The Impact of “America First” on US-ROK and Us-japan Alliances

Under the “America First” foreign policy, the Trump administration has taken a series of coercive measures toward South Korea and Japan, particularly on defense cost-sharing and trade issues. Though it will not fundamentally have an impact on Us-led regional alliances, this approach will lead allies to rethink and review their military ties with the United States.

Under the “America First” foreign policy, the Trump administration has taken a series of measures toward its East Asian allies the Republic of Korea (ROK) and Japan, in order to force them to make substantial concessions on defense cost-sharing and trade issues. As a result, concerns over the reliability of the alliance with the United States have been raised in the two countries, posing new challenges to the US-ROK and Us-japan alliances.

“Fair Trade” and “Defense Cost-sharing” under “America First”

In an address during the 2016 presidential election campaign, US President Donald Trump complained that the US had long placed the interests of other countries above its own, provided security protection to others, carried out “nation-building” in remote areas, signed many economic and trade agreements in which the US has been taken advantage of, and thereby neglected domestic employment, development and security. He said that he would reexamine US foreign policy from an “America First” perspective, and firmly defend US interests. In terms of alliances, Trump believes that since NATO, Japan, the ROK and many other allies are “rich countries,” they are fully capable and also obliged to bear more military spending, rather than simply counting on military protection from the US. In the economic and trade aspect, the United States must review the bilateral and multilateral

trade agreements and make them more “fair and reciprocal.”1

In his first address to Congress after taking office, Trump clearly stated that “America First” would be the major and overriding theme of his administration, and that his primary obligation is to “serve, protect, and defend the citizens of the United States.” On trade issues, Trump indicated that he “believe(s) strongly in free trade but it also has to be fair trade.” In terms of alliances, he said that “our partners must meet their financial obligation.” “We expect our partners— whether in NATO, the Middle East, or in the Pacific— to take a direct and meaningful role in both strategic and military operations, and pay their fair share of the cost,” said Trump in his speech.2

It is not difficult to see that under the concept of “America First,” “fair trade” and “defense cost-sharing” have become two guiding principles for the Trump administration in handling relations with its allies. The veil of “common concepts and values” is lifted, and the true nature of the alliance, which is “coercion” and “transaction,” is clearly revealed.

“Fair trade,” in Trump’s words, means establishing trade relations between the United States and its allies on the basis of fairness and reciprocity, and no longer to allow allies to take advantage of America.3 Trump has complained about unfair economic and trade relations between the US and the ROK and Japan on several occasions, claiming that the US has opened its doors to cars and many other products from Japan, the ROK and other countries, while Japan and the ROK have imposed “unfair” tariffs on US cars and agricultural products, which causes a great trade deficit between the US and the two countries. The US must correct its “unfair” economic and trade relations with Japan and the ROK by renegotiating economic and trade agreements with the two countries. 1 “Transcript: Donald Trump Expounds on His Foreign Policy Views,” The New York Times, March 27, 2016, https://www.nytimes.com/2016/03/27/us/politics/donald-trump-transcript.html; “Transcript: Donald Trump’s Foreign Policy Speech,” The New York Times, April 28, 2016, https://www.nytimes. com/2016/04/28/us/politics/transcript-trump-foreign-policy.html.

2 “Remarks by President Trump in Joint Address to Congress,” The White House, February 28, 2017, https://www.whitehouse.gov/briefings-statements/remarks-president-trump-joint-address-congress. 3 “Remarks by President Trump in Joint Address to Congress.”

“Defense cost-sharing” requires the allies to bear more in military spending, rather than take advantage of America’s security shield as “free ride.” It has been an old problem between America and its allies.4 However, after Trump took office, he threatened to dissolve NATO or withdraw troops from Japan and the ROK, in order to force them to increase defense spending. The requirements of the Trump administration’s “defense cost-sharing” for the allies mainly focus on two things. First, it requires NATO and other allies to increase their defense budgets and make greater contributions to the alliance defense spending. For instance, Trump has urged NATO members to increase defense spending to 2% or even 4% of their respective GDP.5 Second, it requires allied nations with US bases, such as the ROK, Japan and Germany, to bear more cost for the US forces there.

