but also immense complexity. Balancing ties with China and the US, improving relations with Japan despite historical grievances, and addressing North Korea’s nuclear threats all demand diplomatic agility. Lee’s outreach to India and efforts to diversify trade and industrial cooperation could provide critical economic relief.
However, success will depend not just on intentions but also on execution. Suppose Lee can manage internal challenges while keeping external relations steady. In that case, he may succeed in recasting South Korea’s role on the global stage, not just as a reactive player but as a forward-leaning strategic middle power.
About The Author: Jagannath Panda
Dr. Jagannath Panda is the Head of the Stockholm Center for South Asian and Indo-Pacific Affairs at the Institute for Security and Development Policy (ISDP) in Sweden, a Professor at the University of Warsaw, and a contributing editor at The National Interest.
Image Credit: Wikimedia Commons/Jeonnam Provincial Government.
