Indo-Pacific Trade-Security Environment Changes: from Free Trade to Supply Chain Competition 

Choi Yoon Jung 

(yjchoi@sejong.org) 

Director of the Department of Diplomatic Strategy Studies, 

the Sejong Institute 

English Abstract

With the Regional Comprehensive Economic Partnership (RCEP) taking effect, South Korea now enjoys free trade with partners representing 85% of world GDP.​ South Korea is a representative beneficiary of free trade. However, in the Indo-Pacific era of intensifying hegemony competition between the U.S. and China, trade is becoming more closely linked to security; it is clear that advanced economies are competing for an exclusive supply chain rather than free trade. The U.S.-led Indo-Pacific Economic Framework (IPEF) is a typical example. South Korea should maximize the fruits of free trade agreements, such as the RCEP. At the same time, South Korea should consider set up an ‘integrated supply chain adjustment body’ directly under the Blue House in charge of participating in the new supply chains initiated by the U.S. and EU, as well as developing supply networks in the new southern region. A comprehensive approach is required to enhance domestic industrial competitiveness and trade negotiating power. In addition, South Korea must maintain its trade partnership with China through various channels, including the RCEP, while working with the U.S. to contribute to regional prosperity and security.