March 05, 2013

Allies Face Tough Negotiations on Burden Sharing

The negotiations with Washington this year over Seoul’s financial support for the U.S. troops here are expected to be tougher than ever amid America’s budgetary woes and escalating North Korean threats.

The allies are to start their talks over Seoul’s so-called burden-sharing cost for the upkeep of the 28,500-strong U.S. Forces Korea as the current Special Measures Agreement governing it expires at the end of this year.

Experts said the allies should seek a “win-win” solution to ensure the robust alliance to handle missile and nuclear threats by the North, cautioning against the possibility of the crucial security issue descending into an emotional, political war of nerves.

Noting that Washington, struggling with spending cuts to tackle its massive debt, could call for a big rise in Seoul’s contribution, they said the government should think about what security benefits it could secure in return, should it have to raise its share. 

Washington has reportedly demanded Seoul increase its share to 50 percent from the current 42 percent. Observers said the U.S. might want Seoul to raise its share a little closer to the level its staunch ally Japan has agreed to. Tokyo bears some 70 percent of the cost of basing American troops in the archipelago country. 

“Even in good economic times allies haggle over how to share defense burdens, including direct costs. In bad economic times burden-sharing debates can displace strategy,” said Patrick M. Cronin, senior director of the Asia Program at the Center for a New American Security.

The security expert warned that a flip-flop in the forthcoming negotiations over the burden-sharing could undermine the allies’ deterrence efforts against the North’s provocations. 

“Alliance managers cannot afford to be distracted from their shared responsibility for preserving security,” he said. “North Korea’s unrelenting pursuit of weapons of mass destruction, provocative military threats, and abysmal human rights record will not be halted and may be emboldened by alliance mismanagement.”

Since 1991, Seoul has shouldered partial costs under the SMA for Korean civilians hired by the USFK; the construction of military facilities to maintain the allies’ readiness; the combined defense improvement project; and other logistical support. 

Seoul’s burden-sharing, which was 812.5 billion won ($747 million) in 2011 and 836.1 billion won last year, amounts to 869 billion won this year with analysts’ projections for 2014 hovering around 1 trillion won.

Since the Pentagon unveiled its new strategic guidance in January last year, which offers a glimpse into its deficit-driven military strategy, analysts here have warned of the possibility that Washington would step up its call for Seoul to pay more for the USFK.

The across-the-board spending cuts by the U.S. government, known as the “sequester,” which took effect on Friday amid a political standoff, has added to the concerns here that Washington would seek a hike in Seoul’s financial support.

The USFK, the bedrock for the peninsular security, is also to feel the pinch as most civilian workers could face a furlough ― periods of unpaid leave ― due to the spending cuts in defense. Some observers expressed concern that the U.S. would scale down its regular training and exercises including combined drills, which could weaken the allies’ combat readiness posture.

Given all this, Seoul is not in a position to just shrug off its key ally’s call for increasing the cost.

“Given the current security situation here, the ball is hardly in our court. We should seek a mutually beneficial solution so that the negotiation process does not get in the way of the alliance’s evolution,” said Kim Yeoul-soo, politics professor at Sungshin Women’s University.

“We are now in talks over the smooth transfer of wartime operational control from the U.S., and should ensure extended deterrence to deal with North Korea’s nuclear threats and make sure that it does not reduce its training due to budget constraints.”

The allies have been in talks over forging a “tailored” deterrence strategy as part of America’s extended deterrence to deal with Pyongyang’s nuclear arms and other weapons of mass destruction.

Seoul may have much to ask for from the U.S. in terms of security. But for the new Park Geun-hye government, raising its burden sharing would be a tough sell to the public and the divided, conflict-laden National Assembly, as it should push for the costly welfare agenda including free child care services and increased health care for the elderly.

The Seoul administration also faces tough decisions over an array of massive defense acquisition deals including the high-profile project to purchase a high-end fleet of 60 combat aircraft and others to develop an indigenous middle-class fighter and purchase attack helicopters and Global Hawk spy drones.

“Washington might understand South Korea’s situation. Although Korea’s economy has fared relatively well, uncertainty still lingers. During the negotiations over the cost, the allies would seek a good compromise while trying to understand each other,” said Kwon Tae-young, adviser to the non-profit Korea Research Institute for Strategy.

“But Washington could feel bitter if Seoul only takes (an uncompromising stance), when it has to rely much on it for security reasons and it refuses to join the U.S-led global missile defense program.” 

Kim Ho-sup, political science professor at Chung-Ang University, said that Seoul should consider what diplomatic and security benefits it could secure from maintaining a healthy alliance with the U.S.

“In my personal view, maintaining the alliance with the U.S. is South Korea’s crucial national priority. Given that, we could give a positive thought to raising the share, of course, within our capacity,” he said.

“For now, the Park government appears to be perceived as pro-U.S., and this could be a crucial bargaining chip for Seoul. If it doesn’t have friendly ties with Washington, its negotiating leverage could also be limited to a certain extent.” 

Should it have to increase its support for the U.S. troops, Seoul should think about what it could gain in exchange for the increase, experts said.

Apart from the burden-sharing talks, another crucial issue facing the alliance would be the upcoming negotiations over the revision to a decades-old nuclear energy pact that bans its Asian ally from reprocessing spent fuel. First signed in 1956 and last revised in 1974, the pact is to expire in March 2014.

Seoul has sought to revise it to allow it to “complete the nuclear cycle” for more efficient use of atomic energy. But Washington has apparently opposed the revision as it could undermine its non-proliferation initiatives.

Kim of Sungshin Women’s University also said that Seoul could demand Washington help it more swiftly acquire high-tech weapons systems such as Global Hawk spy drones. 

Seoul has sought to deploy four of the high-altitude unmanned aerial vehicles by 2015 with a budget of 450 billion won. But the asking price jumped, which has clouded the prospects for the acquisition deal.

By Song Sang-ho