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PYEONGTAEK AND KOREA MILITARY EVENTS

2006

Eagle

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America

Acknowledgement: Special thanks to Jack Terwiel , Capt, USAF (Ret) of the Osan Retired Activities Office for photos of base (past and present). Special thanks to Jackie Turner , 7th AF Historian, and John Okonski , 51st FW Historian, for their assistance with photos and guidance on the history of Osan AB. Special thanks to Ms. Jin Dal-lae and other staff members of the Jisan-dong Ward Office for taking the time to research and provide historical materials on Songtan and Pyongtaek City. Thanks to the Shinjang 1-dong Ward Office for taking time to provide information on the roads in the area. Thanks to the Seojong-dong Ward Office staff and Chief of the ward Office, Choi Yun-su , for their help in providing maps to unravel the confusing boundary issues. Much of the information on Pyongtaek City and the Songtan area was extracted from the Pyeongtaek City History, Pyeongtaek Si Sa .

USFK ROK Cost Sharing Fiasco: 2007-2008

COST SHARING FIASCO CONTINUES

BACKGROUND: SOFA and Cost-sharing Special Measures Agreement (SMA)

Cost-Sharing: The ROK populace conveniently forgets that, the ROK paid NOTHING as its share of the ROK defense from 1963 to 1991. The ROK started contributing for the FIRST TIME in 1991 after the SOFA was renegotiated by the ROK insistence to gain control of prosecution US "criminals" -- soldiers falling under ROK jurisdiction for prosecution. (NOTE: There was no SOFA prior to 1963 though Japan and Germany (defeated WWII countries) had SOFA agreements before Korea. Polite histories don't want to mention this fact as the US had "bought and paid for" Korea under President Syngman Rhee -- with an economy almost 100 percent dependent on US aid or grants. Even today, one only hears mumbling from the USFK when questioned of this fact. They state that the SOFA was delayed because it hinged upon the SOFA negotiations in Japan -- though Japan was a "defeated nation" and Korea was a "freed nation." In truth, SOFA agreements were a hinderance to the type of operations that were in Korea where the enemy was seen as China -- not North Korea. Eisenhower started "forward-positioning" nuclear weapons (Kunsan AB and Osan AB) starting in 1958 and with tactical nuclear artillery in 1960. Korea was nothing more than a buffer zone to protect Japan.)

When the SOFA was renegotiated in 1991, it also meant the entire SOFA was open for renegotiation. The US had maintained for a long time that Korea was no longer a "poor country" though it kept claiming that it was throughout the negotiations. In fact Korea was a G-13 country in 1991and grew to be a G-11 nation by 2004. All the while it has failed to carry what the US felt was its fair share.

The Special Measures Agreement (SMA) dealing with the cost sharing formulas was agreed upon in the SCM (Security Consultative Meetings). The SMA was instituted in 1991 under which South Korea paid $622 million in direct costs to support USFK.

The US position has remained that the ROK has NOT paid its fair share. The ROK has not supported its own military defense spending -- and under the "progressive" elements have slashed the military budget. As a G-11 nation, it could afford to increase its share -- but instead of supporting its defense funding, it has systematically cut the percentage of GDP from 8 percent under Chun Doo-hwan and Roh Tae-woo; to 6 percent under Kim Young-sam; to 3 percent under Kim Dae-jung; to 2.7 percent under Roh Moo-hyun. Though the ROK stated it would increase its defense budget to 3.2 percent of the GDP in 2004, it was still far less than other nations with hot spots which stands at 6.7 percent of the GDP. (NOTE: The ROK reneged on its promise to increase spending and budgeted only 2.7 percent of GDP for 2004 -- the same as 2003. In 2005, the budget grew to 2.8 percent of GDP (though it had promised 2.9 percent)-- but it was still far below the 3.2 percent recommended by the US.)

In 2005, it boasted that it would increase to 2.9 percent, but it was only 2.8 percent. The ROK government's refusal to authorize a significant 2004 defense spending increase compels the MND to delay further major force development projects. President Moo-Hyun Roh's announcement that the defense budget will probably not reach 3 percent of GDP during his administration does not augur well for future Mid-Term Defense Plans. Defense budget restrictions will continue to force the MND to continue to neglect short-term readiness to fund long-term force development. While the MND recognizes the importance of interoperability with US forces, it is not an overriding factor in procurement decisions because cost is increasingly a key consideration in major procurement programs. US defense industry must also contend with the Korea's increased emphasis on developing the Korean defense industry base. (Source: GlobalSecurity.org.)

To achieve the five-year plan to enhance cooperative self-reliant defense capability by 2008, the Ministry of Defense will secure a total of 99.4 trillion won ($94 billion). On 30 Mar 2005, the Defense Minister noted his intention to increase the defense budget to 3.2% of the total gross domestic product by 2008 from the current 2.8%, a 12.5% increase in relative terms even before economic growth is factored in. The ministry requested 23.3 trillion won for its 2006 budget, up 12% from 2005. This was an "eyewash" move. The National Assembly slashed the spending to 2.8 percent of GDP -- effectively shelving the procurement of new weapons systems and forcing a "reprioritization" of programs already on the books.

Under the "self-reliant defense" scheme of Roh Moo-hyun, the ROK will have to spend over $692 BILLION over the next ten years -- a sum it simply cannot afford. Roh is throwing out pipe-dreams with grandiose promises -- but the reality is that the ROK will not be able to pay for this as the tax base will shrink because the birth-ratio is dropping. The ROK faces major problems as a society that is NON-VIABLE and even now has announced plans to reduce the size of its military by 500,000 simply because by 2010 there will not be enough men to fill the slots.

The response of the NGO activists has been that the US was in Korea for its own geopolitical reasons and therefore there was no need for Korea to pay for the Americans -- a logic that pervades any Korean discussion on the SOFA and cost-sharing. However, remember that when the Nunn-Warner Initiative was to cut in in 1990 with an initial 25 percent reduction in the USFK, the Korean government pleaded for the US forces to remain. When the US announced that it would pull off the DMZ, the ROK fought it tooth-and-nail as they were losing their "tripwire" that ensured the US would enter the fray if North Korea attacked.

In trying to lure the ROK into shouldering its share, the USFK announced that it was "investing" $11 billion in ROK defense in 2004. However, this was really a trick with mirrors put out for PR purposes. The much vaunted $11 billion dollar "investment in the ROK defense" was simply upgrades to the USFK equipment -- Apache Longbows radar and Hellfire missile upgrades, MA-1A Abrams computerized upgrades, new ATACMs munitions with mountain piercing capabilities, increased Command and Control capabilities to allow battlefield commanders real-time intel, etc. Then the USFK changed its structures to the "unit of action" which combined like units giving them greater flexibility as well as improving their ability to react as self-contained units. Some of the enhancements were actually directed at deploying surveillance and attack UAVs and new precision-guided bombs. Because these could have provoked Pyongyang since they were aimed at strengthening the capability to strike the North's military facilities, they were "hidden" under the "investment in ROK defense" scheme.

In 2004, the US pushed the issue with the contentious C4I upgrade of the ROK computer communication systems. The ROK maintained that the US should pay for the upgrades, while the US stated that no-such agreement was ever made. In the end, the matter was dropped with the ROK having no upgrades and unable to interface with the US real-time intelligence. It maintained the manual interface at the command post level with its forces.

The ROK openly refused to increase its share in 2004. The US at that point ceased to press the matter of cost-sharing -- instead preferring to go its own way and allowing the ROK to go on its own. However, the US simply stated that because the ROK would not increase its share, it was sorry but 1000 Korean jobs were going to be cut -- in addition to the jobs that were being lost due to the relocation south. The ROK simply shut up and no more has been said -- at least officially. The US started to play hard ball.

In 2005 Gen LaPorte said about the cost-sharing was that the US government paid 60 percent of the non-personnel costs. The South Korean government support equaled 40 percent of the command's non-personnel costs. When Gen. B. B. Bell took over as USFK Commander, he called on Seoul to cover 50 percent of the defense sharing cost. Currently Seoul covers 38 percent.

It contributed about $150 million. In cost-sharing talks in Seoul last March, the two sides agreed on the amount of Seoul's share for 2005 and 2006 that is less than the $622 million South Korea paid in 2004. (Source: Korea Times.) In the end, the US agreed to reduce the ROK share by about $60 million -- more in disgust than in any spirit of unanimity.

When one compares the USFJ with the USFK one sees that the USFJ received $4.4 billion in host-nation support in 2006 and expected $1.2 billion in 2007 and 2008. On the other hand, the USFK received only 680 billion won ($707 million) for 2005 and 2006. The ROK cost sharing squabble is NOT complete as the ROK wants to REDUCE its support, while the US wanted the ROK to INCREASE its support.

According to USFK, that formula accounted for about 40 percent of the American military cost in 2005 and was expected to cover only about 38 percent of 2006's costs. That money is used to cover local supply contracts, construction projects and salaries for Korean workers at the U.S. bases, according to USFK. In the past, the U.S. has argued that South Korea should pay more; Japan, for instance, pays about 75 percent of the cost of its American military presence. South Korea, however, has argued that as U.S. forces shrink here, so should the bill. The U.S. military is in the midst of a plan to remove 12,500 troops from the peninsula, from 37,500 to 25,000. Currently, there are about 29,000 U.S. troops here. (Source: Stars and Stripes.)

On 27 Apr 2006, the Donga Ilbo ran an article that the Master Plan was again delayed until September 2006. Details were sketchy but it appeared that the cost-sharing issues were the primary problem. The repeated delays have sparked concerns that the original plan to finish relocating by 2008 could be hampered. Reports have said South Korea's cost-sharing is estimated to reach up to $5.5 billion with respect to costs for the provision of land for new U.S. military facilities and the relocation of the headquarters of the USFK and related facilities in Yongsan, Seoul. The United States is expected to pay as much as $4.5 billion for the U.S. Army's 2nd Infantry Division stationed north of Seoul to Pyongtaek,.

