By Troy Stangarone

If 2017 was the year of “fire and fury,” 2018 saw the United States and North Korea turn from the rhetoric of war to diplomacy as U.S. President Donald Trump met North Korean Chairman Kim Jong-un at the first ever U.S.-North Korea summit in Singapore.

If 2018 was the year the diplomacy on the Korean Peninsula, it was also a year of frustrations as the United States and North Korea have been unable to make progress on agreeing to a path towards the dismantlement of North Korea’s nuclear weapon and missile programs, or in taking steps to build the new relationship promised in Singapore. With U.S.-North Korea relations stalled, North-South relations have been unable to move forward at the pace hoped for despite more extensive agreements on inter-Korean cooperation.

While North Korea dominated the headlines in 2018, the past year began with South Korea’s successful hosting of the Winter Olympics. It saw the United States and South Korea agree to revise the U.S.-Korea FTA (KORUS), but South Korea also become caught in the United States trade war with China. The United States and South Korea also failed to reach an agreement on burden sharing.

On the domestic front, the Moon Jae-in administration implemented a series of new policies to advance an income lead approach to economic growth, but so far has yet to see the results hoped for from its reforms.

As we take our annual look back at the events that helped to shape the Korean peninsula during the past year, it is also an opportunity to review the events we highlighted on The Peninsula in our annual 10 Issues to Watch for on The Korean Peninsula in 2018 blog and the events we didn’t see coming.

Looking back, we largely touched on what would be the key issues on the Korean peninsula in 2018, but we missed on the sudden shift to summit diplomacy on the Korean Peninsula and what in one poll has been identified as the top news story in the United States in 2018 – the summit meeting between Trump and Kim. Here are the issues we identified:

1. Could War Break Out on the Korean Peninsula?

Coming into 2017, tensions between the United States and North Korea had been growing. Pyongyang’s December 2017 inter-continental ballistic missile (ICBM) test demonstrated it had the ability to reach anywhere in the continental United States, even if it had not yet completely mastered ICBMs. Despite the increasing threat of war, we were largely right in our analysis when we said that “war can, and most likely will, be avoided as long as cooler heads in Washington and Pyongyang prevail.” What we largely didn’t foresee is that war would be avoided not just because “cooler heads” would prevail, but that would lead to a year of North Korean summits with South Korea, China, and the United States.

2. The Advancement of North Korea’s Nuclear and Missile Programs

With the movement towards dialogue between the United States and North Korea, our prediction that North Korea would continue to test missiles fell flat. For all of 2018, North Korea refrained from conducting missile tests to either demonstrate new capabilities or to express its displeasure at the progress of talks with the United States. At the same time, there is every indication that our second prediction was correct. Kim Jong-un pledged in his 2018 New Year’s Address that North Korea would continue to expand its supply of missiles and fissile material and has yet to shut down its nuclear facilities at Yongbyon or its missile production facilities.

3. The Impact of Sanctions on North Korea

On the surface, sanctions have worked. Exports to China, North Korea’s primary trading partner have fallen to under $200 million through November. At the same time, despite sanctions causing declines in exports to China and other countries, there are signs that the markets are remarkably stable. In data published by DailyNK, the exchange rate and the price of commodities in markets have been fairly stable. Contrast this with Iran, where the U.S. withdraw has caused the Iranian Rial to drop in value. While the North Korean economy is not in a good position, the effect of sanctions seems to be less than many would have expected.

4. The 2018 Winter Olympics

By all measures the 2018 Winter Olympics in Pyeongchang were a success. South Korea finished tied for sixth for the most medals won, and concerns about attendance were ultimately relieved as the organizers came within their goal of selling 90 percent of the tickets. Most importantly, North Korea took part in the games easing concerns that it could disrupt the festivities and its participation helped to jump start a year of diplomacy.

5. Special Measures Agreement/Burden Sharing

The United States and South Korea have yet to conclude discussions on a new Special Measures Agreement to determine how much South Korea will contribute to the non-personnel costs of U.S. troops in South Korea. While the failure to conclude an agreement has not yet affected the alliance, the current agreement expires at the end of 2018. Indications are that the talks are stalled over an insistence by the Trump administration that South Korea raise its contribution to burden sharing by potentially twice as much as South Korea was previously contributing.

6. U.S.-Korea Trade Policy

The United States and South Korea were able to quickly reach an agreement on modest adjustments to the KORUS FTA. With the National Assembly having approved the changes and the U.S. trade deficit with Korea continuing to decline, the concerns around the KORUS FTA have begun to dissipate.

However, the KORUS FTA was not the only trade issue in the U.S.-Korea economic relationship. As we noted last year, the U.S. used a Section 232 national security investigation to push South Korea into agreeing to a quota on its steel exports to the United States equal to 70 percent of its shipments over the last three years, and also imposed tariffs on Korean washing machines as part of a safeguard case. South Korea may not be out of the woods yet, as a decision will likely come on a Section 232 case on automobiles and automotive parts early next year. South Korea is only major automotive producer to not receive some type of assurance that it will not have tariffs imposed on its exports if automotive imports are found to have national security implications.

7. Will China’s Economic Pressure on South Korea Over THAAD End?

As we foresaw at the beginning of the year, China’s pressure over the decision to deploy THAAD has moderated rather than disappeared. Despite South Korea and China agreeing in October of 2017 to normalize economic relations, Lotte is in the process of closing its Lotte Mart stores in China, and the effects on tourism can still be felt. Based on the latest data from the Korea Tourism Organization, a bit more than 400,000 Chinese tourists traveled to South Korea in November. This is up from just under 300,000 at the same point last year. However, despite the increase in Chinese tourism in November, it is still below its pre-THAAD highs. All told, the South Korean economy has lost more than $13 billion from the decline in Chinese tourism alone.

8. Moon Jae-in’s Promised Economic Reforms

The Moon administration continued to implement its income lead growth policies in 2018 taking steps to shorten the work week and raising the minimum wage for the second year in a row. However, the results have been mixed, especially with slowing job growth in August and September. South Korea also saw estimates for its GDP growth in 2018 and 2019 revised down. Some of this revision is due to external factors, but declines in investment and job growth are also weighing on the economy. The new year will be an important period for determining whether the current challenges are due more to the markets adjusting to the new policies or whether the policies themselves will need to be adjusted.

9. South Korean Local Elections

The ruling Minjoo Party won a resounding victory in the 2018 local elections. The party won 14 of the 17 mayoral and gubernatorial posts up for grabs, as well as 11 of 12 by-elections for the National Assembly. Seoul Mayor Park Won-soon also won a third term as mayor.

10. Hallyu’s Ongoing Rollercoaster Will Continue

The growth of K-pop around the globe was one of the major stories in 2018, even being highlighted by the BBC as BTS became the first Korean group to enter the UK Top 40 and land in the top spot of the iTunes album chart in 60 countries. Despite still facing challenges in China as part of the fallout from THAAD, K-pop saw growth in Japan and in Latin American markets. However, the big success for K-pop came in its breakthrough in the United States. BTS had two albums reach the top of the Billboard 200 and three songs on the Billboard Hot 100. However, the success extended beyond BTS as four other Korean acts landed albums in the top 40 of the Billboard 200 and BLACKPINK saw its video Ddu-Du Ddu-Du gain the fifth most views on YouTube in a 24 hour period among all genres.

The Bonus Issue: Will There Be Constitutional Reform?

While the Moon administration pushed for a package on Constitutional reform to be concluded in time for the local elections, ultimately reform efforts stalled in the National Assembly.

Beyond the events that we expected, here is a look at some of the unexpected events that helped to shape 2018:

1. When Donald Met Jong-un

Prior to 2018 no sitting U.S. president had met with the leader of North Korea. That changed in 2018 as U.S. President Donald Trump altered the normal protocol of only meeting a foreign leader, especially one such as Kim Jong-un, until after a series of deliverables have been agreed to by both sides. The summit in Singapore produced an outline for moving relations forward, but there has been virtually no progress in talks with North Korea, despite the United States canceling military exercises with North Korea. In spite of the lack of progress, Trump has professed his goodwill for Kim saying “And then we fell in love, OK? No, really, he wrote me beautiful letters, and they’re great letters. We fell in love.”

2. Perceptions of Kim Jong-un in South Korea Improved – A Lot

If meeting a sitting U.S. president was an historic moment, it was preceded by Kim Jong-un being the first North Korean leader to cross into South Korea, even if only to the South Korean side of the DMZ. Your author was in Seoul at the time watching Kim cross the demarcation line live on his cell phone in a taxi to the National Assembly. What struck me at the time was lack of coordination on the North Korean side as the delegation walked to the DMZ and the lighthearted nature of Kim Jong-un as he invited South Korean President Moon Jae-in to briefly visit North Korea before their meeting.