The Trump Administration’s Pressure on the ROK

The ROK is an important ally or the United States in East Asia and a key pillar to promote the Indo-pacific Strategy. The two countries also share common interests on the issue of North Korean nuclear and missile threats. However, this doesn’t prevent the Trump administration from pressing the ROK with regard to economic, trade and defense issues.

On economic and trade issues, Trump referred to the Korea-us Free Trade Agreement (KORUS FTA) signed by the Obama administration and the ROK in 2012 as a “horrible deal,” and regarded it as the culprit for the rising US trade deficit with the ROK. In April 2017, Trump threatened the ROK with terminating the KORUS FTA. In July of the same year, US Trade Representative Robert Lighthizer demanded a special joint committee

meeting of trade ministers within 30 days to discuss how to amend the pact in order to achieve “more fair and balanced trade.”6 In January 2018, faced with an aggressive stance on the issue by the Trump administration and the intensifying Korean Peninsula nuclear crisis, ROK President Moon Jae-in had to agree to renegotiate the KORUS FTA, which had been in force for six years. In March, the US and the ROK reached consensus on modifying the trade agreement. However, the ROK was pressed to reduce its steel exports to the US market by 30 percent in order to be exempt from the additional tariff imposed by the Trump administration on steel and aluminum products from China, the European Union and other countries.7

In September 2018, the US and the ROK signed a new agreement. According to the revised KORUS FTA, the ROK would take measures to further open its market to, and increase the import of commodities from, the United States, especially automobiles. The agreement stipulates that the ROK will double the quota of US automobile imports, from 25,000 to 50,000 per manufacturer per year, while extending the phase out of the 25% US tariff on Korean trucks until 2041. In addition, the US and the ROK would finalize a memorandum of understanding on prohibiting competitive devaluation and exchange rate manipulation.8

Besides the economic and trade matter, the Trump administration has also waved a stick at the burden sharing for US forces in the ROK. Trump went so far as to threaten that the US might reduce the size of its troops in the ROK or simply withdraw them, if the ROK didn’t significantly increase its share. At one point, Trump even asked the ROK to pay US$1 billion for the THAAD systems deployed in the ROK, threatening to have all the deployed THAAD systems shipped back to the US.

In March 2018, consultations and negotiations began over the burden 6 Jeffrey J. Schott and Euijin Jung, “KORUS Amendments: Minor Adjustments Fixed What Trump Called Horrible Trade Deal,” PIIE Policy Brief 18-22, November 2018, https://www.piie.com/system/files/ documents/pb18-22.pdf.

7 Ibid.

8 “New U.S. Trade Policy and National Security Outcomes with the Republic of Korea,” Office of the United States Trade Representative, https://ustr.gov/about-us/policy-offices/press-office/fact-sheets/2018/ march/new-us-trade-policy-and-national.

sharing for US forces in the ROK. Initially, Washington demanded the ROK to raise its contribution by 50 percent. After more than 10 rounds of negotiations, in February 2019 the two countries finally reached an agreement. According to the new agreement, the ROK was to increase its contribution by 8.2 percent, from $850 million to $923 million per year, which accounted for 41% of the total non-personnel costs. Moreover, unlike the previous Special Measures Agreement (SMA), which had been updated every five years, the Trump administration insisted that the burden sharing for US forces in the ROK be negotiated and adjusted every year thereafter, foreshadowing future rise of price.9

In fact, within six months of implementation of the new agreement, the Trump administration began to press the ROK again. In July 2019, then US National Security Advisor John Bolton demanded significant increases of cost sharing during his visit to Japan and the ROK. It was even rumored that the US suggested a fivefold rise in the two countries’ spending on the US military.10 In August, Trump announced on Twitter that the ROK had agreed to pay substantially more for US military presence there, saying that “the ROK is a very wealthy nation that now feels an obligation to contribute to the military defense provided by the United States of America.”

