Japan’s Economic Assistance to the Republic of Korea, 1977–1981: An Analysis within the Framework of the US-Japan Security Burden-sharing Scheme

Abstract In January 1983, Japan finalized an economic assistance agreement with the Republic of Korea (ROK), pledging to extend $4 billion in economic aid to the country concerned. Prior to the finalization of the agreement, both countries held rounds of negotiation on the aid package conditions, and this led to them entering into a period of growing political friction. Despite this, a political consensus was eventually hammered out in 1983 over their disagreement, and this had a far-reaching effect in stabilizing the political relationship between the countries. Substantial academic research has been carried out on this topic, but the reasons behind Japan’s commitment to rounds of political negotiation with the ROK have yet to be positively analyzed and convincingly substantiated. In light of this fact, the main aim of this article is to analyze the motivational forces that brought Japan to the negotiating table with the ROK. More specifically, it focuses on analyzing the effects of the formalization process of the US-Japan agreement that served to induce Japan to address the ROK-aid negotiation issue conscientiously. The analysis reveals clearly that the major factor that spurred Japan to revisit its ROK’s aid package conditions was Japan’s concern over its security burden-sharing scheme with the United States. It is likely that in July 1981, in his summit meeting with President Ronald Reagan, Prime Minister Suzuki Zenkō pledged to initiate official talks with the ROK in response to the ROK’s request for an extended economic aid package. In tracing the course of US-Japan political negotiations from the period between 1977 and the formalization of the ROK’s aid agreement, this analysis reveals that the United States and Japan were of one mind concerning the need for the agreement as one of the critical means of resolving a myriad of their security concerns. It is also shown, however, that the countries arrived at their shared view from different perspectives, which were politically beneficial to their own interests. On the one hand, the United States expected Japan to assume greater responsibilities in security burden sharing, in line with its global economic status. On the other hand, partly because of the political limitations of shouldering a regional security role, Japan’s primary concern was to minimize its share of security burdens as far as possible and in such a way as not to disrupt its harmonious relationship with the United States. On top of this, insofar as the United States was concerned, it seemed to be unwise to request that Japan overshare the bilateral security defense expenditure, which might be detrimental to its political stability at home and at the same time might affect the credibility of their security alliance. In sum, the article shows that the consensus on aid for the ROK was beneficial to both Japan and the United States in terms of resolving their differences in the political operation of their security alliance scheme, including burden-sharing responsibilities. This was the real reason for Japan’s commitment to revisit its economic aid package with the ROK.