Kim’s visit made an impression on South Koreans as well. Prior to the April Summit Kim had an approval rating in South Korea of 10 percent, though that rose to 31 percent after the summit. More impressive, after the summit a new poll found that 78 percent of South Koreans saw Kim as trustworthy. A degree of goodwill remains as 60 percent of South Korea would have welcomed Kim to Seoul had he come in December as expected.

3. Inter-Korean Relations

In addition to the April summit, Kim and Moon held two additional summit meetings – a second summit in the DMZ and Moon’s visit to Pyongyang. These summits resulted in the Panmunjom and Pyongyang Declarations which laid out steps to improve inter-Korean relations. While sanctions related to North Korea’s weapons programs have prevented significant movement on inter-Korea relations, the two Korea’s did take steps to advance relations in 2018. In addition to the summit meetings, the two Koreas held the first family reunion since 2015, took steps to reduce military tensions and implement a new military agreement in the DMZ, and conducted a joint survey and groundbreaking ceremony for a project to reconnect the railways on the Korean Peninsula.

4. North Korea’s Cyber Activities

North Korean has become one of the world’s most active cyber powers and despite the diplomacy with the United States and South Korea, Pyongyang kept up its activities in 2018. According to Group-IB, since the beginning of 2017 approximately two-thirds of the theft of cryptocurrency has been by North Korea, netting the regime $571 million. It also used the Pyeongchang Olympics and summit meetings with Kim Jong-un as potential bait for phishing attacks.

5. The U.S.-China Trade War

In a globalized world where countries are part of supply chains, tariffs are an imprecise tool and South Korea found itself one the countries most exposed to a trade war between the United States and China. More than 40 percent of South Korea’s GDP is accounted for by exports, while China and the United States are South Korea’s top two trading partners, respectively. For most of 2018, South Korea had managed the conflict fairly well by increasing exports to China and resolving the issues around the KORUS FTA. However, in the year’s last quarter South Korea began to see declining demand for its top export to China, semiconductors, while overall sales of automobiles began to decline significantly in China – signs that the effects of the trade war are beginning to set in.

Troy Stangarone is the Senior Director for Congressional Affairs and Trade at the Korea Economic Institute of America (KEI). The views expressed here are the author’s alone.

Image created by Juni Kim is the Program Manager and Executive Assistant at KEI.

By Robert R. King

Final results on the 2018 U.S. Congressional elections are still being tallied, and as of November 15 two U.S. Senate races and eleven House races have still not been “called.”  The outcome of the congressional elections, however, is clear.  Republicans retained control of the U.S. Senate with a net gain of one or two seats.  On the other side of Capitol Hill, control of the House of Representatives has changed hands.  Democrats have picked up 32 seats giving them a majority of 227-199 in elections that have been decided.  Of the 11 races that have not been called, a majority appear to be leaning Democratic.

The changes brought by the election may result in changes in U.S. foreign policy.  This post attempts to see what might change in policy toward Northeast Asia over the next two years.

Senate Still in Republican Hands, but . . .

During the first two years of his presidential term, President Donald Trump has been able to get most of what he really cared about from both the Senate and the House.  In the Senate, most Republican lawmakers supported the President.  Two Republican critics who publicly voiced disagreement with Trump—Senators Bob Corker (Tennessee) and Jeff Flake (Arizona)—chose not to run for reelection.  The next Congress, however, is likely to have different dynamics.

In the Senate, Trump’s invincibility may be waning.  The President’s failure to achieve an electoral success in the House of Representatives and his serious weakness in suburban areas and with women and ethnic minorities, may well encourage some Republican senators to consider Trump a liability in their own upcoming reelection efforts.  After this election, some senators may well be willing to speak up and vote against the president on some issues.

There was no single national candidate for any office in this election.  Senate contests took place in about two-thirds of the states.  Senate votes are less reliable as a measure of national attitudes and feelings.  Votes for Representatives in Congress were held in every corner of the United States and that vote is a much better measure of national American attitudes and particular attitudes toward the President, since Trump made the election about himself.

The total number of votes cast in the mid-term election for representatives in Congress shows that some 5 million voters chose Democratic representatives over Republican representatives.  The popular vote in the 2016 Presidential Election gave 3 million votes more to Hillary Clinton than Donald Trump.  This suggests that support for Trump is declining, not growing.  Senators are less likely to be intimidated by or to support a president who may soon be a lame-duck.

Another element could influence Trump’s influence with the Senate.  One of the incoming Republican Senators, Mitt Romney (Utah), who was one of the harshest Republican critics of Trump during the Republican primary in 2016.  Romney is a “freshman” Senator and Senate decorum requires deference to elders and new upstarts are frowned upon in the Senate’s clubby ethos.  Romney, however, was the Republican Presidential candidate in the 2012 presidential election.  He knows the Republican members of the Senate and worked with them in the 2012 election and in other political contexts.

Trump nurtures grudges, and Romney’s criticism obviously still rankled him.  After the presidential election in 2016, Trump had at a much-publicized dinner with Romney to discuss the position of Secretary of State.  Shortly after the dinner, Trump appointed Rex Tillerson to the position in what was seen as a deliberate snub of Romney.  (Vanity Fair titled its story about the meal “Mitt Romney Eats Crow at Three Star Dinner with Trump.”)  Throughout Romney’s Senatorial campaign he studiously avoided commenting on Trump or his policies, and Trump stayed away from Utah during the campaign.  Nevertheless, just a few months before the mid-term election Romney spoke out and discussed differences with Trump during the campaign.  Romney may well be a high-profile Senator willing to challenge the President’s policies when he disagrees.

The Democratic-Controlled House will Not Be Friendly to Trump

In the House of Representatives, the swing of votes from the Republican to the Democratic column is the largest such Democratic “wave” in the House since the 1974 election which came just three months after Richard Nixon resigned the Presidency in the aftermath of the Watergate scandal.

House Democrats have not supported the Trump agenda on ideological grounds, but the petty bullying and taunting tactics Trump has used to criticize and mock Democrats have left him with a hostile House majority.  The Republicans who lost their seats in the recent elections largely represented politically more moderate constituents and whom the President has ignored or criticized.  Political moderate, women (particularly college educated women), and minorities turned from Trump.  In a post-election speech Trump blamed these Republican Members of Congress who lost for failing to embrace him, while the constituents saw them as too close to Trump.  The result is that the House of Representatives will be even more sharply divided on Trump and issues he champions.  With the need for both House and Senate to approve legislation, the divided Congress is likely to do less than the do-little congressional session just ending.

Foreign Policy Played a Minimal Role in the Mid-Term Election

Foreign policy issues, including Northeast Asia, received minimal attention in the U.S. election.  Foreign policy seldom is a key political issue in American elections, so this was not unusual.  The only campaign issue with tangential international implications was immigration, but this was an issue primarily intended to energize the Republican base.  Clearly the focus was not American relations with Mexico and Central America.  Fear was stoked with a military mobilization and overheated rhetoric, but we have seen little or no mention of sending U.S. military forces to the U.S.-Mexico border since the election took place.

Issues pressed by Democratic candidates were largely domestic American problems—health care, women’s rights, and the Donald Trump’s  divisiveness and lack of civility.  There has been considerable criticism of some of Trump’s foreign policy actions, but that was not an election issue.

Tariffs and trade was an international issue raised in the campaign, but the principal concern was not foreign policy, but American jobs.  Trump unilaterally imposed tariffs which he said was necessary to preserve American jobs.  The irony is that Republicans have traditionally led the opposition to tariffs and advocated for freer and more open trade.  But Democrats, who have been less supportive of free trade in the past, criticized the negative impact of tariffs on American jobs because of counter-tariffs and the impact on American farmers.  As the election rhetoric intensified, however, tariffs declined in importance.

Implications of the Electoral Change for U.S. Policy in Northeast Asia

Democratic control of the House of Representatives gives Congressional Democrats the ability to investigate, demand documentation, and question publicly or in closed session senior Administration officials on Administration policies.  Democratic leaders are already discussing their plans for “Congressional oversight” to investigate Trump administration policies.

But House Democrats will likely give higher priority to a number of controversial domestic issues—budget priorities, health care, environmental protection, climate change and energy policy, gun control, and women’s rights, including sexual harassment.  These issues more directly impact their constituents, and they will provoke disagreements with the White House.

Most of the key foreign policy and national security issues are not Northeast Asia.  The main issue for Democrats will be President Trump’s involvement in Russian efforts to influence American elections, and protecting the integrity of the Muller FBI investigation.  There could also be investigations into Trump’s business dealings with Russian oligarchs and possible Saudi business connections which may be influencing Administration policy.  The Middle East is always a major problem and a number of issues will be key—the murder of Saudi Arabian journalist Jamal Kashoggi by Saudi officials in Turkey, and the implications for U.S.-Saudi ties; the humanitarian crisis in Yemen and the ongoing internal Yemeni conflict; the thus-far ineffective White House effort to re-impose sanctions on Iran; the continuing conflict in Syria; and the complex issues involving U.S. relations with Israel.

