Digital trade: a new chance for China-South Korea-Japan trilateral cooperation?

Abstract

Abstract Organized economic cooperation among China, South Korea (Republic of Korea) and Japan has been difficult due to the “Asia Paradox” and different interests. However, the digital age is fostering cooperation and interdependence among the three countries. As a result, it is time to explore new areas and methods of cooperation. Therefore, this study focuses on and analyzes the possibility and impacts of digital trade cooperation among the three countries in the Fourth Industrial Revolution. Applying a tripartite cooperation model, this study analyzes the relative advantages of the three countries in digital trade and the “benefits” and “costs” of establishing a Digital Trade Agreement (DTA). The research indicates that the power basis for establishing an equal relationship exists. However, the “cost” of establishing a trilateral DTA is higher than the short-term “benefit,” providing insufficient motivation to develop a trilateral DTA in the short-term. Nevertheless, this study suggests that in the long run, due to new opportunities and crises, the three countries will still seek to pursue a DTA in different ways.