And here is another tough decision for South Korea to make… in its diplomatic maneuver between China and the U.S…. and that is, whether to join a new China-led regional bank.
There are many pros… but the one con is a possible dent in Seoul-Washington relations.
Connie Kim reports.
China aims to create a new financial order centered around China with the Asian Infrastructure Investment Bank.
Launched last year, it aims to provide project loans to developing nations and promote economic growth.
But the U.S. opposes its establishment as it believes Beijing could use the bank for political purposes.
During talks in Seoul on Tuesday, U.S. Assistant Secretary of State Daniel Russell conveyed Washington′s concerns to senior South Korean officials… and called on China to ensure transparency for the new financial institution.
Those who take a cautious stance say South Korea joining the AIIB could be a stumbling block in strengthening the South Korea-U.S. alliance because it goes against the U.S.-led Asian Development Bank.
Supporters of Korea becoming a founding member of the AIIB say it would be a win for Seoul economically and politically.
“Washington and Japan are the biggest shareholders in the Asian Development Bank so Korea would have very little decision making power. If South Korea joins the AIIB, Seoul will have a greater chance of participating in infrastructure projects for developing countries in Asia.”
Looking ahead, analysts also say Seoul′s participation in the bank could help secure stabilization funds and capital for building infrastructure post-reunification.
Pundits, point out, however, that it′s important for Seoul to expand its share in the AIIB to increase its decision making role.
“With Korea mulling over whether to join the China-led development bank, experts call for a diplomatic strategy that does not favor either Washington or Beijing, but is in Korea′s best national interest.
Connie Kim, Arirang News.”