Northeast Asia Issues will also engage House Democratic attention.  The most important of those will be the North Korean Security threat and denuclearization.  The House Committees on Foreign Affairs, Armed Services, and Intelligence are likely to hold both public and classified hearings on North Korean nuclear capabilities and the Administration unsuccessful efforts deal with the problem.  The much-publicized Singapore Summit has led to no discernable progress in denuclearization, and recent reports that North Korea is moving ahead secretly with nuclear and missile facilities while publicly dismantling with great fanfare a few older and well-known bases.

Democrats have openly questioned the value and achievements of Trump’s summitry with Kim Jong-un.  Democrats viewed the Trump-Kim Singapore Summit as largely a press event with little, if any, substance on denuclearization or improving regional stability and security.  Trump is clearly anxious for a follow-up summit—despite Kim Jong-un’s hard ball tactics in cancelling the preliminary meeting to lay the groundwork that was previously scheduled to take place in early November.  The House Foreign Affairs Committee will likely hold well-publicized hearings focusing attention on these concerns with North Korea policy.  The House Armed Services Committee is also likely to hold public and classified hearings on North Korean nuclear capabilities and policies for coping with them.  The fact that up to now Democrats were in the minority in both houses of Congress, however, gave their concerns and cautions little attention.  Now with control of the House agenda, their views will be given considerably more media attention.

Economic issues are important for the relationship with South Korea, Japan, and China.  Democrats have been critical over Trump’s unilateral imposition of tariffs, abandoning previous trade and economic agreements because they did not have the Trump name on them.  The KORUS FTA changes by Trump were not particularly welcomed by Congress, which has always been jealous of its primacy under the U.S. Constitution on trade matters.

The House Democratic majority is likely to support backing away from the Trump trade policies.  Republicans in the Senate are as uncomfortable and skeptical of the Trump trade agenda as are House Democrats.  Traditionally Republicans have been leading advocates for freer and more open trade, and Trump trade policies reflect a departure from that traditional Republican position.  If the Democratic House stands up to Trump’s trade policies, it may give the Republican leadership in the Senate more backbone to push against policies that they ideologically oppose.

On the issue of North Korea Human Rights,  both political parties in both House and Senate have supported pressing for changes on North Korea’s deplorable human rights record.  Trump used human rights as a stick to encourage North Korea to engage with the United States (see his UN Speech in September 2017 and the lengthy discussion of North Korean human rights in his State of the Union Speech in January 2018).  Once the Singapore Summit was on the horizon, however, the Trump administration and the President in particular did not give further attention to human rights.

Congress, however, has a stronger commitment to the human rights issue.  The fact that the North Korea Human Rights Act was extended after the Singapore Summit indicates Congress’ strong interest in the human rights issue.  This legislation is one of the few bipartisan pieces of legislation to pass the Congress in the first two years of the Trump era.  That bipartisan interest will continue and will likely be given additional emphasis by Democratic House committees.

Expectations for a Change with Democratic Control of Congress

The American constitution gives the President considerable latitude in the conduct of American foreign policy.  The Congressional role is limited to allocating and controlling funding for the conduct of that policy.  The House shares that authority with the Senate, which still remains in Republican hands.  It is important not to raise expectations of any legislative limitation or roll back of policies affecting Northeast Asia.

It is also important to keep in mind that the House and the Senate are not particularly disciplined.  There is no Democratic phalanx of loyal Members of Congress that will follow their leaders in lockstep into battle.  As American humorist Will Rogers famously said: “I’m not a member of any organized political party.  I’m a Democrat.”  Howard Baker, the Republican leader of the U.S. Senate for several years, said that trying to be the Republican leader of the Senate is “like herding cats.”  Cooperation in congress requires cajoling and convincing, unlike the Commander-in-Chief, who can give orders and expect they will be followed.

Initiative in foreign policy is with the President.  He has the largest bull horn, the loudest voice in the American government.  Trump, the former reality-TV personality, has shown a willingness and skill in using the media to dominate the conversation.  Thus far, however, he has faced no competitors who have real authority or who get serious attention from the media.  The Congressional Republicans have quictly acquiesced in his policies.  Few voices of disagreement have spoken out from Republicans in either house of Congress.

The House, with its newly-energized Democratic majority, can and will conduct hearings and investigations of President Trump and his policies.  His and his Administration’s actions will be criticized, and the media will give the Democratic leaders greater attention because they hold a majority in the House and their action and views do have consequences.  This will irritate the President, and his counter-responses will make for more interesting news stories for journalists.

The disruptive, erratic actions from the Administration are likely to continue.  The President in his press conference the day after the election made a few conciliatory remarks about working with Democrats, if they accepted his terms.  But even before the end of the press conference he was back to campaign mode criticizing Democratic leaders by name.  The next two years are likely to be more tempestuous and volatile than the last two have been as President Trump begins to gear up for his own reelection bid in 2020.

Robert R. King is a Non-Resident Fellow at the Korea Economic Institute of America. He is former U.S. Special Envoy for North Korea Human Rights.  The views expressed here are his own.

Image of Mitch McConnell credited to Gage Skidmore. Image of Nancy Pelosi credited to Jason Pier.

By Phil Eskeland

There is wide-spread support for strong and close relations between the U.S. and the Republic of Korea (ROK).  South Korea has grown and prospered since the immense sacrifice made by the U.S., South Korea, and others in the international community during Korean War, and emulates America’s model of democracy, political freedom, and free markets.   Korea’s soft power has dramatically flourished as well in recent years in which many Americans, particularly millennials, have a strong affinity for Korean food and K-pop music.  Rapidly rising Korean investment in the U.S. during the past decade, employing a growing number of Americans, further assists the positive image of Korea, particularly in areas in “fly-over” country that have seen tough times and been overlooked by others.

This support is reflected in Congress.  Unlike some areas in U.S. trade policy, the Korea-U.S. Free Trade Agreement (KORUS FTA) passed by wide bipartisan margins in 2011.  Legislation to strengthen sanctions against North Korea have passed Congress by near unanimous vote.  Earlier this year, Congress even added an amendment by unanimous consent to the annual defense bill that limited the ability of the President to unilaterally withdraw U.S. troops from the Korean Peninsula below a certain level.

Yesterday’s mid-term elections produced a result that has not been seen in Washington since 1981 when President Ronald Reagan had to deal with a Democrat-controlled House of Representative, led by Speaker Tip O’Neil of Boston, Massachusetts (“all politics is local” is his most notable quote), and a Republican-controlled Senate, led by self-effacing Senator Howard Baker of Tennessee.  However, unlike the situation faced by President Reagan in 1981, President Donald Trump cannot count on 30 or 40 “boll weevil” or conservative Democrats to join with House Republicans, serving in the minority, to enact more of his agenda.  While some of the newly elected representatives may eventually join the boll weevil successor Blue Dog coalition, there are currently only 18 House Democrats listed as members of this caucus.  In addition, Congress has dramatically changed during the past 30 years in which Speaker Nancy Pelosi, unlike Speaker O’Neil, would control the House floor so effectively that it would preclude renegade Democrats from coalescing with Republicans to pass anything substantial over the leadership’s objections.

What can be expected over the next two years is a return to gridlock and more Congressional investigations and oversight of the Trump Administration.  While there may be certain exceptions, such as enactment of an infrastructure bill, there will be focus by many of the new committee chairmen in the House to reverse what they felt was negligence on the part of previous Republican chairmen to properly oversee the activities and programs of the Executive Branch.

This investigative spirit may spill over into the Foreign Affairs Committee.  Observers of Korea policy will miss retiring Chairman Ed Royce, who because of his constituency and location of his southern California district, was a strong advocate for a deeper understanding of Asia and, specifically, the U.S.-Korea alliance in Congress.  Representative Elliot Engel (who comes from the other side of the United States, representing neighborhoods in northern Bronx and southern Westchester County of New York), will become the chairman of the Foreign Affairs Committee next January.  While Chairman Royce was careful to cultivate a bipartisan approach to issues affecting the Korean Peninsula, particularly during the tumultuous Trump era, Democrats may be torn between their desires for a peaceful and diplomatic solution to the North Korea nuclear issue and their deep skepticism of the Trump Administration’s overall approach towards foreign policy, particularly in light of Trump’s decision to terminate the Iran nuclear deal.  Any deal with North Korea on denuclearization would have to be vastly superior to the Iran nuclear agreement.  Thus, if the Trump Administration agrees to gradually lift some sanctions before there is complete, verifiable, irreversible dismantlement (CVID) of North Korea’s nuclear program, Congressional Democrats may pounce on the deal as incomplete and blame Trump’s incompetency as a negotiator.  This opposition would escalate even further if at some point in the next two years, President Trump decides to withdraw from negotiations with North Korea and threatens kinetic action to pressure North Korea.

