Updated December 9, 2021
South Korea: Background and U.S. Relations
Overview
and achieving “permanent peace” on the Korean Peninsula.
South Korea (officially the Republic of Korea, or ROK) is
Biden supported inter-Korean dialogue and Moon reiterated
one of the United States’ most important strategic and
support for full implementation of U.N. sanctions.
economic partners in Asia. The U.S.-ROK Mutual Defense
Treaty, signed in 1953 at the end of the Korean War,
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 to 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),
implemented in 2012. 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.
In May 2021, President Joseph Biden and ROK President
Moon Jae-in met in Washington, DC. During their summit,
Biden and Moon discussed North Korea policy, and

identified ways to expand cooperation on global and
DPRK leader Kim Jong-un has characterized U.S. offers of
regional issues, such as climate change, energy, cyber-
diplomacy as “a petty trick” for hiding “hostile acts,” such
security, global health, and space. They also announced a
as the continuation of U.S.-ROK military exercises, the
Coronavirus Disease 2019 (COVID-19) vaccine
maintenance of sanctions against North Korea, and South
partnership; an ROK pledge of $220 million in aid to
Korean acquisition and development of sophisticated
Northern Triangle Central American countries to help
military equipment. In reaction to the stasis in U.S.-DPRK
resolve U.S. inward migration challenges; and investments
and ROK-DPRK diplomacy as his time in office runs out,
in the United States by ROK technology companies in key
Moon has been pushing for a U.S.-ROK pre-emptive
sectors. Moon’s presidency is to end in May 2022.
declaration formally ending the Korean War as an incentive
for Pyongyang to come to the negotiating table.
North Korea Policy Coordination
North Korea is the dominant strategic concern in the U.S.-
North Korea has continued to conduct cyberattacks around
South Korea relationship. Moon has promoted engagement
the globe and test short- and medium-range missile
with the DPRK, which he says is critical to prevent military
capabilities to develop their ability to evade missile
conflict and establish a durable peace on the Korean
defenses. The most recent tests occurred in September and
Peninsula. U.N. and U.S. sanctions severely limit Seoul’s
October 2021, when North Korea launched three new types
ability to conduct inter-Korean cooperation activities. Since
of missiles and claimed it had developed a faster fueling
early 2019, the DPRK largely has ignored U.S. and ROK
system. It also test-launched what may be a submarine-
outreach, including humanitarian aid offers.
launched ballistic missile. Some analysts worry that DPRK
leader Kim Jong-un will abandon his nearly four-year-old
The Biden Administration has stated it is pursuing a
unilateral moratorium on nuclear tests and long-range
“calibrated, practical approach that is open to and will
ballistic missile tests.
explore diplomacy with North Korea” while retaining U.S.
and international sanctions to achieve the eventual
U.S.-South Korea Security Issues
“complete denuclearization of the Korean Peninsula.” The
The Biden Administration has worked to repair the alliance,
approach appears to envision incrementally offering partial
which was strained during the Trump years. In February
sanctions relief in exchange for partial steps toward
2021, the Biden Administration concluded a cost-sharing
denuclearization. Moon has welcomed the Biden policy.
negotiation with South Korea that boosted South Korea’s
contribution by 13.9%. The ROK traditionally has paid for
At their 2021 summit, Biden and Moon stated their belief
about 50% (over $800 million annually) of the total non-
that 2018 U.S.-North Korea and South Korea-North Korea
personnel costs of the U.S. military presence, according to
agreements negotiated by Moon and former President
congressional testimony by U.S. military officials .
Donald Trump could form the basis for denuclearization
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South Korea: Background and U.S. Relations
Washington and Seoul have been adapting their alliance to
of mid-December 2021, the country reported around
recognize South Korea’s increased capabilities and desire
500,000 cumulative cases, around 4,000 deaths, and over
for greater autonomy. For over a decade, they have been
80% of the population vaccinated. Under the May 2021
preparing to transfer wartime operational control (OPCON)
U.S.-ROK vaccine partnership, South Korean
to a binational command led by an ROK general with a
biopharmaceutical companies are to produce and globally
U.S. deputy. Under the existing arrangement, South Korean
