Three paths for Northeast Asia: Navigating the US-China rivalry on the Korean Peninsula

The U.S.-China rivalry is rapidly becoming the defining geopolitical contest of the 21st century, with Washington and Beijing maneuvering for influence and regional leadership. This strategic competition draws in a range of regional stakeholders – South Korea, and Japan, traditionally allied with the U.S., and North Korea, and Russia, who are deepening their partnerships with China. Against this backdrop, three strategic scenarios – collision, wedge, and win-win – offer distinct pathways through which the rivalry may unfold, either driving the region toward confrontation, creating divisions among allies and adversaries, or opening the door to mutually beneficial cooperation.

The U.S. approaches the region with two principle objectives: first, the denuclearization of North Korea, which it sees as essential to regional and global security; and second, the containment of China’s growing economic, military, and political influence. To advance these goals, Washington maintains a strong military presence in Asia and continually reinforces its alliances with Seoul and Tokyo. China, by contrast, prioritizes regional stability and economic prosperity in Northeast Asia. By aligning with Russia and the DPRK, Beijing’s broader ambition is to try to reshape the regional order in ways that diminish U.S. influence. This includes thwarting Washington’s military and political foothold and inducing conditions which are conducive to reunification with Taiwan on its own terms.

Collision scenario

In a collision scenario, rising tensions between the U.S. and China may prompt President Trump to take a series of assertive steps aimed at containing China and deterring North Korea’s provocations.

• First, Trump could authorize the deployment of additional U.S. military assets to the region. In addition to the 28,500 U.S. troops already stationed in South Korea, Trump could deploy a wide range of other military assets such as aircraft carriers, F-22 Raptors, additional Terminal High Altitude Area Defense (THAAD), Patriot missiles systems, strategic bombers, and nuclear submarines. These deployments would enhance deterrence, reassure allies, and signal U.S. resolve.
• Second, he may direct the Secretary of the Army to expand the U.S. Army’s forward presence in the Indo-Pacific by increasing prepositioned stocks, and rotational deployments. He would also press for large-scale joint military exercises with South Korea and Japan, as Washington sees closer trilateral cooperation as essential to countering both China’s assertiveness and North Korea’s advancing nuclear program. In addition, the DPRK’s belligerent activities serve as a pretext for the U.S. military presence in the region – largely aimed at containing China’s growing influence.
• Third, Trump could leverage his tariff policy as a strategic tool to contain China. This would involve imposing strict tariffs and restricting technology exports to hinder China’s technological rise, while easing tariffs on Japan and South Korea to ensure they adopt similar export controls, creating a coordinated effort against Beijing.

This would tilt the regional balance of power in favor of the U.S., a clear threat to Beijing’s objectives. The deployment of U.S. missile defense systems and aircraft would be deeply concerning for China.

Possible Chinese reponses

In response to U.S. actions, China may take several drastic steps to counter growing threats from the U.S. and its allies.

• First, China can incite the DPRK to resort to military provocations such as long-range missile tests, military drills, aggressive rhetoric, and testing of nuclear weapons.
• Second, China, intimidated by the U.S.’s growing provocations, may formalize a strategic alliance with North Korea and Russia, turning coordination into a definitive bloc, through joint military exercises, intelligence sharing, and a unified regional strategy.
• Third, Beijing and Moscow could formally recognize North Korea as a de jure nuclear weapons state through statements, legitimizing and cementing its status, while deepening regional divisions.
• Fourth, China might impose targeted punitive economic measures on key South Korean industries, aiming to punish Seoul for deepening its alignment with the U.S.

As tensions precipitate, Trump could encourage South Korea and Japan to pursue independent nuclear capabilities favoring shared deterrence, reversing prevailing nonproliferation. This shift risks creating a precarious nuclear balance among six armed states in Northeast Asia, heightening the chances of miscalculation and conflict.

In a wedge scenario, intensifying U.S.-China rivalry unfolds on the Korean Peninsula, as both great powers seek to reshape regional alignments.

From China’s perspective, South Korea represents the weakest link in the U.S.-led trilateral alliance – especially given the possibility that Lee Jae-myung could become the country’s next president. Lee, who embraces progressive views, has previously suggested that a U.S. troop withdrawal would be acceptable, and has expressed a pragmatic openness toward deeper engagement with China. Overall, his approach appears broadly compatible with Beijing’s long-term interests. Therefore, China would likely take decisive steps to advance its policy goals in Asia. China’s objectives would be a) to ensure permanent peace, stability, and economic prosperity on the Korean Peninsula and in Northeast Asia, b) to undermine the trilateral alliance among South Korea, Japan and the U.S. in order to undermine U.S. efforts to contain China , and c) to pursue unification with Taiwan under the “one country, two systems” framework. In contrast, the U.S. objectives would be comparatively limited – a) to achieve the denuclearization of North Korea, and b) to contain China.

To advance these objectives, China would likely implement the following measures:

1. a) offering South Korea and Japan economic incentives – for example, increasing trade volumes and investments;
2. b) engaging South Korea and Japan on security – for example, by underscoring that North Korea’s nuclear weapons are not aligned with China’s interests, and by pursuing collaborative efforts with Seoul and Tokyo to jointly and peacefully dismantle them;
3. c) countering external interference on the Taiwan issue – by fostering a cooperative relationship with South Korea, China seeks to ensure that Seoul remains inactive during any attempts to unify with Taiwan. Beijing is concerned that, as a U.S. ally, South Korea could be drawn into a potential conflict – whether through supply chains or direct involvement.