In addition, if this scenario plays out, Senate Republicans may also feel a need to separate themselves more from the Trump Administration, particularly as the next election season gets closer to 2020 and if any deal with North Korea falls short of CVID.  The next chairman of the Senate Foreign Relations Committee, Senator Jim Risch of Idaho, comes from a background of service as the Chairman of the Near East Subcommittee and also as a member of the Select Committee on Intelligence.  One test of this proposition is to see if the Asia Reassurance Initiative Act (S. 2736) passes Congress during the upcoming “lame duck” session because it contains a provision that clearly lays out a marker that the objective of U.S. policy towards negotiations with North Korea is the complete, verifiable, irreversible dismantlement of not only its nuclear but also its ballistic missile programs.

It is unclear if Senators Cory Gardner and Ed Markey, who are the main co-authors of S. 2736, will continue serving as the respective chair and ranking member of the East Asia Subcommittee in the next Congress.  Nonetheless, expect policy continuity on Korea-related matters regardless of who serves as chairman of this subcommittee with the possible exception of libertarian-leaning Senator Rand Paul of Kentucky.

One final note: a bright spot from yesterday’s mid-term election was the apparent election of Young Kim to succeed retiring Representative Ed Royce of the 39^th District of California. If she is able to maintain her lead, this will be the first time in 20 years that a Korean American has served in the U.S. Congress. Even being in the minority, she may take on a leadership role that Representative Royce has undertaken these past 26 years to strengthen and deepen the U.S.-Korea alliance, in part because of her heritage but also because of her constituency and the economic interests of the district. Andy Kim is also locked in a tight race with Rep. Tom MacArthur in New Jersey and could potentially be another Korean American to serve in the new Congress.

Phil Eskeland is Executive Director for Operations and Policy at the Korea Economic Institute of America. The views expressed here are his own.   

Photo from the Natig-Sharifov’s photostream on flickr Creative Commons.

By Troy Stangarone

In 1992, Jay Kim was elected from the newly drawn 41^st Congressional District in Southern California, becoming the first Korean-American elected to Congress. As Americans go to the polls for the midterm elections, there is a real chance that a Korean-American will be elected to Congress for the first time since former Congressman Jay Kim left office in 1999. Should one of the Korean-American candidates running for office win, they would become just the second Korean-American elected to Congress.

The following is a brief bio on each of the Korean-Americans hoping to win a seat in Congress on November 6:

Andy Kim (D), NJ-3: Andy Kim is running for in the 3^rd Congressional District of New Jersey where he is hoping to unseat the current incumbent Tom MacArthur. Kim is a former Rhodes Scholar who has worked as a conflict specialist for U.S. Agency for International Development during the George W. Bush administration. During the Obama administration he advised Generals John Allen and David Petraeus in Afghanistan and later served as the director for Iraq at the National Security Council.

Pearl Kim (R), PA-5: Pearl Kim is running in the newly reconfigured Pennsylvania 5^th Congressional district. The Pennsylvania 5^th became an open seat when Congressman Patrick Meehan resigned earlier this year and Pennsylvania’s Congressional districts were reconfigured based on a State Supreme Court ruling. Both Kim and her opponent are also running to fill the remainder of Congressman Meehan’s term in the old 7^th district.  Kim entered the race after a career as a special victim’s prosecutor for Delaware County District Attorney’s Office where she served as an Assistant District Attorney she took a special interest in victims of human trafficking and in the State Attorney General’s office where she worked on cases related to opioids and campus safety. Her work on human trafficking lead to her being named to a special state commission that made proposals for revising Pennsylvania’s human trafficking statue. In addition to her work on human trafficking, Kim has worked on criminal justice reform and ensuring that immigrants had proper access to language services in court.

Young Kim (R), CA-39: Young Kim is running in California’s 39^th Congressional district and seeks to succeed Congressman Ed Royce who currently serves as the Chairman of the House Committee on Foreign Affairs. Kim previously served as in the California State Assembly representing the 65^th District. As a Member of the States Assembly, she introduced legislation protecting victims of domestic violence that passed with bipartisan support.  She began her public career when she worked for Congressman Royce as his Director of Community Operations. Prior to working in the public sector, she was a small business owner and a financial analyst.

Thomas Oh (R), VA-8: Thomas Oh is running in the northern Virginia Congressional district currently represented by Congressman Don Beyer. Oh enlisted in the Army while still in high school and became an Airborne Ranger in the Army and continues to serve in the U.S. Army Reserves. He is currently studying for his MBA at George Mason University.

Keep tuned in Tuesday night to see if any of these candidates are elected to serve as the next Korean-American in Congress.

Troy Stangarone is the Senior Director for Congressional Affairs and Trade at the Korea Economic Institute of America (KEI). The views expressed here are the author’s alone.

Photo from Amanda Walker’s photostream on flickr Creative Commons.

By Linnea Logie

South Korea’s local elections and parliamentary by-elections took place on the heels of the much-hyped June 12 summit between U.S. President Donald Trump and North Korean leader Kim Jong-un in Singapore. Nearly 43 million South Koreans were reportedly eligible to vote in the local elections, where ballots were cast for over 4,000 posts, including 17 mayors and governors of cities and provinces, 824 seats in provincial and metropolitan assemblies, 226 heads of smaller administrative units, 2,927 lower-level local councilors, and 17 superintendent-of-education positions. Simultaneously occurring with local elections for the first time, parliamentary by-elections decided an additional 12 seats in the National Assembly.

Though unlikely to have an immediate or dramatic effect on national politics, quadrennial contests of the type held June 13^th carry major implications for everyday South Koreans and the communities in which they live and work. The intensity of campaigning confirms that local and by-elections came at a critical moment in Korean domestic politics. They are being regarded as a referendum on the presidency of Moon Jae-in, who hoped to strengthen his mandate by translating the overwhelmingly favorable public reaction to his post-Olympics summit with Kim Jong-un into large-margin victories for the ruling Democratic (Minjoo) Party of Korea (DP). The liberal-minded DP seemed poised for a dominant performance prior to the vote, entering June with a 53 percent approval rating that dwarfed major competitors the Liberty Party of Korea (11 percent) and Bareunmirae Party (5 percent). Exit polls project DP victories in 14 of 17 mayoral and gubernatorial races and 10 or 11 of 12 National Assembly constituencies, respectively. These results will likely be confirmed by early Thursday morning at the latest, and they raise questions as to the future of the conservative cause. The leaders of Liberty Party Korea and Bareunmirae Party are widely expected to step down from their posts in the face of an overwhelming defeat.

In spite of these numbers, election outcomes were far from preordained. Members of the Democratic Party expressed concern during the campaign that expectations for a decisive DP showing could depress voter turnout, particularly among younger Koreans. Their unease was understandable, given that the liberal-leaning youth cohort comprised a larger share of eligible voters than in previous election cycles and turned out in force during the 2017 presidential election. Absent strong youth participation, the persistent reluctance among many older Koreans to support the liberal cause (in spite of a splintered conservative camp) could have narrowed DP victories, even jeopardizing tighter races. Ultimately, however, the National Election Commission estimates that voter participation exceeded 60 percent, a level not seen in local South Korean elections since 1995 and higher than the 56.8 percent recorded in 2014.

Faced with the challenge of a generationally bifurcated voter base, many candidates contesting the June 13^th election tapped into pop culture and highlighted issues of common concern to broaden their appeal. Below are a few notable tactics and policy proposals from the campaign trails:

Vehicles

Local U.S. politicians, including mayors and governors, rarely have the funds for flashy transportation. They prefer to invest precious campaign dollars in costly TV or internet campaign ads, community events, and so on. But not so in South Korea.

Be it a national, parliamentary, or local South Korean election, one can always count on there being a crush of campaign vehicles jockeying for position around heavily trafficked, highly visible areas throughout the country for the duration of the brief official campaign blitz.

Campaigns in South Korea exercise little restraint when it comes to outfitting their specially remodeled trucks, plastering candidate names and slogans along the exterior and outfitting them with speaker systems to allow for high-quality audio during candidate speeches and, as discussed below, the blasting of upbeat music.

Canvassing vehicles reflect the need for South Korean electoral candidates to achieve a high level of visibility during a fleeting official campaign season. The major political parties contesting recent local elections waged “all-out war,” dispatching candidates in tight races to subway stations, markets, and even elderly dance classes to shake as many hands as possible before voting began.

K-pop

The Korean popular music phenomenon, better known as K-pop, extends well beyond the realm of entertainment within South Korean society. Students and special interest groups nationwide have politicized various hit tracks to bolster their cause in recent years, and many political hopefuls in South Korea have come to regard K-pop as a valuable campaign tool.

