By Hyonhee Shin

SEOUL South Korea might be making "wrong bets" in the Sino-U.S. rivalry, the Chinese ambassador in Seoul said, urging Seoul to stop "decoupling" from China and restore economic and diplomatic ties.

Xing Haiming made the remarks during a meeting late Thursday with Lee Jae-myung, head of South Korea's main opposition party, which has criticised President Yoon Suk Yeol for pursuing lopsided diplomacy toward the U.S. alliance at the expense of relations with China, its top trading partner.

Xing blamed Seoul for creating "difficulties" for bilateral ties by failing to respect Beijing's core interests, including Taiwan, while being influenced by the United States.

"China-South Korea relations face many difficulties. Frankly, the blame does not lie with China," he said, according to a statement released by the embassy. "We hope that the South Korean side will faithfully keep its promise and clearly respect China's core concerns, such as the Taiwan issue."

Xing warned against making the "wrong judgment" on China because of the "interference of external factors" such as U.S. pressure.

"In a situation where the United States is pressuring China with all its might, some are betting that the United States will win and China will lose. This is clearly a wrong judgment and a failure to properly grasp the course of history," he said. "I can assure you, those who bet on China's defeat will definitely regret it."

Yoon's office and Seoul's foreign ministry did not immediately respond to requests for comment.

Yoon has treaded cautiously amid intensifying U.S.-China competition, but Seoul and Beijing exchanged heated words in April over Yoon's comments on Taiwan, which China claims as its own territory.

In an interview with Reuters, Yoon said that flaring tensions around Taiwan were due to attempts to change the status quo by force, and that he opposed such a change.

Xing said South Korea's trade deficits have worsened because of its efforts to "decouple" from China, but it can "enjoy the bonus" from Chinese economic growth if its confidence in bilateral ties are restored.

"The two countries have built an inextricable economic structure in which their industrial and supply chains are closely connected," he said.

(Reporting by Hyonhee Shin. Editing by Gerry Doyle)