General Security of Military Information Agreement (GSOMIA) was concluded between Japan and the Republic of Korea on November 23, 2016, for the purpose of sharing military information that are critical to defense of the two country, especially at time when North Korea is developing its own nuclear arsenals with relatively frequent missile testings. Before GSOMIA, the two countries were able to share information only through the United States, with which each country has a defense pact. GSOMIA is good for a year with an automatic renewal, unless one of the two parties notifies of an intention to terminate three months in advance. If nothing happened, it was set to be renewed for another year on this November 23. On August 23, however, South Korea told Japan of its intention to terminate. Evidently, the decision to terminate was South Korea’s response to Japan’s move earlier in that month to remove South Korea from the list of most favored trade partners (while list) for national security reasons. Japan’s action stunned and infuriated the Blue House (South Korea’s presidential residence). In response to it, President Moon Jae-in brought the matter to the WTO, and this was understandable. Japan was relatively relaxed about the prospects of automatic extension of GSOMIA, since trade and security issues are clearly considered different. So President Moon’s action shocked Japan’s Shinzo Abe immensely.
South Korea's decision to terminate GSOMIA also infuriated the United States at all levels, including the White House, the State Department, the Defense Department, the Senate Foreign Relations Committee, etc. GSOMIA has been considered as a key component of U.S. strategy in the Pacific, where China’s influence has been steadily rising in recent years. As a distinctly left-leaning politician, President Moon has apparently a stronger interest in ethnic unity with North Korea and an improved relationship with China than the alliance already in place. The U.S. wants to see none of this. Therefore, the U.S. intervened very aggressively in this matter, as the time appeared to be running out. before the Number 23 deadline. It even threatened President Moon that the Pentagon might quintuple South Korea’s financial burden of U.S.. military in the country, or might even choose to withdraw American forces from the country. Under President Trump such a threat cannot be taken as a mere bluff, because of his highly transactional view on global security arrangement .
So President Moon gave in in the eleventh hour, paying a heavy political cost. The decision not to withdraw from GSOMIA has angered his political base. While being anti-Japan always makes good politics on all fronts in South Korea, it is especially so on the left. Giving in to Japan, even under U.S. pressure, can be considered as unspeakably shameful to some in his camp. While extension of GSOMIA makes sense in all practical terms, politics are often not based on rationality in any country. And this is about South Korea’s left, and on Japan. Worse, the country’s economy has been decelerating since he came to the Blue House two years ago, a common fate suffered by economies that are dependent on exports. Dreaming of ethnic unity and being hard on Japan do not make a good economic policy. President Moon has to face a parliamentary election next spring at a time his approval rating has been slipping already. There are some even more difficult times ahead of him. In the face of slipping approval ratings, South Korea’s president. left or right, has a tendency of intensifying anti-Japan rhetorics in the latter half of his/ her five year term with no re-election. Let’s see how Mr. Moon behaves from this point on.
About the author: Ichiro Suzuki, CFA, is an Advisory Group member at Richard A. Mayo Center for Asset Management of Darden School of Business, University of Virginia. He has retired as Senior Portfolio Manager/ Global Equity Strategist at Nomura Asset Management. Suzuki graduated with B.A. from Waseda University and MBA from UVA's Darden School of Business.
Note: The 66 year old alliance between the U.S. and South Korea is in deep trouble https://www.washingtonpost.com/opinions/the-66-year-alliance-between-the-us-and-south-korea-is-in-deep-trouble/2019/11/22/63f593fc-0d63-11ea-bd9d-c628fd48b3a0_story.html