Updated January 29, 2019
South Korea: Background and U.S. Relations
Overview
status of cost-sharing uncertain and President Trump’s
South Korea (officially the Republic of Korea, or ROK) is
stated preference to bring the troops home, some observers
one of the United States’ most important strategic and
see a risk that the alliance could fundamentally shift.
economic partners in Asia. The U.S.-ROK Mutual Defense
Potential tariff hikes on U.S. imports of autos and auto
Treaty, signed in 1953 at the end of the Korean War,
parts, including from South Korea, has also strained the
commits the United States to help South Korea defend
relationship. The Trump Administration’s tendency to
itself, particularly from North Korea (officially the
change policy positions unexpectedly adds another element
Democratic People’s Republic of Korea, or DPRK).
of uncertainty.
Approximately 28,500 U.S. troops are based in the ROK,
which is included under the U.S. “nuclear umbrella.†The
North Korea Policy Coordination
U.S.-ROK economic relationship is bolstered by the U.S.-
North Korea is the dominant strategic concern within the
South Korea Free Trade Agreement (KORUS FTA). South
U.S.-South Korea relationship. In 2016 and 2017, North
Korea is the United States’ seventh-largest trading partner,
Korea conducted scores of missile tests and three nuclear
and the United States is South Korea’s second-largest
weapons tests, demonstrating major strides in the ability to
trading partner, behind China.
strike the continental United States with a nuclear-armed
ballistic missile. The Obama and Trump Administrations
After several years of close coordination, notably on North
responded by expanding multilateral and unilateral
Korea, collaboration between the United States and South
sanctions against North Korea.
Korea has become more inconsistent and unpredictable
under the administrations of Donald Trump and Moon Jae-
in. Moon, a progressive, was elected in May 2017 after a
decade of conservative rule in South Korea. On the one
hand, the two leaders have found a number of areas of
agreement and cooperation. In 2018, Trump and Moon
reached an agreement over modifications to the six-year-old
KORUS FTA. They also have aligned aspects of their
approaches toward North Korea, with both pursuing a
rapprochement with Pyongyang. The outreach has included
a Moon-brokered June 2018 summit in Singapore between
Trump and DPRK leader Kim Jong-un, the first time
leaders of the two countries have met, as well as three
summits between Moon and Kim since April 2018. In these
summits, inter-Korean relations have blossomed and Kim
has pledged to “work toward complete denuclearization†if
the United States takes “corresponding measures.†After
months of stalled U.S.-DPRK negotiations, Trump in
January 2019 said he and Kim will meet again, likely in late
February.
On the other hand, Washington and Seoul reportedly have
Moon supported Trump’s “maximum pressure†campaign,
made significant unilateral policy decisions without any or
but also retained his longstanding preference for engaging
much prior consultation or coordination with each other.
Pyongyang. During 2017, Trump Administration officials,
Critical differences remain on policy issues like whether
including the President, emphasized the possibility of
and under what conditions to offer concessions to North
launching a preventive military strike. This possibility,
Korea and how to share costs associated with the U.S.-ROK
which would risk triggering a North Korean retaliation
alliance. Some observers see a possible disconnect between
against South Korea, appears to have convinced Moon that
U.S. and ROK priorities. Seoul has tended to emphasize
the United States, rather than North Korea, represented the
creating a new peace regime and relaxing sanctions at the
greatest immediate threat to South Korean security. The
outset of negotiations (both of which also appear to be
combination of the fear of war, an ideological preference
DPRK priorities). Washington has stressed denuclearization
for engagement, and a belief that South Korea should shape
and delaying sanctions relief until Pyongyang
the future of the Korean Peninsula drove Moon to improve
denuclearizes. The U.S.-ROK military alliance also appears
inter-Korean relations and broker U.S.-DPRK talks. Kim
to be under some stress: despite months of negotiations, the
Jong-un made these moves possible in early 2018 by
burden-sharing agreement that divides costs associated with
dropping his belligerent posture and embarking on a “charm
hosting U.S. troops expired at the end of 2018. With the
offensive.†Differences between Washington and Seoul
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South Korea: Background and U.S. Relations
over the proper mix and timing of concessions to offer and
among the United States, Japan, and South Korea has
pressure to apply on Pyongyang have strained U.S.-ROK
become more difficult during this time of rising ROK-Japan
coordination at times. In November 2018, the United States
tensions, which coincides with Seoul and Washington’s
and ROK created a bilateral working group to improve
rapprochement with Pyongyang.
coordination.
