U.S., South Korea Near a Deal Over Cost of U.S. Forces on Peninsula

The Biden administration and South Korea are closing in on an agreement that would resolve a yearslong dispute over how to share the cost of American troops based on the Korean Peninsula, U.S. and South Korean officials say.

Headway in the talks between Seoul and Washington comes as the U.S. reached a parallel accord earlier this month with Japan that would extend that burden-sharing arrangement for a year.

The twin diplomatic moves are part of a broader push by the


administration to solidify ties with important allies, put aside the Trump administration’s transactional approach and settle disputes that have long roiled relations with Washington.

“It would certainly put an irritant behind us, which is not insignificant,” said

Randall Schriver,

who served as a senior Pentagon official for Asia during the Trump administration.

At issue in the South Korean negotiation is the approximately $2 billion cost of maintaining nearly 30,000 U.S. troops, of which Seoul now pays nearly half.


What should the Biden administration prioritize in the U.S.’s relationship with South Korea? Join the conversation below.

Settling on a new, five-year agreement—known as the Special Measures Agreement, or SMA—also could make it easier to collaborate on other issues important to Washington, including better aligning South Korea and Japan’s military efforts, and working with both countries on collective defense.

“It will also remove one obstacle to cooperating on larger issues, like North Korea, and maybe even China,” added Kim Hyun-wook, a professor at the Korea National Diplomatic Academy, a government school that trains South Korean diplomats.

As the talks enter the home stretch, it remains to be seen whether the Biden administration will accept what South Korea offered to then-President

Donald Trump

or insist on something slightly more.

U.S. and South Korean officials declined to spell out the remaining differences in the talks, which are being led by

Donna Welton

of the State Department and Jeong Eun-bo for South Korea.

But Chung Eui-yong, Seoul’s newly appointed foreign minister, told lawmakers last week that he expected the two countries to ink an agreement soon, while declining to elaborate further.

Tensions between the U.S. and South Korea escalated after Mr. Trump demanded a fivefold increase in the South Korean contribution. Efforts to forge a compromise fell short of Mr. Trump’s expectations, U.S. officials say.

Even some of Mr. Trump’s own advisers believed that the president’s demands were excessive, officials have said, noting that the South Koreans had paid more than $13 billion for a new headquarters complex south of Seoul known as Camp Humphreys. Aides worried that the cost-sharing issue overshadowed other bilateral issues critical to the Pentagon and the State Department, the officials said.

As the dispute festered, the Trump administration considered options to reduce the number of U.S. troops in the country. When Mr. Trump vetoed the military policy bill in December, the White House said it was partly because the bill would make it harder to trim U.S. troop levels in South Korea. That veto was overridden by Congress.

Washington and Seoul have divided the costs of stationing American troops in South Korea since 1991 under the Special Measures Agreement. The burden-sharing deal has paid the salaries of South Korean nationals working on U.S. bases, the cost of constructing facilities on those installations, and logistical fees.

South Korea has consistently increased its contributions to the deal, except in 1998, when the Asian financial crisis hurt Seoul’s economy. Washington at the time agreed to lower Seoul’s obligations to about $314 million from some $400 million, according to South Korean government tallies. In 2019, Seoul paid more than a trillion Korean won, or about $900 million.

Meanwhile, the number of American service members in South Korea have decreased to 28,500 from about 40,000 in 1991.

Under pressure from the Trump administration, South Korea has offered the U.S. an initial 13% increase in the money it pays for burden sharing, according to two people familiar with the talks. There would be further increases over the following four years that would be determined by the size of Seoul’s military budget, those people said. During the fifth year, the South Koreans would pay about $1.3 billion.

Some South Korean lawmakers, however, say the 13% increase was proposed before Covid-19 struck South Korea and that a smaller increase would now be in the country’s interest.

“Our country’s economy has suffered terribly as well because of the coronavirus,” Kim Young-ho, the ranking ruling-party lawmaker at the foreign affairs committee in Seoul’s legislature, which must approve the agreement, said last week. “With the pandemic still here, there is public opinion suggesting that 13% is too much.”

The State Department declined to comment on the status of the talks and the outstanding differences. Spokesman Ned Price said, “We are firmly committed to concluding an updated Special Measures Agreement.”

Pentagon officials have welcomed the deal to extend by one year the cost-sharing agreement with Japan, which officials expect to renegotiate for a five-year agreement as early as next year. “This further demonstrates the strength and resolute nature of the U.S.-Japan alliance,” a Pentagon spokesman said in a statement.

The Pentagon also shored up ties with Germany by freezing U.S. troop withdrawals Mr. Trump had ordered, pending a review that is likely to confirm the needs for U.S. forces in that country.

Write to Gordon Lubold at Gordon.Lubold@wsj.com, Michael R. Gordon at michael.gordon@wsj.com and Andrew Jeong at andrew.jeong@wsj.com

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