The Trump Administration’s Coercive Measures on Japan

To Japan, another US strategic ally in the Asia-pacific, Trump doesn’t show much mercy either. On economic and trade issues, Trump regarded the Usjapan trade relationship as unfair, complaining that Japan exported a large

number of automobiles to the US while the US got nothing. On security, he was also resentful, as Japan failed to pay enough “protection fee.” He even threatened to pull back US troops from Japan if Japan refused to bear all the expenses.12

Since Trump took office, Japanese Prime Minister Shinzo Abe has paid several visits to Washington, hoping that his personal friendship with Trump could ease the impact of the US President’s policies on the bilateral alliance. Although Trump wasn’t as tough on Japan as he was on the ROK, giving Japan more time to prepare, it was nothing more than a tactical delay. At the first Us-japan high-level economic dialogue held in April 2017, Japan tried to persuade the Trump administration to rejoin the Trans-pacific Partnership (TPP) agreement, so as to further expand Us-japan trade relations within a multilateral framework, and focus on economic policies, energy, infrastructure investment and trade rules. However, the US rejected Japan’s request outright, expressing its lack of interest in expanding Us-japan trade ties in a multilateral context. The US was far more concerned about issues like agricultural products in the bilateral trade, hoping Japan would further open its market to American agricultural products and explore ways for future negotiations on a Usjapan bilateral FTA.13

After basically reaching a new KORUS FTA, the Trump administration imposed a 25 percent tariff on steel products imported from the EU, China, Japan and other countries in March 2018, on the grounds of national security. Despite a US ally, Japan was not exempted, and the pressure from Washington has been keeping up. During Abe’s visit to the US in April of the same year, Trump openly rejected the Japanese Prime Minister’s request for the US to go back into TPP, and saw big arms sales as a quick fix for its trade

deficit with Japan.14 In May, Trump ordered an investigation into imported cars and threatened to impose tariffs on national security grounds, which aimed directly at major auto exporting countries such as Japan and Germany.

Abe refused to accept the steel tariff already in place and the possible introduction of new levies on cars. “From a security perspective, it’s very difficult to understand why this would be imposed on Japan, a military ally,” he said, “We’d consider going to the World Trade Organization if the US took steps to reduce imports.”15

At roughly the same time when the new KORUS FTA was signed in September 2018, Trump and Abe held a bilateral meeting in New York, during which Japan was forced to agree to negotiate a bilateral FTA with the US. A joint statement issued by the two countries emphasized that the US and Japan would enter into negotiations following the completion of necessary domestic procedures.16 On April 15, 2019, the US Trade Representative Robert Lighthizer met with Toshimitsu Motegi, then Japanese Minister in Charge of Economic Revitalization, in Washington for the first round of bilateral trade negotiations. The two sides discussed trade in goods, agricultural products, and came to an agreement on the need to establish high standards in the area of digital trade. In addition, the United States raised its concern for the large trade deficit of $67.6 billion with Japan in 2018. Both sides agreed that they would meet again in the near future to continue these talks.17

In order to obtain more bargaining chips, on May 17, 2019, Trump announced the findings of the US Commerce Department’s investigation into automobiles and auto parts imported from Japan and the EU, which 14 Masaya Kato, “Trump Sees Big Arms Sales as Quick Fix for Japan Trade Deficit,” Nikkei Asian Review, May 12, 2019, https://asia.nikkei.com/politics/international-relations/trump-sees-big-arms-salesas-quick-fix-for-japan-trade-deficit.

15 “Japan’s Abe Hits Back at Trump’s Plan to Slap Tariffs on Ally,” Newsmax, March 28, 2019, https:// www.newsmax.com/t/newsmax/article/863122?section=politics.

16 “Joint Statement of the United States and Japan,” The White House, May 14, 2019, https://www. whitehouse.gov/briefings-statements/joint-statement-united-states-japan.

17 “Statement from USTR on Meetings to Discuss the United States-japan Trade Agreement,” Office of the United States Trade Representative, April 19, 2019, https://ustr.gov/about-u.s./policy-offices/pressoffice/press-releases/2019/april/statement-ustr-meetings-discuss.

concluded that these imports posed a threat to US national security. Trump ordered the US Trade Representative to negotiate with Japan and the EU to resolve this threat and report the results within 180 days. Were agreement not reached by then, Trump warned that he might impose a 25 percent tariff on automobiles and auto parts from Japan and the EU.18

