Policy Briefing 2016-07 THAAD Deployment in Korea: How to Interpret It? Executive Summary (Translated from Korean) Sang Hyun Lee Senior Research Fellow I. Discussion A. On China Considering China s position and perspective, the Chinese government s vehement opposition to the deployment of the Terminal High Altitude Area Defense (THAAD) system on the Korean peninsula is inevitable. - China s geographical location on the map shows sufficient basis for its active opposition to THAAD, since it can debilitate the Chinese region of Manchuria, which is the closest in distance to the U.S. territory. Although the Chinese missiles systems are also positioned in various inland regions in China, due to their longer range, the probability of exposure and interception is high and they are also much more limited by the payload. China has been maintaining surprisingly consistent position in its opposition to THAAD deployment in Korea. - Since China perceives THAAD as a part of missile defense system, China has vigorously opposed THAAD deployment and has been maintaining that position since. During the past strategic talks between South Korea and China, the Chinese representatives expressed their strong objection by alluding the Maginot Line in Korea-China relations and possible threats by the Chinese government. - As the Chinese people often follow non-rational and unconventional line of logic, means of persuasion by rational and logical reasoning are limited and unlikely to bring about significant success. This is in part a failure of framing of the issue on the part of the Korean 1
foreign policy as it has closely tied the national security issues with the foreign policy and diplomatic issues between South Korea and China. China s concerns over its military strategy, foreign policy, and national security. - The Chinese concerns largely stem from its perceived inevitability of having to re-strategize its military posture and rebalance or redistribute various militaryrelated resources in the case of THAAD deployment in Korea and the resultant surveillance and exposure of its missiles capability by the U.S. China has been most concerned about a forward-deployed U.S. missile defense system as the U.S. has been pursuing a pivot to Asia strategy. - Within the domain of diplomacy and national security, as the conflictual relations between the U.S. and China appears to have become severer, China sees the issue of THAAD as a critical card that it cannot and must not lose in dealing with the U.S. China feels significant pressure regarding military arms race with the U.S. as it has experienced an indirect trauma from the past arms race competition between the U.S. and the Soviet Union. Deteriorating South Korea-China relations and China s unwillingness to cooperate on the issue of Korean unification. - The THAAD deployment will inevitably tarnish the South Korea-China relations, and as a result, it becomes more difficult for South Korea to expect coordination or cooperation from China in terms of its unification policy and strategy. - Accordingly, the areas of negotiation should address the Chinese concerns in triadic relations between South Korea, the U.S. and China. B. On Russia The cases of dissolution of the Anti-Ballistic Missile Treaty and deployment of missile defense system in Europe need to be considered. - When President George W. Bush withdrew from the ABM Treaty in 2002 and pushed to deploy missile defense system in Eastern Europe, the Putin government protested against the U.S. move. The Obama administration then attempted to ameliorate Russia s concerns by taking a phased approach toward the complete deployment of missile defense system in Eastern Europe and communicating to Russia that its main target is Iran, not Russia. - Contrary to the case of Europe, however, amid intense security threats posed by North Korea, South Korea cannot just stand behind or sit out of the negotiation process with China regarding THAAD deployment, letting the U.S. negotiate bilaterally with China. 2
II. Issues In the European case, not only the level of threats was not imminent, but the negotiation took place within the multilateral alliance framework of NATO. Case studies and more research on Russia s retaliatory sanctions against the Czech Republic and Poland are needed. - Whether Russia did actually take any type of retaliatory measures or economic sanctions against the Czech Republic or Poland needs to be explored further. China has articulated its perception that THAAD deployment in Korea will only strengthen the security alliance between Korea, the U.S., and Japan, in which case the Chinese government has no option but to treat South Korea as an enemy, insinuating that it could retaliate or impose sanctions against Korea. A. Costs and Benefits of THAAD Deployment The astronomical cost of THAAD deployment here in Korea and the worsening diplomatic relations with China can be all mitigated if the missile defense capability and effectiveness of THAAD is sufficiently proven. Nonetheless, as the missile interception capability of THAAD appears to be limited, the cost effectiveness of its deployment is doubtful. - If North Korea fires 1/10 of its battle-ready missiles that is, 100 out of 1,000 forward positioned missiles THAAD becomes useless. Deterrence by Denial Effects Possible - As a missile defense system, THAAD