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South Korea Finds Itself in a Tough Spot Following Huawei Ban

The banning of Huawei by the United States has sparked off a meltdown in the markets, but it has also made life uncomfortable for a range of countries which fear diplomatic awkwardness due to the issue. South Korea is one such nation, and currently, the Asian country finds itself in a tough spot due to the current situation. In this regard, it needs to be mentioned that South Korea has important relationships with both nations and any strain in those relationships would have far-reaching consequences. The US is one of its biggest allies due to the security it offers, while on the other hand, China is the country’s biggest partner as far as trade is concerned and hence, it is a fine balancing act for Seoul. In addition to that, it is necessary to mention that the South Korean economy is primarily driven by exports, and even a tiny fall could have consequences for the economy.

In a new development, several key political figures from South Korea as well as business leaders travelled to China and visited Huawei’s headquarters. The visit took place soon after the US had blacklisted the company, and hence experts believe that South Korea’s leaders are now going to find themselves in a well-known conundrum. Considering the fact that many companies in the US have now stopped business with Huawei, the US might nudge South Korea to do the same.

However, it would be a difficult pill to swallow for the country as such a move would not only jeopardize their relationship with China but also results in massive losses for some of the biggest corporations in the country. In such a situation, the country would perhaps need to make a choice, and it remains to be seen what that ends up as. Former consulate general for South Korea in Hong Kong stated,

“South Korea has to face the moment of truth – choosing the United States or China. What if the U.S. is not only asking not to use Huawei products but also not to export South Korean semiconductors to China? The government needs to prepare for that worst-case scenario.”

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Jodie Miller

Jodie Miller is experienced journalist. She holds double degree in journalism and communication. She joined our team as a content curator. She enjoys writing and curating contents related to finance and forex world.

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