Following a maiden career victory on his home tour just last week Kim and Asian Number One Jaidee held a two shot lead after sparkling eight under par opening rounds at Suzhou Jinji Lake Golf Club.
But Kim's bid for a bogey-free second round and a two shot lead of his own came unstuck on the final green on a sunny but breezy second day and a three under 67 was only enough for 11 under par overall and a slender lead over Jaidee (70) and Donaldson (68), with American Ryder Cup Captain Corey Pavin (70) and Korea's Kim Dae-hyun (67) a further three shots off the pace.
Kim, who also finished third at the Luxehills Chengdu Open at the start of April, picked up three shots in four holes around the turn, but the 21 year old misjudged the wind into the final green and failed to make the up and down to concede a single blemish.
"I thought I would be quite nervous as it is a big tournament but I am very comfortable after two rounds," said SBS Tomato Open winner Kim.
"I hope to play well this week and hopefully become the champion. I am not nervous and I feel comfortable after winning last week in Korea. I shot 64 last week and I feel I am the hottest Korean player right now."
World Number 48 Jaidee, 40, remained firmly in contention with a two under 70 although the Thai ace was let down by the putting which has been the key to a recent spell of good form that has yielded two top ten finshes this year and a run to the quarter-finals of the World Golf Championships - Accenture Match Play.
"I played very solid, I had one three putt on the back nine. I hit good shots on five and six for two birdies. I had bad putt on 16 and I also missed a short birdie putt at the last, but it is okay," said Jaidee, who carded two bogeys needed seven more putts to complete his second round compared to the first.
"I hit 15 greens, but missed a lot of putts. It was very solid, it was just my putting and I did lose concentration early in the round, but I still hit it very good."
Donaldson finished sixth at the Open de Andalucia in Malaga at the end of March and is well-placed to land his maiden European Tour title after posting six birdies in his four under 68.
"I played pretty good, similar to yesterday and I am very happy with ten under," said 34 year old Donaldson. "I putted nicely both days and gave myself plenty of chances both days. It's just a matter of much more of the same to move on up.
"I played nicely in Malaga. I had two weeks off after and didn't do much, just hit a few balls at the end of the second week and just kept topping it up and I am continuing to play nicely."