In Nov 2006, the US pressed the point that the Congress mandated that the host country must foot 75 percent of the bill for stationing US troops on their soil -- but will settle for the ROK footing 50 percent of the bill. The Korean press started trying to interpret what Secretary of Defense Rumsfeld meant by "equitable" as the ROK pays 38 percent of the cost sharing ($680 million a year) -- but also wants to reduce it further. The Master Plan hinges upon this cost-sharing of both support and relocation costs. The Yongsan move costs were fully ROK initiated -- but the ROK wants to wiggle out of those costs as well. (SITE NOTE: In Nov 2006, we stated that one should watch the National Assembly and Uri Party for more moves to renege on their part during the approval process for the 2007 budget. The move from Uijongbu of the 2d ID is shared by both the US and ROK but this is still being hassled out at the end of 2006.)

Of the 29,500 servicemembers assigned to U.S. Forces Korea, only about 10 percent get financial support — including housing — to bring their families along. Because of that restriction, most assignments here last only a year. As the U.S. forces centralize at Camp Humphreys in Pyeongtaek in coming years, leaders hope to change that shortened, solitary assignment into a three-year stint with orders to bring family members along. The only problem with this is that the ROK refuses to increase their cost-sharing which directly impacts upon the accompanied tours in Korea. This is why the ROK is NOT the area of choice for most personnel because of the unaccompanied tour. In the USFJ, 75 percent of married personnel are accompanied tours, while in Korea only 10 percent are accompanied. Even those that were accompanied live in substandard housing on the camps near the DMZ -- and even worse off-base.

The ROK was not listening to the warning that George Bush issued in 2002 that the US would retain its "presence" in the South as long as the ROK wants the US in Korea. If the ROK would not pay for the upkeep of the troops stationed in Korea, it does not want them here. This warning from George Bush in 2002, Donald Rumsfeld in 2003, and Gen Bell in 2006 is being repeated over and over like a mantra. It was a final warning!!!

There is a grass roots movement to disengage from the ROK as it is increasingly viewed as an "ungrateful" ally. The anti-Americanism in Korea is constantly being brought up in news reports on Korea through the Associated Press and Reuters. The general American public no longer views the ROK as a strong ally -- and views the nuclear threat of North Korea as a number one threat to world peace -- and views the ROK negatively for its support of the North. The recent remarks by Congressman supporting the return of wartime control reflects the change. As such the President, DoD, State Department and Congress are in sync on a "drawdown" based upon the return of wartime control and demise of the CFC. The realignment of the USFJ treaty was in place as of May 2006, the movement of forces to Guam in place funded partially by Japan, the increase in the Missile Defense System for Japan increased by end of 2006, and now all that was required was the drawdown/pullout from Korea. This is what is at stake in the discussions of relocation costs.

The MND "hinted" that the plan would not be completed on schedule because construction of the new facility has been delayed due to protests by residents. However, this was strictly a ROK governmental problem in its failure to remove the residents because it was a political situation. The ROK government could have acted, but they did not. Instead the Roh administration simply went to court -- after stalling on any action. Now the Yonhap News stated, "Last year, the government took legal control of about 11 million square meters of land surrounding Camp Humphreys and has since been seeking to clear the area of people who remain there." This is a lie as the ROK government didn't even start legal action until December 2005.The procurement of the lands was to have been completed and construction started in 2006. Instead, the evictions didn't start until June 2006 and construction is now slated for the first parcel in 2007. The bottomline is that the delays were not by the Daechuri residents, but by the ROK government for failure to take the promised actions.

The MND is attempting to justify the delays on the assumption of wartime control in 2012. "If the relocation is only about U.S. facilities in Yongsan, it will be possible by 2011. But when it is taken into account that the Combined Forces Command would be disbanded around 2012, the base relocation would be finalized by late 2012 or 2013," they said. Unfortunately, the USFK and Gen Bell before Congress has stated that the turnover could be completed by 2009 -- with most elements in place by 2008. The reason is that with the shift of wartime control, there is no more need for the USFK ground forces committed initially to the defense of Korea. These forces can be relocated elsewhere -- especially as the US is in dire need of ground forces in its global war on terrorism.

  • Relocation Costs/Issues: The total cost of base relocations (Yongsan and 2d ID) is estimated to be about 10 trillion won (US$10 billion), and South Korea is expected to fork out about 50 percent, a little less than the originally estimated expense, according to defense sources. Korea is estimated to spend 5 trillion won for the U.S. base relocation, about 50 percent of total cost. It is lower than earlier estimation on Korea's expected cost sharing level of 5.5. trillion won (US$ 5 billion), according to sources. The original cost the USFK projected for Yongsan was 3.2 billion, but the cost has been disputed by the ROK politicians ever since it was first announced. The USFK assumed more of the costs and made concession after concession, but the ROK continued to want more reductions in cost.

    In 2007, the USFK is no longer willing to make further concessions and is simply shutting down its operations at Yongsan. Under the heading of reconfiguring to "units of action" (UX), the units are downsizing and consolidating their operations. The units are preparing to simply shut down their operations and walk away from Yongsan...despite what the ROK wants the USFK to do. In addition, the USFK in a low-key operation switched its non-essential operations from Camp Humphreys to Camp Stanley/Red Cloud allowing the essential units from camps along the DMZ (closed under the Land Partnership Plan (LPP)) to bypass consolidating at Camp Stanley -- and then at a later date moving to Camp Humphreys.

    The relocation will be affected under a Master Plan that unfortunately is being modified as one goes along. It was supposed to have been completed in June 2006...then slipped to Sep 2006...then slipped to Dec 2006...then slipped again. The reason is (1) the contentious cost sharing issue that has not been resolved; (2) the continued foot-dragging of the ROK government to forestall the relocation as long as possible (and now set in their minds at 2013); and (3) the larger picture that is shaping up as the USFK being in a support role to the ROK and therefore not requiring large amounts of ground troops. These and other issues such as the 8th Army structure disappearing; the ROK refusal to commit its funds to a "joint" C4I system (GSSC-K) and opting for their own home-grown system; and the CFC no longer moving to Camp Humphreys. However, overshadowing this all is the larger picture where the US forces are relocating to Guam and the US talking of committing its air arm (USAF/Navy) to the ROK defense -- instead of ground forces.

    The relocation costs must be divided into two groups: (1) Move from Yongsan; and (2) the 2d ID move off of the DMZ. The costs given to Congress differed between those given by Adm Fallon in Mar 2006 ($6.8 billion) and Gen La Porte in Mar 2005 ($8 billion). Fallon's numbers supposedly came about by adding Korea's SMA share for USFK upkeep to the W5-5.5 billion for relocation of the Yongsan garrison and a Land Partnership Plan. The figure suggested by Adm. Fallon was $1.2 billion less than the $8 billion cited by former USFK commander Gen. Leon LaPorte before the committee in March 2005. At the time, LaPorte said the $8 billion included $1.6 billion for investment in build-transfer-lease (build-to-lease or BTL) projects, $1.68 billion for South Korea's SMA share in troop upkeep and $480 million for USFK facilities. Adding the $1.6 billion for BTL projects, as LaPorte suggested, to the $6.8 billion quoted by Fallon comes to $8.4 billion, suggesting Fallon subtracted the BTL projects. (Source: Chosun Ilbo on 9 Mar 2006.)

    Under a 2004 agreement for the U.S. base relocation, Washington agreed to pay for the move of the 2nd Infantry Division and Seoul agreed to cover the relocation costs for the Yongsan troops. So, given the roughly US$10 billion total estimated cost - which includes the Pyeongtaek base construction and troop relocation but which does not include the $1 billion land purchase - and given that the cost of moving the Yongsan and 2nd Infantry troops is estimated to be nearly equal, South Korea had said it would pay around $5 billion, while the U.S. would shoulder the remainder. However, General Bell's remarks on 18 Jan 2007 seemed to confirm that half of the costs that were slated to be paid by the U.S. will in fact be paid by the South Korean government. In short, Bell's comments would mean that half of the $5 billion previously thought to be paid by Washington will come from SMA funds, meaning that Seoul will in effect pay an additional $2.5 billion for the relocation of the U.S. bases, or 75 percent of the $10 billion cost, rather than the 50 percent previously stated by South Korean officials. (Source: Hankyoreh News.)

    • Yongsan: The first is the move to Pyeongtaek from Yongsan by 2008 as agreed to in 2004. However, according to the Korea Herald on 13 Dec 2006, the relocation of the main U.S. military base in central Seoul was likely to be postponed until 2013 apparently due to a delay in construction of an alternative installation and differences over costs. Concerns over how the two allies will split the costs of the project, and delays from anti-expansion protests staged on lands earmarked for the expansion, were among reasons the Ministry of Defense cited for the possible timetable change. They tried to blame the cause on the US failures to reach a cost-sharing agreement as well as other factors. However, the biggee is that the ROK must foot the ENTIRE bill for the relocation out of Yongsan .... and it was expecting to pay for it from the sale of Yongsan land to developers. Unfortunately there is a great controversy over the development of the lands. Thus the MND is out on a limb.

      In 1990, a MOU was signed to move the Yongsan Garrison, but the ROK would not come up with the $9.5 billion it required to relocate the USFK headquarters. In addition, cities refused such as Pyongtaek refused to have the new USFK headquarters located in their cities. In addition, the ROK claimed the costs were excessive and should have been around 4 billion. It was a stalemate and everything returned to a status-quo.

