Updated May 18, 2021
South Korea: Background and U.S. Relations
Overview
denuclearization measures in exchange for relief from
South Korea (officially the Republic of Korea, or ROK) is
international and U.S. sanctions. Kim also has linked
one of the United States’ most important strategic and
progress on denuclearization talks to the cessation of U.S.
economic partners in Asia. The U.S.-ROK Mutual Defense
joint military exercises with and shipments of advanced
Treaty, signed in 1953 at the end of the Korean War,
military equipment to South Korea.
commits the United States to help South Korea defend
itself, particularly from North Korea (officially the
Democratic People’s Republic of Korea, or DPRK). The
alliance also helps the United States promote its interests in
East Asia and around the globe, including by deploying
ROK troops to U.S.-led military conflicts in the Middle
East. Approximately 28,500 U.S. troops are based in the
ROK. The economic relationship is bolstered by the U.S.-
South Korea Free Trade Agreement (KORUS FTA). In
2020, South Korea was the United States’ seventh-largest
trading partner, and the United States was South Korea’s
second-largest trading partner, behind China.
On May 21, President Joseph Biden and ROK President
Moon Jae-in are scheduled to meet in Washington, DC. The
meeting, Biden’s second in-person summit after one with
Japan’s prime minister, appears to signal the
Administration’s priority on the Indo-Pacific region and on
reinvigorating U.S. alliances. Under the Trump
Administration, the U.S.-ROK alliance was strained by
disputes over South Korean contributions to cost-sharing
In the near term, some analysts worry Kim will abandon his
arrangements to host U.S. troops. During the upcoming
three-and-a-half-year-old unilateral moratorium on nuclear
summit, the two leaders reportedly are expected to discuss
tests and long-range ballistic missile tests. North Korea has
North Korea policy, a Coronavirus Disease 2019 (COVID-
continued to test short- and medium-range missiles and to
19) vaccine partnership, the challenges of dealing with
conduct cyberattacks around the globe. U.N. and U.S.
China’s rise, U.S.-South Korea-Japan coordination, and
sanctions remain in place, officially barring nearly all of
cooperation to make semiconductor supply chains more
North Korea’s typical exports and many of its imports. The
resilient.
sanctions severely limit cooperation activities that the
Moon government favors. Inter-Korean relations under
North Korea Policy Coordination
Moon have closely tracked U.S.-North Korea relations,
North Korea is the dominant strategic concern in the U.S.-
improving markedly in 2018—when three Moon-Kim
South Korea relationship. Moon has championed U.S.-
summits were held—before collapsing in 2019. Since early
North Korea talks, which he views as critical to preventing
2019, Pyongyang largely has ignored Seoul’s outreach and
military conflict and to realizing his goal of establishing a
has severed all overt inter-Korean communication channels.
durable peace on the Korean Peninsula. In April 2021, the
Biden Administration announced it had completed a review
U.S.-South Korea Security Issues
of DPRK policy, and that it will pursue a “calibrated,
Secretary of Defense Lloyd Austin has described the U.S.-
practical approach that is open to and will explore
ROK alliance as “the linchpin of peace and security in the
diplomacy with North Korea” to achieve eventually the
region” and “among the most combined, interoperable,
“complete denuclearization of the Korean Peninsula.”
capable and dynamic” alliances in the world. The alliance
Although Moon has welcomed the mention of diplomacy,
showed signs of strain in the past several years, as President
his preference for more aggressive engagement with North
Trump was openly skeptical of the value of the alliance and
Korea could create tensions with the United States.
requested steep increases in funds from South Korea to
offset the cost of hosting U.S. troops on the Peninsula. In its
North Korea’s steady advances in its nuclear weapons and
first two months in office, the Biden Administration
ballistic missile programs were not stopped by over two
concluded a cost-sharing negotiation with South Korea that
years of personal diplomacy between President Trump and
boosted South Korea’s contribution 13.9%. South Korea
North Korean leader Kim Jong-un. U.S.-DPRK talks halted
traditionally has paid for about 50% (over $800 million
in early 2019 due to differences over the scope and
annually) of the total non-personnel costs of the U.S.
sequencing of concessions, specifically North Korean
https://crsreports.congress.gov
South Korea: Background and U.S. Relations
military presence, according to congressional testimony by
South Korea’s COVID-19 Response
U.S. military officials.