Under this constant pressure, Japan was forced to make concessions on issues like agricultural products. On September 25, 2019, the two countries signed a preliminary agreement. According to the agreement, Japan would open new markets to approximately $7 billion of American agricultural products, and significantly lower or eliminate the tariffs for US beef, pork, wheat, corn and wine, among other commodities. The US would, on the other hand, provide tariff elimination or reduction for agricultural imports from Japan valued at $40 million, and also reduce or eliminate tariffs on certain industrial goods from Japan such as certain machine tools, bicycles and musical instruments. In addition, they reached a deal for robust commitments on $40 billion of digital trade between our two countries, which meets the “gold standard” on digital trade rules set by the USMCA.19 Trump declared it “a huge victory for America’s farmers, ranchers, and growers,” saying that “the deal we’re announcing today will reduce our chronic trade deficit built up and taken effect over many, many years of dealing with other governments and other administrations.”20 However, this agreement was only a preliminary one between the US and Japan, the “first stage” of a comprehensive trade agreement, which didn’t cover Japan’s concerns about tariff elimination for automobiles and auto parts.21 18 “U.s.-japan Trade Agreement Negotiations,” Congressional Research Service report, September 12, 2019, pp.1-2, https://crsreports.congress.gov/product/pdf/if/if11120; Anna Swanson, “Trump Lifts Metal Tariffs and Delays Auto Levies, Limiting Global Trade Fight,” The New York Times, May 17, 2019, https:// www.nytimes.com/2019/05/17/u.s./politics/china-auto-tariffs-donald-trump.html?module=inline.

19 “Fact Sheet on U.s.-japan Trade Agreement,” Office of the United States Trade Representative, September 25, 2019, https://ustr.gov/about-us/policy-offices/press-office/fact-sheets/2019/september/factsheet-us-japan-trade-agreement.

20 “Remarks by President Trump and Prime Minister Abe of Japan in Signing of Joint Trade Agreement,” The White House,september 25, 2019, https://www.whitehouse.gov/briefings-statements/remarkspresident-trump-prime-minister-abe-japan-signing-joint-trade-agreement-new-york-ny/.

21 “Abe, Trump Sign Statement on U.S. Farm Products: Vague on Autos,” The Asahi Shimbun, September 26, 2019, http://www.asahi.com/ajw/articles/aj201909260036.html.

Japan had hoped that the Trump administration could make a written commitment to abandoning the tariffs imposed on Japanese automobiles and auto parts based on national security concerns, in return for Japan’s concessions on agricultural products, but the Trump administration never agreed.22

Besides economic and trade issues, Trump is also asking Japan to bear more of the cost for US forces in Japan. The Trump administration has been discussing internally how to get host countries, such as Germany and Japan, to pay more of the cost of keeping US troops. In March 2019, it came out with the so-called “cost plus 50” model. This meant that the United States would work to get allies to cover the full cost of US military presence in their countries, and pay an additional 50% of that cost, for the value of having US military presence there. If this model were implemented, some countries would pay more than five times what they are currently paying.23

In June 2019, Trump openly expressed his dissatisfaction with the inequality of the Us-japan alliance when he visited Japan to attend the G20 summit. He regarded the Us-japan Security Treaty as very unfair, claiming that “if Japan is attacked, we will fight World War Three.” “We will go in and protect them with our lives and with our treasure. But if we’re attacked, Japan doesn’t have to help US,” he said.24 On July 21-22, during his visit to Japan, John Bolton asked Japan to significantly expand its spending on US forces in Japan, by a purported five-fold increase. Officials of the Japanese Foreign Ministry said that “the (fivefold) figure is close to impossible,” as it “would exceed the total cost of hosting the US military in Japan.”25 Given that the current Us-japan agreement on defense cost-sharing will expire in

March 2021, this attitude of the Trump administration since 2019 means that Japan will continue to be under pressure from the US to significantly increase the payment.

In addition to cost-sharing, there have been disagreements for years between the US and Japan on the reconfiguration of US military bases in Okinawa. With Abe’s strong intervention, the two countries finally reached an agreement on the relocation of the Okinawa base and the construction of a new one. However, the two sides are still at odds over cost-sharing, the speed of construction, and the relocation schedule, with particular concerns raised by the Okinawa local government, which has been greatly dissatisfied with the large number of US troops stationed there.26

Impact of “America First” on US-ROK and Us-japan Relations

The Us-japan and US-ROK alliances are typical asymmetrical alliances. As the “boss” in the alliance, the comprehensive power of the United States, especially its military power, puts it in an absolutely dominant position. For now, Trump’s “America First” policy, especially the pressure exerted by his “fair trade” and “defense cost-sharing” arguments, has affected the alliance relationships in a three-fold way.