K-pop politicking reaches a fever-pitch in South Korean campaign cycles where ample resources are at play, such as the 2017 presidential election. Performers bedecked in candidates’ signature colors take to parade floats and mobile stages to belt out well-known tunes, sometimes altering lyrics to incorporate candidate names and key platform themes. The overall effect is a concert-like atmosphere in major cities across the country, promising unusual amusements such as a human-sized blue Smurf performing choreography alongside other campaign dancers.

Campaign theme songs enable candidates who might otherwise resemble members of the old political establishment better connect with younger voters. Using a personalized version of the song “Cheer Up” by K-pop girl band Twice as an anthem, for example, helped freshen up the image of then-presidential hopeful Moon Jae-in, a “64-year-old lawyer in a gray suit who may be the antithesis of a K-pop star.” Candidate Moon apparently had 11 other songs on rotation to appeal to a broad range of audiences. For Moon and others in South Korea, these songs often double as soundtracks for playful campaign ads, contrasting starkly with the typically humorless, reflective tone of political ad spots in the U.S.

K-pop was no less a feature of the recent local election campaign effort. Music started at high volume early each morning, building throughout the afternoon. Not everyone in Korea is fond of the raucous campaign atmosphere; residents of North Jeolla Province filed 28 complaints over loud noise between 7 am and 12 pm on the first day of official campaigning, alone. These sentiments are widespread, with locals throughout the country expressing annoyance at the clamor and illegal parking, while also wondering over the seeming lack of regulation surrounding the conduct of campaign vehicles. Others simply reject the notion that a song or amplified speech could sway their vote.

Posters 

South Korean electoral candidates have only days to share their message with constituents. As a result, the start of official campaigning in South Korea sets off a visual assault of bright colors and graphic imagery. Banners, posters, online ads, and vehicles emblazoned with candidate names and smiling faces crowd public areas, fighting for the attention of passers-by. Many candidates incorporate slogans into their signage in an effort to stand out from their competitors, though doing so sometimes elicits less-than-enthusiastic responses from members of the general public.

Shin Ji-ye, twenty-seven-year-old Green Party Korea candidate in one of the most significant races in the June 13^th election, the mayorship of Seoul, experienced this firsthand. Vandals targeted her posters, which promoted Shin in seemingly typical fashion: name, photograph, and candidate number set against a vivid green background. But Shin believes it was her decision to describe herself as “Feminist Seoul Mayor” on the posters that prompted the backlash, and she denounced the mischief as “crimes violating the election law” and “misogynic terrorism against a feminist politician.”

Though true that unjustifiably disrupting the installation of, or subsequently tampering with, campaign paraphernalia is a punishable offense in South Korea, it is Shin’s assessment of what earned her posters unwanted attention that carries broader implications for the ROK and Asia-Pacific region.

Gender roles that subordinate women to inferior positions within society are deeply entrenched throughout Asia. So while Shin leveraged her situation to gain support at the polls, her comments nevertheless highlight an issue sure to have a major impact on South Korea’s economic development and global standing in years to come. Much like neighboring Japan and China, South Korea is home to an aging and contracting population. These inexorable demographic trends imperil national interests, undermining productivity while adding to social welfare costs. Robust female participation in the workforce will be essential for East Asia’s major powers as they navigate this difficult period, requiring policy and cultural changes.

Flashy Proposals

Even in periods of strong economic growth, jobs, wages, affordable housing, family planning, and upward mobility are rarely far from voters’ minds. More than a few of the candidates contesting key mayoral races in the June 13^th South Korean local election outlined proposals to establish local cryptocurrencies as a means of stimulating local economic growth and fostering more civically responsible communities.

Such proposals are perhaps best understood as social-benefits programs funded by individual cities, wherein “points” or “credits” would accrue to businesses and citizens who demonstrate environmental responsibility, participate in volunteer or charitable work, or provide other services to the local community (some of the plans include pension points for seniors and unemployed workers, as well as incentives for child-rearing). These credits could then be cashed in for city-funded services. Candidates gave their proposals catchy abbreviated titles, such as “S-Coin” from incumbent Seoul mayor Park Won-soon, “B-Coin” from Park Min-shik of Busan, and “Local Coin” from Kim Kyocheung of Incheon, among others. With Park Won-soon expected to retain his post, becoming the first to win a third term as mayor of Seoul, time will tell whether S-Coin becomes a reality.

In short, interest in the historic Trump-Kim meeting should not come at the expense of developments below the 38^th parallel. The local election campaign process now coming to an end offers a fascinating glimpse into South Korean democracy and the challenges elected ROK officials will confront in the years to come.

Linnea Logie is an incoming graduate student with the Security Studies Program at Georgetown University.  She is currently an Intern at the Korea Economic Institute of America. The views expressed here are the author’s alone.  

By Jun Young (James) Park  

On June 13, local elections in South Korea will be held for about 4,000 local administrative, legislative, and educational leaders in 17 major cities and provinces. The Democratic Party of Korea (DPK) is predicted to dominate in fourteen of them.

The approval rate of President Moon Jae-in and his administration has been above 70% for the past few months, and has seemingly translated into massive public support for DPK candidates for the upcoming elections. According to a recent survey, 52% of South Koreans are known to favor the DPK, 18.5% support the conservative Liberty Korea Party (LKP), 6.6% for the Bareunmirae Party, and 7.7% for the Justice Party. In South Korea, where the land is small, but population density is high, local elections can be as important as presidential elections. Local policies can have direct and immediate impacts on the daily lives of citizens, and the implementation of local policies is highly dependent on the leadership of mayors and governors. As usual, major regions like Seoul, Gyeonggi, and South Gyeongsang have received a lot of attention from the general public, but for various reasons in this year’s case.

The Seoul mayoral election traditionally has been regarded as the highlight of South Korean local elections. This year, the Seoul mayoral election presents high-profile candidates, as the race has shaped up as a three-way competition among Park Won-soon of the DPK, Kim Moon-soo of the LKP, and Ahn Cheol-soo of the Bareunmirae Party.

The hottest issue of the Seoul Mayoral election has been whether Kim and Ahn will seek a single candidacy or not. Incumbent Mayor Park Won-soon of the DPK, aiming for his third term, has been ahead of Kim and Ahn with 56.1 % of Seoul citizens supporting his mayorship, while Kim and Ahn’s support rates are only 15.8% and 14.9%. Many people expressed skepticism towards Kim and Ahn’s possible merger as their combined approval rate is still significantly lower than that of Park. Both Kim and Ahn stated that neither would be willing to give up his candidacy, leading to a prediction that Park would easily outperform his rivals.

During the Seoul mayoral election debate, Park was harshly criticized by both Kim and Ahn for Seoul’s increasingly devastating air pollution and the issue of reconstructing old, impoverished areas, which have been problematic for multiple years during Park’s two terms as the mayor. On the other hand, Kim was condemned for his negative comments on the LGBTQ issue during the debate. Despite the LKP and Bareunmirae Party’s collaboration to downplay Park’s candidacy, the Seoul public’s support for Park remains sky-high.

The gubernatorial election of Gyeonggi Province, where more than twelve million people reside, is arguably the second most significant event of the local elections. This year, the Gyeonggi gubernatorial election is by far the most controversial of the elections, with negative campaigns targeting Lee Jae-myung, the DPK candidate. Similar to most regions, Gyeonggi Province has witnessed DPK dominance, with Lee’s support rate consistently being around 50% or above for the past couple months, and its counterpart Nan Kyung-pil of the LKP only receiving less than half of Lee’s support. As a way to decrease Lee’s support, Lee’s rivals including Nam and Kim Young-hwan of the Bareunmirae Party, have conducted negative campaigns in full swing, by addressing two notable scandals involving Lee: his verbal harassment of his brother and the brother’s wife in 2012 and his possible extramarital affair with an actress named Kim Bu-seon. While scandals involving Lee have been on the top news for many weeks, Lee seemingly has not been affected by them, as his support  has not dropped.

The DPK’s exceptional performance in 2018 local elections is an anticipated outcome, but this year’s South Gyeongsang gubernatorial race might have been a surprise for the conservatives. Previously governed by the LKP’s current Chairman Hong Jun-pyo from the year of 2012 to 2017, South Gyeongsang Province traditionally has been regarded as a conservative stronghold. The two-way race between the DPK candidate Kim Kyoung-soo and the LKP candidate Kim Tae-ho, who already had been elected as the governor of South Gyeongsang for two terms from 2004 to 2010, was expected to be a close competition. On top of the LKP’s historical dominance in the region and Kim Tae-ho’s distinguished resume as a politician, the effect of the Druking Scandal, an online public opinion rigging scandal that Kim Kyoung-soo is alleged to be heavily involved led to the conservatives’ belief that they should at least be able to have a good run in South Gyeongsang. Unlike many conservatives’ wish and hopeful prediction, Kim Kyoung-soo, with his support in the mid-to-high 40%, has entirely led the competition between him and Kim Tae-ho. The nationwide dominance of the DPK, even in highly conservative regions like the South Gyeongsang not only shows South Koreans’ trust and favoritism towards President Moon, but is also a strong reminder of the public’s huge disappointment and antipathy towards the LKP in recent years.

