South Korea-US Concluded Defense Cost Negotiations, Strengthened Alliance

On March 7, at the 11th Korea-U.S. Special Measures Agreement negotiations in Washington, D.C., South Korea and the United States reached a de facto agreement. The negotiations to determine South Korea’s contribution to the United States Forces Korea were supposed to have concluded in 2019. In March of last year, Korea-U.S. negotiation officials tentatively agreed on a 13% increase in funding, but the deal fell through as former president Donald Trump insisted on an absurd demand of a “five-fold increase.” So, the conclusion of the frustrating negotiations 46 days after President Joe Biden took office was welcomed.

The content of the agreement is also impressive. Although the specific rate of increase was not disclosed, it is known that it was set within a reasonable range. Also of note is that the agreement will not expire until 2025. As reported by foreign media, a six-year agreement is worth evaluating in that it can avoid exhausting negotiations every year.

It is also noteworthy that the news of the agreement was reached on the day the South Korea-U.S. joint command post training began, with Secretary of State Antony Blinken and Defense Secretary Lloyd Austin scheduled to visit Korea following a trip to Japan from July 15 to 17. Expectations have grown that the two-plus-two (diplomatic + defense) talks, which had been suspended, will resume after five years.

This forward-looking move seems to be a strategy to strengthen alliances with democratic countries in response to the rise of China, which is why Korea and Japan were chosen as the first two-plus-two foreign visitors since Biden’s inauguration. As competition for supremacy between the U.S. and China became visible, Korea’s status became more important.

The U.S. has also begun reviewing the supply chain for four key items, including semiconductors and electric vehicle batteries. This suggests that the U.S.-China conflict will not be a “tariff war,” but a “technology competition.” International competition will create both a crisis and an opportunity for the Korean economy. It is time for South Korea to review its diplomatic, security and economic strategies organically. Instead of simply restoring and normalizing the Korea-U.S. alliance, Seoul should seek ways to raise the alliance to the next level in line with our diplomatic philosophy and national interests.