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The original documents are located in Box 18, folder "President Ford's Trip to Seoul,
November 1974 (3)" 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States of America his copyrights in all of his unpublished writings in National Archives collections.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 18 of NSC East Asian and Pacific Affairs Staff: Files, 1969-1977 at the Gerald R. Ford Presidential Library
la
BACKGROUND PAPERS
GERALD R. FORD
DEPARTMENT OF STATE
BRIEFING PAPER
ROK DOMESTIC POLITICAL SITUATION
Park's Repressive Measures 1971-74
Since he seized power in a coup in 1961, Presi-
dent Park Chong-hui has invigorated the ROK bureau-
cracy and created a favorable climate for rapid eco-
nomic growth. In 1971 he undertook to reduce ten-
sions in the Korean peninsula through dialogue with
the North. Over the past three years, however, his
domestic problems have mounted as Park became increas-
ingly authoritarian and promulgated a series of meas-
ures aimed at strengthening his regime and perpetuat-
ing himself in office:
--In December 1971 Park declared a state of
national emergency, enabling him to impose press cen-
sorship and issue economic decrees.
--In October 1972 he dissolved the National As-
sembly and imposed martial law.
-- In November 1972 a referendum conducted under
martial law and in which no opposition was permitted,
approved a new constitution providing for a rubber-
stamp electoral college instead of direct election of
the President; presidential appointment of one-third
of the legislature; arrest without hearing; and cur-
tailment of free speech and assembly.
-- In August 1973, from a Tokyo hotel room, Korean
CIA agents abducted Kim Tae-chung, Park's opponent in
the 1971 presidential election, returning him to virtual
house arrest in Seoul.
--In January 1974 President Park authorized spec-
ial courts-martial empowered to sentence up to 15 years
anyone who "defamed" or tried to change the November
1972 constitution or criticized these same measures.
--An April 1974 decree authorized the death pen-
alty or life imprisonment for anyone planning, support-
ing or participating in student anti-government demon-
strations.
CONFIDENTIAL
GDS
FORD
DECLASSIFIED
E.O. 12958 (as amended) SEC 3.3
State Dept Guidelines
conses
By
in
LIBRARY
NARA, Date 1/3/11
CONFIDENTIAL
-2-
The Growth of Opposition
Initially there was almost no overt resistance
to Park's gathering in of power. The only voices
to protest against the changes were the Roman Cath-
olic cardinal and a lone Protestant minister. The
opposition party felt too weak to act; students were
intimidated just before the first emergency declara-
tion by the indiscriminate arrest and beating of stu-
dents on a Seoul campus; customarily outspoken intel-
lectuals were cowed by Korean CIA coercion; and the
press was under strict censorship. Generally, the
Korean public -- faced with shifting international
power relationships, hopeful that the newly-instituted
reunification talks with the North would show progress,
and conscious of continuing strong economic growth --
seemed willing to give strong-man rule a chance.
Open opposition began in late 1973, when in the
aftermath of the Kim Tae-chung kidnapping university
students demonstrated, demanding Kim's release and the
restoration of civil liberties. At the same time op-
position politicians were successful beyond expecta-
tion in a signature campaign petitioning Park to re-
store the old constitution.
The government responded with court-martial trials,
sentencing dissenters to death (none yet carried out)
or long prison terms. (Included in those sentences are
Catholic and Protestant leaders, a prominent poet and
a former president.) These measures succeeded in
squelching the signature campaign and heading off the
anticipated spring 1974 student demonstrations. But
resistance by Christians surfaced in August when 2,000
Catholics and Protestants attended a mass said for a
Catholic bishop who had been sentenced to 15 years at
hard labor for allegedly aiding anti-government students.
Controls Relaxed
In the midst of a Park speech on August 15 an as-
sassin's shot missed Park but killed his wife. It was
widely expected that Park would respond by imposing add-
itional strict measures. His initial reaction, however,
has been in the direction of relaxation. On August 23,
possibly reasoning that public sympathy over the death
of his wife would take much of the steam out of any re-
newed protest, he lifted the decrees banning dissent.
FORD
CONF IDENTIAL
CONF IDENTIAL
-3-
In subsequent moderate actions:
-Newspapers have been permitted to report out-
spoken demands by the recently-elected chairman of the
opposition New Democratic Party that the government re-
store constitutional safeguards on civil liberties and
free all persons arrested on political grounds.
