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The original documents are located in Box 5, folder "Korea (8)" of the NSC East Asian
and Pacific Affairs Staff: Files, 1969-1977 at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald R. Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 5 of NSC East Asian and Pacific Affairs Staff: Files, 1969-1977 at the Gerald R. Ford Presidential Library
MEMORANDUM
tab pok filier
NATIONAL SECURITY COUNCIL
}
LIMITED OFFICIAL USE
INFORMATION
December 2, 1974
MEMORANDUM FOR:
MR. SMYSER
FROM:
JOHN A. FROEBE, JR INK
SUBJECT:
Proposed Thank You Notes to Embassies
Tokyo and Seoul
Dan O'Donohue, after checking with Ambassador Habib, has suggested
a thank you note to Sneider and the Embassy for their hard work in
preparing for the visit. I told him I did not know what you had in mind
but that I would raise it with you. Obviously, if we send one to Seoul,
we should also send one to Tokyo. I agree with Dan that this would
be a nice touch -- despite your problems with Erickson and Shoesmith
on the preadvance.
LIMITED OFFICIAL USE
FORD is LIBRAR GIVENG
6251
200
NATIONAL SECURITY COUNCIL
WASHINGTON, D.C. 20506
fain N.
TOP SECRET/NODIS (XGDS)(3)
January 9, 1975
S
National Security Decision Memorandum 282
M
TO:
The Secretary of Defense
The Deputy Secretary of State
folder
SUBJECT:
Korean Force Modernization Plan
The President has reviewed the response to NSSM 211, together with
the departmental and agency views thereon, and has decided the
following:
-- The United States will complete its obligation to the Republic of
Korea Force Modernization Plan at an early date, in order to
demonstrate the United States commitment to the security of the
Republic of Korea.
-- The shift from grant military assistance to FMS credits should be
accelerated to the rate defined in Option 2 in the NSSM response.
-- No termination date should be set for grant military assistance
to the Republic of Korea. The downward trend in grant military
assistance defined in Option 2 should be continued beyond FY 77,
but should look toward the maintenance of a modest investment
and training program with an annual ceiling of $10 million.
-- The F-4D squadron now on bailment to the Republic of Korea
should be transferred to the Republic of Korea by sale. The
Republic of Korea should be asked to pay the $3.3 million cost
for rehabilitating the two F-5A squadrons being returned to
South Korea under the Enhance Plus Agreement, but this should
not be a condition for the sale of the F-4D squadron if the Republic
of Korea raises serious and persistent objections.
-- The review of the North Korean threat and the Republic of Korea
air defense requirement contemplated by NSDM 227 should be
TOP SECRET/NODIS (XGDS)(3)
.
FORD
DECLASSIFIED
AUTHORITY
nse meeting 1/30/09
GERALD
BY wh N/RA DATE 12/1/10
TOP SECRET/NODIS (XGDS)(3)
2
forwarded with recommendations to the President no later than
March 3, 1975.
A.
Kim
Henry A. Kissinger
cc: The Director of Central Intelligence
Director, Office of Management and Budget
The Chairman, Joint Chiefs of Staff
TOP SECRET/NODIS (XGDS)(3)
Press 2b
6251
MEMORANDUM
NATIONAL SECURITY COUNCIL
ACTION
TOP SECRET
December 20, 1974
MEMORANDUM FOR:
SECRETARY KISSINGER
FROM:
RICHARD T. KENNEDY
ATK
W. R. SMYSER of
ATK/OWN
SUBJECT:
Future U.S. Military Assistance
to South Korea
At Tab II is the EA/IG response to NSSM 211, which requested a review
of the future of our military assistance to South Korea. Specifically,
the NSSM request asked whether the rate of shift from grant MAP to
FMS credits should be accelerated, whether a termination date should
be set for grant MAP, and whether additional high-performance air-
craft should be transferred to the Republic of Korea (ROK).
Policy Background
The EA/IG paper analyzes the import of the following factors for future
U.S. military assistance to the ROK:
-- North Korean Intentions and the Military Balance on the Peninsula.
The paper holds that Pyongyang, like Seoul, perceives no advantage in
initiating major hostilities at present. Pyongyang has not disavowed its
goal of controlling the Korean Peninsula, but would make a major mili-
tary move probably only if South Korean internal stability broke down.
However, a high level of tension between the two Koreas remains after
three years of political talks which both sides now view mainly as a
channel of communication rather than a forum to resolve their differences.
The paper asserts that great power interest in detente has been the
principal factor in reducing the chances of a new major military conflict
on the Peninsula.
The paper says that Pyongyang, like Moscow and Peking, would not
interpret adjustments in the form of U.S. military assistance to South
Korea in the present context as a sign that U.S. support for South Korea
was weakening, as long as the basic elements of the U.S. ROK security
relationship remain intact.
DECLASSIFIED
TOP SECRET
NSC E.O. Memo, 12056 S/30/03. (ericincer(ed) Glate Dept. SEC Guidelines 3.3; DOD , statement Directive 9/18/03
5200.30
By
NARA, Date 12/7/10
TOP SECRET
2
Comment: The paper gives a somewhat overly sanguine view of the
continuing North Korean disposition. We doubt that North Korea per-
ceives no major advantage in initiating major hostilities. We think
that Pyongyang is restrained not by a lack of perceived advantage, but
rather by the PRC and Soviet Union, by the U.S. defense commitment
backed by U.S. forces in South Korea, and by an increasingly credible
South Korean military deterrent.
South Korea's Interest in Continued U.S. Military Assistance.
The EA/IG paper holds that South Korea will accept substantial adjust-
ments in U.S. military assistance -- so long as our defense commit-
ment and troop presence remain essentially intact. More specifically,
the paper asserts that the ROK expects, and is fully prepared, to accept
further reductions in grant MAP as long as the U.S. increases FMS
credits. The paper notes that, at the same time, the ROK is exploring
the possibilities of third-country procurement. Last, the paper con-
cludes that the ROK is economically quite capable of assuming a much
larger defense burden.
Comment: While we do not differ essentially with the EA/IG paper on
these points, we believe the paper underestimates how much South
Korea may try to reduce its dependence on us if we reduce U.S. military
assistance. This has probably been the most important factor in the new
ROK interest in third-country procurement, in establishing an in-country
defense industry, and in developing nuclear weapons by 1980. In
addition, reduced ROK dependence on us, like reduced North Korean
dependence on its suppliers, increases its freedom of action in the
North-South confrontation, although this is partially offset by the con-
straints of detente.
Status of the ROK Force Modernization Plan. The modernization
plan, to which we committed $1.5 billion in 1971 at the time we with-
drew the first of our two divisions from Korea, was to have been finished
in FY 75. By the end of FY 74, however, we were still $500 million
short, due to budgetary limitations.
The ROK places considerable
store by our..rounding out, in some credible fashion, our contribution to
the modernization plan. The President in his recent meeting with
President Park reaffirmed our support for the plan, and said he hoped
its completion could be speeded up.
The EA/IG paper notes that the ROK has indicated its willingness to
accept greatly expanded FMS credits -- $500 million in FY 75-77 --
TOP SECRET
TOP SECRET
3
and its expectation that grant MAP will end with the completion of
the plan. The EA/IG paper fails to mention that the ROK at the same
time has requested $345 million in grant MAP for FY 75-77; the paper
ignores the likelihood that the ROK passively accepts as inevitable the
prospect of greatly reduced grant MAP and its possible early termina-
tion.
Distaste in Congress for Park's handling of his domestic political
situation did not in the end reduce our military assistance to South Korea
by as much as earlier seemed likely. For FY 75, Congress has
authorized a total of $145 million, plus another $20 million if the President
certifies that Park is making substantial progress on human rights.
Congress has left to the President's decision how this total is to be
divided between grant MAP and FMS credits. This figure compares
favorably with the FY 74 appropriation of $100 million grant MAP and
$57 million FMS credit. For FY 76, we are requesting $75 million in
grant MAP and $100 million in FMS credit.
The ROK last spring expanded its requests for U.S. military equipment
by asking for the following: (1) the transfer of the F-4D squadron now
on a bailment to the ROK under the Enhance Plus Agreement, plus one
additional F-4E squadron (these would be added to the one F-4D squad-
ron already owned outright by the ROK to give it a wing of F-4s); (2) a
minimum of three F-5E squadrons either through purchase or co-
production (in addition to the four F-5E squadrons already planned); and
(3) a follow-on light-weight fighter such as the YF-16 or YF-17.
Policy Options
A. Rate of Shift from Grant MAP to FMS Credit. The EA/IG paper
casts its four options in terms of proposed levels only through FY 77,
the year by which the paper recommends that we complete our obliga-
tion to the modernization plan. The totals of grant MAP and FMS
credits under all four options would fill out the remaining $500 million
in our obligation.
FY 76
FY 77
Grant
FMS
Grant
FMS
Option 1
147
65
96
90
Option 2
75
100
50
150
Option 3
50
125
25
175
Option 4
10
175
10
250
TOP SECRET
TOP SECRET
4
Options 1 and 4 border on the unfeasible. Option 1 would ask for a level
of grant MAP and Option 4 would ask for a level of FMS credit which
would almost certainly not be seriously considered by Congress. (Option 1
embodies existing Presidential guidance. ) In addition, Option 4 would
assume that the 27 F-5Es which have been programmed and have been
partially funded in FY 75 would become a ROK funding responsibility,
which the ROK would view as a reversal of our commitment on this
major item. A further disadvantage to Option 4 is that the ROK would
assume the burden of supply costs, which can run 10-20 percent of total
grant MAP and which we have assumed so far.
Option 2 reflects the level which Congress has authorized for FY 75 and
which we are requesting for FY 76.
1. Departmental Views. State supports Option 2, while Defense
wants Option 3. State stresses the political importance of an Executive
Branch request for a higher level of grant MAP. Defense emphasizes
Congressional constraints and the reputed ROK desire for increased
FMS credits.
2. Our View. We support Option 2. We agree with State's
emphasis on the political importance of an Executive Branch request
for this level of grant MAP in the present Korean context. We also be-
lieve that this combination of grant MAP and FMS credits is a figure
that would be taken seriously by Congress, would not conflict with our
Congressional tactics on the level of FMS credit we are requesting, and
takes cognizance of the ROK economic ability to assume a larger share
of the defense burden. Option 2 also reflects the level that Congress
has authorized for FY 75 and that we are requesting for FY 76.
B. A Possible Termination Date for Grant MAP.
Option 1: After FY 77, continue a low level of grant MAP for minor
investment programs.
-- Would provide political assurance to the ROK and preserve
some U.S. lever on ROK military affairs. On the other hand, might
well be resisted on the Hill.
Option 2: After FY 77, terminate grant MAP except for a level of
training on the order of $1 million.
:
FORD
TOP SECRET
GERALD
LIBRAR
TOP SECRET
5
-- Would afford continued U.S. influence in ROK military
affairs, but would not be as politically reassuring to the ROK.
1. Departmental Views, Defense wants Option 1. State also
supports Option 1, but with a difference: if Congress does not approve
a level of grant MAP and FMS credit for the ROK sufficient to complete
our contribution to the modernization plan by FY 77, State would have
us continue to request both of these in subsequent years until the plan
were completed. State would terminate grant MAP, except for training
(at about $2 million a year), after the plan is finished. OMB would
make no decision on the termination of grant MAP until after Congress
completes action on the FY 76 bill.
2. Our Views. We favor Option 1. We believe that, at least at
this point, the United States should plan to continue a low profile of
grant MAP after FY 77. We would suggest about $25 million in FY 78,
tapering off to $5-10 million thereafter. To make a decision now to
terminate grant MAP would needlessly isk giving the wrong signal
to Pyongyang and would not support confidence in Seoul. The paper
misleads when it states that the ROK "already accepts" the notion that
grant MAP will terminate immediately upon the end of the Modernization
Plan in FY 77; the ROK has only "resigned itself to" this possibility.
C. Additional High-Performance Aircraft for the ROK. At this
point, the only real question is whether to transfer to the ROK the
F-4D squadron which has been bailed to the ROK under the Enhance
Plus Agreement since late 1972. The question of other high-performance
aircraft -- the ROK's other requests for a squadron of F-4E aircraft,
additional F-5E aircraft, and possible YF-17 or YF-18 light-weight
freighters -- is the subject of a basic reassessment of the that North
Korean air threat and consequent ROK air defense needs/is now being
done by Defense. The provision of these additional aircraft would
move the ROK substantially toward air defense self-sufficiency, and
thus would raise the question of the withdrawal of at least part of our
own F-4 wing in South Korea. It would also require a detailed reassess-
ment of the North-South air force balance in order not to risk stimulating
another round in the arms competition between the two Koreas.
As regards the F-4D bailed squadron, a State memorandum attaching
a draft cable instruction (Tab III) indicates general agreement in the
bureaucracy to sell this squadron to the ROK. As you may recall, a
second F-4 squadron was contained in the original Five-Year Modernization
TOP SECRET (XGDS)
BOBALD
LIBRARY
TOP SECRET
6
Plan drawn up in 1971, but was removed from last year's revision of that
plan because no F-4 squadron was available for transfer to the ROK.
Our own Air Force at that time, and indeed until very recently, was
adamantly opposed to transferring the bailed squadron to the ROK.
We do not believe that this addition to the ROK Air Force's capability
would risk an intensification of the arms competition on the Peninsula,
even though the bailed squadron has in effect been in the ROK inventory
for two years. State and Defense have agreed to put a price tag of $43
million on the F-4D squadron.
DOD, however, wants to attach a condition to the sale: that the ROK
be asked to pay the $3. 3. million cost for rehabilitating the two F-5A
squadrons being returned to South Korea from South Vietnam under the
Enhance Plus Agreement. DOD rationalizes that, although the rehab
cost is our obligation under the Enhance Plus Agreement, the Agreement
also provided that the F-4D bailed squadron be returned to the U.S. Air
Force when the two F-5A squadrons were returned to South Korea. DOD
argues that our flexibility on th F-4D bailed squadron should therefore
be matched by ROK flexibility on the rehab cost. DOD's real motive,
however, is to try to pick up another $3. 3 million for its sorely-pressed
Vietnam budget.
Our View. As regards the substantive issue of whether to transfer the
bailed F-4 squadron, we support the transfer, as indicated above. As
to the tactical issue of whether to attach the condition proposed by Defense,
we have no objection to doing so, but agree with State that we should not
press the matter to a breaking point with the ROK if it resists strenuously --
which it is likely to do.
