The $5 billion bargain and the 'test' of the US-South Korea alliance.

The bargaining failed.

Negotiations between the US and South Korea on defense cost-sharing have been underway for a long time. The US wanted South Korea to serve as a model for further negotiations with other allies, such as those in Europe. However, the talks that Washington had been anticipating did not yield the desired positive results. The meeting, initially scheduled for one day to allow both sides to negotiate and find a consensus, ended with the US delegation leaving after just over an hour because "South Korea did not meet the requirements for a fair sharing of the security cost burden."

South Korean and U.S. officials participate in defense cost-sharing talks in Seoul on November 18, 2019. Photo: Yonhap

Specifically, Washington wants Seoul to contribute $5 billion annually to maintain more than 28,000 US troops stationed in South Korea. This amount is five times the budget that the South Korean government currently contributes to the United States. It is unclear what the "new items" that the US is demanding increased costs for are. However, according to Yonhap, these items would include personnel costs for US soldiers in South Korea, support costs for soldiers and their families, costs for the rotational deployment of US troops to the Korean Peninsula, and overseas training costs…

In reality, it's difficult to accurately estimate whether the $5 billion figure constitutes a "balanced" cost. South Korea states that it is willing to pay more for the US to maintain its military presence and security, but only within "acceptable limits," and that $5 billion is too high. Meanwhile, the US Secretary of Defense maintains that "South Korea is a wealthy country and can and should pay more" for maintaining US troops in the country.

Photo: Reuters

Although not explicitly stated, both the US and South Korea appear to be seeking justifications for their respective demands and requests. The US argues that its military presence in South Korea helps Seoul counter the "threat" from its neighbor, North Korea. Without increased funding, the US would withdraw its troops, which wouldn't affect US security, but for South Korea, it's a "life-or-death situation" because, theoretically, South Korea and North Korea are still technically at war. However, South Korea believes that inter-Korean relations are warming, and direct threats from the North have somewhat subsided. Furthermore, a majority of its citizens oppose increased US military spending, forcing the Seoul government to carefully consider its options.

Where is the value of alliance?

From both sides, the breakdown in defense cost-sharing negotiations has left both South Korea and the United States disappointed. For the US, President Donald Trump's long-standing position is that "America is not the global policeman," meaning any nation seeking Washington's protection must "pay." The US was expected to begin negotiations to redistribute defense costs with Japan, Germany, and NATO in 2020. South Korea was the Trump administration's first "test case" partner for this issue. Therefore, this failure will significantly impact Washington's plans, as a bad start makes a bad finish difficult.

US President Donald Trump and his South Korean counterpart Moon Jae In. Photo: AFP

The remaining US partners will certainly be watching how President Trump "behaves" towards South Korea in order to make appropriate preparations.

Previously, Trump had hinted that he might withdraw US troops if South Korea did not agree to share the burden of ensuring security. If the US were to carry out this threat, it would create a major rift in the US-South Korea alliance, profoundly impacting Washington's foreign and security policy in Northeast Asia. Meanwhile, if negotiations with Seoul continue without results, the US would lack the authority to enter into similar negotiations with other allies.

As for South Korea, the current US administration's somewhat "excessive" demands for defense cost-sharing will cause the country to question its nearly seven-decade-long alliance with Washington. Controversies surrounding the cost of contributing to the US military presence in South Korea have sparked heated debate in the country's parliament. A group of South Korean social activists argues that the US demand is "unreasonable" and calls for significant reductions or even withdrawal of US troops.

Counterfeit banknotes bearing the image of U.S. President Donald Trump were displayed on the street as protesters gathered near the U.S. Embassy in Seoul to protest the U.S. demand that Seoul increase spending on U.S. troops stationed there. Photo: AP

This group argues that the US forces in South Korea are also acting in their own interests, aiming to contain Russia and China, not just to ensure Seoul's security. One South Korean official didn't hesitate to ask, "Has the US become a mercenary? Is this a business deal?" While each side has its own arguments, the recent failed US-South Korea negotiations will undoubtedly negatively impact this alliance, especially since both the US and South Korea need each other to resolve their shared issue: the nuclear program on the Korean Peninsula.

While the principle of reciprocity is perfectly normal in international relations, the US demanding that allies pay extra for security guarantees appears to damage its prestige and global standing. In fact, this move has led Washington's allies to question whether the US measures the "value of allies" in monetary terms.

US and South Korean troops participate in a joint exercise. Photo: AFP