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New U.S.-China showdown may color upcoming APEC summit

Published: 13 Oct. 2025, 15:00

U.S. President Donald Trump, left, shakes hands with China's President Xi Jinping during a meeting on the sidelines of the G-20 summit in Osaka, Japan on June 29, 2019. [AP/YONHAP]

Signs are emerging of a renewed U.S.-China standoff, triggered this time by a dispute over rare earth exports. After China announced export controls on the strategic materials on Oct. 9, U.S. President Donald Trump responded the next day, declaring that Washington would impose 100 percent tariffs on Chinese goods starting Nov. 1.

The move all but dismantles the so-called Geneva Accord struck in May, when the two countries agreed to cut tariffs by 110 percentage points each. With the agreement unraveling, Korea finds itself trapped in the middle — unable to take sides and increasingly exposed to what analysts are calling a “sandwich risk.”

The United States condemned China's export control holding the world economy as “captive,” according to Trump, while China defended the measure as a legitimate exercise of its “rightful interests,” according to its Ministry of Commerce.

“China is weaponizing its near-monopoly on rare earth technology, treating it as a strategic asset in its standoff with the United States,” said Heo Yoon, professor at Sogang University’s Graduate School of International Studies. “The U.S., in turn, has countered with tariffs while keeping the door open for negotiation.”

Rare earth elements are a group of 17 metallic elements used in high-tech industries ranging from defense and smartphones to electric vehicles and semiconductors. Because a disruption in supply could halt production lines in major manufacturing economies, they are often referred to as the “oil of the 21st century.” China currently supplies about 60 percent of the world’s rare earth elements — and more than 80 to 90 percent of U.S. imports — making it likely that building an alternative supply chain will take several years. As a result, control of rare earths and other critical minerals is becoming one of China’s most potent bargaining chips.

The impact is already being felt in Korea. Key industries such as semiconductors and electric vehicles are vulnerable to supply chain disruptions.

Export cargo is piled up at the Pyeongtaek Port in Gyeonggi on Oct. 1. [YONHAP]

“As China gains broader discretion over how it interprets its export control list, Korean exporters are growing increasingly anxious,” said Chang Sang-sik, head of the Korea International Trade Association’s International Trade Research Institute.

Further compounding Korea’s dilemma is the ongoing deadlock in Korea-U. S. tariff negotiations. The United States is insisting on upfront investments in a deal worth $350 billion, while Korea is pushing to include an unlimited Korea-U. S. currency swap as a precondition. Minister of Trade and Industry Kim Jung-kwan visited Washington earlier this month and made some headway, but no substantive progress has been reported. Deputy Prime Minister and Finance Minister Koo Yun-cheol is scheduled to meet with U.S. Treasury Secretary Scott Bessent in Washington on Oct. 15 to continue the talks.

“U.S.-China tensions are also spilling over into Korea-U. S. relations, introducing new uncertainty,” said Lee Jae-min, professor at Seoul National University School of Law. “While the conflict with China is undoubtedly a challenge, it could also push the United States to finalize tariff talks with Korea before it becomes further embroiled in Beijing-related issues.”

Chang echoed the sentiment, saying, “With the U.S. spread thin across multiple negotiating fronts with China, it has greater incentive to wrap up trade issues with Korea quickly. For Korea, this is the moment to assert its interests, including greater cooperation in supply chains.”

As the U.S.-China spat escalates into a game of brinkmanship, concerns are growing that Korea’s sandwich risk will intensify ahead of the Asia-Pacific Economic Cooperation (APEC) summit at the end of this month.

“If the U.S. and China fail to ease tensions in the three weeks before the APEC summit, the meeting itself could be overshadowed by geopolitical friction,” said Park Sung-hoon, professor emeritus at Korea University’s Graduate School of International Studies. “The absence of any message of reconciliation or cooperation would place significant pressure on Korean diplomacy.”

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY KIM WON [[email protected]]