At Tab I is a draft memorandum from you to the President embodying
the above discussion and recommendations and attaching a draft NSDM.
RECOMMENDATION:
That you sign the draft memorandum to the President at Tab I.
TOP SECRET (XGDS)
MEMORANDUM
6251
THE WHITE HOUSE
WASHINGTON
TOP SECRET/NODIS (XGDS)(3)
MEMORANDUM FOR:
THE PRESIDENT
FROM:
HENRY A. KISSINGER
SUBJECT:
Future U.S. Military Assistance
to South Korea
As part of the preparations for your recent visit to South Korea, the
departments completed a policy study on future U.S. military assistance
to the Republic of Korea (ROK). The specific issues they took up in
this study included (1) whether the rate of shift from grant military
assistance (MAP) to FMS credit should be accelerated, (2) whether
a termination date should be set now, and (3) whether additional high-
performance aircraft should be transferred to the Republic of Korea.
During your meeting with President Park, you discussed our military
assistance in- general terms. You reaffirmed U.S. support for the
Five-Year ROK Force Modernization Plan, and said that we hoped to
speed up completion of our assistance to that plan. You also assured
Park that we had no intention to withdraw U.S. forces from South
Korea.
We now need your guidance on the specific issues listed above. The
inter-departmental paper presents the following options on these issues:
A. Rate of Shift from Grant MAP to FMS Credit. The Modernization
Plan, to which we committed $1. 5 billion in 1971 at the time we withdrew
the first of our two divisions from Korea, was to have been finished in
FY 75. By the end of FY 74, however, we were still $500 million
short due to budget limitations. The ROK places considerable store
by our rounding out, in some credible fashion, our contribution to the
Modernization Plan. From the beginning, we have made clear that we
would fulfill our obligation through a combination of grant MAP, FMS
credit, and excess defense articles. In the last year or so, we have
begun shifting to larger amounts of FMS credit, both because of tightening
Congressional constraints on grant MAP and because the ROK has been
TOP SECRET/NODIS (XGDS)(3)
DECLASSIFIED
E.O.
12000
SEC3.3, 100 Diradir 5200.30
NSC Memo, 3/3
Dept. Guidelines
By
NARA, Date
state 9/18/03
625
TOP SECRET/NODIS (XGDS) (3)
2
able to pick up more of the burden. On the other hand, we do not
want to shift too rapidly. We do not want to give the wrong signal
to Pyongyang and its allies or to undercut confidence in Seoul.
Distaste in Congress for Park's handling of his domestic political
situation did not in the end reduce our military assistance to South
Korea by as much as earlier seemed likely. For FY 75, Congress
has authorized a total of $145 million, plus another $20 million if
you certify that Park is making substantial progress on human rights.
Congress has left to your decision how this total is to be divided
between grant MAP and FMS credits. This figure compares favorably
with the FY 74 appropriation of $100 million grant MAP and $57 million
FMS credit. For FY 76, we are requesting $75 million in grant MAP
and $100 million in FMS credit.
FY 76
FY 77
Grant
FMS
Grant
FMS
OPTION 1
147
65
96
90
OPTION 2
75
100
50
150
OPTION 3
50
125
25
175
OPTION 4
10
175
10
250
Departmental Views. State supports Option 2 while Defense wants
Option 3. State stresses the political importance of an Executive
Branch request for a higher level of grant MAP. Defense emphasizes
Congressional constraints and the reputed ROK desire for increased
FMS credits.
My View. The real choice is between Options 2 and 3. Option 1 and
Option 4 would not likely be considered seriously by Congress. I support
Option 2. I believe it important in light of the present political and
strategic situation on the Korean Peninsula that the Executive Branch show
continuing solid support for ROK needs. Moreover, I believe that
TOP SECRET/NODIS (XGDS)
TOP SECRET/NODIS (XGDS)(3)
3
this combination of grant MAP and FMS credits is a figure that would
have a chance with Congress and reflects Korean ability to assume a
growing share of the defense burden. Option 2 also reflects the level
that Congress has authorized for FY 75 and that we are requesting for
FY 76.
B. A Possible Termination Date for Grant MAP. The Presidential
guidance of mid-1973 did not give a termination date for grant MAP.
The inter-departmental paper presents two options:
Option 1: After FY 77, continue a low level of grant MAP for
minor investment programs.
Option 2: After FY 77, terminate grant MAP except for a level
of training assistance at about $1 million annually.
Departmental Views. Defense wants Option 1. State also supports
Option 1, but with a difference: if Congress does not support enough
grant MAP and FMS credit to complete our contribution to the Moderni-
zation Plan by FY 77, State would have us request both of these in
subsequent years until the Plan were completed. State would terminate
grant MAP, except for training (at about $2 million a year), after the
Plan is finished. OMB would make no decision on terminating grant
MAP until after Congress completes action on the FY 76 bill.
My View. I favor Option 1. At this point, we do not want to indicate
a termination of grant MAP. In terms of military and budgetary
planning, it is not necessary that we do so now, since either Option 2
or 3 on the rate of shift from grant MAP to FMS credits indicates the
downward trend in grant MAP. Projecting beyond FY 77, if you choose
Option 2 on the rate of shift from grant MAP to FMS credits, I recom-
mend that we then think in terms of about $25 million in grant MAP for
FY 78, and thereafter taper off to a level of not more than $10 million
annually.
C. Additional High-Performance Aircraft for the ROK. At this point
the only real question is whether to transfer to the ROK the one F-4D
squadron which has been bailed to the ROK under the Enhance Plus
Agreement since late 1972. Before we consider other ROK requests
for additional high-performance aircraft, we want to look at a basic
reassessment of the North Korean threat and of ROK air defense needs.
Defense is now completing this study.
TOP SECRET/NODIS (XGDS)
TOP SECRET/NODIS (XGDS)(3)
4
As regards the F-4D bailed squadron, State and Defense agree that
we should transfer this squadron to the ROK by sale. The ROK
already owns one F-4 squadron outright. The transfer of this second
F-4 squadron to ROK ownership at this time should not stimulate arms
competition on the Korean Peninsula, since this second squadron has
in reality been in the ROK Air Force inventory for two years already
although it remained our property.
Defense wants to attach a condition to the sale of this F-4D squadron:
that the ROK be asked to pay the $3. 3 million cost for rehabilitating
the two F-5A squadrons being returned to South Korea from South
Vietnam under the Enhance Plus Agreement. Defense wants to use
the $3.3 million for its sorely-pressed Vietnam budget. I think we can
ask the ROK to pick up this $3.3 million (on top of the $43 million
price tag we have put on the bailed squadron itself), but believe we
should not press the ROK to pay this additional cost if it raises serious
objections.
At Tab A is a draft NSDM which embodies my recommendations above.
RECOMMENDATION:
That you approve my signing, in your name, the draft NSDM at Tab A.
Approve
Disapprove
TOP SECRET/NODIS (XGDS)(3)
2d
NSSM 211
Security Assistance to the Republic of Korea
I. Introduction
This paper responds to the President's request for
a study of the U.S. Security Assistance Program for the
Republic of Korea (NSSM 211). The response outlines
U.S. interests and policies in Korea and discusses
how the Security Assistance Program complements them.
AS directed, the study assumes that there will be no
significant changes in the level or mission of United
States forces in the ROK.
In accordance with the President's request, the
study addresses the following specific issues:
- Should the rate of shift from grant military
assistance to FMS credits, defined in NSDM
227, be accelerated and, if so, what should
the new rate be?
- Should a termination date be set for grant
military assistance and if so, what should
that date be?
- What types and numbers of high performance
aircraft should be included in the Korean
Force Modernization Program?
- What modirications, if any, should be made
in the five-year Modernization Program for
the Republic of Korea prescribed in NSDM
129?
II. U.S. Interests, U.S. Policies, and Policy Situation
A. U.S. Interests
The primary U.S. interest in Korea lies in prevent-
ing major hostilities between North and South. Such
nostilities could reverse present desirable trends to-
ward U.S. disengagement, run the risk of major escala-
SECRET
DECI ASSIFIED
GDS
E.D.
SEC 8.3
NSC Mem
Dept. Guidelines
By
NARA, Date 12/7/10
CECRET
-2-
tion, and have an important impact on the situation in
Nortneast Asia, particularly in Japan. U.S. interest
in further reduction of tensions in korea stems also
from our interest in detente with the soviet Union and
the PRC.
For Seoul, the basic underpinnings of its rela-
tions with the U.S. rest on the Mutual Security Treaty
and an American troop presence. So long as these re-
main essentially intact, South Korea is prepared to
accept substantial modifications and adjustments in
U.S. military assistance. The ROK has already demon-
strated a capacity to adjust to such changes by com-
mitting itself to greater self reliance in the equip-
ment field and has initiated longer-range planning to
adjust to a more substantial U.S. disengagement.
Like Seoul, Pyongyang, Moscow, and Peking will not
perceive adjustments in the form of American assistance
as signaing a weakening of fundamental U.S. support
for South Korea's security as long as the pasic elements
in the relationsnip remain intact. Pyongyang has for
some time focused its criticism on the U.S. troop pre-
sence as the principal obstacle to achieving its goals
on the peninsula and is not likely to be encouraged
by anything less than significant U.S. disengagement.
Peking has indicated a willingness to tolerate the U.S.
troop presence as a means of preserving stability on
the peninsula; it is not likely to interpret changes
in military assistance mix as undercutting the U.S.
commitment to ROK security. Although much more cir-
cumspect in revealing its views, Moscow too would
differentiate between such adjustments and a funda-
mental change in U.S. support. The willingness of
both to provide North Korea with military assistance
will be conditioned largely by their rivalry with each
other and is unlikely to be influenced by changes in
the way US military assistance 1S funded as long as
levels are not perceived to be significantly increased.
B. U.S. Policies
In our efforts to maintain stability in Korea anu
to improve the ROK derensive capability the U.S. has
maintained three basic policies. First, the United
States has stoutly maintained its Mutual Derense Treaty
SECRET
SECRET
-3-
commitment to the ROK in the event of an attack from
the North. second, the United States has kept forces
in Korea as a deterrent to attack and more recently
as a symbol of U.S. support of the ROK. in addition,
the United States has maintained light infantry forces
elsewhere in Northeast Asia and in the united States
itself which are intended primarily for deployment as
necessary in Asia. Third, the United States has sup-
ported a major security assistance program which nas
been instrumental in building ROK forces to the point
that they are now capable of defending against a North
Korean attack with only limited U.S. air and naval
combat support.
C. The Policy Situation
Although the fundamental U.S. commitment to the
security of the ROK has not changed since the end of
the Korean War, the level of U.S. deployments and the
nature of the security assistance program have changed
during that time. in the past two years grant assis-
tance allocated to Korea has not reached planned levels.
The ROK now expects further reductions in grant aid;
continued reductions shoula have little effect as long
as the U.S. continues to provide additional FMS Credit
and there are no expectations of significant reductions
in U.S. deployments.
Prime Minister Kim has already told the National
Assembly that the ROKG expects an end to grant assis-
tance in the next 2-3 years.
rurther, as the ROKG uses its own runds in mili-
tary procurement, it is looking at possible third
country procurement for some major items. Part of
this may be a desire on the part of the ROKG to lessen
its dependence on U.S. sources. However, in the main,
it is a reflection of the fact that in the mid-seventies
the ROKG will provide most of its own defense costs
and will wish to make its own decisions.
Recent developments in Northeast Asia will have
a major impact on future U.S. policies in the area.
The most important political aspect has been our judg-
ment that the Soviets and the Chinese share our desire
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to prevent North-South hostilities and seek to lessen
the risks of their involvement in future conflicts on
the peninsula. Thus, we must work with both the PRC
and the USSR toward easing tensions in Korea, hoping
that the two Koreas can reach an accommodation that
will turn their military confrontation into peaceful
competition.
*
The North-South relationship remains acrimonious
after three years of periodic, unproductive dialogue.
Military incidents occasionally occur, and each side
uses the threat of war to help motivate and control
its people. Yet neither side perceives any advantage
in initiating major hostilities at present. Both are
concentrating their energies on economic development
while maintaining a strong military posture. The
South has no aggressive designs on the North. And,
while Pyongyang has not disavowed its goal of con-
trolling the peninsula, it probably would act only in
the event of a breakdown in South Korean internal
stability. Despite the current impasse in their dia-
logue, both want to keep the channel of communication
open as a safety valve and for future contingencies.
Given the great power efforts at detente, the
possibilities of major military conflict have been
reduced. North Korea's military strategy remains
primarily defensive although its military buildup over
the past several years has given the armed forces a
significant offensive capability. North Korean strategy
appears designed to maintain a military balance in the
peninsula while providing flexibility to choose from
a wide range of offensive as well as defensive options.
We are confident that South Korea can now successfully
defend against a North Korean attack with only limited
U.S. air and naval combat support. Moreover, both
North and South Korea would require extensive logisti-
cal support from their respective allies if they were
*In this regard, one possible approach meriting
further study would be the pursuit of agreed re-
straints among the major powers in our respective
arms transfers to the peninsula.
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to continue a conflict beyond a few weeks.
Internal political factors in South Korea must
also be considered in the development of U.S. policies.
Park Cnong-hui is now in his fourteenth year as the
President of Korea and the opposition to his leader-
ship has increased significantly in the past several
years. His recent attempts to stifle opposition have
been temporarily successful but may have served to
unify and strengthen the opposition. An economic de-
cline could also result in the growth of dissatis-
faction with the Park regime. Further, Park's in-
ternal policies have damaged the ROK's international
image, particularly among church groups and the media.
This has had a clear impact on U.S. Congressional at-
titudes, which might well aftect the future levels of
Korean MAP.
The ROK has made great strides in its economic
capability. For the past several years, GNP has grown
at an annual rate of about 11%. Nonetheless, along
with most countries, South Korea is now beginning to
suffer from economic dislocations. Although there
has been a sharp decline in the second half of 1974,
the ROK is expected to achieve real growth of approxi-
mately 8-9% for the entire year. ROK planners, anti-
cipating the decline in GNP growth rate, have made ad-
justments to maintain a high level of military expen-
diture which should permit a continuation of the trend
away from grant aid.
