[기자문답] US-Korea defense cost share negotiations concluded in 1 year and 6 months | Voice of America

After a year and a half of discussions between South Korea and the United States, they agreed on a statement of the defense cost share. The agreement significantly increased the Korean side’s contributions and included measures to prevent unpaid leave for Korean workers. Let’s find out more with reporter Ham Ji-ha.

Moderator) Shall we first look at the main contents of this agreement?

Reporter) Yes, as officially announced by the United States and South Korea, the two countries agreed on the text of the Special Defense Share Agreement (SMA), which began in January 2020 and ends at the end of 2025. Looking briefly at the contents of the text, it is considered that there is no increase in 2020, and it is decided to make an increase of 13.9% this year. In addition, until the remainder of the year 2025, we have decided to raise the ante every year to meet the growth rate of South Korean defense spending.

Moderator) Please point to a specific amount.

Reporter) Korea’s contributions in 2019 amounted to a total of 1.38.9 trillion won and USD 911 billion. Accordingly, the contribution for 2020, when the increase rate is 0%, is set at the same amount, but this year, the increase of 13.9% is $1,075.7 million. On the 10th, a senior State Department official held a telephone briefing to some media including the VOA. The official explained that during the six years of the agreement, the costs that Korea will be borne are more than about $7 billion.

Host) Earlier, Korea proposed a 13% increase last year during the Trump administration. However, it is noteworthy that the increase rate has increased slightly from that time.

Reporter) Yes, a State Department official said that the Korean side’s contribution in 2021 is actually the biggest increase since 2004. It was going to cost more money than Korea originally proposed. However, State Department officials stressed that the negotiations were conducted to a level that the people of the two countries could understand.

Moderator) What part can you see like that?

Reporter) Yes, first of all, the State Department official emphasized that the proportion of the ROK side of the total cost of stationing the US military has not exceeded the previous level. Usually, Korea has shared 40-45%, but this share is a little over 44%. This is an explanation that is sufficiently convincing given the inflation rate of 9-10%. Also, in the case of last year, maintaining the level in 2019 without any additional increase can be seen as an advantage for the Korean side.

Host) It is also interesting to note that from next year, the share will increase in line with the increase rate of Korea’s defense spending. Could you explain this a bit more?

Reporter) According to the Ministry of State, the two sides have decided to set the rate of increase in the share of Korean defense spending from 2022 before that year. Therefore, Korea’s defense expenditure growth rate this year is 5.4%. This rate is expected to be reflected in the rate of increase in contributions in 2022. In this way, the rate of increase in defense expenditures in 2022 is determined as the rate of increase in contributions in 2023, and the rate of increase in defense expenditures in 2023 is determined as the rate of increase in contributions in 2024.

Facilitator) Based on the increase in defense expenditures in Korea, does it mean that there will be no increase in the ante if defense expenditures do not rise? Have you ever set a minimum standard for your hike?

Reporter) A senior State Department official said he had not set a minimum for the rate of increase. However, it is explained that the contributions will increase every year because it is based on the rate of increase, not the amount of change in defense expenditures.

Moderator) What other content of the agreement is notable?

Reporter) It can be pointed out that the system has been improved so that Korean workers working in the U.S. military do not suffer from unpaid leave due to negotiated defense cost sharing. In the event of a breakdown of the contribution agreement or a situation where new negotiations take place, we have included a phrase stating that workers’ wages can be paid the same as the previous year’s labor costs.

Moderator) Did this actually happen to Korean workers?

Reporter) Yes. During the Trump administration, in 2020, when the two sides failed to reach an agreement, a large number of Korean workers in the USFK went on unpaid leave. Since then, as the US accepted South Korea’s proposal to pay labor costs in advance, the unpaid leave situation ended, but it took about two months to resolve the problem.

Moderator) How long has the agreement been reached between the US and South Korea and the start of the agreement?

Reporter) Yes, the two countries started negotiations about three months before the expiration of the 10th SMA in September 2019. For the next three months, negotiations between the two sides went to Seoul, Honolulu, Washington, and so on, but could not reach an agreement.

Moderator) At the time, there were media reports saying that President Trump demanded an excessive increase in defense cost contributions, right?

Reporter) Former President Trump has often pointed out that US allies are enjoying the security benefits of the United States at a free ride, or low cost. In the midst of this, some media reported that President Trump wanted to increase South Korea’s defense spending by five times. In this situation, the two sides continued to negotiate in 2020, but they did not make much progress.

Moderator) Then, when the Biden administration was launched, there was a big change, right?

Reporter) Biden’s administration has been emphasizing the’reconstruction of the alliance’ as a key element of foreign policy even before its inauguration. Accordingly, there have been many observations that when the Biden administration enters the US-Korea defense cost share negotiations, the negotiations will also be in a hurry. In fact, this agreement was reached 46 days after the Biden administration was launched. A senior State Department official stressed that the Biden administration is doing great things to ensure a reasonable and quick conclusion.

Moderator) Both sides have not signed the final signature yet, what are the remaining procedures?

Reporter) A senior State Department official said there are many internal procedures that both the US and South Korea have to go through. In the U.S., after reviewing the legal part, you will receive a final approval from the Secretary of State. He said it would take a little longer than the United States because South Korea has to go through the government ratification agreement process. Therefore, the official predicted that it would take 2-3 weeks for the agreement to take effect.

Together with reporter Hahm Ji-ha, we investigated the special agreement to share defense costs between the United States and South Korea.