Concerns rise over defense cost-sharing talks

Activists stage a protest against the U.S.' plan to shift a bigger share of costs to maintain U.S troops here, to South Korea during their upcoming defense cost-sharing negotiation, in front of the headquarters of the South's Ministry of National Defense in Seoul, on Aug. 9. Yonhap

By Lee Min-hyung

• Published Sep 25, 2019 5:13 PM KST
• Updated Sep 27, 2019 10:21 PM KST

By Lee Min-hyung

The Korea-U.S. talks on defense cost sharing is emerging as one of the key issues between the two allies.

The Special Measures Agreement (SMA) talks for determining Seoul's share of costs to maintain U.S. troops in Korea is gaining a lot of attention from the Korean public. It comes as additional pressure on Seoul, which is already struggling with grave diplomatic challenges ― particularly the ongoing feud with Japan over history, trade and national security.

Representatives of the two countries opened the talks to renew the SMA in Seoul, Tuesday, only a few hours after President Moon Jae-in held a summit meeting with U.S. President Donald Trump in New York on the sidelines of the United Nations General Assembly.

During a speech at the U.N. President Trump called for a “fair share” of defense costs. "All of our partners are expected to pay their fair share of the tremendous defense costs which the United States has borne in the past," Trump said.

After a meeting with Polish President Andrzej Duda, Trump noted that Poland will likely shoulder the “entire expense” of the new facilities for additional U.S. troops expected to be sent to the European country.

During the Moon-Trump summit in New York, the leaders exchanged their respective positions on the defense cost-sharing negotiations. “The President stressed an equitable share with a reasonable increase,” an aide to President Moon said after the summit. “The President also explained our efforts for a stable stationing of the U.S. troops in Korea, including the increase in our defense budget and in the purchase of U.S. arms, in addition to a steady increase in defense-sharing costs.” During the meeting with Moon, Trump mentioned that Korea is “our largest purchasers of military equipment.”

According to Cheong Wa Dae, Moon is said to have touched on a plan to purchase U.S. arms over the next three years. Analysts have underlined that the arms purchase plan could be used as a “negotiation card” in the SMA talks to offset the U.S. demand for an excessive increase.

While it is unknown whether Trump may view additional arms purchase in connection with the SMA negotiations, the dominant prospect in the diplomatic community is that Trump, who has criticized Korea for “paying peanuts” for U.S. troops, will not lower the pressure on Korea to increase defense costs even if Seoul buys additional U.S. weapons.

Concerns over new chief negotiator

With Trump stepping up pressure on Korea to pay more, attention is being paid to the change in Korea's negotiating team for the new round of SMA talks.

Defying precedence, Seoul is reportedly expected to announce a former high-level finance ministry official to lead the negotiations to thoroughly check the U.S. demand for the increase from a budgetary perspective. But critics argue the government should not pay too much attention to signing the deal with the focus on reducing the cost, as such a strategy may end up harming diplomatic relations with the South's biggest security ally.

“The SMA has more to do with diplomacy between the two countries, rather than a mere financial negotiation,” a source familiar with the matter said. “To renew the sensitive agreement, the potential chief negotiator should be well-versed in not just trade but diplomacy, and engage in the negotiation in a way not to harm the counterpart's emotions. This is why diplomatic skills are also very crucial.” Moon is advised to remain prudent over Trump's possible political pressure over the issue, as the U.S. is the strongest ally of the South amid growing security uncertainty surrounding the Korean Peninsula, according to the source.

Skepticism is growing over the government's plan to name an expert in the economic and finance sector as the chief negotiator for the upcoming defense cost-sharing talks with the United States, rather than an official with sufficient experience in negotiations with the U.S. and a deep understanding of the history of Korea-U.S. alliance. The government is reportedly considering appointing Jeong Eun-bo, former vice chairman of the Financial Services Commission, to the position. Jeong formerly served as assistant vice minister of the finance ministry in 2013. With his appointment still yet to be announced, Seoul sent Ambassador Chang Won-sam from the foreign ministry for talks with his U.S. counterpart, James DeHart. Chang has been leading talks since 2017.

So far, South Korea has picked officials only from the Ministry of Foreign Affairs or the Ministry of National Defense to lead delegations for talks with Washington to share costs for the upkeep of the 28,500 U.S. Forces Korea here.

Currently, the focus of the dialogue is on how much South Korea will have to pay for the sharing burden next year. Under the 2019 SMA, Seoul pays 1.04 trillion won ($875 million), up 8.2 percent from the previous year.

White there are rising concerns among the Korean public about the increase, some experts have noted that Seoul should be open to an increase when considering to maintain the health of the alliance.