On the face of it, the recently-signed free trade agreement between the US and South Korea, America's biggest agreement in over 10 years since the signing of the North American Free Trade Agreement (NAFTA), may appear to be propelled by President Barack Obama's desperation to increase exports and, in turn, create the jobs his country badly needs.

But there is more to it than meets the eye.

After initial reluctance towards the pact, South Korea's change of heart seems to have come after North Korea's recent shelling of Yeongpyeong island.

Though the US-South Korean pact is essentially economic in character, its timing would suggest that the South Koreans want to "keep Washington happy" and ensure that it is actively on board if push came to shove with regard to an unpredictable North Korea where transfer of power from its leader Kim Jong-il to his 27-year-old son can only add to the irrational behaviour.

With Americans baying for cuts in unproductive defence expenditure, the South Koreans feared that Washington's support would slacken in the fight against the North. The pact is the proverbial carrot that would prod Washington to provide active support should the current tense situation escalate into a full-blown war.

The Obama administration, already waging wars in Afghanistan and Iraq, will be cautious about opening up another front which could have a disastrous impact on the US economy. Thus, the US will not give the South Koreans a free hand in determining how to retaliate if there is any further provocation from the North.

Pyongyang is "craving for attention", to use the oft-repeated euphemism for its urgent need for money. Though China's largesse helps the North keep afloat, Beijing is by no means liked by North Koreans, as many of its officials fleeing to the South have been telling the media.

China's attitude towards the North, motivated by the desire to maintain the regional balance-of-power, is summed up by the adage ‘you-throw-the-dog-a-bone' to shut it up for some time. Recent Chinese statements also suggest its growing frustration with Pyongyang though it will continue to support it.

Full-scale war

But the danger emanating from North Korea is far greater than one would imagine. The US intelligence community believes that a military clash of low intensity between South and North Korea could follow in the event of another provocation; the scenario would be characterised by shelling from both sides on targets across each other's territory or skirmishes at sea.

The US administration, facing a major economic crisis at home, is unnerved by another development: the usually restrained South Koreans are now thinking of giving a "fitting reply" to North Korean provocations.

General Han Min-koo said that the South Korean military would "completely crush the enemy" if there was another North Korean attack. A recent survey suggests that 80 per cent of South Koreans would support a military retaliation against another North Korean attack, compared with only 30 per cent supporting such a response six months back.

The just-concluded joint US-South Korean military exercises off the coast of the Korean peninsula — even though Washington described them as "defensive" — were intended to send a strong message to Pyongyang: that its belligerence will no longer be tolerated and that a retaliation would be inevitable if there was another attack from it.

Since South Korea, backed by the US, will not tolerate any North Korean provocation, China will try to restrain Pyongyang — though it will not easily yield to Beijing's pressure. Beijing cannot afford to have a military conflict, or become involved in one, in its neighbourhood. That would spell disaster for its economic development and shatter its global leadership aspirations.

It would also be in China's interest to urge North Korea to show restraint on the nuclear issue so that it comes out of its present isolation. The balance-of-power in the Korean peninsula is delicately poised, and both China and America will have to ensure that this balance is maintained in the future.

 

Manik Mehta is a commentator on Asian affairs.