The five year (FY 71-75) MOD Plan, was formulated
and announced in conjunction with the withdrawal of
one U.S. combat division from Korea. NSDM 129 author-
ized a program of $250 million in EDA and $1.25 billion
maximum in new obligational authority (NUA), this amount
to be reduced to the maximum extent possible through
FMS Credit and Cash sales, provision of additional EDA,
and other "no cost" U.S. equipment transfers. As of
end FY 74, there was a shortfall of approximately $110
million in EDA and $500 million NOA (including supply
operations and training) remained untunded. Achieve-
ment of the EDA goal is not considered critical since
pricing. of EDA is arbitrary and the ROKs have not averted
to this aspect of the MOD Plan. However, sufficient
NOA to fulfill the MOD Plan commitments has not been
made available and the program has been extended.
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The MOD Plan was reviewed in 1973 by the Under-
secretaries Committee and the following recommendations
and additional directions were approved in NSDM 227:
(1) the United States should continue to
strive to complete the MOD Plan but planning for grant
aid and requests to Congress should not be precipit-
ously reduced nor should assistance be switched
rapidly to FMS Credit.*
(2) The emphasis in modernizing ROK forces
should be shifted to air defense to assist in moving
the ROK toward combat self-sufficiency against the
North.
(3) Before high performance aircraft beyond
replacement aircraft in the original modernization
plan are funded, a complete review of the threat and
air defense requirements should be undertaken and
recommendations submitted to the President.
In FY 74 the ROK unhesitantly accepted the U.S.
offer of nearly $57 million in FMS Credit, more than
twice the amount that had been planned. The ROK has
indicated that it would like even higher levels of
FMS Credit, and at the September 1974 Security Con-
sultative Meeting the Korean delegation outlined a
program for $500 million in credit over the period
FY75-77. Indeed, the ROK has indicated that it:
(1) does not expect continued high levels of grant
aid; (2) does not expect the U.S. to continue to pro-
vide grant aid once the MOD Plan is completed; and
(3) is concerned about the availability of high levels
of FMS Credit in the future.
In addition to their request for higher levels
of FMS Credit, the ROK has been making efforts to
NSDM 227 approved an option which was considered
and rejected by the Undersecretaries Committee. The
rejected option recommended that the funding of the
MOD Plan be stretched out through FY 77 with a steep
increase in FMS Credit as a substitute for grant aid.
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significantly improve its air force. While it is
not clear what the eventual ROK plan will be, they
have asked to purchase the F-4D squadron now on loan
to them and they wish to take additional steps to in-
crease the number of aircraft in their inventory.
At one point, the ROKG wished to purchase 57
F-4E aircraft. However, in September, the ROKG in-
dicated its readiness to embark on a program involv-
ing the following mix:
a. One F-4 wing (the already provided MAP-
funded F-4D squadron; the bailed F-4D
squadron and one F-4E squadron to be
purchased.)
b. in addition to 72 MAP-furnished F-5E air-
craft, a minimum of 3 squadrons (54 UE) of
F-5E to be purchased or co-produced.
c. An expressed ROKG preference for an eventual
follow-on light-weight fighter. The ROKG
decision on eventual long range moderni-
zation would be made after results of the
USAF competitive test (YF-16 vs. YF-17) be-
come available. Should the USAF fail to
adopt either, the ROKG decision would then
be made on other suitable US first line air-
craft for incorporation into ROKAF structure
in the late 70's or early 1980's.
III. Policy Issues and Options
A. Should the rate of shift from grant aid to
FMS Credit be accelerated?
Given past funding shortfalls and the ROnG's in-
creasing ability to bear its own detense costs, we
would in any event have to address the question of an
accelereated shift from grant aid to FMS credit. In
view of present Congressional attitudes regarding
MAP, a review now is essential.
As of end FY74 $500 million of the MOD Plan
remained unfunded. The ROK has been repeatedly and
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publicly reassured on numerous occasions by high rank-
ing U.S. officials that the U.S. intends to complete
the MOD Plan. Accordingly the Administration has no
alternative but to continue to pursue the completion
of the MOD Plan. The ROKG has been informed that
completion of the MOD Plan will require a greater use
of FMS (cash and credit) and the issue of concern 1S
the mix of grant aid and FMS Credit which should be
provided. Grant aid has not been realized as pro-
jected in the MOD Plan. For example, of $241.0 mil-
lion grant aid planned for FY 1974, some $78 million
became available. (Supply operations of $22 million
brought the total for Korea to $100 million.) The
overall grant aid plan in FY 1975 is for $180.0 million
($162 M grant and $18 M supply operations). Although
the Foreign Aid bill has not been approved, the Senate
and House Foreign Relations Committees have success-
ively cut the ROK funds to $117.5 and $100 million.
FMS Credit levels were addressed only by the SFRC
which proposed levels for FY 75-77 considerably below
the Administration projections and further provided
for FMS termination after FY1977.
In sum, the clear ability and willingness of the
ROK to provide significantly greater amounts of the
funds required for its defense expenditures and the
U.S. inability to continue providing high levels of
grant aid make it necessary to consider new options
for completing the MOD Plan. We recognize that what-
ever option is adopted may well be more than the Con-
gress will accept. However, they are consonant with
our assurances to the ROKG while reflecting an apprecia-
tion of legislative realities.
Option 1. Continued Funding Plans in Accordance
with NSDM 227.
This would involve a grant aid request for Korea
for FY 1976 of $147 million and an FMS figure of $65
million. Each year our request for grant aid would
decrease by about $48 million. No termination date
would be set for grant aid. The following illustra-
tive funding schedule depicts a continuation of NSDM
227 financing of the MOD Plan. It assumes no cuts
to the requested amounts. Supply operations and
training costs are included.
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ILLUSTRATIVE FUNDING SCHEDULE
Option 1
($ Millions)
FY 75
FY 76
FY 7/
TOTAL
Grant Aid
192
147
96
435
FMS
45
65
90
200
Total
237
212
186
635
MOD Plan Shorttall as of end FY 74
500
Excess over MOD Plan
135
This option provides the advantages of:
-- consistency with amounts requested in previous
years
--- supporting past Administration assurances that
the MOD Plan will be completed as soon as
possible.
--- conforming to the caution in NSDM 227 that
requests for grant aid not be precipitously
reduced.
Disadvantages of this option are:
-- Congress is likely to disapprove such high
levels of security assistance, particularly
grant MAP for Korea because of (1) an out-
standing economic growth and very good finan-
cial credibility, (2) recent suppression of
human rights, and (3) the generally negative
Congressional attitude on MAP.
-- Does not recognize ability -- and willingness
-- of the ROKG to utilize large amounts of
FMS credit tor procurement of modernization
equipment.
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Option 2. Plan on reduced levels of grant aid
and increased levels of credit
This option assumes a FY 75 grant aid total for
Korea of $100 million and an FMS Credit total of $52
million. Each year our request for grant aid would
decrease by $25 million, while our FMS request would
increase by $50 million. The table below shows the
funding schedule for the period FY 75-77. Supply
operations and training costs are included.
ILLUSTRATIVE FUNDING SCHEDULE
Option 2
($ Millions)
FY 75
FY 76
FY 77
TOTAL
Grant Aid
100
75
50
225
FMS
52
100
150
302
TOTAL
152
175
200
527
MOD Plan Shortfall as of end FY 74
500
Excess Over MOD Plan
27
The following advantages apply to this option:
-- It strikes a balance between decreasing grant
and increasing FMS levels.
-- The grant portion for FY 1975 corresponds to
the HFAC recommendation and reflects a reason-
able decrease for FY 1976.
-- It emphasizes to the ROK that we are still
earnestly trying to complete the MOD Plan
under the original concept at the least cost
to the ROK.
-- The significant reduction in FY 76 from the
FY 1975 request for grant MAP and greater
emphasis on FMS credit might receive greater
Congressional support.
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Disadvantages are:
-- There is no assurance we will get either the
grant or FMS levels requested.
-- Congress may expect the total Administration
request to show a lower level than allocated
in the previous year.
-- The SFRC recommended $75 million grant MAP
and $42.45 million FMS credit in FY 1975.
-- Korea's consistent economic growth record
militates against the requested levels, par-
ticularly the grant portion.
Option 3. Plan on grant aid levels below Option
2, but with increased levels of FMS Credit
In this option we would decrease grant aid by $25
million for each of the next two years (from $75 million
in FY 75), and FMS requests would be increased approxi-
mtely $50-$75 million a year (from $52 million in FY
75). This provides $300 million in FMS Credit over the
next two years, or $352 million by the end of FY77,
and our MOD Plan commitment to the ROKG will be ful-
filled assuming $150 million in grant aid is provided.
The tollowing illustrative funding schedule re-
flects the above. it assumes a cut in the FY 75 grant
aid and a partially off-setting increase in FMS for
out years. Supply operations and training costs are
included.
ILLUSTRATIVE FUNDING SCHEDULE
Option 3
($ Millions)
FY 75
FY 76
FY 71
TOTAL
Grant Aid
75
50
25
150
FMS
52
125
175
352
TOTAL
127
175
200
502
MOD Plan Shortfall as of end FY 74
500
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For FY 76 and FY 77 it seems reasonable to expect
Congress to authorize progressively lower grant aid
levels than in FY 75. However, we expect that Con-
gress will permit higher F:S levels as a trade-off
for the lower levels of grant aid in FY 76 and FY 77.
Assuming that $75 million grant aid and $52 million
FMS credit will be provided in FY 75, $373 million
of the MOD Plan will remain unfunded after FY 75.
The advantages to this option are:
-- It more clearly reflects Congressional wishes
for an accelerated end to grant assistance.
-- It offers an early end to grant MAP as an
inducement for Congressional support for
a planned phase-out and for increased FMS
credit.
-- It provides for a large compensatory increase
in FMS which the Koreans are willing to accept.
-- It allows us to complete the Modernization Pro-
gram within the FY-77 timeframe in a manner
acceptable to the ROKG and consonant with our
past assurances.
The disadvantages are:
-- There is no assurance that Congress will accept
either the contemplated grant levels or the
steeply increased FMS requirements.
-- The ROKG may interpret the sharper grant reduc-
tion as evidence that the Administration is
moving away from its expressed support for the
Modernization Plan. This will be true if the
projected FMS levels are not realized.
-- Congress may further lower the already reduced
grant aid level.
Option 4. Meet the ROK request for $500 million
in FMS Credit during FY 5-77 and pro-
vide minimum levels of grant aid
demonstrate the U.S. commitment.
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This option has four considerations:
(1) the ROK would like to receive $500 million
in FMS Credit over the period FY 75-77; (2) the ROK
economy is capable of supporting FMS credit levels
of this magnitude; (3) the ROK expects reductions in
grant aid and it is considered unlikely that serious
consequences would result from such reductions so
long as they are accompanied by assurances of con-
tinued U.S. support; and (4) the Congress might pos-
sibly be more responsive to a proposal for a more
rapid shift to FMS credit. The table below shows the
funding schedule for the period FY 75-77. This option
does not provide funds necessary for supply opera-
tions. The ROKG would have to supply these funds.
ILLUSTRATIVE FUNDING SCHEDULE
Option 4
($ Millions)
FY 75
FY 76
FY 77
TOTAL
Grant Aid
25
10
10
45
FMS
75
175
250
500
TOTAL
100
185
260
545
MOD Plan Shortfall as of end FY 74
500
Excess Over MOD Plan
45
This option presumes that procurement of 27
MOD Plan F-5Es which have been programmed and partially
funded in FY 75 would become a ROK responsibility.
The ROKs could be expected to react vigorously to
what they consider a U.S. reneging on its commitment.
This option has the following advantages:
-- This minimum level of grant MAP is much
less likely to be challenged by Congress
inasmuch as the very sharp decrease
presages an end to grant security assistance
for Korea.
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-- The significantly increased level of FMS
credit is within the capability of the
ROK which has indicated a need for $500
million in FMS credit over the three years
ending in 1977.
Disadvantages are:
-- Congressional reaction to the sharply in-
creasing level of FMS will be unfavorable
-- even antagonistic -- in light of ex-
pressed Congressional wishes to decrease
all security assistance programs.
-- The minimum grant level requested would upset
the ROK. Such a request would be interpreted
as an implied abandonment by U.S. Administra-
tion of its support for the modernization
program.
B. Should a Termination Date be set for grant
military assistance?
As noted previously, the ROKG already expects
that grant military assistance for equipment will end
once the MOD Plan is completed. Although it may be
in our interest to continue providing security
assistance to the ROK, the United States is under no
obligation to do so once the MOD Plan is completed.
However, the completion of the MOD Plan does not mean
that all ROK modernization requirements are met. A
joint U.S./ROK military ad hoc committee on Korean
Force Modernization recently completed a review of
ROK defense needs and developed a list of ROK moderni-
zation requirements whose total cost is approximately
$1.9 billion. Of this amount about $550 million was
identified as required for completion of the MOD
Plan. It was understood that the remaining $1.35
billion would come from ROK resources, facilitated
by FMS cash and credit.
Once the MOD Plan is completed, the major justi-
fication for continuing grant aid will be the effect
that such assistance would have in demonstrating the
U.S. support and the influence such a program provides
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-- low levels of grant aid will be insignificant when
compared with the large amounts of FMS Credit and Cash
sales that are expected. However, it may be in U.S.
interests to provide aid for training and funding of
some minor program requirements.
Option 1. Continue providing a low level of
grant aid for some minor investment
programs.
This level would be relatively insignificant in
terms of total ROK purchases but it would continue to
demonstrate the U.S. interest in ROK security and pro-
vide some measure of leverage on military matters.
There will be no post MOD Plan economic requirement
for grant aid, however, and the Congress might well
consider it inappropriate to continue providing grant
aid. This option would also provide for training
programs.
Option 2. Termination grant aid except for
training.
Under this option the United States would con-
tinue to provide grant aid for training, but would
terminate grant aid for investment. The ROK secu-
rity assistance program would be similar to the pro-
gram for the Republic of China. This option would
provide a vehicle for continued U.S. influence with
all levels of the ROK military.
C. What Types and Numbers of High Performance
Aircraft Should Be in the Korean Force Modern-
ization Program?
Predicated on the continued presence of one wing
(72 UE) of USAF F-4s in Korea, NSDM 227 reaffirmed a MOD
Plan goal of 10 squadrons of high performance aircraft
(1 F-4D and 9 F-5A/E squadrons). Additionally, NSDM 227
accepted the Korean Force Requirements Study, which
included a recommendation that in order to be self-
sufficient against a North Korean threat (i.e., without
requiring USAF tactical air support), the ROKAF requires
an additional 90 F-5Es (5 squadrons) or the equivalent.
