June 28 (Bloomberg) -- South Korean President Park Geun Hye and Chinese President Xi Jinping pledged closer diplomatic and economic ties, called for resuming talks to quell North Korea’s nuclear ambitions and vowed to expand bilateral trade by 140 percent in the next three years.
South Korea and China agree that a nuclear North Korea is “unacceptable under any circumstance” and will work together toward denuclearization of the North and peace and stability on the Korean peninsula, Park said in a joint press conference with Xi yesterday after their summit meeting in Beijing.
Xi called for six-nation North Korean nuclear disarmament talks to be resumed “as soon as possible,” while saying the situation on the peninsula is “currently changing in a positive direction.” The two leaders agreed to expedite the signing of a free-trade accord and expand bilateral trade to $300 billion by 2015.
“The summit showed a change in Chinese attitude regarding North Korea,” said Park Byung Kwang, senior research fellow at the Institute for National Security Strategy in Seoul. “Xi expressed through Park that China will never accept a nuclear North Korea, which is a definite shift from its previous stance of always stopping short of making such declarations and instead repeating calls for dialogue.”
After triggering tougher United Nations sanctions by testing a missile in December and a nuclear device in February, the North threatened strikes against the U.S. and South Korea. It then backtracked and proposed new talks this month, first with South Korea and then with the U.S. The North later called off the inter-Korean gathering, citing a protocol dispute.
China tightened enforcement of United Nations sanctions on the totalitarian regime, and Communist leaders have stressed the need for a nuclear-free peninsula during two visits from North Korean diplomats since late May. While Park campaigned on re-engagement with the North, she’s taken a tougher line since becoming president.
China and South Korea are “really trying to design their approach to North Korea,” said John Delury, assistant professor of East Asian Studies at Yonsei University in Seoul. “Both of them are groping a bit but they do have a good deal of common ground.”
Park’s office has said economic ties would be a main focus of the trip to the South’s biggest trading partner and the world’s second-largest economy. The countries signed eight agreements on cooperation in developing marine technology, nuclear energy and green issues and streamlining customs clearance processes for approved businesses. They also agreed to extend their currency swap line, worth 360 billion yuan or 64 trillion won, by three years to October 2017.
Park left Seoul yesterday leading the largest business delegation to accompany a South Korean leader on a state visit. This four-day visit is a chance to help South Korean conglomerates such as Hyundai and Samsung Group better tap China’s growing consumer class.
Such efforts may help her deliver on campaign promises to boost employment to 70 percent by 2017 from 64.2 percent. Park will hold a breakfast meeting today, joined by 71 South Korean executives, including Hyundai Motor Co. Chairman Chung Mong Koo. More than 300 business leaders and government officials will attend a business forum in Beijing, where Park will deliver a speech.
“South Korea’s future is increasingly the China relationship in terms of trade and investment,” Delury said. “For a new South Korean president this is the top priority -- to get China right.”
On her third day in China, Park will visit Xi’an, the location of a factory that Samsung Electronics Co. started constructing in 2012 to build memory chips. The facility is expected to be finished in 2014.
Park’s interest in China may have helped her in enlisting Xi’s support on North Korea. She taught herself Chinese in her late 30s by watching language programs on public television, according to her 2007 autobiography. She recommends Chinese philosopher Feng Youlan’s “A History of Chinese Philosophy,” which guided her through “times of difficulty,” she said in May.
Park comes to China as it grapples with its own troubles. A cash squeeze increases the chance that China will miss its economic growth goal of 7.5 percent this year. Park’s economy -- about six times smaller than China’s with a population that’s less than 4 percent of the larger country’s -- can’t compete on issues such as cheap labor and cheap exports, said Han Jae Jin, a research fellow at Hyundai Research Institute in Seoul.
“We need to accept reality and work together with China, and pick our battles,” Han said.