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Foreign policy developments never occur in a vacuum. The final decision to deploy THAAD in South Korea two weeks ago takes place against the particularly fraught context of the Hague ruling on Beijing’s South China Sea claims, which can only be read as a sweeping legal defeat. With China on the defensive, regional politics in Northeast Asia are also likely to become more tense. China-South Korea relations had already frayed in the wake of Beijing’s blasé response to North Korea’s fourth nuclear test. But Beijing’s commitment to assist on North Korea—such as it is—could now wane further still.
The Terminal High Altitude Area Defense (THAAD) is the upper layer of a 2-tiered ballistic missiles defense (BMD) system, intercepting short and medium-range missiles during mid-course or final stage flight. It thus complements point-based defense systems such as already-deployed Patriots designed to take out missiles just before impact; Michael Elleman and Michael Zagurek provide an introduction to what the system can and can’t do at 38North.
Yet their account focuses only on defense of South Korea against North Korean threats. Two features of the system give it wider regional significance, even if Beijing exaggerates them. First, the THAAD complex includes a mobile phased array X-band radar (AN/TPY-2 Forward-Based Mode). US officials have stated that the system would be deployed in “engagement” vs. “look” mode and that using the radar to cover China would undermine its mission on the peninsula. But the system is technically capable of reaching into China and can feed ballistic missile threat data to the US through the Command and Control, Battle Management, and Communications (C2BMC) system. As a result, although the system is clearly deployed and optimized only against North Korean threats—which have become more substantial with the successful Musudan tests (Jeff Lewis at Arms Control Wonk here on the technical details)—the system could in theory have implications for Chinese capabilities by expanding US tracking capabilities.
"THAAD plays into Chinese fears—or myths—of encirclement"
Second, and relatedly, Beijing sees THAAD as yet another step in the construction of a multilateral BMD system in a region where alliances have historically had a hub-and-spoke structure. The Joint Integrated Air and Missile Defense Vision 2020 statement issued in 2013 states explicitly that coordination with allies on BMD is a strategic objective of the US; Geoffrey Weiss offers a useful overview at Joint Force Quarterly. In fact, the US already has two AN/TPY-2 radars deployed in Japan (at Shariki and Kyogamisaki), space-based assets, plus a range of ship-borne radars and larger land-based radars in other parts of the Pacific theatre; it is not clear that this incremental change in capabilities has much substantive significance. But THAAD plays into Chinese fears—or myths—of encirclement (see Sungtae Jacky Park at the National Interest for an elaboration of this view). In denouncing the THAAD deployment, China not only denied that it would have any effect on resolving tensions on the peninsula but explicitly stated that the US and the ROK should “refrain…from undermining China’s strategic security interests.”
In fact, as in the South China Sea, Beijing largely has itself to blame. Listless in its response to North Korea’s fourth test and slow in enforcing multilateral sanctions, China was also perceived as seeking to strong-arm South Korean decision-making on THAAD in a way reminiscent of how it has dealt with the South China Sea issue vis-à-vis ASEAN. My personal view is that THAAD is expensive protection against an unlikely eventuality, and does little to guard against the much cheaper asymmetric means that North Korea can use against the South, from traditional artillery, to cyber-attacks to weapons like drones or even low-flying kamikaze attacks. But North Korea is just unpredictable enough to generate support for this costly move—assuming NIMBY doesn't derail it—and China largely has itself to blame for ultimately seeing Pyongyang as a strategic asset rather than the liability that it so clearly is. In addition to slowing Chinese cooperation on North Korea, this move could well elicit the not-so-subtle economic signals that have become a hallmark of Chinese foreign policy. The Financial Times reports a textbook case: a Chinese automaker ceasing production of a vehicle using South Korean batteries on fears that it might lose government subsidies.