As economic interdependence between nations deepens, concerns over excessive reliance have come to the foreground. When interdependence becomes asymmetrical, it breeds vulnerabilities, widens inequalities and ignites geopolitical conflict. The problem is particularly acute among countries locked in strategic competition. Today’s global turbulence — most notably, U.S. President Donald Trump's aggressive tariff regime — reflects this. His administration is preparing to levy a punishing 145 percent tariff on Chinese goods, a move driven by the urgent need to resolve America’s overdependence on China.
Trump has long criticized China for exploiting its developing status since joining the World Trade Organization in 2001, arguing that it suppressed imports, promoted exports, weakened America’s manufacturing base and exacerbated inequality and unemployment. While the United States’ dependence on Chinese imports has steadily increased, China’s reliance on U.S. exports has declined — deepening concerns over asymmetrical interdependence. The Joe Biden administration, in response, introduced a strategy of “de-risking,” pursuing the diversification of critical mineral imports, correcting trade deficits and encouraging China to reduce its holdings of $85 billion in U.S. Treasury bonds. The goal was to preserve the benefits of economic ties while mitigating national security risks, by diversifying external dependencies, restructuring supply chains among friendly nations, boosting resilience and tightening controls on security-related technologies.
The current Trump administration, however, is taking a different approach. Rather than diversifying dependencies, it seeks to repatriate supply chains and shrink reliance outright. Tariffs have been imposed not only on China but also on friendly nations like Mexico, Canada and Vietnam, out of concern that China has used these countries as alternative export bases, prolonging U.S. dependency. Supply routes whereby Korea and Japan export intermediate goods to China for assembly into final products bound for the United States are also being blocked.
Yet the effort to resolve overdependence through tariffs has unleashed a retaliatory spiral, fueled by deepening mistrust between Washington and Beijing. Tariff levels have risen to near-prohibitive heights. In truth, the broad decoupling now underway is not merely a reaction to overreliance or unfair practices. It is a calculated move to weaken China and blunt its challenge to U.S. leadership — a war without gunfire, an economic war.
A complete decoupling, of course, remains unrealistic. The U.S. and Chinese economies are still intricately intertwined. As Trump has hinted, a shift toward negotiations is likely not far off. Nevertheless, reversing the steep tariffs and wide-ranging export and import restrictions now in place will be difficult. Diplomatically, China is forging alliances to counter the Trump tariffs, while the United States is pressuring major trading partners to limit transactions with Beijing, aiming to isolate China. As a result, the depth of interdependence between the two powers may decline significantly.
While excessive dependence is dangerous, insufficient interdependence carries even graver geopolitical risks. Dense economic networks have historically underpinned geopolitical stability. One reason East Asia has seen no full-scale war since China’s 1979 invasion of Vietnam is that major countries are tightly enmeshed in transnational supply chains. These links have helped prevent military conflicts even amid territorial disputes between China and Japan and tensions in the South China Sea.
Korea finds itself in a precarious position. Heavily exposed to risks from overreliance on both U.S. and Chinese markets, it faces an urgent strategic need to diversify. As the risks of U.S.-China decoupling grow, Korea may soon face an unwelcome dilemma — having to drastically scale back interdependence with one side or risking weakened security ties. While ongoing U.S. tariff negotiations are crucial, Korea must also prepare for broader shifts, pursuing a strategic adjustment across diplomacy, industry, and trade to reduce overreliance while maintaining appropriate interdependence. Furthermore, it faces a critical task: forging new partnerships and alliances with other nations confronting similar challenges to secure its place in a changing international order.