AnalysisGyeongju Declaration cements Korea’s leadership amid US-China rivalry

President Lee Jae Myung poses with world leaders during the Asia-Pacific Economic Cooperation Economic Leaders' Meeting in Gyeongju, North Gyeongsang Province, Saturday. Newsis

Korea emerged as a diplomatic leader as the Asia-Pacific Economic Cooperation (APEC) economies concluded the landmark event in the historic city of Gyeongju, North Gyeongsang Province, by adopting the Gyeongju Declaration. The summit’s outcome not only solidified Korea’s stature as a regional power broker, but also set the tone for international cooperation amid an intensifying U.S.-China rivalry and the rise of protectionism around the world.

Korea, as host of the 2025 APEC summit, successfully steered the Gyeongju Declaration to completion, notably achieving a consensus to include artificial intelligence (AI) and demographic changes as central pillars of future Asia-Pacific economic cooperation.

For President Lee Jae Myung, it was the passing of a major test. He led a week of high-stakes negotiations and successfully navigated uncertainty to broker consensus among 21 member economies. He also led efforts to secure a trade agreement in the long-running tariff dispute with Washington.

Central to the summit was Korea’s success in brokering the joint declaration, framed around the 2025 APEC agenda of connectivity, innovation and prosperity. It addressed pressing challenges and called for commitments to further economic integration and collaboration in the region.

Notably, the statement acknowledged the growing role of the culture industry in bringing together the member economies and promoting exchanges among them. Moreover, it framed the rise of AI technologies as both a risk and an opportunity, launching the joint APEC AI Initiative to promote safe, human-centered systems benefiting all.

President Lee Jae Myung shakes hands with U.S. President Donald Trump at Gyeongju National Museum in Gyeongju, North Gyeongsang Province, Wednesday. Courtesy of presidential office

Ahead of the event, Lee faced the possibility of “fruitless” discussions regarding tariff negotiations with the United States. But following his talks with U.S. President Donald Trump on Wednesday, Seoul said the two allies agreed to a phased $200 billion investment plan, accompanied by progress on tariff arrangements and Washington’s approval of Korea’s plan to build its first nuclear-powered submarine.

The news has alleviated uncertainty facing Korean companies investing in the U.S., though the two sides are still working on a fact sheet to clarify the details.

This has restored momentum to the Korea-U.S. alliance after months of doubts in Washington over Lee’s diplomatic stance, as critics initially attacked him as being “anti-American.”

President Lee Jae Myung smiles with his Chinese counterpart Xi Jinping during a banquet at the Lahan Select Gyeongju hotel in Gyeongju, North Gyeongsang Province, Saturday. Courtesy of presidential office

Meanwhile, Lee’s meetings with Chinese President Xi Jinping and Japanese Prime Minister Sanae Takaichi exhibited his broader balancing act. Korea reaffirmed economic and security ties with China, while attempting to deepen cooperation with the U.S. and Japan. His practical outreach eased anxieties over imminent diplomatic risks, such as lingering historical disputes with Japan and the potential of sustained supply chain disruptions from China.

Global businesses took notice. During his visit for the APEC CEO Summit, Jensen Huang, founder and CEO of Nvidia, committed 260,000 high-end graphics processing units for the Korean government and companies, signaling renewed faith in Korea’s economy in the era of AI.

Yet the diplomatic risks have not been completely eliminated. As tariff and investment details are still under negotiation with Washington, a careful approach is required to protect Korea’s national interests. Beijing’s concerns over nuclear nonproliferation could also hinder the project of building a nuclear-powered submarine, and there is the persistent risk of historical disputes flaring up with Tokyo.

Compounding this delicate balancing act, Lee must also revive the momentum for Washington-Pyongyang talks, which have stalled since Trump’s 2019 meeting with North Korean leader Kim Jong-un in Vietnam during his first term. Speaking to reporters on Saturday, Lee said he will take “preemptive measures” as part of the effort to rebuild inter-Korean trust, signaling a more proactive approach.

In a rare moment of bipartisan unity, representatives from both the ruling and opposition parties welcomed the adoption of the Gyeongju Declaration.

“This Gyeongju Declaration is a meaningful advance in that, amid an uncertain international order, Asia-Pacific nations presented a new direction for cooperation and jointly established common agendas for future growth,” Rep. Park Sung-hoon, chief spokesman for the main opposition People Power Party, said in a statement. “We hope that this Gyeongju Declaration will not remain a mere formality but will lead to practical cooperation that would invigorate the creativity of the private sector and the autonomy of the market.”