The government has used restraint in dealing with
a renewed round of demonstrations by Christians and stu-
dents, for example imposing jail sentences not exceed-
ing thirty days.
Prospects
Protest activity, suspended temporarily out of pub-
lic sympathy over the death of Park's wife, soon resumed.
Since late September, Christians and university students
have held almost daily peaceful demonstrations, their
size held down by school closures aimed at dispersing the
students. The students are becoming more persistent in
their demands; the government has been forced to respond
with tear gas.
Thus discontent obviously continues to fester among
these two important groups in South Korea. There is
little prospect that it will dissipate as long as Park
refuses to move toward significantly greater political
liberalization, something which at this stage he shows
no inclination to do.
But if serenity is not in sight, neither is up-
heaval. A number of factors are in Park's favor.
--During his thirteen-year rule, Park has ruled
autocratically but has shown himself flexibly capable
of compromise when necessary, shifting between tighter
and looser controls.
-- Park retains the loyalty of the bureaucracy
and military leaders.
The government possesses strong instruments of
control over security and public order.
-Park employs talented officials, works hard and
provides government which is in most ways effective
and relatively efficient.
CONFIDENTIAL
CONFIDENTIAL
-4-
-- For many South Koreans, the military threat
from the North provides a rationale for autocratic
government.
In the rather unlikely event that university stu-
dent demonstrations should swell to the point where
Park felt that violent repression was called for, there
could be some question as to how the government and
military establishment -- mindful of the student dis-
turbances which overthrew Syngman Rhee in 1960 -- would
react. An additional complication might ensue if the
opposition proved capable of making a truly popular
issue out of the economic difficulties now beginning
to impinge on the general public.
Department of State
November 1974
CONF IDENTIA
B
1020
0
DEPARTMENT OF STATE
BRIEFING PAPER
The South Korean Economy
South Korea is moving into its most pronounced
economic slump in a decade, largely because of the
economic downturn in the major industrial countries
that take the bulk of Korea's exports and supply a
large share of investment funds. Although real
growth this year will average 8%-10%, practically
all the gains came in the first half. The down-
turn will extend well into 1975 when real growth
will probably register considerably less impressive
gains. Problems stemming from slow growth will add
to Seoul's already growing political problems.
The Emerging Slump
The economy expanded rapidly during the first
half of 1974, but the pace slowed sharply after mid-
year. Real gross national product during the first
half was 15% above the first half of 1973 while
industrial output was 20% above last year's average.
In recent months, however, industrial output has
stagnated. In some industries production has de-
clined because of weak foreign demand for South Korean
goods. With no turn-around expected in the months
ahead, real GNP may register little or no gain during
the second half of 1974. However, a poor second
half should not detract from Korea's performance
because the low growth rate is by comparison with
the preceding year in which Korea had a record real
growth rate of 16.5%.
So far the downturn has been concentrated in
relatively few industries. The hardest hit include
textiles--with output down nearly 10% from the
early 1974 peak--electronics, and other light con-
sumer industries producing for the export market.
Heavy industry continues to do relatively well, but
output in recent months has been increasing at a
slower pace.
Unemployment, although not yet a serious pro-
blem, is on the rise. Some 60,000 workers, some-
what less than 1% of the labor force, have been
laid off this year with further substantial layoffs
planned by several major US and Japanese firms.
FORD
UNCLASSIFIED
UNCLASSIFIED
- 2 -
Most foreign and locally-owned firms, however, are
maintaining their labor force, preferring instead
to reduce work hours. Nonetheless, employer groups
and the government are concerned over the likeli-
hood of increased labor unrest, particularly in
urban areas.
Government Policies
Seoul has shifted from seeking to control infla-
tion to efforts to maintain employment and output.
Increased spending on public works to offset the
decline in private sector employment as well as on
welfare, defense, and government industrial projects
has brought the budget--in surplus during the first
half of 1974--into sizeable deficit.
Seoul is also providing special loans to busi-
nessmen to help avoid bankruptcies. Practically
all of the at least $100 million being used for this
purpose is going to small and medium-sized firms
facing the most serious financial problems. Large
firms are better able to handle financial problems
now that credit restrictions are being eased. In
some instances they have been able to increase their
foreign borrowing.
