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Japan, South Korea Make Last-Minute Push to Save Intel Pact

U.S. Set for Strategic Blow as Japan-South Korea Pact Nears End

(Bloomberg) -- Japan and South Korea made a last-ditch effort to save their expiring intelligence pact, after the Trump administration pressed its two allies to prevent their feud from dealing a lasting blow to the U.S.’s regional security network.

The two sides were having “positive” discussions about a potential resolution to their standoff over the General Security of Military Information Agreement, according to a person familiar with the talks. The pact, which allows the two allies to share information independently from the U.S., will cease to exist at 12 a.m. Saturday local time without a compromise.

With just hours to go, South Korean Foreign Minister Kang Kyung-wha decided to attend Group of 20 meetings in Nagoya on Friday that will bring her into contact with her Japanese counterpart, Jiji Press reported. The decision to send Kang came after South Korea’s presidential office held a national security council meeting to discuss the pact, broadcaster KBS reported.

The agreement could be the most significant casualty yet of a dispute between Japanese Prime Minister Shinzo Abe and South Korean President Moon Jae-in that rapidly escalated over the past year as the U.S. sat largely on the sidelines. A late U.S. push to save the deal, including a Seoul visit last week by Defense Secretary Mark Esper and a call Thursday by Secretary of State Michael Pompeo, resulted in no immediate breakthroughs.

The Munhwa Ilbo newspaper reported earlier Friday that a high-level South Korean government official handicapped the chances of an extension at “50-50.”

The deal’s expiration would put more strain on America’s postwar network of alliances, as President Donald Trump prioritizes troop-funding increases and trade concessions over maintaining multilateral relationships. Esper and Pompeo faced the difficult task of asking South Korea to compromise with Japan, while carrying Trump’s demands for a five-fold increase in military funding.

“The U.S. needs both Japan and South Korea to be on the same page when it comes to their posture vis-a-vis regional security challenges,” said Yuki Tatsumi, director of the Japan Program at the Stimson Center in Washington. “The breakdown of the Japan-South Korea relationship makes any gesture to demonstrate the health of U.S. alliance network extremely difficult, if not impossible.”

While a brief meeting between Abe and Moon earlier this month buoyed expectations for a breakthrough, subsequent exchanges have illustrated how far apart the two sides remain. Moon, who was elected in 2017 on a promise to reconsider his predecessors’ deals with Abe, reaffirmed his stance this week not to revive the pact unless Japan withdraws export controls imposed on South Korea over the summer.

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

Abe and Moon have few incentives to back down from a fight that has proved popular among their nationalistic political bases, even as Japanese trade restrictions and South Korean boycotts put pressure on their economies. Japanese Chief Cabinet Secretary Yoshihide Suga told reporters Friday that the the government’s position hasn’t changed and called on South Korea to reach a “wise decision” on GSOMIA.

Pompeo stressed the importance of maintaining ties with Japan during a phone call with Kang as the deadline neared, but the South Korean foreign minister had already told her country’s parliament that GSOMIA was going to expire unless Japan changed its attitude.

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

North Korean state media published a commentary Wednesday celebrating the pact’s imminent demise. “It was a due decision and another victory achieved by the candlelight demonstrators in South Korea,” the Korean Central News Agency said.

Meanwhile, China has moved to improve relations with both Japan and South Korea as the two U.S. allies come under pressure from Trump on trade and security costs. Chinese Premier Li Keqiang is slated to host Abe and Moon for a three-way summit in southwestern city of Chengdu next month.

--With assistance from Jihye Lee.

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

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

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