Senior Vice President for Asia, U.S. Chamber of Commerce
August 17, 2023
What to expect
President Biden will host Japanese Prime Minister Kishida and South Korean President Yoon at Camp David on August 18, marking the first time he welcomes world leaders at the U.S. presidential retreat in Maryland. This will be the fourth meeting among the three leaders this year, with the most recent meeting taking place in Hiroshima on the sidelines of the G7 Summit. In addition, this is notably the first standalone meeting among Biden, Yoon, and Kishida, signaling a welcome warming of relations between the U.S.’ most important allies in the Indo-Pacific. We expect the leaders to use this opportunity to reiterate their commitment to deepen trilateral ties and expand cooperation on economic and security issues.
Why it matters
Japan and South Korea have a complex and difficult historical relationship and one that has impeded efforts to build trust and cooperation. The two countries are vital to U.S. interests in the region, and the thaw in relations presents an exceptional opportunity to strengthen trilateral economic and commercial cooperation. The U.S., together with Japan and South Korea – our fourth and sixth largest goods trading partners, respectively – share common values and are global leaders in innovation. The U.S. and Korea celebrate the 70th anniversary of their alliance this year, with the two governments and private sectors highlighting their strong bilateral high-tech collaboration. Meanwhile, the U.S. and Japan have emphasized their economic leadership through their hosting of and collaboration on the APEC and G7 meetings in 2023, respectively, based on a shared commitment to uphold a rules-based, safe, and secure global trading system.
The two countries' shared approaches to regional security and trade are reasons for the new opening in bilateral relations. Japan-Korea trade relations have also thawed under the leadership of Prime Minster Kishida and President Yoon, with Japan lifting export restrictions on high-tech materials to Korea in March and both countries relisting each other on their respective trade “whitelists.” Improved relations between Japan and Korea will have positive implications for the business community, especially as the three countries look to strengthen economic security cooperation and enhance supply chain resilience. Coordination among the three partners is also fundamental to the success and durability of the Biden administration’s efforts to make progress on regional initiatives like the Indo-Pacific Economic Framework and any successor endeavors.
What we want to see
Digital trade stands as a pivotal realm for trilateral collaboration owing to its substantial contributions to global economic growth and employment opportunities. To effectively counteract the proliferation of digital protectionism and prejudiced digital policies that imperil prospects within the digital economy, it is imperative for the U.S. to foster enhanced cooperation with Japan and Korea.
Equally important is the need for the three partners to address climate change while ensuring the secure, stable energy supply each nation requires to advance equitable energy access and economic competitiveness. The robust involvement of the U.S. in the evolution of global energy supplies presents an avenue for substantial benefits to Japan and Korea's energy security. The leaders should promote an “all-of-the-above" approach to the energy transition by mobilizing a diverse array of energy sources.
The Chamber’s take
U.S.-Korea economic and commercial relations, based on the foundations of the U.S.-Korea Free Trade Agreement (KORUS), are stronger than ever. The U.S. private sector has a large footprint in Korea and remains committed to strengthening the bilateral trade relationship. The Chamber’s U.S.-Korea Business Council (USKBC) hosted South Korean President Yoon for the U.S.-Korea Business Roundtable and Forum earlier this spring at the Chamber, bolstering the U.S.-Korea Alliance, and highlighting ways to advance cooperation between the two countries’ private sectors.
Esperanza Jelalian, Executive Director of the USKBC said, “The council welcomes deepened trilateral relations between the U.S., Japan, and Korea. We look forward to working closely with Korean business organizations and supporting efforts to strengthen partnerships on climate resilience and energy transition, digital transformation and critical and emerging technologies, economic security, and supply chains.”
The U.S.-Japan economic relationship is a critical source of stability and prosperity in the Indo-Pacific. As demonstrated by their longstanding business investment and operations in Japan, U.S. businesses seek to continue to grow in the market and forge the most cooperative and mutually beneficial economic partnership possible between the two countries. The 60th U.S.-Japan Business Conference, co-hosted by the Chamber’s U.S.-Japan Business Council (USJBC) together with our Japanese counterpart in October, is a testament to this robust and enduring economic partnership.
“The positive trajectory of Japan-South Korea relations signals a key opportunity for greater cooperation on issues of critical importance to the business community, such as addressing economic coercion and strengthening supply chain resilience. We look forward to working alongside the governments and private sectors of both countries to support this productive momentum, which will have reverberations beyond Northeast Asia,” said Tomoko Hosaka Mullaney, Executive Director of the USJBC.
President Biden is to be commended for the breakthrough in trilateral relations. As with most things, the hard work will follow the meetings at Camp David. The people-to-people and security relationship among the three countries has never been stronger. Improving the commercial relationship can only strengthen the bonds among the three Allies.
About the authors
Charles Freeman, senior vice president for Asia at the U.S. Chamber of Commerce, has been helping companies navigate complex markets in the Asia-Pacific for 25 years. His career included senior stints in government, business, law, and academia, giving him a unique perspective on the challenges and opportunities in the world’s most dynamic region.