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However, NSDM 227 directed that before high performance
aircraft beyond replacement aircraft in the original
modernization plan are funded, a complete review of
the threat and air defense requirements should be
undertaken and recommendations submitted to the President.
Recently it was decided to sell to the ROK the
18 US F-4D aircraft currently bailed to them. The
ROK will be asked to pay $43.2 M for the aircraft
(which will be credited toward MOD Plan completion),
and will be asked to make other concessions. If the
sale is consummated and programmed F-5Es are funded
in FY 75, the ROKAF will have one more tactical fighter
squadron than was anticipated in the MOD Plan.
There is general agreement that a requirement
exists for additional high performance aircraft for the
ROK particularly if they are to approach self-suf-
ficiency. However, as NSDM 227 noted, before add-
itional high performance aircraft for the ROK are fund-
ed, the threat should be reviewed and Presidential
approval obtained. Further, the type and numbers of
high performance aircraft for the ROKAF should be
determined after dialogue with the ROKG in the normal
course of events. At the Seventh Security Consultative
Meeting it was urged that the ROK/U.S. staffs continue
to examine the requirements for overall ROK air defense.
This question is now under study. Therefore, it is
considered premature to formulate types and numbers
of high performance aircraft for the future ROKAF
inventory now.
D. What Modification, if any, should be made
to the MOD Plan?
At this time no modifications to the MOD Plan are
recommended other than those funding changes discussed
in III.A., above. The U.S./ROK Military Ad Hoc Com-
mittee monitoring ROK force modernization, have gen-
erally agreed to the modernization requirements. The
only two notable areas of disagreement concern ROK air
defense and include the numbers and types of high
performance aircraft (discussed in III.C., above),
and the requirements for ground based air defense
systems. The latter disagreement arises from the U.S.
recommendation that the ROK convert all 12 of its Hawk
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Batteries to the improved version (at a cost of about
$75 M), whereas, the ROK initially desired to retain
the basic Hawk system. An agreement was reached under
which the ROK will convert 4 forward firing batteries.
The disagreement over the number of Hawk
batteries which should be converted will not be
resolved until an investigation of total ROK air
defense requirements is completed. The U.S./ROK
re-evaluation of ROK air defense requirements,
now underway, was prompted by: (1) the House
report accompanying the FY 75 Military Appropria-
tions Bill which recommended transfer of all U.S.
air defense assets in Korea to the ROK, and (2) a
recent Secretary of Defense decision calling for
negotiation of the transfer to the ROK of the six
U.S. Nike Hercules batteries in Korea.
It is, therefore, recommended that no additional
modifications to the MOD Plan impacting on ROK air
defense be made at this time.
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FORM DS 322{0CR}.
DECLASSIFIED
5200.30
SECRET
E.O. 12958 SEC3.3, DV Liveaue
NSC Memo, 3/30/06, State Dept. Guidelines ; state
By
NARA, Date
9/18/8
DOD/ISA:PFLINT/EA/K:DAO'DONOHUE:LM
11/14/74 EXT 20780
EA: PCHABIB
PM:RMARRYOTT
DOD : UPCLEMENTS
NSC:
S/S:
:CEMAW
PRIORITY
SEOUL
EXDIS
is
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PCH.
PF/DOE
TAGS: MARR, MASS, KS, US
RM
SUBJECT: SALE OF F-4D AIRCRAFT TO ROK
DOD
JOINT STATE/DEFENSE MESSAGE
NSC
1. THE USG HAS DECIDED TO AGREE TO ROKG REQUEST TO SELL
S/S
THEM THE BAILED F-4D SQUADRON ON AN FMS CASH BASIS. IN
INFORMING THE ROKG OF THIS DECISION YOU SHOULD MAKE IT
CEM
CLEAR THAT THIS HAS BEEN A DIFFICULT DECISION FOR US
FOR THE FOLLOWING REASONS:
A. THIS DECISION WILL HAVE ADVERSE EFFECT ON USAF ASSETS.
THE USAF ALREADY HAS A DEFICIT OF OVER 100 AIRCRAFT OF THIS
TYPE AND THIS SALE WILL ADD TO THIS ALREADY SERIOUS
SITUATION.
B - DOMESTICALLY, WE WILL PROBABLY BE UNDER CONGRESSIONAL
PRESSURE FOR SELLING THESE PLANE WHEN USAF IS ALREADY SHORT
OF FIGHTER AIRCRAFT. HOWEVER, USG DECISION TO SELL BAILED
SQUADRON OF 18 F-4D AIRCRAFT HAS BEEN MADE BECAUSE VP OUR
DESIRE TO HELP ROKG TO IMPROVE KOREAN DEFENSE CAPABILITIES
AND BECAUSE OF INCREASING MAP STRINGENCIES. FYI. WE INTEND
TO CHARGE THE $43.2 MILLION FMS SALE AGAINST THE MOD PLAN
$1.25 BILLION NOA CEILING. END FYI.
2. BELIEVE THE ROKG SHOULD ALSO RECOGNIZE THAT THEY COULD
NOT OBTAIN THE EQUIVALENT AIR DEFENSE CAPABILITY WITHIN THE
MILITAR
ADDRESS
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FORM DS 322A10CR}
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2
NEAR TERM WHICH THE F-4D SQUADRON PROVIDES BECAUSE
DELIVERY LEAD TIMES FOR ADVANCED AIRCRAFT ARE AT LEAST
TWO TO THREE YEARS. FURTHER, ANY SIMILAR CAPABILITY
{I.E., TO F-4D'S} ACQUIRED AT TODAY'S PRICES WOULD COST
MORE THAN TWICE THE PROPOSED PURCHASE PRICE {I.E., F-4E'S
EXCLUDING AGE AND SPARES}. WE PROPOSE TO OFFER THE F-4D'S
TO ROKG AT A COST OF $2.4 MILLION EACH {EXCLUDING AGE AND
SPARES}. THIS PRICE IS BASED ON FOLLOWING:
A. EACH REPLACEMENT F-4E AIRCRAFT WHOSE EXPECTED LIFE IS
18 YEARS COSTS THE USAF $5.3 MILLION {EXCLUDING AGE AND
SPARES}. THE LIFE SPAN OF THE F-4D IS ALSO ESTIMATED TO
BE 18 YEARS AND THUS THE BAILED AIRCRAFT COULD BE EXPECTED
TO BE SUPPORTED AND USED FOR AN ADDITIONAL NINE YEARS.
B. THE BAILMENT MOU PLACES REPLACEMENT COSTS AT $1.7
MILLION. THAT COST CAN STILL BE CONSIDERED VALID SINCE
INFLATION COULD OFFSET DEPRECIATION SINCE THE MOU WENT INTO
EFFECT. HOWEVER, THE USAF HAS SPENT $700,000 PER AIRCRAFT
IN CLASS IV AND V MODIFICATIONS IN ORDER TO KEEP THE
AIRCRAFT UP TO USAF STANDARDS. AS NOTED ABOVE, SPARES AND
AGE ARE NOT INCLUDED IN THE $2.4 MILLION PRICE AND
ACQUISITION OF THOSE ITEMS COVERED BY THE BAILMENT WILL
HAVE TO ЬЕ NEGOTIATED SEPARATELY. WE CONSIDER THE $2.4
MILLION PRICE TO BE FIRM.
3. FOR ITS PART WE WOULD EXPECT THE ROKG TO VIEW
SYMPATHETICALLY THE PROBLEM ASSOCIATED WITH THE RETURN OF
THE 36 F-5A'S AND ASSOCIATED AGE AND SPARES. THE FY 75
VIETNAM AID PROGRAM IS IN DIFFICULT STRAITS AND WE MUST
SEEK ALL LEGITIMATE MEANS TO MAXIMIZE THE EFFECTIVE LEVEL
OF AID. ASSUMPTION BY THE ROKG OF RESPONSIBILITY FOR THE
COSTS ASSOCIATED WITH THE REHABILITATION AND RETURN OF THE
F-5A'S AND THE REPLACEMENT OF ASSOCIATED AGE AND SPARES
APPEARS TO BE A REASONABLE CONCESSION ON THEIR PART IN
VIEW OF OUR DECISION ON THE F-4D'S. YOU ARE AWARE, OF
COURSE, THAT THE FY 75 MAP PROGRAM BEFORE CONGRESS IS
IN DIFFICULTY AND IT MAY BE USEFUL TO MAKE ROKG AUARE AT
THIS TIME THAT UNCERTAIN PROSPECTS FOR FY 75 AID LEVELS,
INCLUDING F-SE AIRCRAFT- INFLUENCE OUR FAVORABLE
CONSIDERATION OF THEIR F-4D REQUEST
FORD
4. SHOULD ROKG EXPRESS INTEREST IN PURCHASE OF F-4E'S
{IN ADDITION TO PURCHASE OF BAILED SQUADRON} YOU SHOULD
INFORM THEN THAT DECISION RE SUCH PURCHASE WOULD BE
SEBALD
LIBRAR
SUBJECT TO A SUBSEQUENT REVIEW OF U.S. POLICY CONCERNING
THE MIX OF AIR DEFENSE/OFFENSE CAPABILITY WHICH THE ROK
WOULD THEREBY ACQUIRE
IN Form THEM THAT THIS REQUEST IS UNDER STUDY.
SECRET
FORM DS 322A{0CR}
SECRET
13
5. WE LEAVE TO EMBASSY/COMUSK DISCRETION HOW AND AT WHAT
LEVEL TO INFORM ROKG OF FOREGOING USG DECISION.
6. AFTER NEGOTIATIONS HAVE BEEN CONSUMMATED, WE
ANTICIPATE PROVIDING A LETTER FROM DEPSECDEF CLEMENTS FOR
DELIVERY TO MND SUH RE THIS SALE. YY
FORD is LIBRARY
SECRET
3a 6251
NATIONAL SECURITY COUNCIL
ROK
WASHINGTON, D.C. 20506
TOP SECRE NODIS (XGDS)(3)
January 9, 1975
's
n
National Security Decision Memorandum 282
Korean
TO:
The Secretary of Defense
The Deputy Secretary of State
M
SUBJECT:
Korean Force Modernization Plan
The President has reviewed the response to NSSM 211, together with
the departmental and agency views thereon, and has decided the
following:
-- The United States will complete its obligation to the Republic of
Korea Force Modernization Plan at an early date, in order to
demonstrate the United States commitment to the security of the
Republic of Korea.
-- The shift from grant military assistance to FMS credits should be
accelerated to the rate defined in Option 2 in the NSSM response.
-- No termination date should be set for grant military assistance
to the Republic of Korea. The downward trend in grant military
assistance defined in Option 2 should be continued beyond FY 77,
but should look toward the maintenance of a modest investment
and training program with an annual ceiling of $10 million.
-- The F-4D squadron now on bailment to the Republic of Korea
should be transferred to the Republic of Korea by sale. The
Republic of Korea should be asked to pay the $3.3 million cost
for rehabilitating the two F-5A squadrons being returned to
South Korea under the Enhance Plus Agreement, but this should
not be a condition for the sale of the F-4D squadron if the Republic
of Korea raises serious and persistent objections.
-- The review of the North Korean threat and the Republic of Korea
air defense requirement contemplated by NSDM 227 should be
TOP SECRET/NODIS
(XGDS)(
DECLASSIFIED
SEALO R. FORD VIBRUET
AUTHORITY
nse momo 1/30/09
BY
DATE
12/7/10
TOP SECRET/NODIS (XGDS)(3)
2
forwarded with recommendations to the President no later than
March 3, 1975.
H
A.
Kim
Henry A. Kissinger
cc: The Director of Central Intelligence
Director, Office of Management and Budget
The Chairman, Joint Chiefs of Staff
TOP SECRET/NODIS (XGDS)(3)
3b
Korean
6251
MEMORANDUM
NATIONAL SECURITY COUNCIL
ACTION
plable
TOP SECRET
December 20, 1974
3
Rok
MEMORANDUM FOR:
SECRETARY KISSINGER
FROM:
RICHARD T. KENNEDY
W. R. SMYSER I
ATK/TAY
chim files)
SUBJECT:
Future U.S. Military Assistance
to South Korea
At Tab II is the EA/IG response to NSSM 211, which requested a review
of the future of our military assistance to South Korea. Specifically,
the NSSM request asked whether the rate of shift from grant MAP to
FMS credits should be accelerated, whether a termination date should
be set for grant MAP, and whether additional high-performance air-
craft should be transferred to the Republic of Korea (ROK).
Policy Background
The EA/IG paper analyzes the import of the following factors for future
U.S. military assistance to the ROK:
North Korean Intentions and the Military Balance on the Peninsula.
The paper holds that Pyongyang, like Seoul, perceives no advantage in
initiating major hostilities at present. Pyongyang has not disavowed its
goal of controlling the Korean Peninsula, but would make a major mili-
tary move probably only if South Korean internal stability broke down.
However, a high level of tension between the two Koreas remains after
three years of political talks -- which both sides now view mainly as a
channel of communication rather than a forum to resolve their differences.
The paper asserts that great power interest in detente has been the
principal factor in reducing the chances of a new major military conflict
on the Peninsula.
The paper says that Pyongyang, like Moscow and Peking, would not
interpret adjustments in the form of U.S. military assistance to South
Korea in the present context as a sign that U.S. support for South Korea
was weakening, as long as the basic elements of the U.S. ROK security FO,
relationship remain intact.
DECLASSIFIED
E.O. 12058 (no amended) SEC 3.3 DOD Directive 5200.30
TOP SECRET
By NSCIMemo, m 3/30/06, State Dept. Guidelines ; stole guidelines 9/18/03
NARA, Date 12/7/10
TOP SECRET
2
Comment: The paper gives a somewhat overly sanguine view of the
continuing North Korean disposition. We doubt that North Korea per-
ceives no major advantage in initiating major hostilities. We think
that Pyongyang is restrained not by a lack of perceived advantage, but
rather by the PRC and Soviet Union, by the U.S. defense commitment
backed by U.S. forces in South Korea, and by an increasingly credible
South Korean military deterrent.
-- South Korea's Interest in Continued U.S. Military Assistance.
