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Since South Korea and Taiwan established diplomatic ties in August 1948, the relationship between Seoul and Taipei has gradually expanded through public channels and private-sector networks. However, South Korea’s normalization of relations with China in 1992 led Taiwan to sever its formal ties with South Korea. Nevertheless, Seoul and Taipei expanded their economic and cultural private-sector exchanges. What made this possible? We argue that the private-sector networks developed through economic and cultural exchanges enhanced national interests, which explains why the two governments facilitated expansion of their informal ties. Although the importance of personal networks has been studied in the context of intergovernmental organization memberships, there is a void in the literature on how private-sector networks may affect foreign relations. Thus, this study sheds light on the effects of private-sector networks on interstate relationships.