[11차 방위비분담금 협상안 공개]
Defense expenditure growth rate applied from 2022 to 2025
‘Agreement blank’ freezes 1.38.9 billion won in 2020
U.S. defense and state secretary will visit Korea on the 17th to discuss
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This year, the Korean-US defense cost share was settled at 1,183.3 billion won, up 13.9% from last year. As U.S. President Joe Biden made a significant concession from former President Donald Trump’s demanded amount of $5 billion (about 5.7 trillion won), it is predicted that this could demand South Korea to join the pressure on China.
According to the 11th Special Agreement on Defense Cost Sharing (SMA) negotiations released by the Ministry of Foreign Affairs on the 10th, the ROK and the United States decided to freeze the defense cost share in 2020 at KRW 1.38.9 trillion, the same as in the previous year (2019). Decided to increase by 13.9% from the previous year to KRW 1,183.3 billion. From 2022 to 2025, the increase rate of Korean defense spending in the previous year will be increased. The share of defense expenses in 2022 will increase by 5.4%, which is the rate of increase in the ROK military budget in 2021.
The 13.9% increase in the defense cost share in 2021 is the sum of the increase in Korean military defense spending (7.4%) and labor costs (6.5%) in 2020. The Ministry of Foreign Affairs explained that the reason for the increase in the labor cost from the defense cost share was “the lower limit of the ratio of the labor cost share for the defense cost share was expanded from 75% to 87%.”
In addition, it stipulated that if the agreement is vacated, the labor cost of the previous year can be paid. In 2019, the ROK and the US signed a one-year contract through the 10th SMA, but further negotiations have been difficult since then, and in 2020, the SMA agreement was in a vacuum. For several months, some Korean workers in the USFK were put on’unpaid leave’. The ROK and the United States agreed to exclude KRW 344.4 billion in wages paid by the Korean government to Korean workers in the USFK through a special law at the time of unpaid leave from the 2020 defense cost share payment.
This increase is the third highest level ever since 2002 (25.7%) and 1994 (18.2%), but it is equivalent to 20% of the 5.7 trillion won requested by former President Trump. Yang Moo-jin, a professor at North Korea’s Graduate School, said, “During the Trump administration, he dispels concerns over unreasonable demands and shows off the solidity of the ROK-US alliance.”
Meanwhile, US Secretary of State Tony Blincoln and Defense Minister Lloyd Austin will visit Korea on the 17th to attend the Korea-US 2+2 (diplomatic and defense ministers) talks. It is expected that the conclusion of SMA negotiations and the issue of Korea’s participation in the pressure front with China will rise on the 2+2 talks table.
/ Reporter Kim In-yeop [email protected]
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