The EA/IG paper holds that South Korea will accept substantial adjust-
ments in U.S. military assistance -- so long as our defense commit-
ment and troop presence remain essentially intact. More specifically,
the paper asserts that the ROK expects, and is fully prepared, to accept
further reductions in grant MAP as long as the U.S. increases FMS
credits. The paper notes that, at the same time, the ROK is exploring
the possibilities of third-country procurement. Last, the paper con-
cludes that the ROK is economically quite capable of assuming a much
larger defense burden.
Comment: While we do not differ essentially with the EA/IG paper on
these points, we believe the paper underestimates how much South
Korea may try to reduce its dependence on us if we reduce U.S. military
assistance. This has probably been the most important factor in the new
ROK interest in third-country procurement, in establishing an in-country
defense industry, and in developing nuclear weapons by 1980. In
addition, reduced ROK dependence on us, like reduced North Korean
dependence on its suppliers, increases its freedom of action in the
North-South confrontation, although this is partially offset by the con-
straints of detente.
Status of the ROK Force Modernization Plan. The modernization
plan, to which we committed $1.5 billion in 1971 at the time we with-
drew the first of our two divisions from Korea, was to have been finished
in FY 75. By the end of FY 74, however, we were still $500 million
short, due to budgetary limitations.
The ROK places considerable
store by our rounding out, in some credible fashion, our contribution to
the modernization plan. The President in his recent meeting with
President Park reaffirmed our support for the plan, and said he hoped
its completion could be speeded up.
The EA/IG paper notes that the ROK has indicated its willingness to
accept greatly expanded FMS credits -- $500 million in FY 75-77 --
TOP SECRET
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3
and its expectation that grant MAP will end with the completion of
the plan. The EA/IG paper fails to mention that the ROK at the same
time has requested $345 million in grant MAP for FY 75-77; the paper
ignores the likelihood that the ROK passively accepts as inevitable the
prospect of greatly reduced grant MAP and its possible early termina-
tion.
Distaste in Congress for Park's handling of his domestic political
situation did not in the end reduce our military assistance to South Korea
by as much as earlier seemed likely. For FY 75, Congress has
authorized a total of $145 million, plus another $20 million if the President
certifies that Park is making substantial progress on human rights.
Congress has left to the President's decision how this total is to be
divided between grant MAP and FMS credits. This figure compares
favorably with the FY 74 appropriation of $100 million grant MAP and
$57 million FMS credit. For FY 76, we are requesting $75 million in
grant MAP and $100 million in FMS credit.
The ROK last spring expanded its requests for U.S. military equipment
by asking for the following: (1) the transfer of the F-4D squadron now
on a bailment to the ROK under the Enhance Plus Agreement, plus one
additional F-4E squadron (these would be added to the one F-4D squad-
ron already owned outright by the ROK to give it a wing of F-4s); (2) a
minimum of three F-5E squadrons either through purchase or co-
production (in addition to the four F-5E squadrons already planned); and
(3) a follow-on light-weight fighter such as the YF-16 or YF-17.
Policy Options
A. Rate of Shift from Grant MAP to FMS Credit. The EA/IG paper
casts its four options in terms of proposed levels only through FY 77,
the year by which the paper recommends that we complete our obliga-
tion to the modernization plan. The totals of grant MAP and FMS
credits under all four options would fill out the remaining $500 million
in our obligation.
FY 76
FY 77
Grant
FMS
Grant FMS
Option 1
147
65
96
90
Option 2
75
100
50
150
Option 3
50
125
25
175
Option 4
10
175
10
250
1080
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4
Options 1 and 4 border on the unfeasible. Option 1 would ask for a level
of grant MAP and Option 4 would ask for a level of FMS credit which
would almost certainly not be seriously considered by Congress. (Option 1
embodies existing Presidential guidance.) In addition, Option 4 would
assume that the 27 F-5Es which have been programmed and have been
partially funded in FY 75 would become a ROK funding responsibility,
which the ROK would view as a reversal of our commitment on this
major item. A further disadvantage to Option 4 is that the ROK would
assume the burden of supply costs, which can run 10-20 percent of total
grant MAP and which we have assumed so far.
Option 2 reflects the leve which Congress has authorized for FY 75 and
which we are requesting for FY 76.
1. Departmental Views. State supports Option 2, while Defense
wants Option 3. State stresses the political importance of an Executive
Branch request for a higher level of grant MAP. Defense emphasizes
Congressional constraints and the reputed ROK desire for increased
FMS credits.
2. Our View. We support Option 2. We agree with State's
emphasis on the political importance of an Executive Branch request
for this level of grant MAP in the present Korean context. We also be-
lieve that this combination of grant MAP and FMS credits is a figure
that would be taken seriously by Congress, would not conflict with our
Congressional tactics on the level of FMS credit we are requesting, and
takes cognizance of the ROK economic ability to assume a larger share
of the defense burden. Option 2 also reflects the level that Congress
has authorized for FY 75 and that we are requesting for FY 76.
B. A Possible Termination Date for Grant MAP.
Option 1: After FY 77, continue a low level of grant MAP for minor
investment programs.
-- Would provide political assurance to the ROK and preserve
some U.S. lever on ROK military affairs. On the other hand, might
well be resisted on the Hill.
Option 2: After FY 77, terminate grant MAP except for a level of
training on the order of $1 million.
TOP SECRET
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5
-- Would afford continued U.S. influence in ROK military
affairs, but would not be as politically reassuring to the ROK.
1. Departmental Views, Defense wants Option 1. State also
supports Option 1, but with a difference: if Congress does not approve
a level of grant MAP and FMS credit for the ROK sufficient to complete
our contribution to the modernization plan by FY 77, State would have
us continue to request both of these in subsequent years until the plan
were completed. State would terminate grant MAP, except for training
(at about $2 million a year), after the plan is finished. OMB would
make no decision on the termination of grant MAP until after Congress
completes action on the FY 76 bill.
2. Our Views. We favor Option 1. We believe that, at least at
this point, the United States should plan to continue a low profile of
grant MAP after FY 77. We would suggest about $25 million in FY 78,
tapering off to $5-10 million thereafter. To make a decision now to
terminate grant MAP would needlessly risk giving the wrong signal
to Pyongyang and would not support confidence in Seoul. The paper
misleads when it states that the ROK "already accepts" the notion that
grant MAP will terminate immediately upon the end of the Modernization
Plan in FY 77; the ROK has only "resigned itself to" this possibility.
C. Additional High-Performance Aircraft for the ROK. At this
point, the only real question is whether to transfer to the ROK the
F-4D squadron which has been bailed to the ROK under the Enhance
Plus Agreement since late 1972. The question of other high-performance
aircraft -- the ROK's other requests for a squadron of F-4E aircraft,
additional F-5E aircraft, and possible YF-17 or YF-18 light-weight
freighters -- is the subject of a basic reassessment of the that North
Korean air threat and consequent ROK air defense needs/is now being
done by Defense. The provision of these additional aircraft would
move the ROK substantially toward air defense self-sufficiency, and
thus would raise the question of the withdrawal of at least part of our
own F-4 wing in South Korea. It would also require a detailed reassess-
ment of the North-South air force balance in order not to risk stimulating
another round in the arms competition between the two Koreas.
As regards the F-4D bailed squadron, a State memorandum attaching
a draft cable instruction (Tab III) indicates general agreement in the
bureaucracy to sell this squadron to the ROK. As you may recall, a
second F-4 squadron was contained in the original Five-Year Modernization
TOP SECRET (XGDS)
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6
Plan drawn up in 1971, but was removed from last year's revision of that
plan because no F -4 squadron was available for transfer to the ROK.
Our own Air Force at that time, and indeed until very recently, was
adamantly opposed to transferring the bailed squadron to the ROK.
We do not believe that this addition to the ROK Air Force's capability
would risk an intensification of the arms competition on the Peninsula,
even though the bailed squadron has in effect been in the ROK inventory
for two years. State and Defense have agreed to put a price tag of $43
million on the F-4D squadron.
DOD, however, wants to attach a condition to the sale: that the ROK
be asked to pay the $3.3 million cost for rehabilitating the two F-5A
squadrons being returned to South Korea from South Vietnam under the
Enhance Plus Agreement. DOD rationalizes that, although the rehab
cost is our obligation under the Enhance Plus Agreement, the Agreement
also provided that the F-4D bailed squadron be returned to the U.S. Air
Force when the two F-5A squadrons were returned to South Korea. DOD
argues that our flexibility on the F-4D bailed squadron should therefore
be matched by ROK flexibility on the rehab cost. DOD's real motive,
however, is to try to pick up another $3. 3 million for its sorely-pressed
Vietnam budget.
Our View. As regards the substantive issue of whether to transfer the
bailed F-4 squadron, we support the transfer, as indicated above. As
to the tactical issue of whether to attach the condition proposed by Defense,
we have no objection to doing so, but agree with State that we should not
press the matter to a breaking point with the ROK if it resists strenuously --
which it is likely to do.
At Tab I is a draft memorandum from you to the President embodying
the above discussion and recommendations and attaching a draft NSDM.
RECOMMENDATION:
That you sign the draft memorandum to the President at Tab I.
TOP SECRET (XGDS)
3b
MEMORANDUM
6251
THE WHITE HOUSE
WASHINGTON
TOP SECRET/NODIS (XGDS)(3)
MEMORANDUM FOR:
THE PRESIDENT
FROM:
HENRY A. KISSINGER
SUBJECT:
Future U.S. Military Assistance
to South Korea
As part of the preparations for your recent visit to South Korea, the
departments completed a policy study on future U.S. military assistance
to the Republic of Korea (ROK). The specific issues they took up in
this study included (1) whether the rate of shift from grant military
assistance (MAP) to FMS credit should be accelerated, (2) whether
a termination date should be set now, and (3) whether additional high-
performance aircraft should be transferred to the Republic of Korea.
During your meeting with President Park, you discussed our military
assistance in general terms. You reaffirmed U.S. support for the
Five-Year ROK Force Modernization Plan, and said that we hoped to
speed up completion of our assistance to that plan. You also assured
Park that we had no intention to withdraw U.S. forces from South
Korea.
We now need your guidance on the specific issues listed above. The
inter-departmental paper presents the following options on these issues:
A. Rate of Shift from Grant MAP to FMS Credit. The Modernization
Plan, to which we committed $1. 5 billion in 1971 at the time we withdrew
the first of our two divisions from Korea, was to have been finished in
FY 75. By the end of FY 74, however, we were still $500 million
short due to budget limitations. The ROK places considerable store
by our rounding out, in some credible fashion, our contribution to the
Modernization Plan. From the beginning, we have made clear that we
would fulfill our obligation through a combination of grant MAP, FMS
credit, and excess defense articles. In the last year or so, we have
begun shifting to larger amounts of FMS credit, both because of tightening
Congressional constraints on grant MAP and because the ROK has been
FOND
TOP SECRET/NODIS (XGDS)(3)
E.O.
SSC 3.3; Day Directive 5200.30
NSC Memo, Mr 3/9
Guidelines shtereview9/18/03 9/18/03
By
NARA, Date 12/7/10
6251
FOP SECRET/NODIS (XGDS)(3)
2
able to pick up more of the burden. On the other hand, we do not
want to shift too rapidly. We not want to give the wrong signal
to Pyongyang and its alnes or to undercul confidence in Seoul.
Distaste in Congress for Park's handling of his domestic political
situation did not in the end reduce our military assistance to South
Korea by as much as earlier seemed likely. For FY 75, Congress
has authorized a total of $145 million, plus another $20 million if
you certify that Park is making substantial progress on human rights.
Congress has left to your decision how this total is to be divided
between grant MAP and FMS credits. This figure compares favorably
with the FY 74 appropriation of $100 million grant MAP and $57 million
FMS credit. For FY 76, we are requesting $75 million in grant MAP
and $100 million in FMS credit.
FY 76
FY 77
Grant
FMS
Grant
FMS
OPTION 1
147
65
96
90
OPTION 2
75
100
50
150
OPTION 3
50
125
25
175
OPTION 4
10
175
10
250
Departmental Views. State supports Option 2 while Defense wants
Option 3. State stresses the political importance of an Executive
Branch request for a higher level of grant MAP. Defense emphasizes
Congressional constraints and the reputed ROK desire for increased
FMS credits.
My View. The real choice is between Options 2 and 3. Option 1 and
Option 4 would not likely be considered seriously by Congress. I support
Option 2. I believe it important in light of the present political and
strategic situation on the Korean Peninsula that the Executive Branch show
continuing solid support for ROK needs. Moreover, I believe that
FORD
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ovvuto
LIBRARY
TOP SECRET/NODIS (XGDS)(3)
3
this combination of grant MAP and FMS credits is a figure that would
have a chance with Congress and reflects Korean ability to assume a
growing share of the defense burden. Option 2 also reflects the level
that Congress has authorized for FY 75 and that we are requesting for
FY 76.
B. A Possible Termination Date for Grant MAP. The Presidential
guidance of mid-1973 did not give a termination date for grant MAP.
The inter-departmental paper presents two options:
Option 1: After FY 77; continue a low level of grant MAP for
minor investment programs.
Option 2: After FY 77, terminate grant MAP except for a level
of training assistance at about $1 million annually.
Departmental Views. Defense wants Option 1. State also supports
Option 1, but with a difference: if Congress does not support enough
grant MAP and FMS credit to complete our contribution to the Moderni-
zation Plan by FY 77, State would have us request both of these in
subsequent years until the Plan were completed. State would terminate
grant MAP, except for training (at about $2 million a year), after the
Plan is finished. OMB would make no decision on terminating grant
MAP until after Congress completes action on the FY 76 bill.
My View. I favor Option 1. At this point, we do not want to indicate
a termination of grant MAP. In terms of military and budgetary
planning, it is not necessary that we do so now, since either Option 2
or 3 on the rate of shift from grant MAP to FMS credits indicates the
downward trend in grant MAP. Projecting beyond FY 77, if you choose
Option 2 on the rate of shift from grant MAP to FMS credits, I recom-
mend that we then think in terms of about $25 million in grant MAP for
FY 78, and thereafter taper off to a level of not more than $10 million
annually.
C. Additional High-Performance Aircraft for the ROK. At this point
the only real question is whe' er to transfer to the ROK the one F-4D
squadron which has been bail. d to the ROK under the Enhance Plus
Agreement since late 1972. Before we consider other ROK requests
for additional high-performar :e aircraft, we want to look at a basic
reassessment of the North Ko ean threat and of ROK air defense needs.