First, it has deepened the dissatisfaction of Japan and the ROK with the United States. The ROK was hurt by the accusation of the Trump administration that it has taken advantage of the US on security issues. It acknowledges that it needs security protection from the US because of the threat from North Korea, but that it has not taken advantage of the US since it has paid enough “protection fees” through direct defense costsharing and many other indirect measures. ROK scholars pointed out that the ROK actually pays much more for US troops in the ROK than the amount stipulated in the agreement, which also includes tax reductions and exemptions for US troops as well as indirect financial support on facilities, 26 Emma Chanlett-avery and Christopher T. Mann, “U.S. Military Presence on Okinawa and Realignment to Guam,” Congressional Research Service report, March 22, 2019, pp.1-35.

base relocation and land, which reached nearly $5 billion in 2015 alone. For example, the ROK shouldered over 90 percent of $10.8 billion for construction of Camp Humphreys, the largest overseas military base built by the US in the ROK. Moreover, from 2012 to 2016, the ROK purchased $19.8 billion worth of US military equipment, accounting for nearly 80 percent of the country’s total import of defense equipment.27

The Trump administration’s “extortion” on the above-mentioned issues has also made the Japanese and South Korean people very dissatisfied. A survey conducted at the end of 2018 showed that only 39 percent of Japanese respondents thought the relationship between Japan and the US was “good,” down from 56 percent in the previous year, which was the biggest drop since 2000. Another 39 percent said the relationship was “bad,” up from 23 percent, and 75 percent of Japanese said Trump’s demand for Tokyo to reduce its trade surplus with the US was unreasonable.28 Another survey of ROK attitudes done in early 2019 also showed that although a majority of Koreans still supported the stationing of US forces in the country, 45 percent supported maintaining Korean contributions at current levels, while 28 percent believed the contributions should increase and 17 percent believed the contributions should decrease. In addition, 40 percent of Koreans supported the Moon administration’s plan for Korea to assume operational control of forces in wartime.29 This reflected the dissatisfaction of South Koreans over the Trump administration’s extortionist policies on issues such as defense cost-sharing.

Second, it has caused greater concern in Japan and the ROK about the United States’ credibility. South Korean scholars believe that Trump’s awful attitude and ham-handed approach toward US allies is sending a wrong signal to the ROK, and will further hinder the strategic and military 27 Se Young Jang, “U.s.-the ROK Military Negotiations Could Cost the Alliance,” East Asia Forum, February 13, 2019, https://www.eastasiaforum.org/2019/02/13/u.s.-south-korea-military-negotiationscould-cost-the-alliance.

28 “Japan’s View on U.S. Ties Worsens on Trump’s Trade Push: Yomiuri,” Reuters, May 23, 2019, https:// www.reuters.com/article/us-usa-trade-japan-iduskbn1oi0b2.

29 Scott Snyder, et al., “South Korean Attitudes toward the U.S.-ROK Alliance and USFK,” Issue Brief, February 22, 2019, pp.1-14.

cooperation between the two countries. “If the US can’t make a convincing security commitment to the ROK, or if it threatens to withdraw troops due to cost-sharing concerns, the ROK will doubt the reliability of the alliance.” In particular, the ROK is concerned that the cost-sharing negotiation will be conducted annually rather than every five years as before, meaning that the ROK will have to face such “hard bargaining” from the US every year, which “may gradually make the ROK doubt the credibility of the US as a security partner, and lead to long-term slippage in the stability of the alliance.”30

An editorial in Asahi Shimbun pointed out that “demanding such a steep increase in the financial burden allies bear for hosting US troops would only be viewed as a sign that the United States does not recognize the value of its security alliances.” Japan pays much more than any other US allies for the stationing of US forces in the country. Moreover, the US stations troops in Japan not just to defend Japan but also as part of its strategy of maintaining the Us-led world order. “Its global network of allies and friendly countries is a key element of US power that is vital for protecting its national interest. The ‘cost plus 50’ proposal considered by the Trump administration could destabilize US alliances and undermine the foundation of its own national security.”31 The Trump administration’s practices have neither enhanced Japanese respect for American acumen nor convinced Tokyo that the US is committed to the alliance.32

