Summary of Key Points
On the 34th anniversary of the establishment of diplomatic relations between China and South Korea, the bilateral relationship has demonstrated characteristics of a deeply integrated community of shared interests in areas such as chips, manufacturing, flights, and intangible cultural heritage (ICH). China has once again become South Korea's largest export market (with semiconductors being the driving force behind this growth). South Korean chip giants continue to increase their investment in China, while local Chinese chip companies, such as ChangXin Technology, are rising and challenging the global landscape. Chinese new energy vehicles have made inroads into the South Korean market, reshaping the automotive trade patterns in East Asia. Flights between China and South Korea have returned to pre-pandemic levels, with a surge in people-to-people exchanges and cultural and tourism activities. Cooperation in ICH and the establishment of regional flight routes have further promoted cultural exchange and business synergy.
1. Chips: From "Decoupling Rumors" to "Deep Integration"
The previous South Korean government followed the United States in restricting chip cooperation with China and even talked about "decoupling the industrial chain." However, reality has proven otherwise: In July 2026, China once again became South Korea's largest export market, with trade increasing by 47.7% compared to the previous year, and 70% of imports consisted of South Korean chip equipment. The reason is simple: China has a vast manufacturing capacity and market, while South Korea possesses technological advantages, creating a strong complementarity.
South Korea's two leading chip companies, Samsung and SK Hynix, have continued to invest heavily in building factories in China. Samsung's Xi'an factory (the only overseas memory production base, accounting for 40% of NAND production) saw a 67.5% increase in investment, and SK Hynix's Wuxi factory (accounting for 30% of DRAM production) saw a 102% increase. China is not just a consumer; ChangXin Technology, a company based in Hefei, has worked for a decade to develop its capabilities and this year made its debut on the STAR Market, increasing its market value in the A-share market. Its global DRAM market share soared from 3% to 8%, significantly reducing SK Hynix's share from 36% to 29%. Even South Korean think tanks acknowledge that the global storage chip market landscape (composed of Samsung, SK Hynix, and Micron) is changing.
2. Manufacturing: Chinese New Energy Vehicles Take the Lead
In the past, South Korea mainly imported German and Japanese fuel vehicles, with only a small amount of Chinese vehicles being exported. This year, however, the situation has reversed. In the first half of 2026, China surpassed Germany as South Korea's largest source of imported vehicles, with one in every three imported electric vehicles being a Chinese brand (such as BYD and NIO).
The reason for this turnaround is twofold: first, China has a complete new energy industry chain with strong capabilities in battery production, control systems, and motors, making it difficult for others to replicate; second, Chinese companies have improved their services, with well-established showrooms, charging facilities, and maintenance systems. The South Korean market serves as a testing ground for global automotive competition, and the success of Chinese vehicles indicates that Chinese manufacturing has moved beyond the "low-cost, low-end" stereotype, with its high-end products gaining recognition from developed countries.
In addition to vehicles, China's economic recovery has also boosted imports of South Korean products such as petrochemicals, display panel materials, and auto parts, as China has the most comprehensive manufacturing system in the world, requiring a large supply of these industrial materials.
3. Flights and Cultural Tourism: Record-Breaking Demand
Flights between China and South Korea have expanded for the first time in seven years, with more than 2,500 round-trip flights per week and 50 freight flights. The number of people traveling between the two countries is approaching pre-pandemic levels, and it is expected to exceed these figures next year. From January to July, 11.486 million people traveled between the two countries. JiuZhou Airlines' passenger load factor increased from 79.8% to 86.4%, and popular routes (such as Incheon to Qingdao) are so popular that tickets are hard to secure during peak periods.
Cultural and tourism activities are also booming. Shanghai is the largest source of foreign tourists for South Korea, with 515,000 visitors in the first half of the year. South Korean youths are fascinated by Shanghai's night views and the Bund, while popular attractions like the Hongquan Road Korean Street and the Bund Cheongsam Photography Tours (40% of visitors are from South Korea, with average spending of nearly 1,000 yuan) are very popular. Qingdao has promoted "weekend tours," with 1.195 million visitors from January to July, and a special Korean pavilion was set up at the Beer Festival.
4. ICH and Regional Cooperation: Cultural Bonds Strengthen Business Ties
This year, Jingdezhen's traditional porcelain industry was successfully inscribed on the UNESCO World Heritage List, making it a popular destination for South Korean tourists. In turn, South Korea hopes that China will promote its own ICH sites. Recently, a direct flight route was launched between Datong, Shanxi, and Qingzhou, South Korea (a historic city near Seoul and Busan), which not only facilitates cultural and tourism exchanges but also activates Shanxi's inbound tourism market.
These cultural collaborations are not superficial. For example, Jingdezhen's heritage recognition has increased South Korean tourists' interest in visiting China, and the new flight route between Datong and Qingzhou has strengthened business ties between the two regions, using culture to bridge the gap and promote business opportunities.
5. The "Ballast Stone" of Sino-South Korean Relations: The Community of Shared Interests Is Not Just Talk
From chips to manufacturing, from flights to ICH, the underlying logic of Sino-South Korean cooperation is that both countries are interdependent. South Korea needs China's market and manufacturing capabilities, and China needs South Korea's technology. Chinese new energy vehicles can enter the South Korean market, South Korean chips can be sold in China, and the resumption of flights has boosted consumption. ICH cooperation promotes cultural exchange—these are all examples of a deeply integrated community of shared interests. The previous theories of "decoupling" have failed because the two countries' industrial chains are too closely intertwined, and cooperation is the only way to achieve mutual benefit.
In the future, as the benefits of the AI industry continue to emerge, the new energy vehicle market expands, and cultural and tourism interactions deepen, Sino-South Korean relations will become even closer.
This news highlights that the cooperation between China and South Korea has gone beyond mere trade; it has evolved into a "community of shared fate," where one cannot exist without the other.