Efforts to stimulate domestic demand will tend
to aggravate Korea's inflation problem. With higher
oil and other commodity costs the chief factors,
consumer prices by September were about 28% higher
than the year before and wholesale prices rose even
faster. Higher labor costs are now also becoming
an important cause of inflation. In an effort to
control inflation next year, the government has
pressed employers and unions to keep wage settlements
moderate.
Trade and Payments
Higher oil and other commodity prices have
boosted Korea's trade deficit sharply and it will
reach $1.2 billion for 1974. Next year's deficit
will approach that level. Because of weak demand
in the US and Japan, which take about 70% of Korean
exports, Seoul will have to lower its 1975 goal of
FORD
UNCLASSIFIED
UNCLASSIFIED
- 3 -
a 40% increase in overseas sales. If export growth
slips too far, the government could resort to
devaluation even at the cost of more inflation.
This year's current account deficit will approach
$1.5 billion, compared with $300 million in 1973.
Most of the deficit is being offset by long-term
capital inflows stemming in part from investment
commitments made last year. However, there is some
slowdown in direct investment particularly from
Japan where the decline reflects bilateral political
problems as well as economic reasons. New US invest-
ment is customarily moderate but investment approvals
of US equity is already ahead of the modest total
for 1973.
To compensate for reduced long-term inflows
the Koreans have substantially increased their
short-term borrowing abroad. This borrowing reached
$400 million during the first half of 1974 and will
nearly double by year end. Korea's good interna-
tional credit rating and low debt service payments--
10% of exports in 1973 compared with 20% the previous
year--has made it relatively easy to obtain these
funds. To help finance next year's payment deficit,
Seoul is reportedly trying to obtain long-term loans
from Arab oil exporters.
The ROK announced at the beginning of this year
that increased costs of commodity imports, especially
oil, would require a significant increase in gross
capital inflow. The figure of $1.55 billion for
1974 was endorsed at the Consultative Group Meeting
at Paris in March. One third of the amount was to
come from official sources. By mid-1974, $900
million of that amount had been committed. However,
the remaining $650 million may be difficult to
obtain in the present tight money market unless
exhorbitant interest is applied.
UNCLASSIFIED
Department of State
November 1974
B.FORD
MD
1G
NATIONAL ARCHIVES AND RECORDS ADMINISTRATION
Presidential Libraries Withdrawal Sheet
WITHDRAWAL ID 033102
REASON FOR WITHDRAWAL
ÇNational security restriction
TYPE OF MATERIAL
ÇBriefing Paper
TITLE
Security Conditions in South Korea in
Relationship to the President's Visit
CREATION DATE
11/1974
VOLUME
4 pages
COLLECTION/SERIES/FOLDER ID
033700346
COLLECTION TITLE
NATIONAL SECURITY ADVISER. NSC EAST
ASIAN AND PACIFIC AFFAIRS STAFF FILES
BOX NUMBER
18
FOLDER TITLE
President Ford's Trip to Seoul,
November 1974 (3)
DATE WITHDRAWN
03/24/2011
WITHDRAWING ARCHIVIST
TMH
Sanistizal 9/28/05
Approved For Release 2005/09/28 : NLF-NSC_EA_PA-18-1-1-6
EPARTMENT OF TATE
1g 0
BRIEFING PAPER
Security Conditions in South Korea
In Relationship to the President's Visit
Key Conclusions
We see no direct threat to the security of
President Ford while in Korea.
There are, nonetheless, two areas of concern
regarding security aspects of President Ford's visit
to Seoul:
-- The more serious is the possibility, however
remote, of another attempt on the life of President
Park who presumably will appear in public with
President Ford.
- Of concern mainly as a potential source of
embarrassment is the possibility of large-scale
anti-Park demonstrations or even small ones if they
take place in President Ford's presence.
-- The efficient South Korean security apparatus,
however, will make it extremely difficult for any
person or group to mar President Ford's visit to
Seoul.
Introduction
We see no direct threat to the security of
President Ford (or members of his party) while in
South Korea. The South Korean people are well
disposed toward the U.S. and, in any case, the Park
government will take all possible measures to prevent
any incident that might cast doubt on its friendship
or reliability.
Possible anti-Park Demonstrations
FORD
President Ford's visit, however, comes to a
time of considerable unrest in Seoul. On and off,
for a year or more, a significant portion of the
GERALD
educated elite in the South Korean capital --
w/portions
exempted
SECRET
Presidential Library Review of DOS Equities
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State Guidelines
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- 2 -
Christians, students, intellectuals, journalists and,
most recently, some politicians -- have been agitating
for political reform. Most would probably settle for
a return to the pre-1972 system of limited repre-
sentative government; others seek Park's removal
from power.
