"We were informed that (a meeting) won't be possible due to scheduling issues," Song In-chang, an assistant deputy finance minister, told reporters.

South Korea saw the G-20 meeting as a chance to ease the mounting diplomatic tension with China, which has been enraged by Seoul's stationing of an advanced US missile defense battery, known as Terminal High Altitude Area Defense system, claiming that its high-power radar will be used to spy on its own military.

South Korean businesses have been under a great deal of strain since Beijing began to heap on what appears to be a slew of retaliatory measures against Seoul, banning group trips to South Korea and placing Korean firms' China-based units under suspension.

Although China's hostile policies are too ambiguous for South Korea to officially file a complaint, it would have been at least an opportunity for Seoul to address the issue and send a message to Beijing that the economy should be dealt with separately from politics. 

The failed attempt for a bilateral talk adds pressure on Seoul since the economic damage from China's trade restrictions is expected to take a toll on key industries, such as tourism and retail.

The latest report by the Seoul-based Eximbank showed that Korea will suffer a 3-7 percent on-year drop in its trade with China, with the number of Chinese tourists to be halved from the current tally of some 8 million over the next two years if China shows no signs of change in its policies. (Yonhap)