President Donald Trump and South Korean President Moon Jae-in met for the first time last Thursday to discuss trade, stationing U.S. troops in South Korea, and most importantly, finding a common approach to halting and dismantling North Korea’s nuclear program. Then, just days later, on July 4th, North Korea successfully tested a new type of missile considered to be its first ICBM (intercontinental ballistic missile). While North Korea continues to commit provocations and advance its capabilities, the U.S., South Korea, and other nations are still at a loss on a successful path to negotiations and denuclearization. The Cipher Brief spoke to James Kim, director of the Asan Institute’s Washington, DC office, about the new approach to North Korea proposed by Moon and whether it stands a chance when so many previous attempts have failed.
The Cipher Brief: Broadly speaking, the U.S. and South Korea have the same goal for North Korea: denuclearization and have outlined a phased approach. Can you describe what this phased approach looks like and highlight any differences or sticking points in either the South Korean or U.S. position in pursuing this goal?
James Kim: The “phased and comprehensive” approach to North Korea has two or three components. First, it calls for an end to North Korean nuclear and missile provocations. Under the right conditions, the U.S. and South Korea would then begin dialogues with North Korea to negotiate a freeze on its nuclear and missile development. The final phase calls for achieving what the joint statement describes as “complete, verifiable, and irreversible denuclearization” of North Korea.
There appears to be at least three potential challenges for this approach. One is the question about the condition for dialogue. In particular, it is not clear what the “right conditions” are for South Korea and/or the U.S. to engage in any dialogue or negotiation with North Korea.
During his address at the Center for Strategic and International Studies (CSIS) last week, President Moon laid out two possible scenarios that may fit the requirements to begin talks: 1) North Korea promises to stop all nuclear and missile tests or 2) it may agree to release three American hostages held in North Korea. Although there have been some suggestions that the conditions should also include the allies’ willingness to reduce the joint military exercise in exchange for North Korea agreeing to freeze its nuclear and/or missile tests, Moon has maintained that this would not be appropriate given that the joint military exercise is conducted in accordance with international laws and norms while the North Korean nuclear and missile tests do not. Without a shared understanding about the right conditions for dialogue, South Korea and the United States risk jeopardizing a coordinated effort to successfully implement the phased comprehensive approach to denuclearizing North Korea.
Secondly, there appears to be some gap in the use of pressure to bring North Korea to the bargaining table. As outlined in the joint statement, there is quite a bit of emphasis on sanctions. But the Trump administration’s “maximum pressure” approach appears to include other measures. In April of this year, for instance, the U.S. deployed the USS Carl Vinson and the USS Michigan to send a message to North Korea. Then-candidate Moon lamented the rising tensions on the Korean Peninsula and stated that military action on the Korean Peninsula should only be possible with Seoul’s consent. If more frequent or even permanent deployment of U.S. strategic assets is within the scope of what the Trump Administration considers part of its “maximum pressure” approach, then this could become an area of potential friction or disagreement with the Moon Administration.
Finally, the phased approach assumes that North Korea desires engagement. What if this is not the case? North Korea claims to have miniaturized its nuclear device and successfully tested its first intercontinental ballistic missile (ICBM) on July 4. Why would Kim Jong-un want to negotiate a freeze or denuclearize when he has single-mindedly pursued the development of his nuclear arsenal during his time as the leader of North Korea? Even if North Korea wants to negotiate, why assume that Pyongyang would want to do so in terms outlined by the U.S. and South Korea? The problem here is more fundamental in that the very premise of the phased approach to denuclearization is built on questionable assumptions about North Korea’s intentions and motives.
TCB: The controversial THAAD missile defense system was one of the early challenges for the Moon Administration. Has the system played a part in the summit and have the U.S. and South Korea reached an understanding on THAAD?
Kim: Interestingly, the Terminal High Altitude Area Defense (THAAD) system was not a major issue in the summit as some observers anticipated. This is largely due to the Korean government’s media blitz leading up to the summit. Both Moon and Foreign Minister Kang Kyung-hwa made public statements to confirm that South Korea will not cancel or reverse its decision on THAAD and that the environmental impact assessment is an issue of domestic due process.
TCB: The U.S. and South Korea have had very positive bilateral relations and are perhaps near the high water mark. One major issue for the Trump administration is the U.S. trade deficit with South Korea and the terms of the KORUS FTA. Trump called for a renegotiation during their meeting. How is this perceived from the South Korean perspective? Does South Korea have any of its own trade related grievances.
Kim: With Moon by his side in the Oval Office, Trump stated that he is “renegotiating a trade deal right now… and hopefully it will be an equitable deal, it will be a fair deal for both parties.” Moon, however, stated during a meeting with South Korean correspondents a day after the summit that there has not been any agreement about a renegotiation of the FTA. He may have a point given that there is no explicit reference to any renegotiation in the joint statement. There is, however, language that the two sides will work to “foster expanded and balanced trade,” and that the two countries will work “to reduce the global overcapacity of such basic materials as steel, as well as non-tariff barriers to trade.”
On the issue of non-tariff barriers, President Moon has stated that he is inclined to look “for improvement[s]… [by establishing] a working-level task force to examine and analyze the effects of the FTA.” The South Korean position is that the data on trade for both countries shows a continual increase in both imports and exports since the Great Recession. While the U.S. may have maintained a deficit on traded goods, the service trade has been a net surplus. Granted, South Korea concedes that the U.S. has continued to maintain a net trade deficit.
When it comes to job creation, however, the data that really matters are direct investment. Again, the data shows that South Korea has maintained more direct investment in the U.S. than U.S. direct investment in South Korea since 2014. This trend is likely to continue as the 52 business leaders that accompanied Moon to this summit announced a five-year, $35.2 billion investment package that will contribute to thousands of new jobs in the United States. Overall, Trump’s repeated reference to the renegotiation of the KORUS FTA was interpreted by the South Korean audience as a price tag for formulating a common position on North Korea.
TCB: Trump reiterated his focus on burden sharing over U.S. forces in South Korea. Are there any specifics on what he wants the new arrangement to be? What do you think the South Korean reaction will be?
Kim: President Trump has stated that the two countries “are working together to ensure fair burden sharing in support of the U.S. military presence in South Korea.” There are no specifics as to what the U.S. would like the new arrangement to be, but the existing Special Measures Agreement (SMA) will be replaced by a new one in 2019. Under the current arrangement, South Korea is contributing approximately $820 million or nearly half of the overall cost of stationing U.S. forces in South Korea. South Korea should have a better sense about the U.S. demands when negotiation for the new SMA begins, perhaps as early as the end of 2017.
TCB: Has anything surprised you about the summit or Moon’s visit?
Kim: What this summit has shown is that Moon is a very pragmatic leader who is willing to put aside his ideology and find a way forward with the Trump Administration. He will look for pockets of opportunities to promote his own agenda, but he is also very open to embracing a more conservative approach if necessary. For instance, one interesting aspect of this summit that did not receive as much media attention was the joint statement provision about enhancing U.S.-ROK-Japan trilateral cooperation. While the multilateral framework was mentioned in reference to North Korea, it can also be construed as part of a broader strategy to keep China’s rise in check.