      However, the anti-American demonstrations in 2002 culminating in the knife attack on an Army Officer at Yongsan led to a backlash that added ammunition to moving the troops out of harms way -- not from the North Koreans, but from the South Koreans. In February 2003, it started with whispers to fact to actual discussions to set up the framework for the April review that will discuss a large area from relocations, time-tables and cost-sharing. Finally after much foot-dragging, Sec of Defense in the Security Consultative Meeting (SCM) of Oct 2004 simply stated that the US was departing Yongsan for Pyeongtaek and the ball was set in motion.

    • Camp Humphreys: The second is the move of the 2d ID off of the DMZ. It was thought that this move would be a win-win situation when the Land Partnership Plan (LPP) was devised. Under the plan, the US would consolidate its bases along the DMZ into Camp Stanley and Camp Red Cloud and then relocate the bases to Camp Humphreys in Pyeongtaek. Unfortunately, the ROK did not really want the US to leave the DMZ and started to throw numerous obstacles in the way. In 2006, the NGO activists were accusing the USFK of not cleaning up their pollution and the ROK refused the camps. In the end, the USFK said they had done as agreed to under the SOFA and unilaterally abandoned the bases -- though it did had some back to the ROK.

      A series of ultimatums had been given on cost-sharing (dating back to 2004); bombing range availability (starting in 2003); relocation costs (dating back to 2003); relocation from Yongsan (dating back to 2003); Land Partnership Plan failure because of ROK refusal to accept camps regardless of the SOFA agreement (dating back to 2005); failure of the ROK to provide adequate lands (dating to 2006 on 500 million dollar flood control project); and the list goes on. But the biggest problem was that the Roh administration had proven that it was not a reliable ally by backing the North Koreans -- even though the US was faced with protecting the ROK from the North. It had not stood with the US in attempting to bring the North to the negotiating table, but destroyed the pact to act with one voice in the dealing with the North on the nuclear issue. It was now too late in 2006 and the US started playing hardball.

      In the midst of this there is the 500 million flood control project that the USFK brought up in 2006 that the ROK simply swept under the carpet. It remains unresolved. Supposedly a dedicated train line to move heavy equipment directly to the Rodriquez range on the DMZ from Camp Humphreys has not been heard of since its initial announcement -- though it still may be on the drawing boards.


Defense Funding Talks Conclude (Nov 2006) South Korean and U.S. military officials concluded talks on sharing the cost of stationing U.S. troops in Korea for 2007. The ROK reportedly agreed to slightly increase its current contribution of six-hundred-80 billion won in light of the fact its share was sharply reduced in 2005. With the agreement, Seoul claimed that it was partially accepting Washington's call for Seoul to share half of the defense costs.

The U.S had wanted a long-term contract that would run up to ten years, but now Washington accepted Seoul's request for a short-term agreement lasting for only two to three years. The South's delegation is headed by the Foreign Ministry's North American Affairs Bureau chief Cho Tae-yong while the American contingent is represented by senior State Department advisor Robert Loftis.

The agreement was considered a lose-lose situation. In effect, neither side agreed to anything with the US stating that the end result may result in the loss of workers jobs.


Korea, US Mull New Defense Cost-Sharing Formula (Jan 2007) The government and the United States have agreed to devise new ways to calculate the sharing of defense costs for U.S. forces stationed in Korea. The Foreign Ministry said on 4 Jan that Foreign Minister Song Min-soon made the proposal on 3 Jan while meeting with U.S. Deputy Defense Secretary Gordon England in Washington. Song proposed discussing new methods to calculate each side's share of defense costs based on objective data, to which England responded positively.

The ministry added that the two sides also agreed on the need to decide as soon as possible the timetable for the transfer of wartime operational command in order to remove any uncertainties. The two officials also exchanged opinions on the latest six-party nuclear talks, vowing their governments' continued cooperation.


New Formula for Cost-Sharing (Jan 2007) Chosun Ilbo reported on 8 Jan 2007 that the ROK and the US have agreed on a new system to calculate the cost of US troops stationed in the ROK. Sources at the US Embassy in Seoul say the agreement came after a meeting between Foreign Minister Song Min-soon and Deputy US Defense Secretary Gordon England in Washington. The two sides have acknowledged that it's time to change their "push-and-pull" style of negotiating. The plan is to develop the new system within the year.

The last meeting resulted in a lose-lose situation with the ROK determined to reduce their share and the US determined to have the ROK increase their share or else. See ROK-US Defense Cost Sharing Talks (Aug-Oct 2006) for details on on-going Cost-Sharing Dispute in 2006.

On 6 Dec 2006 it was reported that the ROK government and US had struck a deal to increase Seoul's share of the cost of maintaining U.S. troops in Korea by 6.6 percent supposedly after six months of official negotiations. The Foreign Ministry said Seoul will contribute a total of 725.5 billion won next year, up 45.1 billion won from 2006 -- by less than 21.4 billion won from 2004. The outcome was less than ideal for both sides, analysts said, with some describing it as a lose-lose agreement. Korea had been reluctant to increase its contribution while the United States had been demanding an equitable share.

"The results of the negotiations this time do not fully satisfy either side, but they are regarded as the most reasonable based on the spirit of the South Korea-U.S. alliance," the ministry said in a press release. Officials here said the rise in the payment was inevitable, given the job security of South Korean employees at U.S. military bases. The USFK argued that it would be forced to cut its number of local staffers unless Seoul paid more money. Reacting to the 2006 reduction in Korea's share, the US had laid off a total of 470 Korean workers at the military bases.

"This agreement is a kind of transitional one," a ranking Foreign Ministry official said in a background briefing for the media. "The two sides agreed to begin a joint study to draw up a more stable, transparent and fairer method of sharing the burden." The United States had also wanted a longer term contract. Korea insisted on a shorter contract citing planned U.S. troop reductions by 2008. This is unresolved. The key sticking point had been the United States' demand for "equitable" burden-sharing, meaning Seoul should raise its share to 50 percent of the total cost. Korea currently bears 38 percent. This too is unresolved. (SITE NOTE: This is a two-way street. The US is playing hardball. It is going to reduce the numbers of troops to reflect the amount of monies for a shortfall. The ROK is stepping directly into the game plan of the US. In Nov many organizations were "streamlined" by having missions combined and portions of the organizations eliminated. The transfer of wartime control by 2009 (US view) will eliminate many positions -- and billeting, housing, etc requirements -- which will reduce the ROK cost-share. WHEN the USFK makes the decision to switch to an airstrike support versus a ground force commitment, there will be all kinds of hell to pay. This is all speculation and things are happening in all areas that point to a major confrontation between the US and ROK in 2007.)

Under the two-year deal, Korea will raise its contribution in 2008 to adjust for inflation. The two countries also agreed to maintain the current expense categories eligible for Korea's contribution: personnel, facility building, combined defense capability building and logistics support. As Korea will continue to pay its contributions in Korean won, the government is expected to enjoy greater stability in drawing up and managing the budget. The Foreign ministry must now submit the budget plan for approval by the National Assembly. Opposition was anticipated as liberal lawmakers have already denounced the latest agreement citing an "unfair" estimation of the actual contribution by Korea. (SITE NOTE: Any delay on the part of the Uri Party and DLP in approving the budget make meet with immediate action to reduce the ROK workforce laying the blame at the ROK footsteps. As expected the 2007 budget included cuts in the military spending for the relocation of the USFK bases.) (Source: KBS News and Joongang News.)


ROK, US to Revise Defense Cost-Sharing Formula (Feb 2007) The ROK government and the United States sought a new formula for sharing the cost of stationing U.S. forces in Korea. The Defense Ministry said on 2 Feb that the two sides agree on the need to devise new ways to calculate and negotiate the sharing of defense costs, adding that they will hold further consultations this year.

Seoul and Washington have held the Special Measures Agreement (SMA) talks every two or three years to discuss defense cost sharing. The two sides are reportedly considering a new formula based on itemized actual expenses instead of the current method based on total expenses. In December last year, the two sides agreed that Seoul will raise its contribution to 725 billion won this year, up six-point-six percent from last year. Approval for the hike is pending review at the extraordinary session of the National Assembly. (SITE NOTE: Unfortunately, the USFK states that this "share" will result in a shortfall in USFK expenses as the ROK only covers 38 percent of costs of stationing forces in Korea. Unresolved is the US Congressional mandate that the host country support at least 50 percent of the costs.)


ROK to shoulder up to 75% of U.S. base relocation (Mar 2007) "Largely, the money that we need to move the 2nd Infantry Division from north of Seoul to Pyeongtaek, about 50 percent of that money, we intend to be SMA money." This remark was made by Burwell B. Bell, commander of U.S. Forces Korea, during a speech to foreign correspondents in Seoul on January 18. The SMA, or Special Measures Agreement, last updated in December, is the contract under which South Korea makes contributions toward the cost of stationing U.S. troops in Korea.

General Bell's remarks sparked a controversy regarding how much South Korea will have to shoulder in the ongoing move of several U.S. military bases. Two large concentrations of soldiers - one at Yongsan Garrison in Seoul and the other comprising the 2nd Infantry Division, spread along the border with North Korea - will be moved to Pyeongtaek, south of Seoul, as part of the U.S.'s move to increase mobility in its troops stationed worldwide.

Bell's remark also seemed to uncover the reason why the U.S. and Korean sides have been giving seemingly contradictory accounts regarding the base relocation cost. So far, the U.S. Department of Defense has told Congress that the U.S. will pay much less than will South Korea, while South Korea has never mentioned the possibility that its money would be part of the "U.S. share" of the cost. Another example of these conflicting accounts occurred when William J. Fallon, commander of U.S. Pacific Command, told the U.S. House Appropriations Committee in March 2006 that the South Korean government would pay $6.8 billion, including $1.68 billion from Korea's contributed SMA funds, for the relocation of the U.S. bases, which contrasts with South Korea's version of a 50/50 split of the cost.