One persistent threat in the thinking among these
relatively sophisticated South Koreans is the belief,
justified or not, that the U.S. government is in a
position to bring decisive pressures on Park to modify
his authoritarian policies. They seem to believe, for
example, that in August when Park rescinded some of
his more onerous decrees, he was largely responding
to U.S. press, congressional and, ultimately, official
criticism. Indeed, through their extensive contacts
in U.S. political and intellectual circles, Park's
opponents were able to provide substantial backing
for this summer's congressional attacks on military
aid programs for South Korea.
It is virtually certain, therefore, that Park's
domestic opponents will at least try, before and during
President Ford's visit to South Korea, to impress the
U.S. leadership with the need to lean on Park to ease
up at home -- to release political prisoners, restore
representative institutions, and provide for consti-
tutional guarantees of civil liberties. Their tactics
will probably include efforts to attract the notice of
President Ford -- and accompanying U.S. journalists --
with personally passed notes, hand-held signs, and
small-scale demonstrations. The possibility of a
more dramatic protest -- a ritual suicide or mutila-
tion, for example --- cannot be dismissed.
Students. Any such anti-government mani-
festation on the occasion of President Ford's visit
would most likely be carried out by university students,
always among the most active opponents of the Park
government. In recent weeks the police have largely
confined student demonstrations to the campuses, and
many colleges have been shut down.
25X
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(1
Thus, while a student
demonstration on the occasion of the President's
visit may occur, any action involving more than a
handful of participants is unlikely to take place
near the President.
Christians. Of other vocal domestic opponents
of the Park government, only the Christian social action
groups -- Protestant and Catholic -- appear capable of
creating disturbances when President Ford is in Seoul.
With the streets certain to be closed to them during
the Presidential visit, however, any organized Chris-
tian effort to advertise the anti-Park cause would
probably be confined to the churches. The government
might even approve holding church meetings, as in the
past, for their value as a political safety valve. A
few Christian activists, however, including foreign
missionaries, might attempt to mount small demonstra-
tions in the streets.
Security Precautions. South Korean security
agencies will attempt to forestall any activist street
activity by rounding up known troublemakers beforehand
and by stern warnings to all dissident groups. In
any case, tough and experienced police and -- if
needed -- military detachments would move quickly
and effectively to quash any threatening situation.
The South Korean security agencies that will
be directly responsible for the protection of President
Ford are the Presidential Protective Force (PPF), the
Korean National Police (KNP), and its local arm, the
Seoul Metropolitan Police Bureau (SMPB). In the unlikely
event that military assistance were required, it could
be provided by the elite Capital Security Command (CSC)
and other well-trained army units in the Seoul area.
SECRET
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25
Possible Attempts to Assassinate Park
Another attempt on the life of President Park can-
not be excluded. There have been three: North Korean
agents tried in 1968 and 1970, during a period of
unusually intense North Korean hostility toward the
South; and, on August 15 of this year, a Korean resi-
dent of Japan seeking to kill Park killed his wife.
Extraordinary protection measures were taken at Park's
one public appearance since August 15.
There is particular concern, at this point, over
the possibility that foreign terrorists such as members
of the "Japanese Red Army" (which carried out the Lod
Airport massacre in Israel) will enter South Korea to
kill Park. Extremely tight immigration and travel
procedures in South Korea will be further tightened
through the period of President Ford's visit. Presi-
dent Ford himself is not believed to be a target of
this terrorist group.
It is unlikely that North Koreans leaders would
order an attempt on Park's life at a time when' they are
working hard to establish themselves as responsible
members of the international community. (The United
Nations debate on the Korean issue may begin only a
few days after President Ford leaves Korea.) North
Korea is even more unlikely to order an attack on
President Ford; its current diplomatic strategy
appears focused on winning U.S. acquiescence in
direct talks on the future of Korea.
Central Intelligence Agency
November 1974
SECRET
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DEPArTment OF STATE
BRIEFING PAPER
Prospects for Stability on the Korean Peninsula
Key Conclusions
The possibility of another war in Korea seems
remote under present circumstances.
-- The presence of US forces in South Korea and
the mutual security treaty with the US deter
North Korea from major military adventures.