Defense is now completing th study.
TOP SECRET/NODIS (XGDS)
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4
As regards the F-4D bailed squadron, State and Defense agree that
we should transfer this squadron to the ROK by sale. The ROK
already owns one F-4 squadron outright. The transfer of this second
F-4 squadron to ROK ownership at this time should not stimulate arms
competition on the Korean Peninsula, since this second squadron has
in reality been in the ROK Air Force inventory for two years already
although it remained our property.
Defense wants to attach a condition to the sale of this F-4D squadron:
that the ROK be asked to pay the $3. 3 million cost for rehabilitating
the two F-5A squadrons being returned to South Korea from South
Vietnam under the Enhance Plus Agreement. Defense wants to use
the $3.3 million for its sorely-pressed Vietnam budget. I think we can
ask the ROK to pick up this $3. 3 million (on top of the $43 million
price tag we have put on the bailed squadron itself), but believe we
should not press the ROK to pay this additional cost if it raises serious
objections.
At Tab A is a draft NSDM which embodies my recommendations above.
RECOMMENDATION:
That you approve my signing, in your name, the draft NSDM at Tab A.
Approve
Disapprove
TOP SECRET/NODIS (XGDS)(3)
3d
NSSM 211
Security Assistance to the Republic of Korea
I. Introduction
This paper responds to the President's request for
a study of the U.S. Security Assistance Program for the
Republic of Korea (NSSM 211) The response outlines
U.S. interests and policies in Korea and discusses
how the Security Assistance Program complements them.
AS directed, the study assumes that there will be no
significant changes in the level or mission of United
States forces in the ROK.
In accordance with the President's request, the
study addresses the following specific issues:
- Should the rate of shift from grant military
assistance to FMS credits, defined in NSDM
227, be accelerated and, if so, what should
the new rate be?
- Should a termination date be set for grant
military assistance and if so, what should
that date be?
- What types and numbers of high performance
aircraft should be included in the Korean
Force Modernization Program?
- What modirications, if any, should be made
in the five-year Modernization Program for
the Republic of Korea prescribed in NSDM
129?
II. U.S. Interests, U.S. Poicies, and Policy Situation
A. U.S. Interests
The primary U.S. interest in Korea lies in prevent-
ing major hostilities between North and South. Such
nostilities could reverse present desirable trends to-
ward U.S. disengagement, run the risk of major escala-
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tion, and have an important impact on the situation in
Northeast Asia, particularly in Japan. U.S. interest
in further reduction of tensions in Korea stems also
from our interest in detente with the soviet Union and
the PRC.
For Seoul, the basic underpinnings of its rela-
tions with the U.S. rest on the Mutual Security Treaty
and an American troop presence. So long as these re-
main essentially intact, South Korea is prepared to
accept substantial modifications and adjustments in
U.S. military assistance. The ROK has already demon-
strated a capacity to adjust to such changes by com- -
mitting itself to greater self reliance in the equip-
ment field and has initiated longer-range planning to
adjust to a more substantial U.S. disengagement.
Like Seoul, Pyongyang, Moscow, and Peking will not
perceive adjustments in the form of American assistance
as signaing a weakening of fundamental U.S. support
for South Korea's security as long as the pasic elements
in the relationsnip remain intact. Pyongyang has for
some time focusea its criticism on the U.S. troop pre-
sence as the principal obstacle to achieving its goals
on the peninsula and is not Tikely to be encouraged
by anything less than significant U.S. disengagement.
Peking has indicated a willingness to tolerate the U.S.
troop presence as a means of preserving stability on
the peninsula; it is not likely to interpret changes
in military assistance mix as undercutting the U.S.
commitment to ROK security. Although much more cir-
cumspect in revealing its views, Moscow too would
differentiate between such adjustments and a funda-
mental change in U.S. support. The willingness of
both to provide North Korea with military assistance
will be conditioned largely by their rivalry with each
other and is uniikely to be influenced by changes in
the way US military assistance 1S funded as long as
levels are not perceived to be significantly increased.
B. U.S. Policies
In our efforts to maintain stability in Korea anu
to improve the ROK derensive capability the U.S. has
maintained three basic policies. First, the United
States has stc tly maintained its Mutual Derense Treaty
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commitment to the ROK in the event of an attack from
the North. second, the United States has kept forces
in Korea as a deterrent to attack and more recently
as a symbol of U.S. support of the ROK. in addition,
the United States has maintained light infantry forces
elsewhere in Northeast Asia and in the united States
itself which are intended primarily for deployment as
necessary in Asia. Third, the United States has sup-
ported a major security assistance program which nas
been instrumental in building ROK forces to the point
that they are now capable of defending against a North
Korean attack with only limited U.S. air and naval
combat support.
C. The Policy Situation
Although the fundamental U.S. commitment to the
security of the ROK has not changed since the end of
the Korean War, the level of U.S. deployments and the
nature of the security assistance program have changed
during that time. in the past two years grant assis-
tance allocated to Korea has not reached planned levels.
The ROK now expects further reductions in grant aid;
continued reductions should have little effect as long
as the U.S. continues to provide additional FMS Credit
and there are no expectations of significant reductions
in U.S. deployments.
Prime Minister Kim has already told the National
Assembly that the ROKG expects an end to grant assis-
tance in the next 2-3 years.
rurther, as the ROKG uses its own runds in mili-
tary procurement, it is looking at possible third
country procurement for some major items. Part of
this may be a desire on the part of the ROKG to lessen
its dependence on U.S. sources. However, in the main,
it is a reflection of the fact that in the mid-seventies
the ROKG will provide most of its own defense costs
and will wish to make its own decisions.
Recent developments in Northeast Asia will have
a major impact on future U.S. policies in the area.
The most important political aspect has been our judg-
ment that the Soviets and the Chinese share our desire
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to prevent North-South hostilities and seek to lessen
the risks of their involvement in future conflicts on
the peninsula. Thus, we must work with both the PRC
and the USSR toward easing tensions in Korea, hoping
that the two Koreas can reach an accommodation that
will turn their military confrontation into peaceful
competition.
*
The North-South relationship remains acrimonious
after three years of periodic, unproductive dialogue.
Military incidents occasionally occur, and each side
uses the threat of war to help motivate and control
its people. Yet neither side perceives any advantage
in initiating major hostilities at present. Both are
concentrating their energies on economic development
while maintaining a strong military posture. The
South has no aggressive designs on the North. And,
while Pyongyang has not disavowed its goal of con-
trolling the peninsula, it probably would act only in
the event of a breakdown in South Korean internal
stability. Despite the current impasse in their dia-
logue, both want to keep the channel of communication
open as a safety valve and for future contingencies.
Given the great power efforts at detente, the
possibilities of major military conflict have been
reduced. North Korea's military strategy remains
primarily defensive although its military buildup over
the past several years has given the armed forces a
significant offensive capability. North Korean strategy
appears designed to maintain a military balance in the
peninsula while providing flexibility to choose from
a wide range of offensive as well as defensive options.
We are confident that South Korea can now successfully
defend against a. North Korean attack with only limited
U.S. air and naval combat support. Moreover, both
North and South Korea would require extensive logisti-
cal support from their respective allies if they were
*In this regard, one po. sible approach meriting
further study would be t e pursuit of agreed re-
straints among the major powers in our respective
arms transfers to the pe insula.
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to continue a conflict beyond a few weeks.
Internal political factors in South Korea must
also be considered in the levelopment of U.S. policies.
Park Chong-hui is now in his fourteenth year as the
President of Korea and the opposition to his leader-
ship has increased significantly in the past several
years. His recent attempts to stifle opposition have
been temporarily successful but may have served to
unify and strengthen the opposition. An economic de-
cline could also result in the growth of dissatis-
faction with the Park regime. Further, Park's in-
ternal policies have damaged the ROK's international
image, particularly among church groups and the media.
This has had a clear impact on U.S. Congressional at-
titudes, which might well affect the future levels of
Korean MAP.
The ROK has made great strides in its economic
capability. For the past several years, GNP has grown
at an annual rate of about 11%. Nonetneless, along
with most countries, South Korea is now beginning to
suffer from economic dislocations. Although there
has been a sharp decline in the second half of 1974,
the ROK is expected to achieve real growth of approxi-
mately 8-9% for the entire year. ROK planners, anti-
cipating the decline in GNP growth rate, have made ad-
justments to maintain a high level of military expen-
diture which should permit a continuation of the trend
away from grant aid.
The five year (FY 71-75) MOD Plan, was formulated
and announced in conjunction with the withdrawal of
one U.S. combat division from Korea. NSDM 129 author-
ized a program of $250 million in EDA and $1.25 billion
maximum in new obligational authority (NOA), this amount.
to be reduced to the maximum extent possible through
FMS Credit and Cash sales, provision of additional EDA,
and other "no cost" U.S. equipment transfers. As of
end FY 74, there was a hortfall of approximately $110
million in EDA and $500 million NCA (including supply
operations and training) remained unfunded. Achieve-
ment of the EDA goal is not considered critical since
pricing. of EDA is arbit ary and the ROKs have not averted
to this aspect of the MO ) Plan. However, sufficient
NOA to fulfill the MOD lan commitments has not been
made available and the program has been extended.
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The MOD Plan was reviewed in 1973 by the Under-
secretaries Committee and the following recommendations
and additional directions were approved in NSDM 227:
(1) the United States should continue to
strive to complete the MOD Plan but planning for grant
aid and requests to Congress should not be precipit-
ously reduced nor should assistance be switched
rapidly to FMS Credit. *
(2) The emphasis in modernizing ROK forces
should be shifted to air defense to assist in moving
the ROK toward combat self-sufficiency against the
North.
(3) Before high performance aircraft beyond
replacement aircraft in the original modernization
plan are funded, a complete review of the threat and
air defense requirements should be undertaken and
recommendations submitted to the President.
In FY 74 the ROK unhesitantly accepted the U.S.
offer of nearly $57 million in FMS Credit, more than
twice the amount that had been planned. The ROK has
indicated that it would like even higher levels of
FMS Credit, and at the September 1974 Security Con-
sultative Meeting the Korean delegation outlined a
program for $500 million in credit over the period
FY75-77. Indeed, the ROK has indicated that it:
(1) does not expect continued high levels of grant
aid; (2) does not expect the U.S. to continue to pro-
vide grant aid once the MOD Plan is completed; and
(3) is concerned about the availability of high levels
of FMS Credit in the future.
In addition to their request for higher levels
of FMS Credit, the ROK has been making efforts to
NSDM 227 approved an option which was considered
and rejected by the Undersecretaries Committee. The
rejected option recommended that the funding of the
MOD Plan be stretched out through FY 77 with a steep
increase in FMS Credit as a substitute for grant aid.
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significantly improve its air force. While it is
not clear what the eventual ROK plan will be, they
have asked to purchase the F-4D squadron now on loan
to them and they wish to take additional steps to in-
crease the number of aircraft in their inventory.
At one point, the ROKG wished to purchase 57
F-4E aircraft. However, in September, the ROKG in-
dicated its readiness to embark on a program involv-
ing the following mix:
a. One F-4 wing (the already provided MAP-
funded F-4D squadron; the bailed F-4D
squadron and one F-4E squadron to be
purchased.)
b. in addition to 72 MAP-furnished F-5E air-
craft, a minimum of 3 squadrons (54 UE) of
F-5E to be purchased or co-produced.
C. An expressed ROKG preference for an eventual
follow-on light-weight fighter. The ROKG
decision on eventual long range moderni-
zation would be made after results of the
USAF competitive test (YF-16 VS. YF-17) be-
come available. Should the USAF fail to
adopt either, the ROKG decision would then
be made on other suitable US first line air-
craft for incorporation into ROKAF structure
in the late 70's or early 1980's.
III. Policy Issues and Options
A. Should the rate of shift from grant aid to
FMS Credit be accelerated?
Given past funding shortfalls and the ROnG's in-
creasing ability to bear its own detense costs, we
would in any event have to address the question of an
accelereated shift from grant aid to FMS credit. In
view of present Congressional attitudes regarding
MAP, a review now is essential.
As of end FY74 $500 million of the MOD Plan
remained unfunded. The ROK has been repeatedly and
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-8-
publicly reassured on numerous occasions by high rank-
ing U.S. officials that the U.S. intends to complete
the MOD Plan. Accordingly the Administration has no
alternative but to continue to pursue the completion
of the MOD Plan. The ROKG has been informed that
completion of the MOD Plan will require a greater use
of FMS (cash and credit) and the issue of concern 1S
the mix of grant aid and FMS Credit which should be
provided. Grant aid has not been realized as pro-
jected in the MOD Plan. For example, of $241.0 mil-
lion grant aid planned for FY 1974, some $78 million
became available. (Supply operations of $22 million
brought the total for Korea to $100 million.) The
overall grant aid plan in FY 1975 is for $180.0 million
($162 M grant and $18 M supply operations). Although
the Foreign Aid bill has not been approved, the Senate
and House Foreign Relations Committees have success-
ively cut the ROK funds to $117.5 and $100 million.
FMS Credit levels were addressed only by the SFRC
which proposed levels for FY 75-77 considerably below
the Administration projections and further provided
for FMS termination after FY1977.
In sum, the clear ability and willingness of the
ROK to provide significantly greater amounts of the
funds required for its defense expenditures and the
U.S. inability to continue providing high levels of
grant aid make it necessary to consider new options
for completing the MOD Plan. We recognize that what-
ever option is adopted may well be more than the Con-
gress will accept. However, they are consonant with
our assurances to the ROKG while reflecting an apprecia-
tion of legislative realities.
Option 1. Continued Funding Plans in Accordance
with NSDM 227.
This would involve a grant aid request for Korea'
for FY 1976 of $147 million and an FMS figure of $65
million. Each year our request for grant aid would
decrease by about $48 million. No termination date
would be set for grant aid. The following illustra-
tive funding schedule depicts a continuation of NSDM
227 financing of the MOD Plan. It assumes no cuts
to the requested amounts. Supply operations and
training costs are included.
FORD:
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ILLUSTRATIVE FUNDING SCHEDULE
Option 1
($ Millions)
FY 75
FY 76
FY 71
TOTAL
Grant Aid
192
147
96
435
FMS
45
65
90
200
Total
237
212
186
635
MOD Plan Shorttall as of end FY 74
500
Excess over MOD Plan
135
This option provides the advantages of:
-- consistency with amounts requested in previous
years
--- supporting past Administration assurances that
the MOD Plan will be completed as soon as
possible.
