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S. Korea buries differences to trade with China

Officially, China and South Korea are not on speaking terms.

But, in advance of any possible diplomatic normalization, Korean business interests have begun indirect trade approaches to the mainland through Japan.

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Seoul and Peking were on opposite sides in the 1950-53 Korean war, and the Chinese remain publicly committed to their communist allies in North Korea.

In spite, or perhaps because of this, the South Korean government has begun sending out hints of a desire to bury the past. Political analysts in Tokyo cite the statement of South Korean President Chun Doo Hwan in Washington in January 1981 that ''a friend of a friend of ours is our friend.''

There is nothing unusual in South Korea's current interest in trading with China. An anticommunist stance has not stopped Seoul from seeking trading opportunities in Eastern Europe, for example.

But there is one big difference:

China fought South Korea in a bloody war 30 years ago, and Peking would have to avoid ties with the South that might upset its sensitive relations with North Korea.

The China-North Korea relationship certainly is not as close as it was in the cold war era. But political analysts say China cannot afford to upset the North Koreans too much at this stage. That could offer an advantage to Pyongyang's other supporter - China's major rival, the Soviet Union.

Indeed, to cement Chinese-North Korean relations, Chinese Defense Minister Geng Biao has just visited North Korea. He once again called for withdrawal of American troops from South Korea and pledged that Chinese soldiers would fight alongside North Koreans.

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Of course, South Korea remains staunchly anticommunist. This will not change while it is locked in bitter confrontation with North Korea .

But, putting outside political considerations, there are obvious economic reasons favoring a Seoul-Peking thaw.

South Korea's current economic development requires a large, preferably neighboring country with basic raw materials like oil, coal, and uranium, and a market for large quantities of its manufactured products.

Although there are no political difficulties involved, that role can never really be fulfilled by Japan. For one thing, this country has no raw materials to sell to the Koreans, only manufactured goods. In addition, the Japanese are becoming concerned about the price and quality competitiveness of Korean industry.

There has been no open commerce between China and South Korea as yet. But indirect trade has been carried on for some years via Japan and Hong Kong.

Chinese coal, for example, goes to the Koreans, who have been selling basic textiles and some electric and electronic products in return.

Officially, of course, the trade doesn't exist. China maintains a cold, silent attitude toward Seoul, to the extent of inserting a clause in trade contracts with Hong Kong, Japan, and other Asian nations that Chinese products will not end up in South Korean hands.

Anticipating their government's desire to normalize relations with Peking, Korean businessmen have begun seeking the help of Japanese trading interests in approaching China, informed sources here report.

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