U.S.-South Korea Economic Relations
U.S.-South Korea Security Relations
In 2017, bilateral trade totaled $156 billion in goods and
In addition to the presence of U.S. troops, South Korea is
services. Since the 2012 KORUS FTA’s entry into force,
included under the U.S. “nuclear umbrella†(also known as
bilateral trade and investment flows have increased with
“extended deterrenceâ€), and pays for about 50% (over $800
U.S. services exports (+$7.5 billion) and auto imports
million annually) of the total non-personnel costs of the
(+$8.5 billion) seeing the largest gains. Though many U.S.
U.S. troop presence in South Korea. In their talks over a
businesses highlight improved market access and an
new burden-sharing agreement, called the “special
improved mechanism for dispute resolution, the rise of the
measures agreement†talks, Washington reportedly has
bilateral trade deficit, as well as concerns over Seoul’s FTA
demanded Seoul increase its contribution by at least 50%.
implementation, have caused some criticism of the pact. An
President Trump’s sharp criticism of European allies’
increase in U.S. exports to South Korea in 2017 led to a $7
contributions to NATO also has raised concerns in Seoul
billion decline in the bilateral U.S. trade deficit, but at $9.3
about the U.S. commitment to the alliance. His decision to
billion it remained 70% larger than its pre-FTA 2011 value.
facilitate talks with North Korea by suspending major U.S.-
ROK military exercises has raised questions about the
In 2018, at the request of the Trump Administration, the
allies’ ability to maintain their state of readiness.
two countries negotiated modifications to the KORUS FTA.
South Korea agreed to a number of concessions, most
The U.S. military is in the process of relocating its forces
prominently on bilateral trade in motor vehicles, including
farther south from bases near the border with North Korea,
an extension of U.S. light truck tariffs. Although President
with South Korea paying $9.7 billion for construction of
Trump characterized the changes, which took effect January
new large-scale military facilities. The recently-opened
1, 2019, as a “basic redoing†of the agreement, most
Camp Humphries is the largest overseas U.S. base in the
analysts agree that the modifications are relatively limited
world. In 2016, North Korea’s nuclear and missile tests led
in scope and unlikely to fundamentally alter the balance of
the two governments to agree to deploy the U.S. Terminal
commitments. Unlike proposed modifications to the U.S.
High Altitude Area Defense (THAAD) ballistic missile
trade agreement with Canada and Mexico, the modified
defense (BMD) system in South Korea. China protested the
KORUS FTA does not explicitly exempt auto imports from
THAAD deployment and retaliated against South Korean
potential Section 232 tariffs—a pending investigation under
companies and economic interests. In July 2017, President
Section 232 of the Trade Expansion Act of 1962 could lead
Moon at first delayed finishing the deployment but then
to increased tariffs on all U.S. auto and parts imports. Autos
reversed himself after one of North Korea’s long-range
and auto parts are consistently the largest U.S. import from
missile tests. Moon later repaired ties with China by
South Korea ($23.9 billion in 2017), and enter duty-free
promising not to accept any more THAAD deployments.
under the KORUS FTA. In addition to the U.S. auto tariff
threat, an existing steel quota and increased tariffs on
South Korea’s Regional Relations
aluminum, washers, and solar panels, continue to add
China’s influence in the region figures prominently in
tension to the trading relationship.
South Korea’s foreign and economic policy. North Korea’s
growing economic dependence on China since the early
Figure 1. Party Strength in South Korea’s National
2000s has compelled South Korea increasingly to factor
Assembly
Beijing’s actions and intentions into its North Korea policy.
China is South Korea’s largest trading partner and
destination for foreign direct investment. In general, South
Korea tries to avoid taking steps that might antagonize
China, as evidenced by South Korea’s cautious approach to
the THAAD deployment.
Ties with Japan continue to be tense over historical issues
stemming from Japan’s colonization of the Korean
Peninsula from 1910 to 1945. Three events in 2018 and
Notes: President Moon belongs to the Minjoo Party. National
early 2019 caused ROK-Japan relations to decline
Assembly elections are held every four years and were last held in
April 2016. South Korea’s next presidential election is scheduled for
precipitously: multiple incidents involving Japanese
May 2022. South Korean presidents are limited to one five-year term.
reconnaissance planes and South Korean naval vessels;
South Korean Supreme Court rulings that Japanese firms
should compensate South Koreans for forced labor during
Mark E. Manyin,
Japan’s occupation; and Moon’s steps to weaken
Emma Chanlett-Avery,
implementation of a 2015 ROK-Japan agreement over
Brock R. Williams,
“comfort women†who were forced to provide sexual
services to Japanese soldiers during the 1930s and 1940s.
IF10165
Trilateral security cooperation on North Korea policy
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South Korea: Background and U.S. Relations
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