ROK Drop

Avatar of GI KoreaBy on July 5th, 2013 at 11:55 pm

US and South Korea To Renew Cost Sharing Negotiations

I think the ROK should be very careful how they approach these negotiations because the public and Congress are not in the mood anymore to let wealthy nations freeload off the US defensive umbrella:

U.S. and South Korean officials will negotiate how much each country will pay for American military support on the Korean peninsula during a second round of talks later this month.
Negotiations over a renewal of the cost-sharing agreement are planned to conclude in October after six or seven rounds, three South Korean foreign ministry officers told Stars and Stripes on Friday on condition of anonymity.
The first meeting was held in Washington on Tuesday. Although officials declined to provide details, Washington was expected to ask for more than the roughly $800 million Seoul has paid annually since the last agreement was signed in January 2009.
A Senate Armed Services Committee in April reported that U.S. spending was expected to outpace South Korea’s contributions by $330 million.
On Thursday, South Korean broadcaster KBS reported that South Korea will balk at U.S. requests for significantly higher spending. [Stars and Stripes]

You can read more at the link, but to put the cost sharing in comparison Japan spends $2 billion annually to support 38,000 US troops. Like I have always said, I believe a wealthy nation like the ROK should split the costs 50/50 with the US. They are no longer a developing nation, but instead one of the world’s most affluent nations that can afford the additional cost.

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  • Commander
    3:31 am on July 6th, 2013 1

    The USFJ has a far more expensive force structure than USFK. USFK is mainly composed of Army personnel and ground weaponry with a small number of air and C4ISR assets. USFJ on the other hand composes an entire Pacific Fleet and an Air Force, as well as several combat brigades from the USMC that are geared for quick crisis response. The logistical cost of maintaining them purely from personnel numbers is mathematically invalid and incomparable. A Bradley doesn’t cost as much to maintain as an SSBN or an aircraft carrier.

    In fact, when considering the differences in GDP Korea contributed far higher defense cost-sharing for US forces as a percentage of the country’s GDP compared to countries with larger GDP (as well as much larger US military power presence) like Japan. In nominal GDP basis Japan has five times the Korean GDP but pays less than 2.5 times more for a larger US force. This is on top of the fact that Korea already spends 2.5% of its GDP for its own military where as Japan pays only 1%. Korea has consistently paid more for its defense, even to the US, than Japan in relative terms, with any difference in absolute terms justified by the fact that Korea is a small country compared to Japan or the US.

    “The Congressional goal for all cost sharing [SMA is one subset] was for the ROK to pay 62.5% of U.S. non-personnel stationing costs in Korea in 1999. The ROK actually paid $692 million out of $1.84 billion non-personnel stationing costs, or 38%. However, Korea still provided a substantial contribution compared to other nations when factoring in differences in gross domestic product.”

    http://www.epubbud.com/read.php?g=UV3YS7ZP&two=1&tocp=31

    While Korea could afford to pay more for the cost-sharing, presuming that Korea is paying less than Japan does relative to the defense premium they get and their ability to pay is kinda myopic.

  • Jim
    7:57 am on July 6th, 2013 2

    Foreign countries need to pay 100%. S. Korea, Japan and Europe. No negotiation.

  • Bob
    4:07 am on July 7th, 2013 3

    At #1- are you talking about per capita GDP?

    https://www.cia.gov/library/publications/the-world-factbook/rankorder/2004rank.html?countryname=Korea, South&countrycode=ks&regionCode=eas&rank=43#ks

    GDP per capita (PPP)
    Korea- $32,400
    Japan- $36,200

    That just rendered your argument invalid.

  • Commander
    7:19 am on July 7th, 2013 4

    It is very obvious that I, and the Congressional statement, were talking about total GDP. And no, it doesn’t render my argument invalid even if we necessarily talked about per capita GDP. The Japanese and Korean taxpayers would still be paying equally relative to their income if the US forces in both countries cost the same to maintain.

    The Koreans still try hard to increase their own defense budget by substantial amount each year, by figures of 5-7% at a time of widespread sequestration and downsizing throughout western countries, and amidst increasing pressure from their own country as well to increase welfare spending, to modernize the NCW capability of their forces in great strides. They are not being lazy in improving their military’s self-sufficiency and giving less of a burden to US forces. Since the Korea government is already highly preoccupied even to increase its own defense budget (unlike most western countries who have the ready option of downsizing and relegating more regional security commitments to US forces in the region), finding mutual ground on increasing USFK cost-sharing further is going to be a long process. They have to consider the opportunity cost of their budgetary options on the issue very thoroughly, when each of these options all deal with strengthening national defense.

  • G.I. G.I. Joe
    7:47 am on July 7th, 2013 5

    Yes @4 Commander, “It is very obvious that [you]… were talking about total GDP.”

    “In fact, when considering the differences in GDP Korea contributed far higher defense cost-sharing for US forces as a percentage of the country’s GDP compared to countries with larger GDP (as well as much larger US military power presence) like Japan. In nominal GDP basis Japan has five times the Korean GDP but pays less than 2.5 times more for a larger US force.”

    The problem with scaling Japan’s payment to five times rather than 2.5 times based on Japan’s GDP being five times greater than Korea’s is that if Japan paid five times what it pays now rather than 2.5 times then the U.S. would be making a huge profit on USFJ. That’s where your statementis misleading.

  • Commander
    8:27 am on July 7th, 2013 6

    “Absolute Versus Relative Costs of Maintaining USFK.

    …………….

    However, Korea still provided a substantial contribution compared to other nations when factoring in differences in gross domestic product.”

    This is not misleading at all. The concept of absolute vs relative cost based on country GDP is an important factor in the US Congress’s case by case review of each defense cost-sharing agreements. It was long maintained and understood by US decision makers that one reason why Japan’s defense cost sharing of USFJ became higher than Korea’s was because Japan could afford to pay more. Eventually Korea’s share will increase, but it will not – justifiably – reach the level of Japan and that will be accepted by the US government.

  • G.I. G.I. Joe
    9:13 am on July 7th, 2013 7

    “Absolute Versus Relative Costs of Maintaining USFK.”

    I have no idea what that means in this context.

    I can assure you that as an American taxpayer, I am looking at absolute costs.

    Perhaps you mean absolute vs. relative contribution by ROK to maintaining USFK vis-a-vis Japan and USFJ.

  • Commander
    10:09 am on July 7th, 2013 8

    “I am looking at absolute costs.”

    I’m sure you do. People who govern you and your taxes intuitively take a look at much broader considerations.

  • Tom
    1:54 pm on July 7th, 2013 9

    South Korea should give these beggars more money and tell them to go f off. Maybe then they can spend some of that money to build a proper airport. :lol:

  • What?!Ablueeyedkorean!
    5:27 am on July 8th, 2013 10

    I agree Tom. Koreans should pay back all the money the US spent on Korea since at least 1950 and let your people die for their own damn country instead of foreigners doing it for them. Koreans should pay, fight and die for Korea, no one else, only Koreans. I am sure Tom will agree.

 

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