These efforts could gain momentum if, as expected, Lee Jae-myung becomes South Korea’s president. China would aim to draw both Seoul and Tokyo closer, positioning itself as a stabilizing force amid uncertainty regarding the U.S.’s long-term presence in the region. Consequently, South Korea would gain greater leverage in inter-Korean relations and benefit from a reduced military threat. Yet, in this scenario, both Koreas would face pivotal choices – North Korea would need to weigh the benefits of a U.S. partnership against traditional Chinese support, while South Korea would find itself navigating between a retreating but familiar U.S. alliance and an increasingly assertive China seeking long-term realignment. The result could be a fragmented Northeast Asia, shaped more by geopolitical rivalry than regional cooperation.

For Trump, the U.S.-China rivalry presents an opportunity to redeem his failed 2018-2019 summits and reassert U.S. influence through a bold diplomatic play. His strategy would likely unfold in two phases. First, he would manufacture urgency through pressure: authorizing large-scale joint military exercises with South Korea and Japan and opening talks with Seoul on redeploying or sharing tactical nuclear weapons – moves aimed at unsettling Pyongyang and increasing U.S. leverage.

What the U.S. could offer Kim Jong Un

Trump will then make an offer to Kim Jong Un that he cannot refuse. In exchange for North Korea’s Complete, Verifiable, and Irreversible Denuclearization (CVID), the U.S. would offer a comprehensive package that includes:

• An end to military and political hostility – The U.S. would cease all joint military exercises with South Korea and Japan, and refrain from publicly criticizing North Korea’s domestic politics – including its human rights record.
• Lifting of sanctions – Washington would move to lift sanctions against North Korea that restricted its economy, both unilaterally and through coordinated efforts at the United Nations.
• Peace and diplomatic normalization – The U.S. would endorse a formal peace treaty between the two Koreas, officially ending the Korean War. In parallel, the U.S. and Japan would forge diplomatic relations with the DPRK.
• Economic development support – Under Washington’s initiative, the U.S., South Korea, and Japan would coordinate efforts to support North Korea’s economic development, with South Korea providing credible sums of financial resources to ensure sustained economic growth.

The final, and most significant concession would be a U.S. commitment to withdraw troops from South Korea upon CVID completion. Trump would likely invite Kim Jong Un to the White House and jointly announce the deal at a press conference, framing it as a historic breakthrough – ending the Korean War, redefining the U.S. role in Northeast Asia, and securing his legacy as a peacemaker. A U.S.-DPRK normalization deal would pose a serious challenge to China’s regional strategy. By drawing Pyongyang closer to Washington, it would weaken Beijing’s influence and shift the regional balance in favor of the U.S., transforming North Korea into a cooperative partner and strategically isolating China.

Opportunity created by possible election of Lee Jae-myung

In the “win-win” scenario, tensions ease as major powers converge around shared strategic objectives. The incoming South Korean president – likely Lee Jae-myung – would be uniquely positioned to foster such an outcome. Lee’s accommodating stance toward both China and North Korea – balanced by commitments to the U.S. alliance – positions him as a credible mediator. His ability to engage all sides pragmatically creates a rare opportunity for breakthrough on the Korean Peninsula and to forge a package deal that aligns with the strategic objectives of all key stakeholders – the U.S., China, North Korea, South Korea, Japan, and Russia – offering terms that the DPRK cannot refuse.

The proposal should be built around seven key elements, contingent upon North Korea’s CVID:

1. Security guarantees, backed by both China and Russia
2. A formal peace treaty with South Korea, replacing the current armistice
3. Diplomatic recognition by the U.S., South Korea, and Japan
4. The lifting of international sanctions
5. An end to perceived threats, including cessation of U.S.-South Korean military exercises, and a halt to all public criticism of the DPRK’s internal affairs – including its human rights abuses
6. A commitment to credible and substantial economic aid, aimed at supporting the establishment of a sustained economic model for the DPRK
7. Upon fulfillment of obligations, removal of U.S. troops from South Korea

This strategy enables North Korea to denuclearize without endangering regime survival, while allowing the U.S. to achieve CVID and withdraw its troops from South Korea. Seoul could begin decreasing its military expenditure, focusing on economic growth – potentially fostering an economic partnership with the North. For China, it removes the U.S. military presence near its border, and promotes regional stability and trade.

All six stakeholders have an opportunity to avoid a zero-sum game by seizing a rare opportunity to transform decades of hostility into a practical, mutually beneficial framework for peace. The core challenge is to construct a win-win outcome – rooted in institutions, transparency, and reciprocal incentives – that replaces rivalry with lasting peace.

In the end, the DPRK’s objective is not only regime survival, but also sustained economic development. Yet this will remain out of reach without economic reform, which has to be preceded by political reform, – and as long as North Korea clings to its nuclear weapons. The extractive nature of its economic system has repeatedly proven incompatible without modernization. The time has come for the stakeholders to provide Kim Jong Un with a better chance of survival – one that does not rely on his nuclear arsenal, but instead offers him a chance to lift 25 million North Koreans out of poverty.