is a defensive weapon. Thus, logically, it makes sense to deploy THAAD in Korea considering its effects of deterrence by denial. Regarding the capability and effectiveness of THAAD, South Korea s major concern may be possible failure of interception and penetration of one among many North Korean missiles (even 1% of failure rate). On the flip side of the coin, North Korea may be concerned about a 100% interception scenario. B. Concerns Over China s Retaliation and Economic Sanctions Scenario 1: It is expected that China will use a certain degree of retaliatory measures through economic channels. - China has been alluding to possible threats of retaliation in the case of THAAD deployment in Korea. As South Korea s economy depends heavily on China, the Korean government cannot ignore the possibility of significant economic blows arising from trade conflicts with China worse than the previous so-called, Garlic Trade Dispute. 3
Scenario 2: China cannot use economic sanctions. - The current trade patterns between South Korea and China show that Korea s major export items to China are mostly intermediate or semi-finished goods, and that the volume of consumer goods export remains at a negligible level. - Moreover, as the Chinese economy continues down the path of relative stagnation compared to the early 2000s, the Chinese government faces more barriers in severing economic relations with Korea. Korea s three-step strategy in response to China s possible retaliation and sanctions 1) South Korea needs to articulate and communicate clearly to China the harmful effects of halting semi-finished goods imports from Korea. 2) If China manipulates in terms of its exports of consumer products, South Korea should seek international adjudicatory measure by bringing a suit to the World Trade Organization. 3) South Korea should bring the issue to the U.S. and persuade the U.S. Treasury Department to designate China as a major currency manipulator in order to punish China through global financial and monetary means. III. Areas of Improvement for Further Discussion A. Need for understanding the macro-level and comprehensive character of the issue There exist numerous factors behind the Korean government s decision of making it official the discussion of possible THAAD deployment with the U.S. These factors may include (1) the necessity to strongly respond with military means to North Korea s recent nuclear weapons and missiles tests, (2) the need to put pressure on China, and (3) the need to maintain close relations with the U.S. - The fact that China perceives the issue of THAAD deployment in Korea not only through the prism of security dimension but also a behavioral problem suggests that the THAAD issue is more than a military concern for China. Accordingly, South Korea should also approach the discussion and decision on THAAD from a multidimensional perspective, and should not treat it merely as an issue concerning military strategy. - Also, the uncompromising behavior of China does not seem appropriate considering that China did not put up a fight against THAAD and X-band radar deployment in Japan. B. Need for considering THAAD deployment within the comprehensive framework of national strategy The Pros and Cons of the THAAD Debate - The opinions in favor of THAAD deployment in Korea are based on the notion 4
that Korea should treat it as a critical national interest, not relying on the vague notion of strategic importance. - Those opposed to deployment argue that it will instigate a new era of the Cold War, and that Korea s security and economic interests are significantly at stake. Although various opinions may arise on the question of the utility of THAAD, there exists a consensus on the notion that South Korea should make decisions considering its national strategy. - The core characteristic of the current international order consists of a decline of the U.S. and a rising China. The THAAD deployment should be considered within this broader global environment. - China s persistent objection to THAAD often exhibits unfounded logic. Although the Chinese officials raise concerns regarding THAAD deployment, it is often dubious whether their contentions are based on sufficient factual knowledge. - For South Korea, it is essential to better understand the current and future trajectory of the international order while engaging in discussion on THAAD. The idea of damaging Korea-China relations and emergence of a severe bipolarity in East Asia, or any other type of determinism should be avoided. C. South Korea as a middle power must approach others with confidence. Since the government of South Korea has already announced that it is officially engaging in discussion on THAAD with the U.S., further discussion and debate should be focused on the political background and motivation of the government s decision, not on the minor details. In terms of South Korea s foreign policy and diplomatic approach, it is necessary that Korea no longer subscribe to the mindset of a small or minor country but to use its middle power status. - On the THAAD conflict between Korea and China, China may be holding Korea a hostage as it engages in a tug-of-war. - In this regard, there still exist some enduring effects from the millennia of the Chinese tribute system in Korea. This China trauma of a sort needs to be overcome. 5