-- North Korea cannot rely on the firm support
of its allies for another invasion of the
South.
-- The North does not have the military strength
to deliver a knockout blow to the South at
the outset of any invasion.
There has been only very limited progress, how-
ever, in defusing the inherently unstable Korean
situation.
-- The USSR and China appear constrained by
their competition for favor in Pyongyang
from moving towards recognition of the South.
-- The North-South talks have had no concrete
result.
-- Occasional military incidents continue to
hold the potential for escalation into
serious clashes.
-- The North has not given up its hope of unify-
ing the peninsula under communist rule. Pol-
itical instability in the South, if it be-
comes much worse, might entice the North to
act in support of anti-Pak elements.
Involvement of the Powers
The prospect of renewed hostilities on the
Korean peninsula has decreased basically as a result
of Moscow and Peking's unwillingness to endorse or
support North Korean aggression. This attitude has
SECRET
GDS
RAC NSC. EA. PA-
FORD a OTHERS LIBRARY
Dtate
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been reinforced in recent years by the changes in
relations among the major powers. The deepening
of the Sino-Soviet split, the Sino-US rapprochement,
and progress in US-Soviet detente have created an
atmosphere in which the powers -- and Japan as well
-- now share a common interest in preserving sta-
bility in Korea and removing the peninsula as a
potential source of friction among them. In prac-
tical terms, this has meant unspoken approval of the
continued division into "two Koreas.
Despite this common interest, there has been only
limited cooperation among the powers in dealing with
the Korean problem. Since Korea remains an integral
element in the rivalry between Moscow and Peking, they
have found it important to their interests to court
North Korea as an ally. This has permitted Pyongyang
to play one against the other - and to seek and obtain
increasing quantities of sophisticated weaponry as the
price for good relations. The quest for influence in
the North has also inhibited Moscow and Peking in re-
sponding to overtures from the US for mutual recogni-
tion of the two Korean governments.
Mutual recognition by the major Communist powers
has so far been strongly opposed by Pyongyang which
sees it as a major step in the direction of ratifying
the permanent division of the peninsula. Peking, how-
ever, did cooperate with the US a year ago in working
out a compromise resolution on the Korean question at
the UN. The Chinese helped avert an acrimonious de-
bate in which the presence of US forces in South Korea
would have been loudly attacked. The Soviets also
went along with the compromise. Pyongyang's disap-
pointment was lessened somewhat by a concurrent agree-
ment to dissolve the UN political apparatus in South
Korea.
The North Koreans are again asking for the with-
drawal of all "foreign troops under the UN flag" at
the UN this year. The Soviets are backing Pyongyang,
though without enthusiasm. Peking's support for the
hard North Korean line seems firmer than a year ago,
though the Chinese may again show interest in a last-
minute compromise if - as is likely - a pro-Seoul
resolution has the votes to pass.
of
FORD
SECRET
GERALD
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The North-South Dialogue
While changed relationships among the powers have
reduced the possibility of a new Korean war, they also
have generated anxieties in both Pyongyang and Seoul,
neither certain of the reliability of its allies. Their
most notable adjustment has been an exploratory dialogue
opened in 1971. At high tide, in July 1972, this di-
alogue produced a joint communique in which the two sides
agreed to work for peaceful reunification. By mid-1973,
the dialogue had foundered on conflicting views of its
objectives. During the past year, Pyongyang and Seoul
have returned to the pattern of harsh propaganda ex-
changes which prevailed before 1971. Neither side, how-
ever, has moved to end the bilateral talks. Neither
wants to accept the onus of doing so. Both find uses,
however marginal, for the forum.
Diplomatic Competition
In the changed international environment, North and
South have also undertaken a wide-ranging search for add-
itional sources of political, economic, and military
support. Pyongyang has had dramatic success in increas-
ing the number of states with which it has official rela-
tions. Some 70 states now recognize Pyongyang, compared
to 38 before the 1972 joint communique. Many of the
Third World and European countries that have recognized
North Korea previously had ties only with Seoul; in most
cases, these ties have been maintained. Pyongyang ac-
cepts this duality as a necessity if it is to achieve
international parity with the South. Pyongyang is mak-
ing considerable progress in expanding its foreign trade
beyond the confines of the communist world, especially
with Western Europe and Japan.
