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[Editorial] Stalled negotiations

South Korea, US should not let defense cost-sharing talks drift further

It makes us uneasy to see the defense cost-sharing talks between South Korea and the US remaining stalled nearly three months after the expiry of the previous deal and amid mounting uncertainties over the global spread of the novel coronavirus.

Negotiators from the two sides failed to bridge their differences on South Korea’s share this year of the costs of stationing the 28,500 US troops here during their latest and seventh round of talks, which was held last week in Los Angeles.

After the three-day negotiations, the US State Department said the gap remains “large” and that nearly half of local workers hired by US Forces Korea will be furloughed starting April 1 unless the allies reach a new deal by then.

During last week’s talks, the US rejected Seoul’s proposal for a separate arrangement to fund wages for South Korean personnel working for USFK. US negotiators expressed concern over the possibility that separate talks on the wage issue could further delay negotiations on the broader cost-sharing deal known as the Special Measures Agreement.

USFK has already notified some 9,000 South Korean personnel that they might go on unpaid leave in the absence of a renewed SMA.

The massive furlough should be avoided, given the workers’ role in ensuring the stable functioning of USFK, which is crucial to bolstering the South Korea-US alliance and its combined defense posture. It is particularly incomprehensible at a time when the livelihoods of so many people are being hit by the coronavirus pandemic.

A State Department spokesperson told a South Korean news agency Friday that a large gap remains in the understanding between the allies on the value of the contribution of American taxpayers toward defending South Korea. He said a mutually acceptable agreement would require greater focus and flexibility from South Korea to reach a fair and equitable sharing of burdens.

Under last year’s deal, which expired in December, Seoul paid around $870 million for the upkeep of USFK.

The US initially demanded a fivefold increase in Seoul’s contribution to some $5 billion this year. It is said to be currently calling on South Korea to pay about $4 billion, with Seoul insisting on an increase of around 10 percent from last year’s payment.

The US may well be concerned that separate discussions on funding wages could distract from the expeditious conclusion of a comprehensive deal. But it can be seen as unjust for Washington to put local workers’ livelihoods at stake in order to strengthen its bargaining position.

The spread of the coronavirus may make it difficult for the two sides to hold another round of face-to-face negotiations in the weeks to come. But they can and should continue close consultations through other communication tools.

An arrangement to settle the furlough issue should be worked out based on significant progress in negotiations on the broader deal.

Seoul’s chief negotiator, Jeong Eun-bo, said after the latest round of talks that the two sides were in the process of reducing their gaps “little by little.”

Seoul now needs to be more positive about increasing its burden, departing from its focus on technical issues such as additional areas to be covered by the SMA. As a way to bridge the differences, South Korea may agree to expand its contribution significantly on condition that the cost-sharing deal be renewed every three to five years instead of being revised annually.

Last week’s establishment of a $60 billion currency swap line between the central banks of the two countries may help forge a more favorable atmosphere for the early conclusion of a new SMA.

The US Federal Reserve’s move to set up swap lines with its counterparts in South Korea and eight other nations in addition to a group of rich-country central banks is seen as a bid to prevent emerging-market turbulence from aggravating conditions in the world’s largest economy.

Still, the currency swap deal with the US, along with Washington’s restraint from imposing an entry ban on visitors from South Korea, seems to remind many people here of the usefulness and value of the alliance.

For its part, the US needs to be more flexible about its demand for a steep rise in Seoul’s contribution.

South Korea and the US should quickly move beyond haggling over defense costs and focus on cooperation in coping with the coronavirus pandemic and with North Korea’s recent provocative acts.
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