(SEE ROK STILL In Denial over Relocation Costs The following is from the Chosun Ilbo on 9 Mar 2006. The newspaper claimed that Adm Fallon, CINC of US Pacific Comand came up with a different estimate of the cost to Seoul of relocating the USFK. Actually it was not quite true in that the ROK was the one in denial over the cost of the relocation which it continued to claim was too high. At the time, the Defense Ministry said Fallon's numbers came about by adding Korea's share for USFK upkeep to the W5-5.5 billion for relocation of the Yongsan garrison and a Land Partnership Plan, which is "simply an estimate made by the U.S. on its own." The figure suggested by Adm. Fallon is already $1.2 billion less than the $8 billion cited by former USFK commander Gen. Leon LaPorte before the committee in March 2005. At the time, LaPorte said the $8 billion included $1.6 billion for investment in build-transfer-lease (build-to-lease) projects, $1.68 billion for South Korea's share in troop upkeep and $480 million for USFK facilities. Adding the $1.6 billion for BTL (Build to Lease) projects, as LaPorte suggested, to the $6.8 billion quoted by Fallon comes to $8.4 billion, suggesting Fallon subtracted the BTL projects.)
Korean officials reason that their failure to mention the additional shared amount is that South Korea's annual contribution to U.S. Forces Korea was already agreed upon in the SMA, which it says is an issue separate from the base relocation. But civic groups are crying foul over what they call a pointed omission by the South Korean government.

In addition to Bell's remark casting doubt on the Korean government's account of cost sharing, questions linger over precisely how the U.S. should be spending South Korea's contribution under the SMA. The money contributed by Seoul to the fund is slated for four expense categories: wages for South Korean employees working at U.S. bases, military-related construction projects, combined defense buildup, and the purchase of logistics equipment. When asked about General Bell's comments that SMA money was to be used for the base relocations, an official at South Korea's defense ministry said that the categories of military construction and combined defense buildup can be the ones earmarked for this purpose.

In 2006, spending for military construction and defense buildup accounted for about 40 percent of the total South Korean contribution. U.S. Forces Korea is required to give to the South Korean defense ministry reports of how the money has been spent, but the reports are not detailed enough to specify how the money has been spent, sources say.

"We are not in a position to know that many details regarding how they spend the money," a senior government official said. Regarding the use of the two categories to help fund the base relocations, Kim of the defense ministry said, "Negotiators did not outline such specifics when they reached an agreement [over the cost of hosting U.S. troops in South Korea], so there is no foundation to the argument that South Korea's contribution should not be used to pay for the base relocation."

However, Yu of the civic group said that Korea's contribution to the SMA should not be handed over to the U.S. to spend on its whim without some measure of control in place. Yu said that Korea's contribution increased in 2007, while the number of U.S. troops stationed in South Korea continued to decrease. Yu said he was also concerned that the U.S. may continue to demand that South Korea increase its contribution to the cost of relocating the U.S. bases.

The problem of how Korea pays into the SMA is another issue surrounding the U.S.-Korea accord. When Seoul and Washington agreed to increase South Korea's contribution under the SMA in December, South Korean officials announced that the additional 45.1 billion won (US$48.3 million) added to the 2007 budget would be used toward wages for South Korean workers at the bases. However, General Bell said soon after that he would fire South Korean workers or cut programs that employ such workers if the construction of the Pyeongtaek base fails to be completed on schedule because South Korea's contribution proves inadequate to cover the budget, comments which sparked additional controversy. This situation stems from the fact that South Korea cannot decide on its contribution to the SMA based on specific spending category, but instead pays into it on a lump sum basis. Seoul is currently seeking a change to this payment plan in order to increase transparency in how the money is used.

South Korea pays the U.S. in the hundreds of millions yearly for the stationing of about 28,000 U.S. troops in South Korea; as of December, Seoul under the SMA agreed on a 2007 payment of 725.5 billion won (US$776.4 million) and to pay the same amount in 2008 with an adjustment for inflation. With the 1950-53 Korean War ending with an armistice rather than a peace treaty, the two Koreas are still technically at war. (Source: Hankyoreh News.)


Gen. Bell: Allied Burden Sharing to House Armed Services Committee (Mar 2007) Gen B.B. Bell's report before the House Armed Services Committee on 7 Mar 2007 contained a portion entitled "Allied Burden Sharing." It is extracted below:

With the Republic of Korea's tremendous economic capacity and prominence in the international community, a balanced defense burden sharing arrangement in support of Unites States forces in Korea is fundamental to the strength of the Alliance. Today the Republic of Korea contributes approximately 2.6% of its GDP to its national defense, while the United States expends around 3.9% for our defense. At the end of 2006, the Republic of Korea and the United States concluded talks on a new Special Measures Agreement (SMA) regarding ROK cost sharing support of United States forces in Korea for 2007-2008. (SITE NOTE: The amount of ROK contribution to defense is actually 2.57 percent of GDP -- while a frontline flashpoint nation usually spends about 6% of GDP. The percentage of GDP up to Kim Young-sam remained at 8.0% of GDP, but as soon as Kim Dae-jung took office he used the excuse of the IMF Crisis to reduce the defense share to 2.8% of GDP. Roh Moo-hyun continued with the reductions -- and postponing defense upgrades -- until the present 2.57 percent of GDP.)

In principle, both sides agreed to the goal of reaching an equitable level of cost sharing. The United States believes that to achieve equitable levels, the two allied nations should contribute approximately 50% each of the non-personnel stationing costs (NPSC) for U.S. forces in Korea. To date the Korean Government burden sharing contribution to assist the U.S. in military stationing costs has been below this 50-50 ratio; the 2006 SMA contribution represented on 38% of the NPSC. For 2007, the ROK agreed to provide 725.5 Billion Won ($770M) as a direct contribution and to increase its level in 2008 with the rise in the Consumer Price Index (CPI). The ROK 2007 SMA contribution represents 41% of our NPSC, still short of the principle of equitable 50-50 cost sharing. As a result of SMA burden sharing shortfalls, we are forced to stretch limited funding. I cannot allow readiness to suffer, and I will not allow the quality of life of my Servicemembers or families to suffer. Without more equitable allied SMA funding, we may be forced to recommend a range of fiscal measures to the U.S. government, including a review of base relocation and consolidation plans. (SITE NOTE: Now that the USFJ Military Reorganization agreement has been completed in June 2006 and the close alliance with the Japanese, the ROK alliance is on the brink of collapse if it continues to refuse to pay for its share of the costs. The move is already underway to relocate the 3rd MEU Hq to Guam and reshuffle the forces in Japan. Part of this is to move I Corps to Camp Zama to take over the contingency planning for Korea -- and relocate the UNC to Japan in a support role. According to the Army Transformation Roadmap of 2004, I Corps should transition to its UEx model by 2010.)

Clearly, defense burden sharing is advantageous to both Alliance partners. For the United States, the Republic of Korea's willingness to equitably share appropriate defense costs is a clear indicator that United States forces Korea are welcome, wanted and held necessary by our host. For the Republic of Korea, an appropriate SMA investment gives them the presence and capabilities of the U.S. military. Additionally, 100 percent of ROK SMA burden sharing contributions are returned directly into the Koran economy by paying the salaries of Korean USFK local national employees, Korean contractors and service agents, and Korean construction firms. ROK contributions for the past four years represent shortfalls that USFK has struggled to absorb by reducing expenditures while maintaining readiness. (SITE NOTE: The USFK has already laid off 100 temporary positions in the past due to the ROK refusal to increase its contribution. More can be expected in the future with the current ROK refusal to increase its share.) (Source: Gen Bell before House Armed Services Committee, 7 Mar 2007, pp 17-19.)
But the key phrases of Gen Bell's report was: "We will remain in Korea as a trusted ally as long as we are welcome and wanted." In another portion of his report under cost-sharing he stated, "Clearly, defense burden sharing is advantageous to both Alliance partners. For the United States, the Republic of Korea's willingness to equitably share appropriate defense costs is a clear indicator the United States forces in Korea are welcome, wanted, and held necessary by our host." Be wary when a general (who is an apolitical politician) starts parroting George Bush's words — stated to the Korean people in 2002.


USFK Chief Agrees to Completing Relocation by 2012 (Mar 2007) Commander of the U.S. Forces Korea Gen. Burwell Bell expects the relocation of USFK headquarters and other bases here to be complete by 2012, four years later than planned. Bell told the Stars and Stripes military newspaper that the South Korean consortium winning the bid for the relocation project will be tasked with completing it by 2012. The USFK chief earlier expressed dissatisfaction with the delay in the relocation of U.S. bases to Pyongtaek, south of Seoul. Korea and the U.S. agreed to complete the relocation by 2008, but many expect it to take four or five years longer. Bell's most recent remarks suggest that he has accepted Korea's view, but he appeared determined to start as soon as possible. "So there's not going to be a giant movement one afternoon of thousands of Americans to Pyeongtaek," he said.

"Hundreds of Republic of Korea staff officers and commanders and leaders would have moved down there with that operation. That is now not going to happen," Bell said, since the allies agreed to disband Combined Forces Command by 2012. Bell "said he assumes South Korea will build its own headquarters in Seoul to house what he refers to as a 'Republic of Korea Joint Forces Command,'" the paper added. (Source: Chosun Ilbo.) (SITE NOTE: The acceptance of the 2012 date is a compromise to obtain the 50-50 split in relocation costs, BUT Gen Bell left the door open to relocate units as the facilities become available -- as it has been doing all along.)


