Asia Pacific

U.S., South Korea defense cost talks break down over Trump's $5 billion demand

Bloomberg, Reuters, Staff Report

Cost-sharing talks between the U.S. and South Korea broke down over U.S. President Donald Trump’s demands for a fivefold funding increase, raising new questions about the stability of one of America’s closest alliances.

Talks between the two on Tuesday ended abruptly, with each side blaming the other. South Korea’s Foreign Ministry said it expected to discuss “an acceptable range for both counterparts” based on past cost-sharing discussions, while the chief U.S. negotiator, James DeHart, said that Seoul was “not responsive to our request for fair and equitable burden-sharing.”

The move was likely to stoke concern in Tokyo, which is due to begin its own negotiations on a defense cost-sharing deal next year.

“Our position is that it should be within the mutually acceptable Special Measures Agreement (SMA) framework that has been agreed upon by South Korea and the U.S. for the past 28 years,” the South Korean Foreign Ministry said, referring to the cost-sharing deal’s official name.

“The U.S. believes that the share of defense spending should be increased significantly by creating a new category,” the ministry said in a statement.

The top U.S. negotiator, James DeHart, said the Americans cut short the talks to “give the Korean side some time to reconsider and I hope to put forward new proposals that would enable both sides to work towards a mutually acceptable agreement in the spirit of our great alliance.”

“Unfortunately, the proposals that were put forward by the Korean negotiating team were not responsive to our request for fair and equitable burden sharing,” DeHart told a briefing.

Jeong Eun-bo, who led the South Korean delegation, told reporters in Seoul that talks came to a halt when his counterparts “left their seats first,” adding the two sides had “quite a big difference in principle.” Negotiators left the table after only about one hour of discussions that were scheduled to continue throughout the day, South Korean media reported, citing unnamed Foreign Ministry officials.

The breakdown came despite Trump’s decision to send a high-powered mission to Seoul, including Defense Secretary Mark Esper, to try to convince President Moon Jae-in’s government to pay more for hosting U.S. troops. During a visit to Seoul last week, Esper said South Korea was “a wealthy country, and could and should pay more to offset the cost of defense,” without mentioning a specific figure.

Trump has demanded South Korea pay about $5 billion for hosting U.S. troops, well above the current one-year deal where Seoul pays about $1 billion. The price tag originated with the White House, according to people familiar with the matter, and administration officials justify it by saying it reflects the costs South Korea would incur if it takes operational control of combined U.S.-South Korean forces in the case of a conflict.

U.S. officials have not publicly confirmed the number, but Trump has previously said the U.S. military presence in and around South Korea was “$5 billion worth of protection.”

Trump has long railed against what he says are inadequate contributions from allies toward defense costs. Media reports in last week said that the White House has also demanded Japan pay a similar amount in its next defense cost-sharing deal.

The United States had asked Japan earlier this year to pay significantly more — about five times as much per year — to support U.S. forces stationed on the soil of its major Asian ally, media reports said Saturday.

Tokyo has denied those reports.

Nevertheless, some experts believe Japan may ultimately not be subject to the same kinds of demands that South Korea is currently facing.

“Japan is the linchpin for the United States’ broader security (goals) in the region and has been a proactive partner in cementing the Free and Open Indo-Pacific vision,” Stephen Nagy, a senior associate professor at International Christian University in Tokyo, said in reference to the umbrella term for Washington’s and Tokyo’s regional strategy.

“Based on this role, Japan has much more leverage to resist U.S. demands as well as a much more cooperative track record at the leadership and institutional level than the Moon administration,” Nagy said.

Besides Japan, the United States is also due to begin separate negotiations for new defense cost-sharing deals with Germany and NATO next year.

The U.S. president has repeatedly expressed frustration with the open-ended troop deployment, saying after his first meeting with North Korean leader Kim Jong Un last year that he would “like to bring them back home, but that’s not part of the equation right now.” At the same time, he has accepted a long-standing Kim demand and suspended major joint military exercises that the U.S. and South Korea have relied on to maintain readiness.

Jeong, however, said the U.S. has never mentioned the issues of reducing or withdrawing troops from South Korea during the talks.

The request for more money hasn’t sat well in South Korea, where many in Moon’s progressive camp and opposition conservatives have come out against demands seen as excessive. Moon, facing a sagging support rate, may not want to make any major concessions that further dent his popularity ahead of a parliamentary election next year.

Under South Korean law, the military cost-sharing deal must be approved by parliament.

Ruling party lawmakers have said this week they will “refuse to ratify any excessive outcome of the current negotiations” that deviate from the established principle and structure of previous agreements.

The U.S. has about 28,500 personnel in South Korea who help protect the country from the likes of North Korea, one of the world’s most militarized states. The alliance is seen by U.S. security planners as key to checking the rise of an increasingly powerful military in China.

South Korea’s Foreign Ministry declined to comment on what the new cost category U.S. sought was, but the Yonhap news agency has reported the U.S. demand included labor costs for the U.S. troops in South Korea, military personnel and family support costs, costs of rotational deployment of U.S. troops to the Korean Peninsula and offshore training expenses.

In past cost-sharing agreements, South Korea only paid for three categories — personnel costs of South Korean workers hired by U.S. troops, military construction costs such as building facilities within U.S. bases, and military assistance expenses, such as for services and materials.

The negotiations are also taking place as U.S. efforts to reach an agreement with North Korea over its nuclear and missile programs appear stalled, ahead of a year-end deadline from Pyongyang for the U.S. to shift its approach. They are also going on as South Korea and Japan are engaged a bitter row over history and trade issues that has prompted Seoul to decide to let a key intelligence-sharing pact with Tokyo expire at 12:01 a.m. on Nov. 23.