The recent agreement between South Korea and the United States on the 12th Special Measures Agreement (SMA) reveals a shift in defense cost-sharing dynamics. Starting in 2026, South Korea will see its annual defense spending increase by 8.3%, with subsequent years tied to inflation rates. The most notable change in this latest agreement is the adjustment of the defense cost growth rate based on the Consumer Price Index, a departure from the previous fixed percentage increase approach. While this shift may result in lower financial burdens for South Korea, critics have pointed out the lack of transparency in the budgeting process.
Despite the agreement, concerns loom over potential renegotiations, especially if Donald Trump wins the upcoming U.S. presidential election. The nature of the SMA as an administrative agreement leaves room for reevaluation under a new administration. However, for now, both countries have committed to keeping the annual increase below 5%. This agreement sets the stage for future discussions on defense spending and underscores the delicate balance between maintaining security partnerships and managing financial responsibilities.
Source link