USFK holding 800 bln won worth of defense sharing funds in banks (Mar 2007) Yonhap News reported on 19 Mar that the USFK was holding 800 billion won (US$846 million) worth of defense sharing funds provided by Seoul in banks, military sources said Sunday. The insider, who declined to be identified by name, said the money had been deposited in U.S. and South Korean banks since 2002. (Source: Yonhap News.) (SITE NOTE: We wonder why the US would deposit funds in South Korean banks when the funds would be transferred to the US government -- and then budgeted to the USFK from DoD funds. We wonder what NGO activist group is responsible for spreading this -- and how they arrived at the 800 billion won figure.)


Seoul officials seek to lower burden (Mar 2007) Korea will pay up to 5.6 trillion won ($ 5.9 billion) for the relocation of U.S. military bases, about half of the total costs, the Defense Ministry said on 19 Mar. This breaks down to 1 trillion won for the purchase of land and 4.6 trillion won for the construction of facilities. The ministry released a plan for the base relocation after 17 months of negotiations with the United States. In 2004, the two countries agreed to consolidate 42 U.S. military installations scattered across the peninsula into two hub bases in Pyeongtaek, Gyeonggi Province and Daegu regions. ``Despite 17 months of negotiations, there are still unresolved issues that we have failed to compromise on,'' Army Gen. Kwon Haing-keun, chief of the Defense Ministry's U.S. Forces Korea (USFK) base relocation office, said in a briefing. ``We expect that such remaining problems will be solved after a consortium of firms to handle the relocation is picked in May.'' Kwon declined to comment on how much the United States will pay for the project, only saying, ``Total cost-sharing between the two sides is likely to be 50-50.'

"The Korean side is expected to spend 4.58 trillion won ($4.86 billion) constructing the new military bases and facilities, about 50 percent of the total cost, which is estimated at over 11 trillion won. The remaining half will be paid by the U.S. side under the principle of even cost sharing," Maj. Gen. Kwon Haing-keun, chief of the government's base relocation bureau, told reporters at a news briefing.

But Kwon said his estimate does not include the 1.01 trillion won cost for purchasing land on which the new base will be constructed. So, including the cost of the land, the total cost will be in line with previous estimates of 5.6 trillion won. "The cost is still flexible. We are working on lowering our cost burden through extended negotiations on details," Kwon said.

According to the master plan, the ministry estimated that Seoul will spend 3.67 trillion won to construct new facilities including buildings, infrastructure, and the digital C4I (command, communication, control, computer and intelligence) system for the expansion of U.S. Camp Humphreys in Pyeongtaek. But the master plan, which was reported to the National Assembly, lacks a compromise on some sensitive issues, including the deadline for the project and cost-sharing for the transfer of the "C4I" system. C4I refers to a joint command, control, communications, computers and intelligence system that enables a commander to selectively apply and maximize combat power at critical points in time and space on the battlefield.

"South Korea and the U.S. have yet to reach an agreement on how to split the cost for the construction of schools, hospitals, other welfare facilities, and the setting up of C4I," he said, adding the C4I transfer is likely to cost up to 380 billion won. The United States wants South Korea to pay up to $400 million for the C4I move, $200 million more than South Korea intends to spend, sources said. (SITE NOTE: We are now confused. The latest we heard was the ROK was going to develop its own indigenous system. Now there is talk of "transfer"??? The US C4I system is a NOFORN (no foreign national) system which cannot be transferred. The current system is a dual system that interfaces only in time of war. A continuation of this system was offered to the ROK, but was refused. Thus this must be the transfer of the USFK system to Camp Humphreys ONLY.)

The remaining budget breaks down to 530 billion won for base site planning and program management, and 380 billion won to relocate the facilities in Gunsan, Gimcheon, Waegwan and Pocheon, the ministry said. A concrete date for the completion of base construction will be decided after investigations by the Program Management Consortium (PMC) firms who will run the construction project. Seoul and Washington plan to select a PMC in March for the bid in which four Korean firms and a U.S. consortium are competing, the ministry said. (NOTE: Yonhap News stated the selection of a PMC was in May for a five-year contract.) The PMC will begin the land construction to expand Camp Humphreys from September. The consortium will decide on the exact timing for the completion of the expansion plan but informed defense sources said it will be no later than 2012.

The master plan will get final approval from the joint committee of the Status of Forces Agreement in March. The Defense Ministry plans to begin examining cultural assets at the site of the base and conduct geological investigations of the site later this month. When the investigations are finished in September, the ministry will embark on landfill work to elevate the land. The ministry expected that the large-scale construction project will boost the national economy, stimulating 440 billion won of production and creating 30,000 job openings. It will also contribute to balanced regional development, the ministry said.

Korea and the United States agreed on the Yongsan Relocation Plan and Land Partnership Plan in 2004 to relocate U.S. Yongsan Garrison in central Seoul and 2nd Infantry Division, north of Seoul, to two hub bases in southern Korea. Under the plan, the U.S. military will return 35 military bases and seven training facilities across Korea, measuring 51.7 million pyeong (171 million square meters), to Korea. South Korea will foot the bill for the relocation of the Yongsan compound, while the U.S. side will pay for the move of bases outside of Seoul, according to South Korean negotiators.

Camp Humphreys will be remodeled to accommodate more than 44,000 U.S. soldiers, their families, and Korean employees. On the one million pyeong site, 500 new buildings will be built, including headquarters, an administrative complex, maintenance and logistics facilities, residential housing, dining facilities, a recreational center and hospitals. (Source: Korea Herald, Korea Times and Yonhap News.)

Korea to Pay W5.59 Trillion for U.S. Base Relocation (Mar 2007) The Defense Ministry said it will cost about W10 trillion (US$1=W942) to relocate several U.S. military bases, including the Yongsan Garrison and the 2nd U.S. Infantry Division, to a new base in Pyeongtaek, Gyeonggi Province. South Korea will pay W5.59 trillion of the total cost.

South Korean and U.S. military authorities have agreed to finish the relocation, which was previously slated for the end of 2008, but moved to between 2011 or 2012 when construction on the new base is scheduled to be done. Army Maj. Gen. Kwon Haing-keun, chief of the Defense Ministry's base relocation bureau, revealed the plan on 20 Mar. (SITE NOTE: The ROK agreed to pay W5.59 trillion because the ROK is the one that forced the Yongsan move. The USFK is responsible for the costs of the move off the DMZ -- of which comes from SMA funds contributed by the ROK. Unfortunately, the MND has a problem in that they intended to sell the Yongsan land to developers and shift the profits to the relocation costs. The ROK government decided that the Yongsan Garrison will become a park after the USFK departs. Where their going to find the money? Who knows? As for the ROK signed promise ... well, you make up your own mind by reviewing past US-ROK MOUs on the Yongsan relocation dating back to the 1990s.)

South Korea is expected to spend W4.58 trillion on construction and W1.01 billion for land for the military base, for a total of W5.59 trillion. The U.S. will bear a similar cost for relocating their bases from the outskirts of Seoul. The Pyeongtaek base, measuring 3.3 million sq. meters, will consist of 500 buildings, including the headquarters of the U.S. Forces Korea, the 8th U.S. Army Command, an operations command room, senior officers' quarters and a hospital. The facilities will accommodate 44,370 personnel, including 17,030 American soldiers.

The Defense Ministry will seek approval for the plan from a joint committee of the Status of Forces Agreement (SOFA) this month. It will select Program Management Consortium firms to run the project around May and finish building a road, 8 meters wide and 1.8 kilometers long, for the project by August.

An archaeological survey to check for artifacts and a geological study will be conducted at the Pyeongtaek site for six months if local residents finish moving out this month. Ground-leveling work will begin around September. (SITE NOTE: The US needs to be wary of the archaeological survey. The ROK used this issue of "possible" artifacts to stall the construction of a new US Embassy on a site -- a former girls' high school -- that the US had purchased and been approved by the ROK to move to. After years of frustration, the US has now opted to accept a portion of the Yongsan Garrison transferred land -- in exchange for the site. No artifacts have ever been found and only surface examinations have been undertaken -- though a lot of opinions (papers) have been written by Korean "scholars." The warning is the same can occur here. The geological survey was done in 2005 and the separate military surveys by the MND and USFK done after that. The archaeological surveys were supposed to be done in 2006, but no action was taken by the ROK ostensibly because of the turmoil from prostestors. Our opinion is the USFK needs to watch this element carefully.) (Source: Chosun Ilbo.)


USFK Chief Hints at Review of Base Relocation Plan if Cost Sharing not Increased (Apr 2007) On 25 Apr it was reported that Gen. Burwell Bell has hinted that a review of U.S. base relocations in Korea will be inevitable unless the Korean government shoulders a bigger share in the upkeep of U.S. forces here.

In a written statement to a Senate Armed Service Committee hearing on Monday, Gen. Burwell Bell said, "Without more equitable allied SMA funding, we may be forced to recommend a range of fiscal measures to the U.S. government, including a review of base relocation and consolidation plans."

Commenting on a new Special Measures Agreement (SMA) on Korea's cost sharing support for the USFK for 2007-2008 concluded at the end of last year, Bell said, "The two allied nations should contribute approximately 50 percent each of the non-personnel stationing costs (NPSC) for U.S. forces in Korea."

But Korea paid 38 percent of upkeep last year and is to pay 41 percent this year. Bell said that was "still short of the principle of equitable 50-50 cost sharing." He added, "I cannot allow readiness to suffer, and I will not allow the quality of life of my service members or families to suffer."

Washington has called on Seoul to pay more. But it is highly unusual for a USFK commander to flag a review of base relocation plans to pressure Korea to bear a bigger burden. Bell also urged Korea to buy the latest Patriot missiles (PAC-3). "Korea must purchase and field its own theater missile defense (TMD) system, capable of full integration with the U.S. system," he said. (Source: Chosun Ilbo.) (SITE NOTE: According to the Hankyoreh News on 25 Apr, "The remarks by Gen. Burwell Bell are not helpful to bilateral interests," said a senior government policymaker. He said that the commander's statement could be misinterpreted, and claimed that there was a lack of "balance" in the way the officer looked at the issue. This, the official said, is regrettable. Unfortunately, the ROK policy makers seem to have not been listening to the last "cost-sharing" statement of the General. What he said was the willingness of the ROK to equitably share the burden of defense was an indicator of how the American military was wanted and welcomed in the ROK. The point was very clear in 2005...2006... and now 2007.)


