By Victor Cha, Senior Adviser and Korea Chair at the Center for Strategic and International Studies (CSIS) and Ellen Kim, Research Associate at CSIS Korean Chair

The sinking of the Cheonan remained the predominant issue in the U.S.-ROK relationship as both countries spent this quarter coordinating and undertaking punitive measures against North Korea in response to its alleged attack on the Cheonan.  The UN Security Council adopted a Presidential Statement and formally condemned the attack that led to the sinking of the Cheonan but did not directly blame North Korea.  The U.S. and South Korea held their first “Two-plus-Two” meeting in Seoul where Secretary of State Hillary Clinton and Secretary of Defense Robert Gates met with Foreign Minster Yu Myung-hwan and Minister of National Defense Kim Tae-young.  While countries reopened their dialogue channels to discuss the resumption of the Six-Party Talks, there still remain many challenges and uncertainties that make the future direction of the talks unclear.  Several outstanding issues of the KORUS FTA still remain to be resolved while the negotiators of the two sides expect to hold a ministerial meeting soon to strike a deal.  The Chicago Council on Global Affairs released a report on U.S. attitudes toward South Korea, which highlighted that American public support for trade agreements generally, including ratification of KORUS, is lukewarm.  However, among Americans who viewed fair trade with countries like Korea as critical for U.S. interests, support for KORUS was much stronger.

Cheonan Round 1: UN Presidential Statement

Tension persisted from the beginning of this quarter as countries tried to reach agreement on the UN Security Council measure over the sinking of the Cheonan.  While tireless wrangling and unyielding negotiations between the U.S. and China continued over the language of the Presidential Statement to be issued, North Korea threatened to start a “death-defying war” if the statement condemns North Korea for the sinking of the Cheonan.  On July 9, the UN adopted a unanimous Presidential Statement where it formally condemned the “attack” on the Cheonan without directly blaming North Korea.  Sin Son-ho, North Korea’s Permanent Representative to the UN, called the statement a “great diplomatic victory” for North Korea, and South Korea was widely divided over whether the statement adequately condemned the North with some people expressing disappointment with the outcome.  The statement was well received by the U.S., and The Wall Street Journal called it “a late-hour linguistic, if not diplomatic, victory for the United States.”  U.S. Ambassador to the UN Susan Rice stated that although North Korea was not explicitly criticized, the statement’s message to North Korea was “unmistakable” and emphasized that the language was not “neutral.” The White House also stressed that the statement constituted an “endorsement” of the results of the South Korea-led Joint Investigative Group which concluded North Korea’s responsibility in the sinking of the South Korean warship.   (For more details on the Joint Investigate Group report, please refer to the previous Comparative Connections from the second quarter 2010 at http://csis.org/files/publication/1002qus_korea.pdf)  Disagreements lingered over the interpretation of the Security Council’s Presidential Statement, but at the same time, its declaration helped the U.S. and South Korea move forward and pursue independent actions against North Korea.

Cheonan Round 2: Military Exercise and New Sanctions on North Korea

The Security Council’s response cleared the way for both allies to take a series of strong measures against the North.  On July 20, U.S. Secretary of Defense Robert Gates and South Korea’s National Defense Minister Kim Tae-young met in Seoul and announced that the two countries will conduct their first naval and air exercises in the East Sea for four days from July 25.  To send a strong message of deterrence to North Korea, the first joint military exercises involved an American aircraft carrier, the USS George Washington, as well as 20 ships and submarines, 200 aircraft, and 8,000 military personnel from both countries.  Throughout the quarter, the U.S. and South Korea conducted two more rounds of joint naval exercises, one in the southern part of the Korean Peninsula and the other in the Yellow Sea.

Another measure taken against the North in response to the Cheonan’s sinking was a new package of U.S. financial sanctions that were announced by Secretary Clinton right after the first U.S.-ROK “Two-plus-Two” meeting in Seoul.  In early August, Robert Einhorn, Special Advisor for Nonproliferation and Arms Control, and Daniel Glaser, the Treasury Deputy Assistant Secretary for Terrorist Financing and Financial Crimes, visited Seoul to discuss these new sanctions with senior ROK government officials.  At the end of August, President Obama signed a new executive order authorizing expanded North Korea sanctions, targeting the country’s illicit activities such as arms sales, money laundering, narcotics trafficking, and the procurement of luxury goods.  The Treasury and State Departments also blacklisted additional entities and individuals found to be engaged in the weapons of mass destruction proliferation.

‘2+2’ and Sanctions on Iran

There is general consensus among policymakers in Seoul and Washington that the current U.S.-ROK alliance is in the best shape it has been in recent years.  The onset of the Cheonan’s sinking brought together two already close allies to become united against North Korea and stage a “show of force.”  The first “Two-plus-Two” meeting held in Seoul between U.S. Secretaries Hillary Clinton and Robert Gates and ROK Ministers Yu Myung-hwan and Kim Tae-young exemplified an “upgrade” of the U.S.-ROK alliance from a traditional military alliance forged in the wake of the Cold War to a more comprehensive one.  In a ministerial joint statement, Secretary Clinton acknowledged that the alliance “has evolved into a strong, successful and enduring alliance” and announced the ministers’ decision to complete Strategic Alliance 2015 by the next Security Consultative Meeting.

The strength of the U.S.-ROK alliance was also put to the test as South Korea came under U.S. pressure to join its global nonproliferation campaign against Iran and impose independent sanctions on the country.  During his visit to Seoul with Robert Einhorn, Deputy Assistant Secretary of the Treasury Daniel Glaser strongly urged the South Korean government to make a decision, calling the South Korean participation “absolutely vital.”  Pressures mounted on Seoul particularly after Japan adopted sanctions on Iran.  The situation presented a dilemma for Seoul as Iran is Korea’s third-largest trading partner in the Middle East with the annual bilateral trade amounting to $10 billion.  More importantly, South’s heavy reliance on Iran for oil concerned many Koreans of a potential backlash from Tehran.  Internal splits within the ROK government delayed Seoul’s response to U.S. entreaties.  While the foreign ministry favored sanctioning Iran, the economic ministries were more cautious, in no small part because they remembered that sanctions by the ROK against Tehran during the George W. Bush administration resulted in immediate retaliation against South Korean businesses operating in the country.

Despite rumors that Seoul’s reluctance made Washington uncomfortable and even briefly strained their alliance, South Korea’s later announcement of its sanctions on Iran reaffirmed the resilience of the U.S.-ROK alliance and eased the anxiety of alliance managers.  The ROK government blacklisted 102 Iranian firms and 24 individuals and suspended, albeit temporarily, the Seoul branch of Bank Mellat, which the U.S. accused of conducting financial transactions related to Iran’s nuclear development activities.  The centrality of the U.S.-ROK alliance and cooperation, especially in the aftermath of the Cheonan to coordinate their response to North Korea’s provocative behavior, prevailed over South’s economic interests with Iran, experts say.  We believe, however, that the core cause for Seoul’s agreement for the Iran sanctions stemmed from proliferation concerns which overrode business interests.  The ROK could not possibly have pressed for the international community to implement counterproliferation sanctions against the DPRK but then abstain from pursuing similar policy objectives regarding Iran.

This is the first part of the Pacific Forum’s Comparative Connection available here.