With Japan and South Korea locked in a bitter dispute over export controls, the collateral damage may extend beyond the economic space: It could also impact a bilateral intelligence-sharing pact, the General Security of Military Information Agreement (GSOMIA).

That pact – the only official tie linking the militaries of the two Northeast Asian democracies, which have separate bilateral alliances with the United States – is set to expire this Saturday, August 24.

From the perspective of US-led security efforts in Northeast Asia, it is critical that, regardless of the emotive national sentiments currently roiling South Korea, the agreement be renewed.

History, trade, security

The risk to GSOMIA originates not in the security field, but in a bilateral export-control dispute that has dragged Seoul-Tokyo ties to a new low.

This month, Tokyo removed South Korea from its so-called “white list” of preferential export destinations – ostensibly for having inadequate export controls on a range of materials. That move followed a July action to emplace export restrictions on three key chemicals that are essential to South Korea’s high-tech sector. Seoul has since retaliated by removing Japan from its own “white list.”

That row, too, had jumped across firewalls. It originated not in the economic but in the diplomatic/legal space.

Bilateral trust remarkably deteriorated after Seoul’s Moon Jae-in administration, citing negative public sentiment, overturned a bilateral 2015 “comfort women” agreement. Designed to be a final and irreversible resolution to that prickly issue, the agreement had been signed between the former Park Geun-hye administration in Seoul and the Shinzo Abe administration in Tokyo. In addition to an apology from Abe, Japan offered compensation of $8 million to Korean comfort women.

Then, last year, South Korea’s Supreme Court ruled that Japanese companies Nippon Steel Corporation and Mitsubishi Heavy Industries had to compensate victims of wartime forced labor. Tokyo’s position was that the ruling violated the 1965 Treaty on Basic Relations between Japan and the Republic of Korea. As part of the 1965 agreement, Japan provided aid and loans to resolve compensation issues and normalize relations with South Korea.

After last year’s court ruling, Tokyo demanded third-party arbitration, per the 1965 treaty. Seoul rejected that, saying the judiciary’s decision is complete and final. A senior member of Japan’s foreign ministry commented that such refusal is a violation of an international treaty and could prompt a response from Tokyo.

More recently, the court has authorized the authorities to seize assets of the defendants in Korea.

Despite this preamble, Tokyo’s recent imposition of export controls caught Seoul by surprise. Tokyo accused Seoul of having only included missile- and weapons-of-mass-destruction-related dual usages in its export control procedures, while ignoring conventional-weapons-related dual usages.

Seoul argued back that both parties had agreed on multi-dimensional cooperation, and noted its compliance with relevant international regimes, such as the Nuclear Suppliers Group, the Australia Group, the Missile Technology Control Regime and the Wassenaar Arrangement.

In the wake of these developments, various figures in South Korea have advocated a withdrawal from GSOMIA, which is set to either be renewed or go defunct on Saturday.

Why it matters

Signed on November 23, 2016, GSOMIA is seen as vital for Japan and South Korea to jointly cope with North Korea’s weapons of mass destruction programs. Amid a series of nuclear and missile tests by North Korea, the Obama administration urged South Korea to sign the GSOMIA. The agreement was devised as part of Obama’s “Pivot to Asia” and represented US strategic interests in East Asia, as it sought to contain North Korea and China.

The idea of the two countries sharing military intelligence had originally been proposed by South Korea in the late 1980s, when Seoul’s primary concern was its lack of satellite intelligence. South Korea’s military has acquired substantial capability in signal, imagery and voice intelligence over the past few years, but its area of operation is restricted to the south of the military demarcation line (the actual borderline that runs through the 4-km wide Demilitarized Zone). Given recent advances in Pyongyang’s missiles and nuke weapons, Seoul, which has no military satellites, can only garner so much intelligence.

Now, Seoul’s threat to stop sharing military information with Japan raises a potential rift in the Japan-South Korea-US relationship.

Seoul has every reason to cooperate with Tokyo because Japan’s Self-Defense Force (SDF) already operates three to four intelligence satellites that monitor the northern half of the Korean Peninsula. Moreover, Japan is planning to increase the number of satellites by up to 12 in the coming years.

In addition, the Japanese SDF possess world-class anti-submarine capabilities. These are critical now that North Korea is developing a submarine-launched ballistic missile (SLBM) program.

Lastly, South Korea’s grand strategy is predicated upon its alliance with the United States – which includes Japan’s security in its overall East Asia policy. As a result, South Korean policy advisers for national security have so far kept GSOMIA intact.

And it is not just about weaponry. Seoul and Tokyo have also shared information on North Korea’s sanctions-busting activities with regard to ship-to-ship transfers of oil, coal and banned luxury goods.

All this makes GSOMIA a solid basis for security cooperation in interdicting North Korea’s military and illicit trade operations in the region. Despite the ongoing export controls dispute, as recently as August 6 South Korea and Japan shared military information on North Korea’s short-range ballistic missile test (SRBM).

Spite face

Seoul’s threat to cease sharing military information with Japan raises a potential rift in the Japan-South Korea-US relationship.

It appears that Seoul’s presidential office is using possible withdrawal from GSOMIA as a bargaining tool against Japan. Kim Seong-jo, Moon’s chief of staff for policy, in a radio broadcast spoke of games of chance when he mentioned the policy options at the disposal of Korea and Japan in the dispute – an apparent reference to game theory and its related risks.

However, Korea’s options in intelligence gathering are limited, and Seoul’s defense ministry may not be on the same page as the presidential office. In this sense, for Seoul to abandon the military information sharing agreement would be a case of “cutting off the nose to spite the face.”

It would also have wider ramifications. Abandoning GSOMIA would add security risk to ongoing bilateral economic discordance, and cleave a potential rift in the Japan-South Korea-US relationship.

Shaky 3-way ties

Although there is no official trilateral alliance linking the three parties, from a security perspective, the Japan-South Korea-US partnership is the cornerstone of US-led multilateral security cooperation in Northeast Asia. Using GSOMIA as leverage in a trade dispute will not only damage Korea-Japan relations, but also risk a deterioration in trilateral defense efforts.

Colonial-era history is undeniable and is an indivisible part of South Korea’s national integrity. However, related highly emotive issues are now impacting national policy far beyond the history classroom. Amid North Korea’s violations of UN sanctions and ongoing negotiations on its nuclear arms, national sentiment related to this harsh past should not take the lead in policy direction.

To preserve regional and state security, Seoul must decouple security and economy when it comes to policy toward Japan. Furthermore, it must communicate with Tokyo at the working and senior official levels to avoid future disputes. Lastly, South Korea must be informed by both morality and strategy as it conforms to international norms.

To the joy of Beijing and Pyongyang, Seoul and Tokyo are playing a lose-lose game. The economic dispute may expand and weaken not only their relationship but also impact the US-China strategic competition, since security cooperation among the three democracies requires trilateral efforts.

Seoul, Tokyo and Washington need to renew cooperation at all levels and in all areas to achieve their common goal of denuclearizing North Korea.

Jong-hwa Ahn is a Korea Foundation Non-Resident Fellow at the Pacific Forum. He served in the Korean Demilitarized Zone and with the United Nations Mission in South Sudan. He received his master’s in international peace and security from Korea University. Abdiel Lawrence is a military intelligence analyst at USAG Humphreys for the 2nd Infantry Division in Pyeongtaek, Korea. He received his master’s in international peace and security from Korea University.