JEJU ISLAND, South Korea — A few years ago, Kim Kyoung-chul's once-thriving crab restaurant on a balmy island off the southern coast of South Korea unwittingly became a casualty of escalating tensions between global powers.
Hundreds of miles and a sea crossing away from his touristy street lined with bling, fashion and cardboard cutouts of K-pop stars, South Korea was installing an American missile interceptor over China's objections that it threatened its national security. The interceptor's radar, China's Foreign Minister Wang Yi said at the time in 2016, "goes far beyond the defense need of the Korean Peninsula. It will reach deep into the hinterland of Asia, which will ... directly damage China's strategic security interests."
Kim had little idea how deeply the geopolitical dispute would impact his small business. Beijing's harsh and swift economic retribution against South Korea — the repercussions are felt to this day — took a toll on economic matters including K-pop groups, exporters and a department store conglomerate. Chinese tourism to South Korea evaporated overnight.
Nowhere was that impact felt more keenly than on Jeju Island, and particularly on Kim's street, which had for years been popular with Chinese visitors but was feeling the wrath of an emboldened China that under Xi Jinping was determined to realign the world order.
"It all came crashing down. There wasn't a soul on the street," said Kim, adding that his restaurant had barely recovered in late 2019, before the coronavirus hit. "China can do that, just not send its people."
South Korea's Foreign Ministry declined to comment on the missile interceptor system. Seoul has been careful not to anger China for fear of triggering fresh economic retaliation, said Chung Jae-ho, professor of international relations and director of the Program on U.S.-China Relations at Seoul National University.
"There's a sort of Sinophobia where they worry in advance, without knowing what is going to come from China," he said. "They define Korea's national interest mainly in economic terms and think they shouldn't do something that would tick off China's tendencies to use economic sanctions. They won't even try to push back."
China has increasingly resorted to wielding its economic heft as a weapon, holding its tourists and trade hostage in disputes with neighboring nations. It has forced new calculations in diplomacy and investment. In the wake of the missile dispute, corporations in South Korea including retailer Lotte, the country's fifth largest conglomerate, and carmaker Hyundai, the second largest, faced steep declines in sales and stringent regulations in China that cost them hundreds of millions of dollars.
On the other end of the spectrum were the likes of Kim, ordinary South Koreans swept into the fray. Never spelled out in official policy but immediately felt on the street, China's wrath passed like a fever dream, leaving livelihoods in tatters.