Japan, South Korea Rescue Intelligence Pact After U.S. Push

Kanga Kong and Isabel Reynolds

(Bloomberg) -- Japan and South Korea struck a last-minute deal to rescue their expiring intelligence-sharing pact, after a high-powered push from the Trump administration averted a blow to U.S. efforts to strengthen its Asian alliance network.

South Korea will suspend its plans to pull out of the General Security of Military Information Agreement and temporarily withdraw a complaint it made against Japan at the World Trade Organization, Kim You-geun, South Korea’s national security first vice adviser, said in a news briefing Friday, about six hours before the pact was due to expire.

The decision -- which had been a key focus of U.S. Defense Secretary Mark Esper during a trip to Asia over the past week -- was quickly applauded by the Pentagon.

“The Secretary thanks both the governments of ROK and Japan for working to find a path forward and keep working together as allies,” according to a Defense Department statement. “The agreement is important to sharing vital intelligence, particularly in a timely manner with regard to any type of North Korean actions, and it sends a strong message that we are united against regional and shared threats.”

The pact was set to formally cease to exist at 12 a.m. Saturday, three months after South Korea moved to end the deal amid a history-laden dispute with Japan. The three-year-old pact was seen as important because it demonstrated the neighbors’ ability to cooperate independently from Washington to counter shared threats including China and North Korea.

Japan and South Korea agreed to start talks on export controls put in place by Tokyo, Yoichi Iida, a trade control director with Japan’s Ministry of Economy, Trade and Industry, said at a separate briefing in Tokyo. South Korea has demanded the removal of the curbs, which it saw as a political tool that undermined trust.

Both sides tried to show they were able to get their point of view over to their neighbor. “I believe South Korea made a decision from a strategic viewpoint,” Japanese Prime Minister Shinzo Abe told reporters, while Kim said the Japanese government has expressed understanding of Seoul’s moves.

The decision by Japan and South Korea marked a rare reversal in their tensions that have plunged to new depths in recent years and spilled over to hurt their trade, tourism and relations with their main security ally, the U.S.

“Establishing a dialogue channel is a step in the right direction,” said Duyeon Kim, a senior adviser with the International Crisis Group. “But it has been a mistake for Seoul to view GSOMIA as a bilateral issue with Japan when it’s a mechanism that helps protect South Korea from the shared challenges of North Korean and regional security threats, with the help of the U.S. and Japan.”

Troop Risk

The Pentagon had warned that allowing the pact to end would “increase risk” to some 80,000 U.S. troops stationed in the two countries, while Esper said in Seoul that the only ones benefiting from friction between Japan and South Korea “are Pyongyang and Beijing.” North Korea has reminded all three of the risks, test-firing a series of new ballistic missiles since May that weapons experts said can deliver a nuclear warhead to all of South Korea and most of Japan.

The agreement would have been the most significant casualty yet of a dispute between Abe and South Korean President Moon Jae-in that rapidly escalated over the past year as the U.S. sat largely on the sidelines.

President Donald Trump has pushed allies for troop-funding increases and trade concessions over maintaining multilateral relationships. Esper and Pompeo faced the difficult task of asking South Korea to compromise with Japan, while carrying Trump’s demands for a five-fold increase in military funding.

Earlier this year, Japan removed South Korea from its “white list” of trusted export destinations and curbed exports of several items vital to production in the country’s high-tech manufacturing industry. The moves came after a series of South Korean court rulings demanding Japanese companies to compensate Korean workers forced into labor during Japan’s 1910-45 occupation of the peninsula.

“The breakdown of the Japan-South Korea relationship makes any gesture to demonstrate the health of U.S. alliance network extremely difficult, if not impossible,” said Yuki Tatsumi, director of the Japan Program at the Stimson Center in Washington.

(Updates to add Pentagon chief’s comments in TKTK paragraph)

--With assistance from Shinhye Kang, Sophie Jackman, Emi Nobuhiro, Jihye Lee, Gareth Allan and Glen Carey.

To contact the reporters on this story: Kanga Kong in Seoul at kkong50@bloomberg.net;Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net

To contact the editors responsible for this story: Brendan Scott at bscott66@bloomberg.net, Jon Herskovitz, Bill Faries

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