Third, it has stimulated Japan and the ROK to seek greater autonomy. As the two major military allies of the United States in Northeast Asia, Japan and the ROK have always placed high hopes on the alliance with the US. For the ROK to deal with North Korea’s nuclear and missile threat, US protection is the only solid guarantee for its national security. From Japan’s perspective, facing the challenges of China’s rise in Asia, Sino-japanese 30 Scott Snyder, et al., “South Korean Attitudes toward the U.S.-ROK Alliance and USFK.” 31 “Editorial: Trump’s ‘Cost Plus 50’ Strategy Could Undermine Its Own Security,” The Asahi Shimbun, March 24, 2019, http://www.asahi.com/ajw/articles/aj201903160020.html.

32 Walter Russell Mead, “China and Trump Are Making Japan Nervous,” The Wall Street Journal, September 16, 2019, https://www.wsj.com/articles/china-and-trump-are-making-japan-nervous-11568673770.

conflict over territorial and maritime rights and the escalating threat of North Korea, the alliance with the US is also a strong pillar of its national security.33 The Trump administration’s re-assessment of its alliances from the “America First” perspective, however, has raised great concerns in the two countries. Undoubtedly, Trump’s words and actions will stimulate Japan and the ROK to seek greater autonomy so as to maximize their own economic and security interests, though it is unlikely that they will withdraw from the US military alliance network in the foreseeable future. On the contrary, they may even further strengthen the military alliance in order to maintain US presence.

Due to the overhanging North Korean nuclear threat, the ROK’S efforts at autonomy are first and foremost reflected in its “shuttle diplomacy” over the Korean Peninsula nuclear issue, in which the ROK has tried to play a bigger role. Since taking office in May 2017, President Moon Jae-in has held nine leaders’ meetings with Trump with six visits to the US, three meetings with North Korean leader Kim Jong-un in 2018, and four meetings with Chinese President Xi Jinping (plus sending numerous special envoys to China). The ROK has demonstrated to the Trump administration through this shuttle diplomacy its “unique role and contribution” in resolving the Korean Peninsula nuclear issue, while keeping the option of diplomatic settlement on the table in order to prevent the US or North Korea from “losing control.”

When advancing direct talks between the United States and North Korea to calm tensions on the Korean peninsula, the Moon Jae-in administration has also maintained frequent diplomatic engagement and political communication with China in order to win China’s understanding and support. Despite the obstacles posed by the Trump administration, Moon still actively embraces the Belt and Road Initiative (BRI). He even sent a special envoy to Beijing to negotiate synergy between China’s BRI and the

34 “ROK President’s Special Envoy Visits China to Promote Synergy between ‘New Northern Policy’ and BRI,” Belt and Road Portal, April 25, 2018, http://www.yidaiyilu.gov.cn/xwzx/hwxw/53775.htm.

35 “Xi Jinping Meets with ROK President Moon Jae-in,” Ministry of Foreign Affairs of China, June 27, 2019, https://www.fmprc.gov.cn/web/ziliao_674904/zt_674979/dnzt_674981/xzxzt/xcx20jtldrd14chy_697584/ zxxxydlmngfg_697586/ t1676298.shtml.

36 Guo Peiqing and Song Han, “Rok-russia Cooperation in Far East and Arctic in the Framework of New Northern Policy and Its Enlightenment to China,” Pacific Journal,vol.26, No.8, 2018, p.2.

37 Xue Li, “A Study on the Synergy of the ROK’S ‘New Northern Policy’, ‘New Southern Policy’ and the Belt and Road Initiative,” Northeast Asia Forum,no.5,2018, pp.60-61.

38 “Xi Jinping Meets with Japanese Prime Minister Shinzo Abe,” Ministry of Foreign Affairs of China, October 26, 2018, https://www.fmprc.gov.cn/web/zyxw/t1607459.shtml.

39 Ibid.

40

Ministry of Defense of Japan,

Defense of Japan 2019, pp.30-32.