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Apparently threatening to crackdown on one Korea wasn’t enough.
While warning of a potential “major, major conflict” with North Korea during a Reuters interview on Thursday, President Donald Trump made it clear that he was also planning to take a hard line with South Korea over trade and the cost of deploying an advanced anti-missile defense system to the close US ally.
The president said during the interview that he thought Washington’s free trade agreement with South Korea was such a bad deal for the US that he would withdraw from it if they were unable to renegotiate one to his liking.
"It's unacceptable. It's a horrible deal made by Hillary. It's a horrible deal. And we're going to renegotiate that deal, or terminate it," he said. “It's a great deal for South Korea. It's a terrible deal for us."
Trump didn’t accuse South Korea of any specific types of violations of international trade norms. It simply seems that he doesn’t like the fact that the US has a trade deficit with South Korea — it imports more from South Korea than South Korea imports from the US. A trade deficit is a reflection of many factors, including domestic spending and the exchange rate, and doesn’t mean that a free trade deal isn’t a huge net good for the country that’s experiencing the deficit.
The trade deal came into effect in 2012, and helps lower barriers on the roughly $150 billion worth of goods and services that the US and South Korea exchange annually.
Trump also said that he expected South Korea to pay for the THAAD Missile Defense system that the US deployed in South Korea in March, and is meant to protect against any incoming missiles from the North.
“The THAAD system, it's about a billion dollars. I said, 'Why are we paying? Why are we paying a billion dollars? We're protecting. Why are we paying a billion dollars?’” he said. “So I informed South Korea it would be appropriate if they paid.”
“It's phenomenal. It's the most incredible equipment you've ever seen — shoots missiles right out of the sky. And it protects them and I want to protect them. We're going to protect them. But they should pay for that, and they understand that,” he said.
Trump’s comments have riled and baffled South Korea at a time of extraordinary tension with its neighbor and arch-rival, North Korea. The president is undermining trust between the US and South Korea — where roughly 30,000 US military personnel are stationed — just as North Korea has ramped up both its testing of ballistic missiles and its rhetoric on the country’s readiness for war.
The timing of the unsettling comments could also have an effect on South Korea’s domestic politics as well: The country will be holding a presidential election in fewer than two weeks, and Korea watchers believes that Trump’s aggression could change the way people consider the contest. The current frontrunner, Moon Jae-in, is less hawkish than Trump when it comes to North Korea, and has already promised that he would revisit the THAAD deployment if he wins the race.
“So far the reaction in South Korea to all these things that Mr. Trump has said has been surprisingly restrained,” David Straub, a former US diplomat dealing with the Koreas, told the Washington Post. “They know he’s an unusual president, and they’re discounting a lot of what he says, but eventually remarks like these will have a serious effect.”
Trump’s insistence that South Korea pay for the THAAD system will be particularly contentious because many in South Korea don’t want THAAD in their country at all.
The installation of the missile defense system installation has been divisive domestically, sparked protests, and caused an uptick in tensions with China, which doesn’t want the US to have more firepower so close to its borders. For South Korean critics of THAAD, who are skeptical of its effectiveness and question whether having the system is worth provoking Beijing, Trump’s demands for payment for it will only add insult to injury.
Moon is a vocal critic of the THAAD deployment, and is certain to vocally oppose any new US effort to force Seoul to pay more for it. Under the initial deal between the two countries, signed last July, then-President Barack Obama agreed to pay for the system while South Korea promised to supply the land where the system and its operators would be housed.
Now, Trump’s hardline rhetoric about the system threaten to blow up that agreement and deal a new blow to the increasingly tense relationship between Washington and Seoul.
And that’s the most puzzling part of all of this. Trump sees North Korea as America’s biggest national security threat, and South Korea would be a vital part of any new effort to contain Pyongyang. Why the president feels the need to alienate so close an ally, at so complicated and dangerous a time, is hard to decipher.