distribute U.S.-developed vaccines. U.S. vaccine developers
soldiers would be under a binational command led by a
are to invest in ROK-based production facilities.
U.S. general in the event of war. The two sides have
established conditions and benchmarks to demonstrate that
U.S.-South Korea Economic Relations
the ROK can assume wartime OPCON, including improved
The South Korean economy contracted by 0.9% in 2020,
ROK capabilities to lead combined forces and counter the
outperforming many countries during the pandemic. It
DPRK nuclear and missile threat, and a security
benefitted both from success in containing its outbreak and
environment on the Peninsula conducive to a transfer.
strong global demand for semiconductors, a top export.
From 2019 to 2020, U.S. goods and services exports to the
Additionally, U.S. forces in the ROK have consolidated
ROK decreased by $11.9 billion (-15%) to $69.2 billion, in
their presence, in part to return land to South Korea. South
large part due to pandemic-related challenges (South
Korea has paid $9.7 billion—about 94% of total costs—to
Korean spending on U.S. travel services fell by $4.7
construct new facilities such as the recently-opened Camp
billion). U.S. imports from South Korea appear to have
Humphreys, the largest overseas U.S. base. Another
been less affected by the pandemic, decreasing by $2.8
example of alliance adaptation is a May 2021 decision to
billion (-3%) to $86.4 billion. Autos and parts remain the
terminate the bilateral Missile Guidelines agreement,
top U.S. import from South Korea ($24.4 billion in 2020).
originally signed in 1979, which limited the range of South
In 2020, the stock of South Korean FDI in the United States
Korean ballistic missiles to 800 km (497 miles).
was $63.7 billion, and U.S. FDI to South Korea was $33.9
billion. At the May summit, South Korean companies
South Korea’s Regional Relations
announced pledges of $25 billion in new U.S. investment in
Because of both North Korea and South Korea’s economic
coming years with a focus on bilateral cooperation in key
dependence on China, Seoul calibrates its North Korea
technologies including electric vehicle batteries,
policy with an eye on China-DPRK relations. China is
semiconductors, and artificial intelligence.
South Korea’s largest trading partner and destination for
foreign direct investment (FDI), and Beijing has punished
In 2019, limited modifications to the KORUS FTA took
ROK companies when it disagrees with Seoul’s policy
effect, including a delay until 2041 in reductions to U.S.
decisions. South Korea generally tries to avoid antagonizing
light truck tariffs. The changes were negotiated by the
China. An exception was Seoul’s 2016 decision to deploy a
Trump Administration, which characterized them as a
U.S. missile defense system in the ROK. China responded
“basic redoing” of the agreement, but most analysts viewed
by enacting measures that cost ROK companies billions.
the modifications as relatively minor. Trump
Administration import restrictions on South Korean
Moon’s government has taken an ambiguous stance on
products, including steel, aluminum, washing machines,
whether to cooperate with the Quadrilateral Security
and solar products remain in effect, but President Biden has
Dialogue (“the Quad”), a cooperative forum that includes
stated interest in working with allies to address the global
Australia, India, Japan, and the United States. Seoul’s
overcapacity issues that led to the restrictions.
participation in Quad activities is more likely if the group
avoids an anti-China framing. The Biden-Moon joint
South Korean Politics
statement contained China-relevant phrases, including
Moon, elected in 2017, belongs to the left-of-center Minjoo
opposing “all activities that undermine, destabilize, or
(Democratic) Party, which has a commanding majority in
threaten the rules-based international order” and references
the National Assembly. ROK presidents are limited to one
to “freedom of navigation and overflight in the South China
five-year term. The next presidential election is scheduled
Sea and beyond” and “the importance of preserving peace
for March 2022.
and stability in the Taiwan Strait.”
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
South Korea’s COVID-19 Response
Emma Chanlett-Avery, Specialist in Asian Affairs
South Korea, a country of 51.7 million people, has largely
Brock R. Williams, Specialist in International Trade and
contained COVID-19, without resorting to lockdowns. As
Finance
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South Korea: Background and U.S. Relations

IF10165


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https://crsreports.congress.gov | IF10165 · VERSION 30 · UPDATED

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