South Korea political crisis could derail U.S. priorities in the region

The pro-U.S. foreign policy of South Korean President Park Geun Hye is at risk now that she appears to be on her way out over a growing corruption scandal.

Park, whose approval ratings are an abysmal 4%, faces possible impeachment by South Korea's legislature — if she doesn't resign first — and massive street protests over the power she is accused of granting to a controversial personal friend, Choi Soon-sil. Prosecutors allege that Choi, the daughter of a deceased cult leader who mentored Park, used her relationship with Park to extort $68 million in corporate donations to foundations Choi controlled, and invested the money.

Here is a look at several policies Park spearheaded with U.S. approval that could be jettisoned along with her:

NORTH KOREA

Park’s initial policy toward North Korea was to engage through trust-building measures, but her approach made an abrupt turnaround after the North’s nuclear test in January.

“It affected everything with North Korea, China and Japan,” said John Delury, who teaches international studies at Yonsei University in Seoul. “Now, with the equally sudden demise of the president, it puts into question the new hard-line policy.”

Park in February ordered South Korean companies to pull out of the Kaesong Industrial Complex, to protest a North Korean missile launch. The plant, which uses North Korean labor and South Korean management and expertise, was a major source of funds for the North, and one of the few remaining avenues for cultural exchange between the two countries.

If she leaves office, “the liberal opposition would reopen it,” Delury said.

Park's new approach was in line with U.S. efforts to isolate North Korea and deprive it of foreign sources of income. President Obama said in September that new and existing sanctions show North Korea there are "consequences to its unlawful and dangerous actions."

Kathleen Stephens, who served as U.S. ambassador to South Korea from 2008 to 2011, said opposition parties are likely to call for more active efforts to re-engage with Pyongyang on a raft of issues, and to argue that Park's hard-line policy has not worked. It would be "a major project" to reopen relations with the North, but options would include a resumption of food and humanitarian aid, plus family reunions that took place in past years.

Such voices have already spoken out. Chung-in Moon, a foreign affairs adviser to South Korea's opposition, in September called for suspending joint military exercises with the United States and for encouraging dialogue with the North. Such a move by South Korea would be seen as a step toward rejecting the U.S. security umbrella in the region that has existed since the 1950s, said Yun Sun, an analyst at the Stimson Center, a Washington think tank.

MISSILE DEFENSE

After North Korea conducted its fifth nuclear test, in September, Park approved the deployment of a U.S. missile defense system called the Terminal High Altitude Area Defense (THAAD), to protect South Korean cities and 28,500 U.S. troops stationed in her country.

The system allows the U.S. to assert its protective role and contain nuclear threats from rogue nations like North Korea.

The proposed deployment angered China — South Korea’s most important trading partner — which sees the system as a threat to its aircraft and missile capabilities. The deployment is also controversial among South Koreans who question the system’s effectiveness, Delury said. “There is evidence already that North Koreans are figuring out a way around it,” he said.

South Korea's liberal opposition party, which seeks better relations with China in hopes it could temper North Korea, is among the fiercest critics of THAAD. While the liberals may not cancel the $850 million system financed by the U.S., they would likely block its expansion. And if President-elect Donald Trump follows through on his campaign promise to make U.S. allies pay more for their defense, the THAAD deployment could be scrapped.

“If the Trump administration decides to use THAAD as an example of his policy to have allies pay their own way, a liberal (South Korean) president could call Trump’s bluff,” Delury said.

JAPAN

Park’s government this year ordered South Korea’s military to exchange security information for the first time with Japan, a bitter enemy in past decades. The arrangement was encouraged by Obama and his predecessors who've long sought to reconcile the U.S. allies so they could cooperate on security and form a unified front against North Korea and China.

Many South Koreans, however, continue to distrust Japan because of its occupation of Korea during the first half of the 20th century, said Jenny Town, assistant director of the U.S.-Korea Institute at the Johns Hopkins School of Advanced International Studies in Washington.

“South Koreans are always very skeptical of too much military cooperation between South Korea and Japan because of the history between the two countries,” she said.

And North Korea and China, the South’s neighbors to the north and west, see the arrangement as “the U.S. trying to create collective security,” she said. With the coming change of government, “it’s too early to tell how this is going down.”

TRADE

How a post-Park South Korea balances policy toward the United States and China is also hard to predict, in part because the U.S. is going through its own transition, Stephens said. South Korea's trade with China has gotten so big that South Koreans now worry about over-dependence.

“That’s why the U.S. alliance has come to be more valued,” Stephens said. But Korea also has “a huge relationship with Beijing,” she added.

As a candidate, Trump called the U.S.-Korea Free-Trade Agreement reached in 2012 a “job-killing trade deal." He also threatened to impose tariffs on Chinese imports, which would hurt the economies of all the countries in the region.

To save the free-trade agreement, South Koreans will seek to “point out increased trade and services that benefit the U.S.,” Stephens said. “They’re watching very closely, wondering what the new Trump administration will do.”

But South Korea is also developing an alternative, since it shares a long history with China, and trade between the two outweighs trade with the U.S. and Japan combined.

Under Park, South Korea joined the China-organized Asia Infrastructure Investment Bank, a counter to a Western development effort. And many among South Korea's opposition hope to develop a more conciliatory atmosphere toward China, Sun said.

That could spell further trouble for other U.S. priorities, because the "Chinese feel confident they have a piece of critical leverage over South Korean politicians," Sun said.