Arirang News | S. Korea to pay 8.3% more for U.S. troops in 2026, increase contributions based on CPI until 2030 @ArirangCoKrArirangNEWS | Uploaded October 2024 | Updated October 2024, 1 week ago.
주한미군 방위비 분담금 8.3% 증가… 2030년까지 소비자물가지수 반영해 인상

South Korea and the U.S. have finally reached a deal on sharing the costs needed for U.S. troops stationed in Korea, after holding eight rounds of negotiations.
Korea's contribution will go up about 8 percent in 2026 under the new deal.
Our foreign affairs correspondent Bae Eun-ji has the details.

For the past five months, officials from Seoul and Washington have been holding talks, to determine how much South Korea will pay for the roughly 28-thousand-500 U.S. troops stationed in South Korea.
The government explained Friday that the two sides have finally come to an agreement on the 12th Special Measures Agreement, known as the SMA, which will be effective for five years, from 2026 to 2030.
South Korea's contributions in the first year of the agreement, 2026, will be some 1-point-5-2 trillion Korean won, or around 1-point-1-4 billion U.S. dollars.
That's around an 8-point-3 percent increase compared to the previous year.
After that, the cost will gradually increase over the next five years, based on the consumer price index to reflect inflation.
According to the Korea Development Institute, CPI in 2024 is projected to be around 2.4 percent, and 2 percent in 2025.
So, if the cost increases by 2 percent every year, South Korea will be paying around 1-point-6-7 trillion Korean won, an increase of 19.5 percent compared to 2025.
Applying the consumer price index greatly benefits South Korea, as the current SMA effective until next year applies the Korean government's increase in defense spending when it comes to determining the increase rate which is around 4 to 5 percent.
If South Korea were to increase 5 percent annually, it would be paying over 1-point-8 trillion Korean won in 2030, 26.7 percent more than the amount in 2025.
Seoul's foreign ministry said that the two sides have also agreed to set a maximum limit to the annual increase rate so that it will not go over 5 percent.

"We believe the significant achievement of these negotiations is that while South Korea and the United States maintained the framework of the existing agreement, the two countries have replaced the current measure of applying the defense budget to be used as the increase rate, with the annual consumer price index, and have reintroduced a limit."


The latest decision comes amid speculation that South Korea has been seeking to reach an agreement before the U.S. presidential election, to apparently avoid tough bargaining, in case the country's former President Donald Trump returns to the White House who earlier demanded a five-fold increase, calling on Seoul to pay nearly 5 billion dollars.
Bae Eun-ji, Arirang News.

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2024-10-04, 18:00 (KST)