Korea, U.S. begin talks on troop cost formula (Jun 2007) Korea and the U.S. were to hold high-level talks on their financial burdens for stationing American troops in Korea on 6-7 Jun. The Foreign Affairs and Trade Ministry (MOFAT) said the two sides in Seoul will speak on a broad range of topics to advance the cost burden system. The two countries have agreed not to simply raise the sum and instead base their decisions on the actual spending to find a suitable formula. They will launch negotiations on the use of joint military spending for after 2009 once discussions on the current allotment are wrapped up. (Source: KBS.)

However, that is only one half of the problem. The on-going problem has been the ROK refusal to pay their "fair share" of the cost burden. The ROK insists that the amount should be lowered as the number of troops are being reduced. However, the US position is that the ROK did not start paying its share until 1991 when the amount was artificially low because it was being started from scratch. Now it is over a decade and the ROK has balked on increasing its share -- though agreed upon previously. Now South Korean officials have said they want to have more say in how their contribution to the U.S. presence is spent, according to the Korea Herald. U.S. Forces Korea officials said they could not comment on the meeting because it was a State Department matter. U.S. Embassy officials in Seoul said they could not comment because the talks were being handled by the Defense Department.

On 4 Jun senior officials of Korea and the United States began negotiations on the possibility of revising the way the countries share expenses for maintaining U.S. troops on the peninsula. The negotiations come amid controversy over a U.S. Forces Korea plan to use part of the troop maintenance budget, to which Korea contributes, to relocate some U.S. military bases. Some critics in Korea see that as a misappropriation of the funds. (SITE NOTE: Gen Bell has stated before Congress in Jan 2007 that the relocation off the DMZ will be funded in part by the SMA donations from the ROK. Though SMA funds can be used any way that the USFK sees fit after the money is transfered, the ROK does not feel this is justified as the US is using "their" money to fund the relocation off the DMZ that they feel should be fully the US responsibilty. At the same time, they do not want to mention the LPP that is entwined with the USFK relocation where the ROK gains back 53 camps/sites with billions of dollars of infrastructure improvements intact.)

"The high-level consultations will be held (today) in Seoul to seek a more reasonable way of the cost formulation," the ministry said. It is the first meeting and is intended to establish a new formula regarding how Korea contributes to the Special Measures Agreement budget for U.S. troop presence. Seoul wants to contribute to the SMA budget by category instead of the current lump sum basis, to enhance transparency in the use of the money provided by Korea.

Under the current SMA system, the lump sum expenditure by Korea is spent at the discretion of the U.S. military. Once the total expenses that form the basis of the SMA fund are agreed to, Korea contributes the agreed upon sum to the U.S. military. The U.S. forces then spend the SMA funds in accordance with their own needs.

In the talks, Cho Byung-je, director general of the Foreign Ministry's North American Affairs Bureau, will lead the Korean team, while the U.S. team will be headed by Robert Loftis, a senior adviser at the U.S. State Department's Bureau of Political Military Affairs. The usage of the fund is limited to fees for Korean workers serving in the U.S. bases, logistics expenses, installation construction costs, and other expenditures relating to combined defense.

However, USFK commander Gen. Burwell Bell said in January that the U.S. military will spend 50 percent of Korea's contribution on the relocation of the U.S. 2nd Infantry Division to Pyeongtaek. Civic groups have claimed that the U.S. plan means that Korea is paying more than the agreed upon cost for the U.S. base relocation. Seoul and Washington have agreed to split the base cost equally. Under the agreement, Seoul is responsible for the relocation of the Yongsan Garrison to Pyeongtaek, while Washington is supposed to pay for the consolidation of the 2nd Infantry Division to Pyeongtaek. The talks come several months after U.S. Forces Korea commander Gen. B.B. Bell said South Korea isn't contributing enough money, which could hurt his forces' fighting ability.

If the U.S. military makes its payments using the Korean contribution to their budget, Korea would be paying about 75 percent of the cost of relocating the base, civic groups say. Korea began contributing to the cost of maintaining the U.S. troops here in 1991 with a contribution of 107.3 billion won ($115 million). Last December, South Korea agreed to increase its payment to the U.S. from $740 million in 2006 to $789 million in 2007, according to The Associated Press. Bell released a statement of "concern" about the cost-sharing plan after that announcement. His statement said the plan would pay for less than 41 percent of USFK's nonpersonnel stationing costs and less than 15 percent of the total U.S. annual expenditure to maintain U.S. troops on the peninsula. That meant USFK could face "serious funding shortfalls in 2007," according to the statement. The command planned to study the situation "and make appropriate recommendations to the U.S. Government regarding necessary actions to adjust to this funding shortfall, while maintaining its unwavering commitment to the Alliance and the defense of Korea," the statement said. (Source: Korea Herald and Stars and Stripes.)


U.S., South Korea discuss cost-sharing (Oct 2007) U.S. and South Korean officials met in Washington, D.C., to discuss how much South Korea will contribute to the cost of hosting U.S. troops. The two countries have a Special Measures Agreement, under which South Korea pays the United States a set amount for such costs as contracts and wages for South Korean employees who work on U.S. bases. American Ambassador Jackson McDonald and Kim Byong-gi, of the South Korean Ministry of National Defense International Cooperation Office, were to finish two days of discussions on 24 Oct about extending the agreement when it expires at the end of 2008. Under the current cost-sharing agreement, South Korea is providing approximately $789 million for 2007 and $810 million in 2008. (Source: Stars and Stripes.)


ROK to Pay for 55 percent of Earthwork at Camp Humphreys (Nov 2007) Seoul agreed to pay for 55 percent of the land elevation work required at +nformation sources found on the internet. Previously the US demanded that the ROK carry 60 percent of the burden, but the ROK negotiated it down to 55 percent. The base expansion is located on relatively low-lying land and is surrounded by a river. The plan is to elevate the land one-three meters to prevent flooding during the rainy season. The experts estimate the cost to be between $334 million - $445 million, depending on where the sand needed for fill will be transported from. According to the agreement, Seoul is expected to spend between 165-220 billion won, while the US is expected to spend between 135-180 billion won.

The two countries are also close to concluding an agreement where the ROK will shoulder 60 percent of the C4I relocation to Camp Humphreys. These are part of the big budget items that the US-ROK have differed up on cost-sharing measures. Originally the US had proposed spending 300 billion won on relocating the C4I from Yongsan to Camp Humphreys. The ROK is attempting to lower the costs to 200 billion won. Accordingly, the ROK may spend 120 billion won and the US 80 billion won.

The agreement is still a big increase in cost share. Under the previous ROK proposal, the ROK pledged to build the new C4I installation and Camp Humphreys would spend $9 million on replacing obsolete parts. (SITE NOTE: The ROK grandiose idea was to install an indigenous C4I system that is being installed at this time. However, reality has set in that without the tie in to satellite intelligence the value is degraded -- and the ROK military satellite is still only as good as Google Earth. In addition, it will be many years before the inter-service glitches can be worked out. The ROKAF C4I supposedly is on-line, but no more word has been heard of its operation. The Army command posts have also been upgraded, but unfortunately the tanks and other equipment are not modified to provide real-time battlefield informaton. As an interim "fix" the USFK has offered to "bridge" the ROK capabilities until it is ready to assume control -- meaning that it can still used the "old" GSS-K system where they are provided a manual interface with the US C4I system.)

The big problem is that Korea has earmarked 5.6 trillion won for the relocation -- while the US estimate of 11 trillion won remains as it was in the beginning. (SITE NOTE: This cost-sharing problem is far from over. The cost-sharing formula for 2008-2009 is still being hammered out -- with a lot of acrimony involved.) (Source: Korea Herald.)


U.S. refuses to budge on base cost sharing (Nov 2007) The Korea Herald reported on 19 Nov that the United States has said it will keep using part of the shared troop maintenance budget to pay for the relocation of U.S. bases, a practice which has been criticized by some activist groups as a misappropriation of the funds. The U.S. military is paying for the base relocation to Pyeongtaek, some 70 kilometers south of Seoul, out of Special Measures Agreement (SMA) funds provided by Seoul. The two countries are currently renegotiating Koreas contributions to the SMA budget. Seoul wants to make its contributions by category instead of the current lump sum basis, to enhance transparency in the use of the money.

Under the current SMA system, the lump sum expenditure by Korea is spent at the discretion of the U.S. military. Once the total expenses that form the basis of the SMA fund are agreed to, Korea contributes the agreed sum to the U.S. military. The U.S. forces then spend the SMA funds in accordance with their own needs. The funds are meant to be limited to fees for Korean workers serving in the U.S. bases, logistics expenses, installation construction costs, and other expenditure relating to combined defense.

However, in January 2007, U.S. Forces Korea announced that it will spend 50 percent of Koreas SMA contributions on the relocation of the U.S. 2nd Infantry Division, which is currently located north of Seoul, to Pyeongtaek. In a 2004 deal, Seoul and Washington agreed to split the relocation costs equally. Under the agreement, Seoul is responsible for the relocation of the Yongsan Garrison to Pyeongtaek, while Washington is supposed to pay for the consolidation of the 2nd Infantry Division to Pyeongtaek.

