Prolonged Stalemate in Defense Cost-Sharing Talks, US Negotiator Replaced... Negotiations in Fog

U.S. Department of Defense Begins Cutting One-Third of Troops in Germany... Pressure to Significantly Increase Defense Costs Expected to Intensify
Trump States "We No Longer Want to Be Suckers"
Lack of Momentum for Working-Level Talks Depends on Decision Between South Korean and U.S. Leaders

[Image source=Yonhap News]

[Asia Economy Reporter Lim Cheol-young] James DeHart, the U.S. State Department's chief negotiator for the Special Measures Agreement (SMA) on defense cost-sharing between South Korea and the U.S. since last September, has moved to the position of Arctic Coordinator. Meanwhile, U.S. Secretary of Defense Mark Esper officially announced a plan to reduce U.S. troops stationed in Germany by one-third, and President Donald Trump stated, "They (Germany) have been using us for years," adding, "We no longer want to be suckers," intensifying pressure on South Korea.

In diplomatic circles, with uncertainty over when a new U.S. defense cost-sharing negotiator will be appointed, the U.S. has begun to actively reduce overseas troops. This move is expected to increase pressure for a significant hike in South Korea's defense cost-sharing through the card of reducing U.S. forces stationed in Korea.

On the 29th (local time), the U.S. State Department announced in a press release that DeHart would move to the Arctic Coordinator role, serving as a senior advisor to the Secretary and Deputy Secretary of State, leading diplomatic efforts related to Arctic policy formulation. This position had been vacant for over three years since President Trump's inauguration, and DeHart, who led the U.S. defense cost-sharing negotiation team for about ten months, has now been assigned to it.

As a result, concerns over the prolonged seven-month gap in the agreement have grown. Since last September, the South Korean and U.S. delegations have held seven face-to-face negotiations and continued virtual talks amid the COVID-19 pandemic but have failed to reach an agreement. After the seventh round, the working-level teams tentatively agreed on a 13% increase in defense cost-sharing compared to the previous year, but President Trump rejected this, resulting in a failure to finalize the deal.

The U.S. side still demands a substantial increase beyond South Korea's set "13% increase" limit. While President Trump insists on $1.3 billion, a 50% increase from the previous amount, Deputy Secretary Stephen Biegun, who visited Korea from the 7th for a two-night, three-day schedule, reportedly proposed to South Korea a plan to raise defense cost-sharing by 13% annually over three years. Although extending the negotiation period to three years with a 13% annual increase seems like a compromise, if implemented as is, the defense cost-sharing amount would nearly reach 1.5 trillion won, a 50% increase compared to last year. This still represents a significant gap from South Korea's position, which advocates for a longer negotiation cycle and single-digit annual increases.

Some analysts suggest that although the U.S. has proposed a compromise, there is no longer momentum to continue working-level negotiations, and the resolution depends on a decision by the South Korean and U.S. leaders. Previously, South Korea appointed Lee Sung-ho as Deputy Chief Negotiator for defense cost-sharing while also assigning him as Economic Diplomacy Coordinator and recently made changes to the Blue House's foreign and security team.

If the decision by the South Korean and U.S. leaders is delayed, there is speculation that President Donald Trump might use the card of reducing U.S. forces stationed in Korea. On the same day, Secretary of Defense Mark Esper officially announced a plan to return about 6,400 U.S. troops stationed in Germany to the U.S. and relocate about 5,600 to other European countries, leaving 24,000 troops in Germany.

Notably, President Trump's remarks stood out. He said, "We are reducing troops because (Germany) is not paying. It's very simple," adding, "If they start paying, we can reconsider (the reduction). We'll think about it." He also said he no longer wants to be suckers. NATO member countries agreed to increase defense spending to 2% of GDP by 2024, but Germany's spending remained at 1.36% as of last year.

The problem is that the same situation could occur with South Korea. President Trump might use the reduction of U.S. forces in Korea as leverage to claim increased defense cost-sharing as an achievement for his re-election campaign. Regardless of the actual necessity or willingness to reduce troops, Trump could use the reduction of U.S. forces in Korea as a negotiation tool to secure election-year achievements in November. Since President Trump has touted increased defense cost-sharing by various countries as a major accomplishment during his first term, it is difficult to rule out this possibility.

[Image source=AP Yonhap News]

This content was produced with the assistance of AI translation services.