Jun Young (James) Park is a graduate student in Asian Studies at the George Washington University. He is currently an Intern at the Korea Economic Institute of America. The views expressed here are the author’s alone.  

Photo from Simon Williams-Im’s photostream on flickr Creative Commons.

By Troy Stangarone

In 2017, much of the world’s attention turned to the Korean Peninsula. South Korean politics underwent major changes as President Park Geun-hye became the first South Korean president to be removed from office and a snap election was held in May that saw the election of Moon Jae-in. North Korea also dominated the news as Kim Jong-un followed through on his promises to test an intercontinental ballistic missile (ICBM) and has raised concerns over the prospect of military action on the Korean Peninsula as North Korea has advanced its programs more quickly than many expected.

The changes in South Korean politics and North Korea’s progress on weapons development on their own could mark 2017 as a major turning point on the peninsula. However, we also saw the United States threaten to withdraw from the KORUS FTA and China perhaps put more pressure on South Korea over THAAD than North Korea over its nuclear weapons program. As we take our annual look back at the events that helped to shape the Korean peninsula during the past year, it is also an opportunity to review the events we highlighted on The Peninsula in our annual 10 Issues to Watch For on The Korean Peninsula in 2017 blog.

Looking back, we largely touched on what would be the key issues on the Korean peninsula in 2017. Though, in the case of burden sharing we may have been a year too early and there are reasons to believe late in 2017 that our prediction on relations between South Korea and Japan while right for 2017 may be challenged in 2018. Areas where we could have done better include more of a focus on North Korea’s desire to try and complete much of its weapons testing in 2017, how nations in East Asia would react to the U.S. withdrawal from the Trans-Pacific Partnership, and the impact that the impeachment of Park Geun-hye would have on the leadership of South Korean chaebol. With that said, here’s a brief look back at the 10 issues we highlighted and what happened:

1. Political Dynamics and the Presidential Election in South Korea

The impeachment of Park Geun-hye and the subsequent election of Moon Jae-in as president were two major events in South Korean politics in 2017. While the snap election won by Moon resulted in a victory for the leading contender rather than an upstart candidate hoping to take advantage of shifts in the South Korean political scene, it did see the rise of populism in South Korea as we have seen in much of world over the last couple of years. The difference being that populism in South Korea is being driven by the left rather than the right. While Moon’s election could have resulted in shifts in policy towards North Korea and Japan, he has largely represented continuity through his endorsement of President Trump’s policy of maximum pressure and his efforts to separate historical issues from policy more broadly with Japan. Though, he has moved to give the government a greater role in job creation in South Korea.

2. The Trump Administration’s Foreign and Security Policy in East Asia

Despite campaign rhetoric that accompanied President Trump’s run to the White House, U.S. foreign and security policy towards East Asia has remained largely the same. Much of the strong rhetoric about the need for allies to contribute more to their defense has remained, but the broader U.S. policy in the early part of the Trump Administration seems to have largely remained in place. The most significant difference to date may have come in the rhetoric designed to describe the Administration’s policy. The Trump Administration has decided to move away from using the Obama Administration’s Asia Rebalance to a new Indo-Pacific strategy, but it is unclear how different the policy will be in reality. Though, we could see greater differences in 2018 as negotiations on burden sharing with South Korea will need to be completed and North Korea’s

3. Trump Administration Asia Economic Policy

If U.S. foreign and security policy in East Asia has largely remained consistent, the same cannot be said of U.S. economic policy. Trade policy was the one area where it was clear President Trump intended to make changes. On the first day of the new Administration, President Trump followed through on his promise to withdraw from the Trans-Pacific Partnership (TPP) and shift from the use of multilateral trade agreements to bilateral trade agreements to advance U.S. interests. The Trump Administration has also pushed to renegotiate the U.S.-Korea (KORUS) FTA, which President Trump has consistently referred to as a “horrible” trade agreement and only North Korea’s nuclear test in September may have convinced the Trump Administration to renegotiate rather than withdraw from the agreement. It has also taken steps to use more U.S. trade remedies to push a harder line with China on its trade practices.

4. North Korean Behavior in Response to a New Political Environment

Despite announcing in his New Year’s Day address that North Korea was close to conducting an ICBM test, North Korea did seem to display some hesitancy in its testing in 2017 as it adjusted to the new Trump Administration in Washington, DC and there have been indications that Pyongyang is confused by Washington’s new policies. At the same time, North Korea did not conduct as many missile tests around the U.S.-South Korean military exercise in the spring and delayed conducting its first ICBM test until July. However, by the middle of the year North Korea seems to have determined that the new Administration would not be a break on its behavior and proceeded to conduct missile tests at roughly the same rate as in 2016.

5. Will North Korea be a Trump Administration Priority?

It was clear before the Trump Administration came into office that dealing with North Korea would be a foreign policy priority, but less so where it would rank in terms of priorities, especially given candidate Trump’s focus on China. However, addressing North Korea’s nuclear program has become the Trump Administration’s top foreign policy priority because of both the maturity of North Korea’s weapons programs and the growing threat they represent to the U.S. homeland and the region. As a result, President Trump has lessened economic priorities that he campaigned on, such as addressing trade with China, and offered Beijing a better deal on trade if it helped the United States deal with North Korea.

6. Are Sanctions Working?

This was one of the key questions for 2017 and will remain a top issue in 2018. Are sanctions working on North Korea? Sanctions have taken a toll as exports to China have fallen by $410 million through October compared to the same period in 2016 and some countries have begun completely cutting off trade, but they have created no discernable change in North Korea’s testing or willingness to return to talks. However, concerns we had at this time last year that there may be a turn away from sanctions have not yet come to pass. While some of the presidential candidates in South Korea had expressed a desire to reverse course on sanctions with North Korea, Pyongyang’s continued missile test and hydrogen bomb test have closed any avenue for engagement and a lessening of sanctions, easing those concerns. Though, there has been an increasing consideration of the use of military force in the United States to solve the North Korean nuclear issue.

7. Special Measures Agreement/Burden Sharing 

Because of the focus on this issue by candidate-Trump we had an expectation that it could come to the fore in 2017. Asides from the occasional rhetorical flash, it didn’t. However, in 2018 the United States and South Korea will need to conclude a new Special Measures Agreement to determine the level of burden sharing in the alliance. This may just be an issue deferred.

8. Will RCEP Be Finalized in 2017?

One of the expectations for 2017 was that if President Trump followed through on his pledge to withdraw from the TPP, it would help spur the Regional Comprehensive Economic Partnership (RCEP) to conclusion and help to provide China with a platform for supplanting the United States’ leadership in East Asia on economic issues. While China has sought to supplant the United States on trade, RCEP remains unconcluded and rather than withering the TPP is very much alive. The remaining members under Japanese and Australian leadership have sought to conclude the agreement and leave open the door to a U.S. return in the future. The regional response to the United States on trade has not played out how one would have expected.

9. Will the Korean Wave Continue?

The Korean Wave, or Hallyu, continued to grow in 2017 despite Chinese retaliation over THAAD. China is a key market for Hallyu content and products. As a result of THAAD, China prohibited the streaming of new K-dramas and banned group tours to South Korea where Chinese tourists purchase large amounts of Hallyu related products such as K-beauty. Both of these actions cut into profits from Hallyu, but there was also significant growth of K-beauty product exports to China as Chinese customers sought to make up for the loss of purchases from their trips to Seoul. While China’s measures have clearly cut into Hallyu, it has seen increasing success outside of China. One of the biggest new hits on U.S. TV, The Good Doctor, is the export of a South Korean drama and the growing enthusiasm for Hallyu can be seen at KCONs around the world as well as in the American TV debut of boy band BTS, who will be ringing in the new year in Times Square along with the world’s biggest artists. While China’s THAAD retaliation clearly represented a challenge to Hallyu, it continues to thrive.

10. Relations Between South Korea and Japan

The relationship between South Korea and Japan has developed largely as we expected. The 2015 agreement regarding the Comfort Women remains unpopular in South Korea and President Moon has said the South Korea could not “emotionally” accept the agreement. However, in contrast to the Park Administration the Moon Administration has worked to separate historical issues from other issues in the relationship. Shortly after his election President Moon spoke with Prime Minister Abe about North Korea and the two have met in a summit meeting during APEC and the trilateral meeting with President Trump on the sidelines of the UN General Assembly. While the growing threat from North Korea, along with President Moon’s reluctance to date to call for the Comfort Women deal to be revised or scrapped, has likely helped to maintain ties, a South Korean commission recently concluded that the agreement did not adequately take into account the views of the Comfort Women and could challenge this balance in the new year.

