S. Korea cancels Japan intelligence deal amid trade dispute

(AP Photo/Lee Jin-man)

SEOUL, South Korea— South Korea will stop exchanging classified intelligence on North Korea with Japan amid a bitter trade dispute, an official said Thursday, a surprise announcement that is likely to set back U.S. efforts to bolster security cooperation with two of its most important allies in the Asian region.

South Korea’s decision to cancel the intelligence-sharing pact will also further aggravate its ties with Japan, which are already at their lowest point since the two countries established diplomatic ties in 1965. Japanese media said Tokyo will lodge a protest with Seoul and quoted unidentified Tokyo officials as calling the South Korean move “extremely regrettable” and “unbelievable.”

Many experts had predicted that South Korea would be unlikely to spike the 3-year-old intelligence-sharing deal for the sake of its relations with the United States. South Korea has been seeking U.S. help in resolving the trade dispute, and Seoul and Washington have also been working together to restart stalled talks on stripping North Korea of its nuclear weapons.

South Korea’s presidential office said it terminated the intelligence deal because Japan’s recent decision to downgrade South Korea’s trade status caused a “grave” change in security cooperation between the countries.

“Under this situation, the government has determined that maintaining the agreement, which was signed for the purpose of exchanging sensitive military intelligence on security, does not serve our national interests,” Kim You-geun, the deputy director of South Korea’s presidential national security office, said in a nationally televised statement.

He said South Korea will formally notify Japan of its decision before Saturday, the deadline for an extension of the pact for another year.

Japan’s Kyodo News agency quoted an unidentified Japanese government official as saying the South Korean decision was “extremely regrettable.” Public broadcaster NHK said an unidentified Japanese official described the decision as “unbelievable,” while another official said it was unlikely to have much impact on Japanese security.

Since early last month, Japan has imposed stricter controls on exports to South Korea of three chemicals essential for manufacturing semiconductors and display screens — key export items for South Korea — and decided to remove South Korea from a list of countries granted preferential trade status.

South Korea accuses Japan of weaponizing trade to punish it over a separate dispute linked to Japan’s brutal colonial rule of the Korean Peninsula from 1910 to 1945. Japan denies that, saying its steps were taken because of unspecified security concerns.

The Japanese trade curbs triggered an outburst of anti-Japan sentiment in South Korea. Many South Korean citizens rallied in the streets, canceled planned holiday trips to Japan and launched widespread boycotts of Japanese beer, clothes and other products. The South Korean government, for its part, decided to downgrade Japan’s trade status.

Some experts say the tit-for-tat actions could eventually hurt South Korea’s economy more than Tokyo’s. Many big South Korean manufacturers including Samsung rely heavily on materials and components imported from Japan, while Japan doesn’t import many vital materials from South Korea.

The intelligence deal went into effect in 2016, reportedly at the strong urging of the United States, which wants to boost three-day security cooperation to better cope with North Korea’s nuclear threat and a rising China. The United States stations a total of 80,000 troops in the two Asian countries, the core of America’s military presence in the Asia-Pacific region.

Experts said the deal enabled a quicker exchange of information between Seoul and Tokyo, because they had previously exchanged intelligence via the United States. In 2012, the countries nearly forged a similar deal but it was scrapped at the last minute following a vehement backlash in South Korea.

However, it is unclear how effective the deal has been for both countries, especially on intelligence on North Korea, one of the world’s most secretive countries. But there has been a general consensus that South Korea needed information gathered by Japanese satellites and other high-tech systems, while Japan enjoyed signal, voice and human intelligence from South Korea.

Some South Korean government and ruling party officials have questioned how Seoul could share intelligence with a country that questioned Seoul’s handling of sensitive materials imported from Japan. Without providing concrete evidence, some Japanese officials including Prime Minister Shinzo Abe have suggested that some critical Japanese materials with potential military applications exported to South Korea may have reached North Korea. Seoul flatly denies that.

The fate of the deal had divided people in South Korea. Some argued that South Korea should do whatever it could to inflict pain on Japan, and that just floating the idea of ending the intelligence deal could force the United States to persuade Japan to lift its trade curbs. But some stressed that the deal’s cancellation would impair relations with the United States at a time when South Korea faces many security challenges including the stalemated North Korean nuclear talks.

South Korean President Moon Jae-in used the Aug. 15 anniversary of Korea’s liberation from Japan to extend an olive branch by saying Seoul will “gladly join hands” if Tokyo wants to talk. He had earlier declared his country would “never again lose” to Japan.