-- conforming to the caution in NSDM 227 that
requests for grant aid not be precipitously
reduced.
Disadvantages of this option are:
-- Congress is likely to disapprove such high
levels of security assistance, particularly
grant MAP for Korea because of (1) an out-
standing economic growth and very good finan-
cial credibility, (2) recent suppression of
human rights, and (3) the generally negative
Congressional attitude on MAP.
-- Does not recognize ability -- and willingness
-- of the ROKG to utilize large amounts of
FMS credit tor procurement of modernization
equipment.
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Option 2. Plan on reduced levels of grant aid
and increased levels of credit
This option assumes a FY 75 grant aid total for
Korea of $100 million and an FMS Credit total of $52
million. Each year our request for grant aid would
decrease by $25 million, while our FMS request would
increase by $50 million. The table below shows the
funding schedule for the period FY 75-77. Supply
operations and training costs are included.
ILLUSTRATIVE FUNDING SCHEDULE
Option 2
($ Millions)
FY 75
FY 76
FY 77
TOTAL
Grant Aid
100
75
50
225
FMS
52
100
150
302
TOTAL
152
175
200
527
MOD Plan Shortfall as of end FY 74
500
Excess Over MOD Plan
27
The following advantages apply to this option:
-- It strikes a balance between decreasing grant
and increasing FMS levels.
--- The grant portion for FY 1975 corresponds to
the HFAC recommendation and reflects a reason-
able decrease for FY 1976.
-- It emphasizes to the ROK that we are still
earnestly trying to complete the MOD Plan
under the original concept at the least cost
to the ROK.
The significant reduction in FY 76 from the
FY 1975 request for grant MAP and greater
emphasis on FMS credit might receive greater
Congressional support.
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Disadvantages are:
--- There is no assurance we will get either the
grant or FMS levels requested.
-- Congress may expect the total Administration
request to show a lower level than allocated
in the previous year.
-- The SFRC recommended $75 million grant MAP
and $42.45 million FMS credit in FY 1975.
--- Korea's consistent economic growth record
militates against the requested levels, par-
ticularly the grant portion.
Option 3. Plan on grant aid levels below Option
2, but with increased levels of FMS Credit
In this option we would decrease grant aid by $25
million for each of the next two years (from $75 million
in FY 75), and FMS requests would be increased approxi-
mtely $50-$75 million a year (from $52 million in FY
75). This provides $300 million in FMS Credit over the
next two years, or $352 million by the end of FY77,
and our MOD Plan commitment to the ROKG will be ful-
filled assuming $150 million in grant aid is provided.
The following illustrative funding schedule re-
flects the above. it assumes a cut in the FY 75 grant
aid and a partially off-setting increase in FMS for
out years. Supply operations and training costs are
included.
ILLUSTRATIVE FUNDING SCHEDULE
Option 3
($ Millions)
FY 75
FY 76
FY 71
TOTAL
Grant Aid
75
50
25
150
FMS
52
125
175
352
TOTAL
127
175
200
502
MOD Plan Shortfall as of end FY 74
500
Excess over MOD Plan
2
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For FY 76 and FY 77 it seems reasonable to expect
Congress to authorize progressively lower grant aid
levels than in FY 75. However, we expect that Con-
gress will permit higher FMS levels as a trade-off
for the lower levels of grant àid in FY 76 and FY 77.
Assuming that $75 million grant aid and $52 million
FMS credit will be provided in FY 75, $373 million
of the MOD Plan will remain unfunded after FY 75.
The advantages to this option are:
--- It more clearly reflects Congressional wishes
for an accelerated end to grant assistance.
-- It offers an early end to grant MAP as an
inducement for Congressional support for
a planned phase-out and for increased FMS
credit.
--- It provides for a large compensatory increase
in FMS which the Koreans are willing to accept.
--- It allows us to complete the Modernization Pro-
gram within the FY-77 timeframe in a manner
acceptable to the ROKG and consonant with our
past assurances.
The disadvantages are:
-- There is no assurance that Congress will accept
either the contemplated grant levels or the
steeply increased FMS requirements.
-- The ROKG may interpret the sharper grant reduc-
tion as evidence that the Administration is
moving away from its expressed support for the
Modernization Plan. This will be true if the
projected FMS levels are not realized.
-- Congress may fur her lower the already reduced
grant aid level.
Option 4. Meet the OK request for $500 million
in FMS cr dit during FY 75-71 and pro-
vide min um levels CE grant aid to
demonstrate the U.S. commitment.
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This option has four considerations:
(1) the ROK would like to receive $500 million
in FMS Credit over the period FY 75-77; (2) the ROK
economy is capable of supporting FMS credit levels
of this magnitude; (3) the ROK expects reductions in
grant aid and it is considered unlikely that serious
consequences would result from such reductions so
long as they are accompanied by assurances of con-
tinued U.S. support; and (4) the Congress might pos-
sibly be more responsive to a proposal for a more
rapid shift to FMS credit. The table below shows the -
funding schedule for the period FY 75-17. This option
does not provide funds necessary for supply opera-
tions. The ROKG would have to supply these funds.
ILLUSTRATIVE FUNDING SCHEDULE
Option 4
($ Millions)
FY 75
FY 76
FY 77
TOTAL
Grant Aid
25
10
10
45
FMS
75
175
250
500
TOTAL
100
185
260
545
MOD Plan Shortfall as of end FY 74
500
Excess Over MOD Plan
45
This option presumes that procurement of 27
MOD Plan F-5Es which have been programmed and partially
funded in FY 75 would become a ROK responsibility.
The ROKs could be expected to react vigorously to
what they consider a U.S. reneging on its commitment.
This option has the following advantages:
-- This minimum level of grant MAP is much
less likely to be challenged by Congress
inasmuch as the very sharp decrease
presages an end to grant security assistance
for Korea.
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-- The significantly increased level of FMS
credit is within the capability of the
ROK which has indicated a need for $500
million in FMS credit over the three years
ending in 1977.
Disadvantages are:
-- Congressional reaction to the sharply in-
creasing level of FMS will be unfavorable
-- even antagonistic -- in light of ex-
pressed Congressional wishes to decrease
all security assistance programs.
-- The minimum grant level requested would upset
the ROK. Such a request would be interpreted
as an implied abandonment by U.S. Administra-
tion of its support for the modernization
program.
B. Should a Termination Date be set for grant
military assistance?
As noted previously, the ROKG already expects
that grant military assistance for equipment will end
once the MOD Plan is completed. Although it may be
in our interest to continue providing security
assistance to the ROK, the United States is under no
obligation to do so once the MOD Plan is completed.
However, the completion of the MOD Plan does not mean
that all ROK modernization requirements are met. A
joint U.S./ROK military ad hoc committee on Korean
Force Modernization recently completed a review of
ROK defense needs and developed a list of ROK moderni-
zation requirements whose total cost is approximately
$1.9 billion. Of this amount about $550 million was
identified as required for completion of the MOD
Plan. It was understood that the remaining $1.35
billion would come from ROK resources, facilitated
by FMS cash and credit.
Once the MOD Plan is completed, the major justi-
fication for continuing grant aid will be the effect
that such assistance would have in demonstrating the
U.S. support and the influence such a program provides
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-- low levels of grant aid will be insignificant when
compared with the large amounts of FMS Credit and Cash
sales that are expected. However, it may be in U.S.
interests to provide aid for training and funding of
some minor program requirements.
Option 1. Continue providing a low level of
grant aid for some minor investment
programs.
This level would be relatively insignificant in
terms of total ROK purchases but it would continue to
demonstrate the U.S. interest in ROK security and pro-
vide some measure of leverage on military matters.
There will be no post MOD Plan economic requirement
for grant aid, however, and the Congress might well
consider it inappropriate to continue providing grant
aid. This option would also provide for training
programs.
Option 2. Termination grant aid except for
training.
Under this option the United States would con-
tinue to provide grant aid for training, but would
terminate grant aid for investment. The ROK secu-
rity assistance program would be similar to the pro-
gram for the Republic of China. This option would
provide a vehicle for continued U.S. influence with
all levels of the ROK military.
C. What Types and Numbers of High Performance
Aircraft Should Be in the Korean Force Modern-
ization Program?
Predicated on the continued presence of one wing
(72 UE) of USAF F-4s in Korea, NSDM 227 reaffirmed a MOD
Plan goal of 10 squadrons of high performance aircraft
(1 F-4D and 9 F-5A/E squadrons). Additionally, NSDM 227
accepted the Korean Force Requirements Study, which
included a recommendation that in order to be self-
sufficient against a North Korean threat (i.e., without
requiring USAF tactical air support), the ROKAF requires
an additional 90 F-5Es (5 squadrons) or the equivalent.
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However, NSDM 227 directed that before high performance
aircraft beyond replacement aircraft in the original
modernization plan are funded, a complete review of
the threat and air defense requirements should be
undertaken and recommendations submitted to the President.
Recently it was decided to sell to the ROK the
18 US F-4D aircraft currently bailed to them. The
ROK will be asked to pay $43.2 M for the aircraft
(which will be credited toward MOD Plan completion)
and will be asked to make other concessions. If the
sale is consummated and programmed F-5Es are funded
in FY 75, the ROKAF will have one more tactical fighter
squadron than was anticipated in the MOD Plan.
There is general agreement that a requirement
exists for additional high performance aircraft for the
ROK particularly if they are to approach self-suf-
ficiency. However, as NSDM 227 noted, before add-
itional high performance aircraft for the ROK are fund-
ed, the threat should be reviewed and Presidential
approval obtained. Further, the type and numbers of
high performance aircraft for the ROKAF should be
determined after dialogue with the ROKG in the normal
course of events. At the Seventh Security Consultative
Meeting it was urged that the ROK/U.S. staffs continue
to examine the requirements for overall ROK air defense.
This question is now under study. Therefore, it is
considered premature to formulate types and numbers
of high performance aircraft for the future ROKAF
inventory now.
D. What Modification, if any, should be made
to the MOD Plan?
At this time no modifications to the MOD Plan are
recommended other than those funding changes discussed
in III.A., above. The U.S./ROK Military Ad Hoc Com-
mittee monitoring ROK force modernization, have gen-
erally agreed to the modernization requirements. The
only two notable areas of disagreement concern ROK air
defense and include the numbers and types of high
performance aircraft (discussed in III.C., above),
and the requirements for ground based air defense
systems. The latter disagreement arises from the U.S.
recommendation that the ROK convert all 12 of its Hawk
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019814
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Batteries to the improved version (at a cost of about
$75 M), whereas, the ROK initially desired to retain
the basic Hawk system. An agreement was reached under
which the ROK will convert 4 forward firing batteries.
The disagreement over the number of Hawk
batteries which should be converted will not be
&
resolved until an investigation of total ROK air
defense requirements is completed. The U.S./ROK
re-evaluation of ROK air defense requirements,
now underway, was prompted by: (1) the House
report accompanying the FY 75 Military Appropria-
tions Bill which recommended transfer of all U.S.
air defense assets in Korea to the ROK, and (2) a
recent Secretary of Defense decision calling for
negotiation of the transfer to the ROK of the six
U.S. Nike Hercules batteries in Korea.
It is, therefore, recommended that no additional
modifications to the MOD Plan impacting on ROK air
defense be made at this time.
075553
3e
FORM DS 322{0CR}.
E.O. 12958 DECLASSIFIED (as emended) SEC 8.3 DiD Dirative
5200.30
SECRET
By
NSC Momo, wa 3/30/06, State Dept. Guidellnes
NARA, Date 12/1/10
DOD/ISA:PFLINT/EA/K:DAO'DONOHUE:LM
11/14/74 EXT 20780
EA:PCHABIB
PM:RMARRYOTT
DOD : UPCLEMENTS
NSC:
S/S:
T:CEMAW
IMMEDIATS
PRIORITY
SEOUL
EXDIS
PCH
E.O. 11652: GDS
PF/DOI
TAGS: MARR, MASS, KS, US
RM
SUBJECT: SALE OF F-4D AIRCRAFT TO ROK
DOL
JOINT STATE/DEFENSE MESSAGE
NSC
1. THE USG HAS DECIDED TO AGREE TO ROKG REQUEST TO SELL
S/S
THEM THE BAILED F-4D SQUADRON ON AN FMS CASH BASIS. IN
INFORMING THE ROKG OF THIS DECISION YOU SHOULD MAKE IT
CEM
CLEAR THAT THIS HAS BEEN A DIFFICULT DECISION FOR US
FOR THE FOLLOWING REASONS:
A. THIS DECISION WILL HAVE ADVERSE EFFECT ON USAF ASSETS.
THE USAF ALREADY HAS A DEFICIT OF OVER 100 AIRCRAFT OF THIS
TYPE AND THIS SALE WILL ADD TO THIS ALREADY SERIOUS
SITUATION.
B. DOMESTICALLY, WE WILL PROBABLY BE UNDER CONGRESSIONAL
PRESSURE FOR SELLING THESE PLANE WHEN USAF IS ALREADY SHORT
//////
OF FIGHTER AIRCRAFT. HOWEVER, USG DECISION TO SELL BAILED
SQUADRON OF 18 F-4D AIRCRAFT HAS BEEN MADE BECAUSE OF OUR
DESIPE TC HELP ROKG TO IMPROVE KOREAN DEFENSE CAPABILITIES
AND BECAUSE OF INCREASING MAP STRINGENCIES. FYI. WE INTEND
TO CHARGE THE $43.2 MILLION FMS SALE AGAINST THE MOD PLAN
41.25 BILLION NOA CEILING. END. FYI.
2. BELIEVE THE ROKG SHOULD ALSO RECOGNIZE THAT THEY COULD
NOT OBTAIN THE EQUIVALENT AIR DEFENSE CAPABILITY WITHIN THE
MILITAR
ADDRESS
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FORM DS 322A10CR3
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2
NEAR TERM WHICH THE F-4D SQUADRON PROVIDES BECAUSE
DELIVERY LEAD TIMES FOR ADVANCED AIRCRAFT ARE AT LEAST
TWO TO THREE YEARS. FURTHER, ANY SIMILAR CAPABILITY
{I.E., TO F-4D'S} ACQUIRED AT TODAY'S PRICES WOULD COST
MORE THAN TUICE THE PROPOSED PURCHASE PRICE {I.E., F-4E'S
EXCLUDING AGE AND SPARES}. WE PROPOSE TO OFFER THE F-4D'S
TO ROKG AT A COST OF $2.4 MILLION EACH {EXCLUDING AGE AND
SPARES}. THIS PRICE IS BASED ON FOLLOWING:
A. EACH REPLACEMENT F-4E AIRCRAFT WHOSE EXPECTED LIFE IS
18 YEARS COSTS THE USAF $5.3 MILLION {EXCLUDING AGE AND
SPAKES}. THE LIFE SPAN OF THE F-4D IS ALSO ESTIMATED TO
BE 18 YEARS AND THUS THE BAILED AIRCRAFT COULD BE EXPECTED
TO DE SUPPORTED AND USED FOR AN ADDITIONAL NINE YEARS.