Beyond the events that we expected, here is a look at some of the unexpected events that helped to shape 2017:

1. North Korea’s Nuclear Successes

After a series of Musudan missile failures in 2016, few would have expected the progress shown by North Korea in 2017. However, 2017 saw Pyongyang make significant progress as it introduced the Hwasong 14 and 15 models for its three successful ICBM tests. Also, more than a year after claiming the successful test of a hydrogen device, North Korea successfully conducted it first test of a hydrogen bomb. While North Korea’s successes to-date may not quite complete their tests as Kim Jong-un indicated, they have brought North Korea significantly closer to being able to strike the U.S. homeland than many would have thought possible in 2017.

2. How Sanctions on North Korea have Changed

Prior UN sanctions on North Korea were designed to prevent North Korea from acquiring the technology that it needed to advance its nuclear weapons and missile development, but that began to change in 2017. While UN sanctions in 2016 began to move in this direction with caps on the export of coal, sanctions in 2017 prohibited the export of most of North Korea’s minerals, textiles, fish, and basic items such as wood products. They also began to cut into North Korea’s earnings from the export of labor to foreign countries by requiring that all workers return to North Korea in the next year and prohibiting future work contracts. In essence, the sanctions on North Korea have moved from a stage of punishment and deterrence to one of coercion.

3. The Impact of Scandal on the Chaebol Leadership

The impeachment of Park Geun-hye has also had a significant impact on the leadership of South Korea’s chaebol who became embroiled in the scandal, but also left mixed signals. When the scandal first broke there was hopes that the history of the South Korean legal system going light on the heads of chaebol would have changed. Lee Jae-yong, the head of Samsung, was found guilty of giving bribes to Choi Soon-sil in the Park scandal and now faces 12 years in prison. However, there are now indications that may not be the case. Many of the key figures of the family behind Lotte were also convicted in the scandal, but given suspended prison sentences. The Lotte case indicates that the change many hoped for may not be the case and next year we will learn whether Lee Jae-yong’s sentence is also reduced and suspended or if he is faces jailtime.

4. China’s Retaliation Over THAAD

China never formally sanctioned South Korea over the deployment of THAAD, but it took steps related to Hallyu, tourism, Lotte, and other areas in an effort to pressure the South Korean government to reverse its decision over THAAD. While there seemed to be an agreement to return to normal, China has only partially reversed its economic pressure over THAAD and indicated that it will only completely do so once the missile defense system has been reversed. However, through October, the economic costs to South Korea from the deployment of THAAD are likely over $9 billion, while North Korea has only seen its exports to China decline by $410 million.

5. The Assassination of Kim Jong-nam

While not taking place directly on the Korean Peninsula, the assassination of Kim Jong-un’s older half brother Kim Jong-nam in Malaysia was one of the year’s most surprising events. Not only did North Korea take out a potential rival to Kim Jong-un on foreign soil, but it did so using VX nerve gas raising concerns about North Korea’s potential use of chemical and biological agents in addition to its nuclear weapons and missile programs.

Troy Stangarone is the Senior Director for Congressional Affairs and Trade at the Korea Economic Institute of America. The views expressed here are the author’s alone.

Photo from the Republic of Korea’s photostream on flickr Creative Commons.

By Patrick Niceforo

According to the International Institute for Democracy and Electoral Assistance, South Korea’s 19th presidential election last May had a voter turnout of 77.9 percent, the highest it has been since 1997. This election was unique given that it took place following the impeachment of President Park Geun-hye. Accused of corruption, Park Geun-hye is the first South Korean president to be removed from office via impeachment and South Koreans’ frustration with their leadership was likely a major contributing factor to the increased voter turnout.

However, even prior to this presidential election, South Korea had a track record of high voter turnout relative to other countries. In fact, more than 60 percent of South Korea’s age-eligible citizens have voted in each of the last five presidential elections. On the other hand, voter turnout in the United States is consistently low across a similar period. It was lowest in 1996 at 49 percent and highest in 2000 at 58 percent. Only about 55 percent of the United States’ voting-age population participated in the 2016 presidential election.

Former Secretary General of South Korea’s National Election Commission, Joa Soon Im, cited youth outreach programs such as mock election days, celebrity endorsements, and ads in the media as strategies that have successfully increased voter participation. Another factor that could explain South Korea’s relatively high voter turnout is its voter registration process, or lack thereof. South Korean citizens, except those living abroad, who are 19 or older are eligible to vote without going through a formal registration process. In addition, election day is a holiday in Korea, meaning that most voters can go to the polls without worrying about taking the day off.

In contrast, the process for voter registration is complex in the United States, given that the rules vary by state. Same-day registration is only available in 10 states, and many other states lack an online registration mechanism. (A more comprehensive list of voter registration rules can be found here.) Others have cited reasons related to gerrymandering and apathy as negatively affecting voter turnout. Political apathy can come from several sources such as frustration with the status quo, complexity of issues, and the perceived irrelevance of some issues to individual voters.

Of course, there are other factors that may help explain low voter turnout. Particularly in the United States, demographic differences are prominent. Age and level of education seem to be reliable predictors of voting behavior, given that young people and those with limited education consistently have the smallest shares of the electorate. Given that South Koreans between the ages of 19 and 29 were also the smallest portion of the electorate, at first glance it may seem like South Korea similarly suffers from low voter turnout among its youth.

However, this may not necessarily be the case given South Korea’s top-heavy population. In other words, one reason that South Korean youth are the least represented may be because they are a relatively small portion of South Korea’s population. In the past two presidential elections, young South Koreans have outperformed young Americans at the voting booth. In the 2012 presidential election, over 65 percent of South Koreans between the ages of 19-29 voted, while in 2017 over 70 percent voted. Comparatively, less than 50 percent of Americans between the ages of 18-29 voted in presidential elections since 1984. Reasons such as unemployment, corruption, and outdated norms may have contributed to a greater share of South Korean youth participating in the 19th presidential election.

We cannot just measure voter turnout based on presidential elections, however. Similar to the United States, South Korea’s voter turnout is generally poorer when it comes to electing members to its national legislature. While there is room for improvement, South Korea’s consistently high voter turnout can provide lessons for the United States. Standardizing or eliminating voter registration as well as creating a holiday to allow people the flexibility to vote without hurting their paycheck could significantly boost turnout among American voters.

Patrick Niceforo is a graduate student at the Middlebury Institute of International Studies and an intern at KEI. The views expressed here are the authors’ alone.

Photo from Freshly Diced photostream on flickr Creative Commons.

By Gwanghyun Pyun

Moon Vows to Eradicate “Deep Rooted Evils” of Previous Administrations

An unexpected early presidential election was held on May 9 in South Korea. This election was the result of the impeachment of President Park Geun-hye. The election was won by Moon Jae-In, who strongly argued for eradicating ‘deep rooted evils”’ in Korean society, referring to the turmoil from the former President Park. Moon largely won the support of those who protested against the Park administration, and during his campaign he praised the “candle sentiment” of the people who took to the streets with candles to protest. But while he was supported by those who protested against the administration, how will his policies tackle the issues they stood up for?

In Moon and the Minjoo Party’s official pledge book, his first pledge out of twelve is for there to be a ‘Republic of Korea without corruption,’ including the ‘eradication of deep rooted evils’ as its primary agenda. It specifically promises that the next administration would eradicate the deep rooted evils that resulted from the nine years of the former two conservative administrations. This means that his strategy during the election focused on criticizing the previous two  presidents to gain the support of those who took part in the candlelight protests. According to a poll by Gallup Korea, the reasons people voted for Moon were the “eradication of deep rooted evils” (20 percent), “regime change” (17 percent) and Moon’s “good personality” (14 percent).

A Republic of Korea where people are sovereign by finishing the candlelight revolution

Moon and the Minjoo Party decided to begin his list of  four visions for Korea with a vision of “finishing the candlelight revolution, a Republic of Korea where people are sovereign.” It suggests that during the nine years of the two former administrations, Korean society has belonged to the 1 percent of people who have vested interests in the system such as bureaucrats, the chaebol and the rich. Moon insisted during the campaign that finishing the candle revolution would bring a society where all the people are sovereign.

As the first pledge, Moon made promises to take Korean society back from the 1 percent. To do this, his administration will set up a special committee for clearing out deep rooted corruption and confiscating any wealth accumulated by illicit means. While he spoke out against the meddling in state affairs by Choi Soon-sil, a friend of the former president Park closely tied with the scandal that led to hear impeachment, Moon also promised to reform corruption among high-ranking bureaucrats, to remove the blacklist of cultural figures who supported left-wing causes, and to negate the state authored history textbooks made under the Park’s administration.

At the same time, Moon pointed out what he thinks is the fundamental reason why a small number of people have too much power –  the Korean constitution made in 1987 is outdated. Because this constitution has given prior leaders imperial presidential power, he said, Korea needs constitutional revisions to ensure balance between the presidency and the National Assembly.