Civic groups have claimed that the U.S. plan means that Korea is paying more than its fair share for the U.S. base relocation. If the U.S. military makes its payments using the Korean contribution to the SMA budget, Korea would be paying about 75 percent of the relocation costs, they say. In a recent meeting of high-level officials, Seoul proposed a joint implementation of the defense costs, and providing equipment and other needed items for the troops instead of cash. The U.S. side rebutted the proposal, sources said on condition of anonymity. (Source: Korea Herald.)


Relocation of U.S. frontline troops to be delayed (Feb 2008) A proposed southward relocation of U.S. frontline troops in South Korea will be delayed for about one to two years, a government source said on 24 Feb. The envisioned relocation of the 2nd Infantry Division of the U.S. forces in Korea (USFK) slated to be completed by 2013 will be put off because of financing problems, the government source said. In December 2004, South Korea and the U.S. agreed to move the garrisons of the USFK dotted around the country to Pyeongtaek, 70 kilometers south of Seoul. Under the agreement, the 2nd Infantry Division is slated to move to Pyeongtaek from Euijeongbu, 23 kilometers north of Seoul, and Dongducheon, 40 kilometers north of Seoul by 2013.

The U.S. military wants to partly use Seoul's budget for maintaining the USFK to conduct the relocation, but Seoul is reluctant to accept the U.S. proposal, the source said. The U.S. military says Seoul's opposition to its proposal forces the relocation to be delayed, it added. The South Korean government is sticking to its position that it will pay for the cost of moving the U.S. garrison in Yongsan out of Seoul, while the U.S. government should pay for the cost of relocating the 2nd Infantry Division. "Another reason behind delaying the realignment of the 2nd Infantry Division seems to be that Seoul and Washington placed their priority on the relocation of the Yongsan base," the source said. (Source: Yonhap News.) (SITE NOTE: We are not certain if this is the last gasps from the Roh administration to get in its final digs OR a reflection of the Lee Myeong-bak determination to "renegotiate" the relocation of the forces off the DMZ. This however, is the same rhetoric that was stated in Nov 2007. The US has remained steadfast that it can use the SMA funds anyway they want once the ROK pays the lump sum.)


Korea Faces Fresh Call to Pay More for USFK Upkeep (Mar 2008) Washington wants Seoul to shoulder a greater share of the upkeep of the U.S. Forces Korea. U.S. Ambassador Alexander Vershbow said Wednesday his government is stretched by the cost of the wars in Iraq and Afghanistan. “The U.S. would like Korea to share the level of support up to 50 percent in terms of non-personnel stationing costs,” he said. That refers to all costs for keeping U.S. forces here other than labor costs. Vershbow told the Korea Defense Daily, a newspaper published by the Defense Ministry, Seoul's new administration could reach an agreement "for a longer term, instead of having to negotiate every year or a year and a half.”

South Korea currently pays some 41 percent of the upkeep. But the U.S. says that it is less than the contribution of other host countries like Japan and Europe. Vershbow’s remarks follow demands by other senior U.S. officials including U.S. Forces Korea Commander Burwell Bell. They come ahead of President Lee Myung-bak’s visit to Washington.

Bell had told the Kwanhun Club, a gathering of senior journalists, in July last year that South Korea should pay 50 percent of the cost here. Pundits say that in the face of public opposition, the new pro-American Korean government will have difficulty deciding on how much it will increase its share. (Source: Chosun Ilbo.) (SITE NOTE: In Nov 2006, the US pressed the point that the Congress mandated that the host country must foot 75 percent of the bill for stationing US troops on their soil -- but settled for the ROK footing at least 50 percent of the bill. Previously the USFK stated the ROK was footing 38 percent, but this latest article states that it has increased to 41 percent.)


Korea to bear majority of USFK relocation cost (Mar 2008) South Korea has agreed to pay the majority of the expenses for moving U.S. forces out of its capital of Seoul to the tune of approximately US$10 billion, the top U.S. commander there told the House budgeting committee. Gen. Burwell Bell, head of the U.S. Forces Korea (USFK), also said the two countries agreed to equally split the cost of relocating the 2nd Infantry Division. The amounts he suggested are over the amount that the South Korean government has been indicating.

As part of an overall realignment of their military alliance, South Korea and the U.S. decided to move U.S. forces out of the Yongsan Garrison in Seoul and relocate them southward. "South Korea agreed to shoulder the majority of the infrastructure expenses associated with moving our forces out of Yongsan Garrison farther south in their country, down to a place called Camp Humphreys at Pyeongtaek," Bell told the House Appropriations Committee last week. The transcript was made available over the weekend.

"And already, in that physical process, South Korea has spent about $2 billion in an effort that's going to cost them around $10 billion," the general said. "It's of the magnitude of the Guam move." The U.S., on its part, agreed to provide family housing and officer quarters at Camp Humphreys, estimated at about $1.4 billion over a 15-year period, Bell said.

In March last year, the South Korean government said it expected to pay about $5.6 billion to move out of the Yongsan facilities. The USFK commander said that the two countries have agreed to split the cost 50-50 to relocate the 2nd Infantry Division, and that part of the money will come from the host-nation fund provided by the South Korean side.

Seoul's position has been that it would pay to move out of Yongsan Garrison since it had requested it, but that Washington should be responsible for relocating the infantry division since that was the request of the U.S. This argument was behind South Korea's opposition to using host-nation funds, used to maintain U.S. forces in the country, for relocation costs. "Our agreement is about a 50-50 split, and so what I've done is take 50 percent of the cost to move the remaining force that is north of Seoul to its garrison location of the future south of Seoul," Bell said. "The other 50 percent, we need to use host-nation funds for, and we will." (Source: Yonhap News.) (SITE NOTE: Same old story -- but does the ROK buy it? The $10 billion figure is nothing I've heard out of the ROK mouthes. As far as I've heard, the Ministry of Defense can't sell the land to come up with the money so the $10 billion figure may just be a pipe dream. As of Feb 2008, we still have the problem of the USFK using the SMA funds to pay for 50 percent of the costs which the ROK objects to. Same story and on-going negotiations. The SMA funds the USFK can use any way it wants after the ROK pays it so there really isn't any problem -- BUT the ROK keeps wanting to renegotiate as if it were a problem.

The plan is expected to trigger controversy, as Seoul has agreed to pay for the relocation of Yongsan Garrison as it had requested, but that Washington should pay to relocate the infantry division since that was a U.S. request. The costs projected by Bell are controversial, differing hugely from estimates by the Korean Defense Ministry. The ministry has said that the relocation will cost a total of W5.59 trillion (US$1=W997) including W1.01 trillion for the purchase of the land. (Source: Chosun Ilbo.))

Bell: $10B relocation figure 'incorrect' (Mar 2008) The USFK commander said on 17 Mar that his remarks at the U.S. committee hearing had been either misstated or misquoted and that his original statement should have read "South Korea has already spent $2 billion in an effort that will cost the two nations a total of approximately $10 billion." Bell blamed a "misstatement or mischaracterization" in a transcript of his March 12 speech to House Appropriations Subcommittee for the error. That "misstatement" was quoted in numerous South Korean newspaper and television reports, causing an uproar in a country that has pledged to pay about $4.5 billion toward the relocation project. Calling the reports a “misunderstanding”, Bell said the two countries had agreed that South Korea will pay W5.59 trillion for the relocation of the Yongsan base while the U.S. will pay W4.4 trillion for moving its Second Infantry Division to Pyeongtaek. Speaking through the USFK Command, Bell said he "fully intends to correct the official transcript and the record so that it properly reads, 'South Korea has already spent 2 billion in an effort that will cost the two nations a total of approximately $10 billion.'"

Bell, however, did not back down from his earlier claim that Seoul has agreed to and would pick up part of the costs to relocate the frontline 2nd U.S. Infantry Division, though Seoul earlier said such claims are "not true." Seoul has long said it will pick up the entire cost of relocating U.S. troops from Seoul, about $4.4 billion, as the move comes at its request, but insists the cost of relocating the 2nd Infantry Division must be shouldered by Washington as it comes under its own plan.

The South Korean media quoted Bell — speaking to the subcommittee — as saying that South Korea had spent "about $2 billion in an effort that's going to cost them around $10 billion. It's on the magnitude of the Guam move." The Guam move refered to Japan agreeing to shoulder much of the cost of relocating 8,000 U.S Marines and their families from Okinawa to the Pacific island under a troop realignment pact. South Korea's Yonhap News said the comments were taken from a transcript made by the Federal News Service, which provides verbatim transcripts of government hearings. USFK spokesman Col. Franklin Childress said Bell has ordered the transcript not to be posted on the command's Web site, www.usfk.mil, until the "error" is corrected. When asked if the transcript contained a misstatement by Bell or if the South Korean media mistranslated what he said, Childress said, "the transcript contains the error."

Several South Korean civic groups demanded on 17 Mar that Bell and U.S. Ambassador Alexander Vershbow resign, according to news reports.

"The total cost of the USFK base relocation project to be shouldered by the South Korean side is 4.58 trillion won ($4.38 billion)," the Defense Ministry said in a press release. A spokesman from South Korea's Ministry of National Defense said the agency never received a transcript of Bell's speech but has requested one from their "diplomatic channels" in Washington. The ministry spokesman said the two countries never agreed that South Korea would pay $10 billion toward the relocation.

Without commenting on whether Seoul has agreed to provide financial assistance strictly for the relocation of the frontline U.S. troops, the USFK commander said the U.S. is able to use money provided by Seoul to share the burden of maintaining U.S. forces here toward any end it sees fit, including the relocation of the 2nd Infantry Division. "If the Republic of Korea disagrees with this, it will be necessary for the Korean government to raise the issue with the United States," Bell said in a statement released Monday by the USFK Public Affairs Office. (Source: Yonhap News and Stars and Stripes.)