B. THE BAILMENT MOU PLACES REPLACEMENT COSTS AT $1.7
MILLION. THAT COST CAN STILL BE CONSIDERED VALID SINCE
INFLATION COULD OFFSET DEPRECIATION SINCE THE MOU WENT INTO
EFFECTS HOWEVER, THE USAF HAS SPENT $700,000 PER AIRCRAFT
IN CLASS IV AND V MODIFICATIONS IN ORDER TO KEEP THE
AIRCRAF UP TO USAF STANDARDS. AS NOTED ABOVE, SPARES AND
AGE ARE NOT INCLUDED IN THE $2.4 MILLION PRICE AND
ACQUISITION OF THOSE ITEMS COVERED BY THE BAILMENT WILL
HAVE TO BE NEGOTIATED SEPARATELY. WE CONSIDER THE $2.4
MILLION PRICE TO BE FIRM.
3. FOR ITS PART WE WOULD EXPECT THE ROKG TO VIEW
SYMPATHETICALLY THE PROBLEM ASSOCIATED WITH THE RETURN OF
THE 36 F-5A'S AND ASSOCIATED AGE AND SPARES. THE FY 75
VIETNAM AID PROGRAM IS IN DIFFICULT STRAITS AND WE MUST
SEEK ALL LEGITIMATE MEANS TO MAXIMIZE THE EFFECTIVE LEVEL
OF AID. ASSUMPTION BY THE ROKG OF RESPONSIBILITY FOR THE
COSTS ASSOCIATED WITH THE REHABILITATION AND RETURN OF THE
F-5A'S AND THE REPLACEMENT OF ASSOCIATED AGE AND SPARES
APPEARS TO BE A REASONABLE CONCESSION ON THEIR PART IN
VIEW OF OUR DECISION ON THE F-4D'S. OU ARE AWARE, OF
COURSE, THAT THE FY 75 IIAP PROGRAM REFORE CONGRESS IS
IN DIFFICULTY AND IT MAY BE USEFUL TO MAKE ROKG AWARE-AT
THIS TIME THAT UNCERTAIN P' OSPECTS FOR FY 75 AID LEVELS,
INCLUDING F-SE AIRCRAFT, INFL IENCE OUR FAVORABLE
FORD
CONSIDERATION OF THEIR F-4D REQUEST
11. SHOULD ROKG EXPRESS INTER ST IN PURCHASE OF F-4E'S
{IN ADDITION TO PURCHASE OF B ILED SQUADRON} YOU SHOULD
INFORM THEM THAT DECISION RE UCH PURCHASE WOULD BE
SUBJECT TO A SUBSEQUENT REVIEW OF U.S. POLICY CONCERNING
PHC MIX IT AIL DEFENSE/OFFENSE C. ABILITY WHICH THE ROK
WOULD THEREBY ACCUIRE
IN FORM THEM THAT THIS REQUEST IS UNDER STODY.
SECRET
FORM DS 322A{0CR}
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I 3
5. WE LEAVE TO EMBASSY/COMUSK DISCRETION HOW AND AT WHAT
LEVEL TO INFORM ROKG OF FOREGOING USG DECISION.
6. AFTER NEGOTIATIONS HAVE BEEN CONSUMMATED, WE
ANTICIPATE PROVIDING A LETTER FROM DEPSECDEF CLEMENTS FOR
DELIVERY TO MND SUH RE THIS SALE. YY
FORD
GERALD
LIDUARY
SECRET
4A
NATIONAL ARCHIVES AND RECORDS ADMINISTRATION
Presidential Libraries Withdrawal Sheet
WITHDRAWAL ID 032810
REASON FOR WITHDRAWAL
ÇNational security restriction
TYPE OF MATERIAL
ÇMemorandum
CREATOR'S NAME
John A. Froebe, Jr.
RECEIVER'S NAME
Secretary Kissinger
TITLE
Military Assistance for South Korea:
Third Country Procurement
CREATION DATE
01/11/1975
VOLUME
2 pages
COLLECTION/SERIES/FOLDER ID
033700249
COLLECTION TITLE
NATIONAL SECURITY ADVISER. NSC EAST
ASIAN AND PACIFIC AFFAIRS STAFF FILES
BOX NUMBER
5
FOLDER TITLE
Korea (8)
DATE WITHDRAWN
03/03/2011
WITHDRAWING ARCHIVIST
TMH
4b
BY:
(Date & Time Stamp)
DEPARTMENT OF STATE
PPE.NT
Operations Center
OF STATE
WHITE HOUSE
LDX MESSAGE RECEIPT
CNROOM
11 ID 29
S/S #
'75 JAN 11 AM 10.36
LDX MESSAGE NO. 1337
,
CLASSIFICATION SECRET EXDIS
NO. PAGES 4
,
DESCRIPTION OF MSG. Telegram to Seoul re Possible ROK Third Country
Procurement of Major Military Items
FROM:
$
S/S
o
,
Officer
Office Symbol
Extension
Room Number
LDX TO:
DELIVER TO:
EXTENSION:
ROOM NUMBER:
NSC - Mrs. Jeanne Davis
e.
3
#
#
,
,
,
1
,
,
,
FOR:
CLEARANCE
INFORMATION XXX PER REQUEST
COMMENT
/
REMARKS:
VALIDATED FOR TRANSMISSION BY:
REDCXLY
Executive Secretarilat Officer
FORD
SIRACO
LIBRARY
4c
FORM DS 322{0CR}
SECRE
EA/K:DAO'DONOHUE:LM
1/10/75 EXT 20760
EA:PCHABIB
PM - MR. LADD
DOD/ISA:MIABRAMOUITZ (DRAFT}
S/S -
NSC -
DOD/DSAA:GENERAL FISH {SUB}
JCS/J-5: GENERAL CDYOUREE {SUB}
IMMEDIATE
SEOUL IMMEDIATE
EXDIS
PC:
E.O. 11652: XGDS-3
DAC
TAGS: PFOR, MASS, KS
PM
SUBJECT: POSSIBLE ROK THIRD COUNTRY PROCUREMENT OF MAJOR
MILITARY ITEMS
MIA
CINCPAC FOR POLAD
S/S
NSC
REF: A. SEOUL 02: B. STATE 221812
FIS
L. WE AGREE WITH EMBASSY ASSESSMENT THAT - GIVEN FACT THAT
POKG INCREASINGLY BEARING ITS OWN DEFENSE COSTS AND U.S.
CDY
ASSISTANCE DECLINING, KOREANS WILL BE INCREASINGLY
INDEPENDENT IN THEIR PROCUREMENT DECISIONS. FOR OUR PART,
IN PAST SIX MONTHS WE HAVE MADE PARTICULAR EFFORT TO BE
FORTHCOMING ON MAJOR EQUIPMENT DECISIONS REGARDING KOREA.
AS ROKG IS AMARE, OUR DECISION TO ALLOW PURCHASE OF F4D
SQUADRON WAS A PARTICULARLY DIFFICULT ONE. IN RESPONSE TO
MILIT
KOREAN REQUIREMENTS, WE ALSO WERE ABLE TO MAKE SEPARATE
ADDRESS
DECISION AUTHORIZING HARPOON FOR KOREA. WE ARE NOW IN
ADDAC
PROCESS OF ASSESSING PRODUCTION SCHEDULE TO SEE WHETHER IT
POSSIBLE TO EXPEDITE DELIVERY SCHEDULE TO MEET SECOND
GENERATION PSMM DELIVERY SCHEDULE. WE ARE ALSO PREPARED
TO GIVE SERIOUS CONSIDERATION TO KOREAN REQUEST FOR
ADDITIONAL FERSE'S, PENDING DOD AIRCRAFT REQUIREMENTS STUDY
NOW IN LAST STAGES. WE ARE, AND HOPE TO CONTINUE.
PROVIDING SUBSTANTIAL LEVELS OF ASSISTANCE.
FORD
DECLASSIFIED
E.O.12358 (as amended) SEC 8.3
SECRET
By ISC demo/3/30/06, Va State Dapt. Guidelines stite review 9/18/03
u
NARA, Date 12/7/10
FORM DS 322450CR}
SECRET
12
2. OVERALL, IT IS OUR VIEW THAT WE HAVE INDEED BEEN
RESPONSIVE TO KOREAN NEEDS, BOTH ON THESE MAJOR ITEMS AND
ON THE LARGE NUMBER OF LESSER FMS AND COMMERCIAL CASES
WHICH HAVE BEEN APPROVED. GIVEN THE APPARENT BACKGROUND
TO EXOCET AND SUBMARINE DEALS, IT IS OUR IMPRESSION THAT
KOREAN CHARGES OF DELAY ARE NOT JUSTIFIED BY OUR
PERFORMANCE AND APPEAR A RED HERRING TO OBSCURE OTHER
CONSIDERATIONS WHICH WENT INTO ROKG DECISIONS.
3. WE HAVE NO DESIRE TO DICTATE TO ROKG HOW IT COMMITS
ITS OWN FUNDS. THIS IS IN FINAL ANALYSIS THEIR OWN
DECISION. AT SAME TIME, WE SEE NO JUSTIFICATION FOR ROKG
ACTION IN ENTERING INTO LARGE SCALE COMMERICIAL PROCURE-
MENT OF QUESTIONABLE MILITARY EQUIPMENT FROM THIRD
COUNTRY SOURCES AT A TIME WHEN WE ARE STILL PROVIDING
MAJOR ASSISTANCE. DESPITE MAJOR DIFFICULTIES WE HAVE
HAD WITH CONGRESS ON MAP IN GENERAL, AND KOREA IN PARTICU-
LAR- WE STILL EXPECT THAT FY 75 LEVELS -CFMS PLUS MAP3
WILL BE SIGNIFICANT. HOWEVER, KOREAN DECISION TO GO
AHEAD WITH PROCUREMENT OF THESE THIRD COUNTRY SYSTEMS
WILL INEVITABLY CALL INTO QUESTION THE JUSTIFICATION FOR
GRANT ASSISTANCE LEVELS WE ARE SEEKING AND RAISE SERIOUS
CONGRESSIONAL DIFFICULTIES. WE WILL NO BE ABLE TO
DEFEND SITUATION IN WHICH USG PROVIDES LARGE SUMS OF
ASSISTANCE FOR MUTUALLY AGREED UPON PROCUREMENT ITEMS,
WHILE ROKG THEN USES ITS OWN FUNDS TO SHOP AROUND FOR
ITEMS WHICH IT MAY WISH TO PROCURE FOR A VARIETY OF
REASONS, INCLUDING NON-MILITARY CONSIDERATIONS-
4. OUR CONCERNS ARE AMPLIFIED BY FACT THAT WE AND ROK
HAVE ESTABLISHED ELABORATE CONSULTATIVE ARRANGEMENTS
INCLUDING AD HOC MILITARY SUBCOMMITTEE TO SET MILITARY
PRIORITIES. FURTHER, AT LAST SCM- MND SUH WENT TO GREAT
LENGTHS IN ASSURING US OF ROK INTENTIONS REGARDING U.S.
PROCUREMENT AND PRIOR CONSULTATION- IN EXOCET CASE WE
HAVE NEVER RECEIVED CONVINCING MILITARY RATIONALE AND IT
IS OUR IMPRESSION THAT DECISION TO GO AHEAD IS MOTIVATED
ESSENTIALLY BY POLITICAL AND OTHER CONSIDERATIONS. IN
CASE OF BRITISH SUBMARINES, IT APPEARS SUCH PROCUREMENT
WAS NOT EVEN DISCUSSED WITH US BEFORE DECISION MADE.
THIS RAPSES QUESTIONS AS TO SERIOUSNESS OF THE ROK
APPROACH TO OUR PAST MILITARY CONSULTATIONS ON REQUIREMENT
PRIORITIES.
5. YOU SHOULD DISCUSS THE ABOVE CONSIDERATIONS AT
WHATEVER LEVEL OF ROKG YOU FEEL APPROPRIATE. IN MAKING
ABOVE POINTS YOU MAY ALSO NOTE THAT WE ARE REVIEWING
HARPOON SCHEDULE AND MAY BE ABLE TO DO BETTER IN
LIBRARY
SECRET
7
FORM DS B22A-0CR}
SECRET
I 3
DELIVERY TIMES. WE WILL HAVE FIRM READING ON THIS IN
MID-FEBRUARY AND WILL GIVE ROK REQUIREMENTS THE HIGHEST
POSSIBLE CONSIDERATION. YOU SHOULD ALSO AGAIN POINT OUT
MAJOR EFFORTS WE HAVE MADE ON OTHER PROCUREMENT
DECISIONS.
5. AS APPROPRIATE YOU SHOULD ALSO EXPLAIN THAT WE REMAIN
FULLY COMMITTED TO THE SECURITY OF THE ROK. PRESIDENT
:
FORD DURING HIS NOVEMBER VISIT PERSONALLY REAFFIRNED OUR
CLOSE SECURITY TIES TO ASSURE THERE IS NO MISREADING OF
OUR INTENTIONS. WE ARE ALSO DETERMINED TO 00 ALL WE CAN
TO COMPLETE THE MODERNIZATION PROGRAM. GIVEN THE CONTEXT
OF OUR CLOSE SECURITY RELATIONSHIP, WE HOPE THE ROKG WOULD
NOT MOVE IN A DIRECTION WHICH COULD CAUSE SERIOUS
PROBLEMS FOR BOTH USOF US. YY
"
078625
SECRET
O/CT:
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FORD s ovrans LIBRAS