The 58.6 percent who did not vote for the President Moon

Since he has focused on giving power back to the people, Moon needs to be aware of the views of the 58.6 percent of people who did not vote for him. Considering the fact that Moon’s first vision and pledges are about fixing faults from the last nine years, it seems that his victory  is more about the perceived wrongs committed by the prior two administrations than his policies on security and the economy.

During the election, Moon had two main rivals – the conservative Hong Joon-pyo and the centrist Ahn Cheol-soo, who won 23.3 percent and 21.8 percent of the vote respectively.  He also faced two minor opponents in the center-right Yoo Seung-min and the left Shim Sang-jung, who won 6.8 percent and 6.4 percent respectively.

Excluding the topic of cleaning up corruption, Korean publics opinion on other policies are polarized. Especially in terms of security policy, the three other candidates who collectively won 52.9 percent  offered a different vision for dealing with North Korea than Moon’s pledge  to inherit the ‘Sunshine policy’ that pushed for a close relationship between South and North Korea during the liberal administrations of 1998 to 2008.

The two conservative candidates, Hong and Yoo, insisted that Seoul needs to maintain a hardline stance against the North, including deploying tactical nuclear weapons in South Korea. The main candidate, Ahn, said that without North’s denuclearization first, there cannot be any cooperation with North Korea. Furthermore, these three candidates support the deployment of THAAD, while Moon argued that the THAAD deployment decision should be left to the new administration.

When it comes to economic policy, Moon insisted that the government should lead the creation of job opportunities, and has set a target for creating 810,000 new jobs in the public sector. In contrast, his three main rivals argued that private sector should lead job creation and criticized Moon for having no proper plan to budget for the 810,000 jobs he wants to create.

But while Moon Jae-in may face these splits on economic and security policy, particularly among those who did not vote for him, he has acknowledged the need to bridge divides. In his inaugural address, Moon said “I will become a president of all people. Each person who did not support me will still be my people and I will serve them as such,” highlighting the nation’s integration. It will be an important task for him to address the faults of past, but he must also work to overcome the current divisions in society and bring the nation together.

Gwanghyun Pyun is currently an Intern at the Korea Economic Institute of America as part of the Asan Academy Fellowship Program. He is also a student of Sogang University in South Korea. The views expressed here are the author’s alone.

Photo from Republic of Korea’s photostream on flickr Creative Commons.

This is the seventh in a series of blogs looking at South Korea’s foreign relations for the new Korean administration. The series also includes blogs on relations with North Korea, China, Japan, Russia, the European Union, ASEAN, Africa, the Middle East, and Latin America. 

By Kyle Ferrier

The United States is a crucial security and economic partner for South Korea. Not only is the U.S. treaty obligated to defend South Korea, but 28,500 American troops are stationed below the DMZ. Should an armed conflict arise on the peninsula Washington would assume operational control (OPCON) of South Korean forces. Since its implementation in March 2012, the KORUS FTA has helped to secure the U.S. as South Korea’s second largest trading partner, making it the cornerstone of the bilateral economic relationship. While the strength of these ties is built on a foundation of shared values transcending leadership transitions over the years, U.S. President Donald Trump has openly disputed fundamental aspects of the relationship. For the newly elected South Korean President Moon Jae-in, just as central to resolving the issues raised by Trump will be understanding his approach to foreign affairs.

Trump won the U.S. presidential election last November on a platform of radical change. In contrast to the mood of Obama’s campaign in 2008 which employed slogans such as “Hope” and “Yes We Can,” Trump’s “Make America Great Again” complemented his bleak portrayal of a broken American system abused by elites and foreign countries alike. Trump often put South Korea in his crosshairs, claiming they did not pay enough for U.S. troops stationed there—going so far as to suggest withdrawing military personnel in exchange for allowing Seoul to have nuclear weapons as a cost saving measure—and criticizing the KORUS FTA for destroying U.S. jobs.

Once elected, Trump was quick to reverse course on the alliance, assuring President Park of U.S. commitment just one day later. Since then South Korea has hosted a steady stream of senior U.S. officials, including Defense Secretary Jim Matthis, Secretary of State Rex Tillerson, Vice President Mike Pence, and most recently CIA Director Mike Pompeo. Although these visits are an extension of initial efforts to reassure Seoul, they are contrasted by Trump’s “disruptive” approach to foreign policy, which draws on his campaign rhetoric, prioritizes his interpretation of American interests, and is underwritten by unpredictability. The disruptive approach is seemingly being applied to adversary and ally alike, which directly impacts South Korea through U.S. policy on North Korea as well as issues of alliance management and bilateral trade.

The Trump administration has repeatedly stated Obama’s second term policy of “strategic patience” towards North Korea is dead, yet it may just be going by a different name. At the onset of his presidency, Trump was relatively quiet on North Korea, with some hoping this might be interpreted as a willingness to talk with Kim Jong-un. However, since mid-March the administration has taken a more forceful stance. Secretary Matthis first announced the end of “strategic patience” on his trip to Seoul. Soon after, multiple senior officials and even Trump himself claimed military options were back on the table, particularly a pre-emptive strike against North Korea. Then, after a two-month policy review, the administration released its agenda of “maximum pressure and engagement,” which some have noted is remarkably similar to “strategic patience.” Both are centered on pressuring Beijing to influence Pyongyang and waiting for credible indications from the North that they are willing to reduce their illicit weapons programs. Despite posturing otherwise, security realities in Northeast Asia look to be constraining Trump to largely continuing Obama’s approach, at least for the time being, which is more than can be said for alliance management and trade relations.

Although Trump seemed to be shying away from campaign calls for Seoul to pay more for U.S. military presence on the peninsula, recent comments raise new questions, particularly for an upcoming milestone in the alliance. Trump’s call for South Korea to pay $1 billion for the THAAD missile defense system in an April 28 interview was refuted by National Security Advisor H.R. McMaster only a few days later. However, it was not enough to erase the negative impact on the public discourse in South Korea, unnecessarily complicating Moon’s promised domestic review of THAAD’s deployment. The president’s comments also raise questions over how he may attempt to shape the renewal of the Special Measures Agreement (SMA) that is set to expire at the end of this year, which governs the burden sharing arrangement. It is certainly conceivable that Trump may influence SMA negotiations by similarly calling for Seoul to contribute more to the alliance, including the potential to leverage OPCON.

The last major challenge for the Moon administration will be addressing Trump’s criticism of the KORUS FTA. Trump has repeatedly attacked the trade deal, citing the U.S. bilateral trade deficit with South Korea, though it is still unclear if he will pursue the actions he has espoused. KORUS was one of only two trade agreements singled out for not meeting expectations in The President’s Trade Policy Agenda released by USTR, the other being NAFTA. Trump recently suggested that he might terminate the agreement if South Korea was not open to renegotiations, similar to the approach he has taken with NAFTA.

Whereas the relevant senior U.S. officials have attempted to counter Trump’s disruptive approach to North Korea and the alliance, competing coalitions within the administration on trade further obscures how U.S. policy might be carried out. On the one hand, there are those who favor policies more traditionally associated with protectionism: Secretary of Commerce Wilbur Ross, Director of the new Office of Trade and Manufacturing Policy Peter Navarro, and USTR nominee Robert Lighthizer. And on the other are those who support greater global engagement: Director of the National Trade Council Gary Cohn and Senior Advisor to the President Jared Kushner. Although it is not yet clear how the U.S. will seek to pursue new concerns over KORUS—despite generally favorable reports by USTR and the US International Trade Commission released in the past year—the first major hurdle will come at the end of June when Commerce and USTR are expected to release their findings from a major review of all bilateral trading relationships.

How soon the Moon administration attempts to address these challenges with the United States will significantly dictate their potential impact on U.S.-South Korea relations. Whether it is growing pains or a more structural issue, the Trump administration’s implementation of foreign policy so far has negatively influenced South Korean public opinion. While the newly adopted policy of “maximum pressure and engagement” is remarkably similar to “strategic patience,” the process of getting there raised serious questions about U.S. credibility through concerns such as the location of the USS Carl Vinson and the perception that Washington would pre-emptively strike North Korea without consent from Seoul. Efforts by senior U.S. officials to smooth over some of Trump’s more controversial remarks have helped to stabilize relations, but the U.S. loses face each time. Even so, there are still contentious remarks that have not been sufficiently addressed.

Recent polling shows Trump’s popularity in Korea has sharply declined—falling below China’s Xi Jinping who is punishing South Koreans over THAAD. Koreans still view the U.S. favorably, yet it is unclear how long this duality can be sustained. A poor public opinion of the United States would severely constrain Moon’s ability to successfully coordinate the issues Trump has raised, which should make early and direct dialogue with his counterpart in Washington a high priority.

Kyle Ferrier is the Director of Academic Affairs and Research at the Korea Economic Institute of America. The views expressed here are the author’s alone.