South Korea has largely contained COVID-19, without
resorting to lockdowns. As of mid-May 2021, the country
Another focus for the alliance is an agreement to transfer
reported around 130,000 cumulative cases and around
wartime operational control (OPCON) to a binational
1,900 deaths. The Moon government has been criticized for
command led by an ROK general with a U.S. deputy.
being slow to procure COVID vaccines, administration of
President Moon has indicated his desire to accelerate the
which began in February 2021. A U.S.-ROK vaccine
transfer. Under the existing arrangement, South Korean
partnership reportedly will be announced at the Biden-
soldiers would be under a binational command led by a
Moon summit, involving the provision of U.S. vaccines and
U.S. general in the event of war. In peacetime, the ROK
an agreement allowing South Korea eventually to produce
military is responsible for national security. The plan to
and export U.S.-developed vaccines.
transfer OPCON, begun in 2007 and twice delayed,
recognizes the ROK’s advances in economic and military
U.S.-South Korea Economic Relations
strength since the Korean War and is seen by many Koreans
The South Korean economy contracted by 1% in 2020,
as important for ROK sovereignty. The two sides have
outperforming the United States and most industrialized
established conditions and benchmarks to demonstrate that
countries during the pandemic. In addition to success in
the ROK can assume wartime OPCON, including improved
containing its outbreak, South Korea also benefitted from
ROK capabilities to lead combined forces and counter the
strong global demand for semiconductors, a top export.
DPRK nuclear and missile threat, and a security
From 2019 to 2020, U.S. goods and services exports to the
environment on the Peninsula conducive to a transfer.
ROK decreased by $12.0 billion (-15%) to $69.5 billion, in
large part due to pandemic-related challenges (South
The U.S. military is in the process of relocating its forces in
Korean spending on U.S. travel services fell by $4.6
South Korea farther south from the North Korean border,
billion). U.S. imports from South Korea appear to have
with South Korea paying $9.7 billion—about 94% of total
been less affected by the pandemic, decreasing by $2.3
costs—to construct new military facilities. The U.S. exit
billion (-3%) to $86.6 billion. Autos and parts remain the
from these bases, particularly in Seoul, will allow for the
top U.S. import from South Korea ($24.4 billion in 2020).
return of valuable real estate to South Korea. The recently
In 2019 (latest available), the stock of South Korean FDI in
opened Camp Humphreys is the largest overseas U.S. base.
the United States was $61.8 billion, and U.S. FDI to South
Korea was $39.1 billion.
South Korea’s Regional Relations
Because of North Korea’s economic dependence on China,
In 2018, the Trump Administration sought negotiations to
South Korea calibrates its North Korea policy with an eye
modify the KORUS FTA, under threat of U.S. withdrawal
on Beijing’s relations with Pyongyang. China is South
from the pact. South Korea agreed to limited concessions,
Korea’s largest trading partner and destination for foreign
most prominently a delay until 2041 in reductions to U.S.
direct investment (FDI), and Beijing has punished South
light truck tariffs. A number of Trump Administration
Korean companies when it disagrees with Seoul’s policy
import restrictions on South Korean products, including
decisions. For these and other reasons, South Korea
steel, aluminum, washing machines and solar products,
generally tries to avoid antagonizing China. An exception
remain in effect. President Biden intends to work with U.S.
was Seoul’s 2016 decision to deploy a U.S. missile defense
allies toward a global solution to the underlying
system in the ROK. China responded by enacting economic
overcapacity issues in certain sectors but has not committed
measures that have cost ROK companies billions of dollars.
to removal of the U.S. import restrictions.
Moon’s government has taken an ambiguous stance on
whether to cooperate with the Quadrilateral Security
South Korean Politics
Dialogue, referred to as “the Quad,” a cooperative forum
Moon, elected in 2017, belongs to the Minjoo (Democratic)
that includes the United States, India, Japan, and Australia.
Party, which has a commanding majority in the National
Seoul’s participation in Quad activities may be more likely
Assembly. Moon’s popularity has fallen in 2021 due to
after the Biden Administration dropped the previous U.S.
complaints such as soaring housing prices. The next
framing of the group as anti-Chinese and led the creation of
presidential election is scheduled for March 2022. ROK
new Quad initiatives on COVID vaccine distribution,
presidents are limited to one five-year term.
climate change, and critical technologies.
Figure 1. South Korea’s National Assembly
ROK-Japan relations are perennially fraught because of
sensitive historical issues from Japan’s colonization of the
Korean Peninsula from 1910 to 1945. Since 2018, a series
of actions and retaliatory countermeasures by both
governments involving trade, security, and history-related
controversies have caused South Korea-Japan relations to
plummet, eroding U.S.-ROK-Japan policy coordination. To
reverse this trend, the Biden Administration has emphasized
Source: National Assembly website, accessed February 1, 2021.
the importance of trilateral cooperation and has convened
multiple high-level trilateral meetings.
Mark E. Manyin, Specialist in Asian Affairs
Emma Chanlett-Avery, Specialist in Asian Affairs
https://crsreports.congress.gov
South Korea: Background and U.S. Relations
IF10165
Brock R. Williams, Specialist in International Trade and
Finance
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https://crsreports.congress.gov | IF10165 · VERSION 28 · UPDATED