USFK commander Bell says South Korea may want to halt reduction of U.S. troops (Mar 2008) U.S. Forces Korea commander Gen. B.B. Bell said he expects South Korea's new president to ask for a pause in the reduction of U.S. troops stationed here while the countries study the future of the drawdown. During congressional testimony March 12 in Washington, Bell said President Lee Myung-bak could make the request as early as April, when Lee is scheduled to meet with President Bush at Camp David. "If he does ask for that pause, I think it would be prudent for the United States to agree to sit down and discuss the issue and then potentially execute a pause based on those discussions," he said. About 28,500 U.S. troops are stationed in South Korea, down from 37,000 about four years ago. About 25,000 will remain when the drawdown is completed. A spokesman for South Korea's Ministry of National Defense declined to comment on 18 Mar, and Lee's spokesperson did not return calls for comment. (SITE NOTE: Korea Herald reported that an alliance of veterans and conservative civic groups on 17 Mar called on the new government to renegotiate the timing of Seoul's takeover of wartime operational control of its armed forces from Washington. The group, consisting of 227 military veterans and rightist organizations, yesterday delivered the message to Defense Minister Lee Sang-hee, ministry officials said. "The South Korea-U.S. Combined Forces Command should remain intact for a considerable time until North Korea is denuclearized and our military is modernized with information technology," the group said in a statement.)

Bell spoke to several congressional committees last week during a trip to the capital. Transcripts of his testimony were made available over the weekend. Bell told the House Armed Services Committee that Lee and his staff are "absolutely committed" to taking wartime control of forces stationed in South Korea by the April 17, 2012, deadline set by the two countries. "So, then, the review is not over whether or not to do the transfer, it is just to have some auditing that the timelines are getting met to move to the transfer?" asked Rep. Rick Larsen, D-Wash. "That's correct, congressman," Bell said.

In another hearing, before the Senate Armed Services Committee on March 11, Bell said he was concerned about USFK's lack of up-armored vehicles and has asked the U.S. Army to provide them soon. The up-armored vehicles, including the MRAP or Mine Resistant Ambush Protected vehicle, could arrive in about a year, he said. "Given the experience that we've had in Afghanistan and Iraq and knowing the special operating force capability in North Korea, I want all of my wheel vehicles to be up-armored on the peninsula, and that has not taken place yet," he said.

Bell told the committee that about 2 percent of USFK's vehicles are up-armored, which is "not really satisfactory," but units going to Iraq are rightfully getting them first. "I'm not complaining at all, because I'm not facing imminent combat," he said. He spoke about up-armored vehicles three times during a lengthy question-and-answer session with the committee, which asked about everything from troops' housing in South Korea to the mental health of troops serving there after tours in Iraq and Afghanistan. When asked by Sen. John Thune, R-S.D., to rate the preparedness of U.S. forces in Korea, Bell said air and ground forces are ready but not as protected as he would like. "If you walked amongst the 2nd Infantry Division right now, you'd see a very ready division without up-armored vehicles," he said. "So that piece, given what we've seen in Iraq and that vulnerability, does concern me." USFK's public affairs office did not provide answers on 17 Mar to Stripes' questions about how many up-armored vehicles will come to South Korea, their costs and when they will arrive. (Source: Stars and Stripes.)

Seoul Denies Bell's Comment on Pause in Troop Cuts (Mar 2008) The Ministry of National Defense (MND) on 20 Mar dismissed remarks by the top U.S. commander here that South Korea will ask for a pause in the reduction of American forces in South Korea. The remarks by Gen. B. B. Bell, commander of the U.S. Forces Korea (USFK), were construed as a bargaining tactic to help get more host nation funds to maintain its troops, according to security experts and government sources. Bell was quoted by Stars & Stripes as saying that President Lee Myung-bak could make the request during the planned summit with President George W. Bush at Camp David next month. ``If he does ask for that pause, I think it would be prudent for the United States to agree to sit down and discuss the issue and then potentially execute a pause based on those discussions,'' the general said during congressional testimony March 12. Kim Hyung-ki, the ministry's spokesman, quickly dismissed it.

``We understand that the USFK, for its part, wants to freeze troop reductions at the current 28,000 to meet their needs,'' Kim told The Korea Times. ``The ministry and other government agencies haven't discussed the issue of asking for a pause in the reduction of U.S. troops.'' ``If the United States freezes the planned troop cuts, it will surely help defend our nation. But there is no reason for us to ask for the pause, since it would provoke a controversy over defense cost-sharing,'' Kim added. Seoul and Washington had agreed in 2004 to reduce the number of U.S. troops in South Korea by 12,000 to 25,000 in a phased manner by the end of 2008. Under the pact, the Untied States withdrew about 5,000 forces from South Korea in 2004, 3,000 in 2005 and 1,000 in 2006. Currently, 28,500 U.S. soldiers are stationed here as a deterrent against North Korea, which conducted its first-ever nuclear test in October 2006. During last week's congressional testimony, Bell, who concurrently heads the Combined Forces Command and the United Nations Command, renewed his call on Seoul's increasing financial contribution to the presence of its troops to a 50-50 level. South Korea currently incurs 41 percent of costs related to the presence of the USFK. Bell reaffirmed in a press release that the USFK would use host nation burden sharing funds for the relocation of its bases north of Seoul to the south of the Han River.

Liberal lawmakers and progressive civic groups denounced the move, arguing it runs counter to bilateral agreements on the base relocation. Opponents claim that if the United States uses the host nation's burden sharing funds, it means South Korean taxpayers virtually foot most of the $10 billion bill for the relocation project, which is beneficial to both sides. Under the Land Partnership Plan (LPP) reached in 2002, the United States promised to foot the bill for moving bases of the 2nd Infantry Division, north of Seoul, to Pyeongtaek, Gyeonggi Province. On the other hand, Seoul is required to bear the cost for relocating the Yongsan Garrison in Seoul under the Yongsan Relocation Plan (YRP) finalized in 2004.

The base relocation had originally been planned to be completed by 2008 under the pacts, but the timeline was delayed to 2012 due to protests by farmers in the Pyeongtaek area and other technical problems constructing and modernizing facilities at Camp Humphreys, which is to triple in size. Under a master plan drawn up by the two governments last year, South Korea agreed to spend about $5.2 billion on the $10 billion program to move U.S. bases to Camp Humphreys, which will accommodate more than 44,000 U.S. servicemen, their families, base workers and South Korean reinforcements.

``Since 2004, the position of the United States government has been that the United States will use both U.S. congressionally appropriated funds and host nation burden sharing funds under the ROK-U.S. Special Measures Agreement (SMA) to fund the LPP, which includes relocating the 2nd Infantry Division,'' Bell said. ``If the Republic of Korea disagrees with this, it will be necessary for the Korean government to raise the issue with the United States at the next U.S. Department of State and Republic of Korea Ministry of Foreign Affairs and Trade SMA negotiations.''

Under the 2006 SMA agreement, South Korea was required to increase its share of the burden by 6.6 percent for 2007 and 2008. The cost sharing covers non-personnel stationing costs, such as the salaries of Korean employees at U.S. bases, Korean contractors and construction firms. South Korea agreed to pay 725.5 billion won ($770 million) to the United States in 2007, up 45.1 billion won from 2006, and increase its level in 2007 with a rise in the consumer price index, according to the deal. (Source: Korea Times.)


S. Korea works out new USFK cost-sharing proposal -- New plan would involve more non-cash payments to support USFK presence (May 2008) The South Korean government was believed to have mapped out a proposal for sharing the cost of stationing U.S. troops here by drastically increasing its contribution of needed goods, instead of money. The new proposal was devised after the two leaders of South Korea and the United States agreed to revise its agreement on support for the U.S. Forces Korea during their summit on April 19. (SITE NOTE: Actually at the end of the last SCM in Oct 2007, the US stated that the cost-sharing formula was to be COMPLETED before the next SCM. There has been no movement and the ROK keeps making proposals to reduce its share, while the US is adamant about it increasing its share.)

On May 12, a South Korean government official said, “Out of the South Korean government’s cost-sharing budget, we are aggressively considering providing needed goods for military construction costs, which are currently paid in cash, to improve the fund’s transparency.” This means it is likely that the South Korean government will make non-cash payments to build non-combat facilities to support the Combined Defense Improvement Program. The CDIP is a project focused on the construction of combat facilities such as military runways or ports. The South Korean government would also provide non-cash compensation for military supplies needed to maintain ammunition storage or logistics facilities. (SITE NOTE: Once the ROK takes over wartime control, a lot of these facilities will be turned over to the ROK. Currently the ROK is heavily reliant on the USFK for its logistics support, but this will change in the near future. "Non-cash" compensation is meaningless.)

Under the reported plan, the South Korean government would only make cash payments for U.S. military forces personnel. Under the current agreement, the South Korean government makes all of its payments for personnel and 95 percent of its payments for military construction in cash. Up to this point, South Korea has paid 100 percent of the costs for the CDIP and military supplies with needed goods.

If the reported revision is implemented, the ratio of cash payments to the total financial burden assumed by the South Korean government would be reduced to 41 percent, from 78.5 percent. The forecast was based on figures from 2006. South Korea paid 725.5 billion won (US$695 million) to support the USFK last year and allocated 741.5 billion won for this year.

However, the negotiations between South Korea and the United States on how to share defense costs are likely to face an uphill battle as the United States has called on South Korea to pay a larger share of the USFK’s upkeep, while taking a lukewarm stance toward the South Korean government’s proposal to increase its share of non-cash payments because it sees reported revision as undermining the U.S. government’s leeway in allocating the costs. (Source: Hankyoreh News.) (SITE NOTE: This new PROPOSAL of the ROK probably will be rejected -- simply because what they are offering the US has found an alternative already in the BTF private contracting construction as implemented at K-16 and soon to be implemented at K-6. In our view, the ROK is offering nothing for a reduction in costs. This is NOT a good proposal.)


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