The South Koreans still have relations with more
countries than Pyongyang - 94 at last count. But Seoul
is seriously concerned that it has lost the diplomatic
initiative to the North Koreans. In particular, South
Korea wants to open contacts with Peking, Moscow, and
the Eastern Europeans to balance Pyongyang's gains in
the West. Efforts to do so, however, have had no sig-
nificant success.
SECRET
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The Military Balance
The military balance on the peninsula favors
South Korea with respect to ground forces, but North
Korea in the air and on the sea. Both, however, re-
main dependent on external support to sustain any major
military operation beyond a few weeks duration. This
situation is unlikely to change for some years despite
increased emphasis in both countries on developing in-
dependent capabilities for carrying on warfare against
the other. This effort includes increased military
budgets, the provision of additional domestic weapons
production capacity, and increased interest in over-
seas procurement of relatively sophisticated equipment,
especially from Western Europe.
Thus, while the opposition of the major powers to
renewed hostilities is a strong inhibiting factor, it
is also leading to a situation in which the Koreas,
over time, will be less restrained by their respective
allies. Pyongyang, for example, will soon for the first
time have extensive oil storage capacity - now an in-
hibiting factor in its war planning. The North, more-
over, has recently demonstrated willingness to initiate
provocative actions in the open seas and near the DMZ.
With regard to Seoul, there is reliable reporting that
it is bent on developing a nuclear deterrent as soon
as possible.
North Korea's Internal Situation
Among the major concerns of the South Koreans is
the nature of the competing regime in the North, one of
the most disciplined and assertive in the world. State
and party are dominated by the 62-year old Kim Il-song,
the object of a personality cult of extreme intensity.
There is no sign that Kim, after more than 25 years in
power, is threatened by any segment of the North Korean
party, bureaucracy, or army. But he does have domestic
critics and has felt compelled at times to respond by
switching major domestic and foreign policy lines.
Nepotism is one criticism of Kim that has not been met.
Kim has groomed a younger brother and, more recently,
a son as potential successors to his leadership.
Speculation on the succession, however, centers heavily
on the extraordinary difficulties any new Northern lead-
ership would encounter in maintaining tight control.
Central Intelligence Agency
R.
November 1974
GERALD
FORD
SECRET
1080
DEPARTMENT OF STATE
BRIEFING PAPER
US-Korea Economic Relations
For twenty years following WWII, the US was the
principal economic benefactor of the ROK, providing
large amounts of assistance, mostly grant aid. Be-
ginning with normalization of relations between Korea
and Japan in 1965, Japan has been an increasing source
of stimulus to the Korean economy with emphasis on
commercial trade but with appreciable amounts of con-
cessional finance. US participation in today's great-
ly expanded Korean economy is about equal to Japan's
participation.
US-ROK Trade
Korea is a major trading partner of the US, rank-
ing thirteenth among our export markets in 1973. How-
ever, the US share of Korea's imports was only 28% in
1973 ($1.24 billion). If that ratio can be maintained
through 1981, the US share of Korea's projected imports
in 1981 would be $2.9 billion.
Korea's Voluntary Export Restraints
In 1971, Korea agreed to restrain textile exports
to the US, and a bilateral five-year agreement was con-
cluded which provided for a comprehensive quantity
quota and quantity ceilings on component categories and
items. Negotiations are underway to adjust this arrange-
ment to conform to the GATT Multifiber Agreement of
December 1973.
Korea also agreed to restrain exports to the US
of canvas top, rubber-sole footwear and a rubber and
plastic protective footwear. This agreement expires
in 1975. (Korea is the only country that restrains
footwear exports although exports from other countries
are currently causing concern to US producers.)
Mushroom imports from Korea, among other countries,
have been a matter of concern to our domestic industry
and to certain Congressmen, and the Department has re-
quested both Taiwan and Korea to voluntarily restrain
processed mushroom exports to the US. The matter is
still under discussion.
UNCLASSIFIED
UNCLASSIFIED
-2-
Trade Reform Bill Provisions
The Koreans have expressed concern that their
exports will not benefit and, in some cases, even be
adversely affected by the US generalized preferences
system (GSP) included in the trade bill. Unfortu-
nately this will probably be the case in the short
run since Korea's six major exports to the US -- tex-
tiles, shoes, steel, plywood, wigs, electronic tubes
and transistors -- are not likely to qualify for
preferential treatment. In the long run, however,
given the country's rapidly diversifying economy we
expect it to be one of the major beneficiaries of our
GSP, as its economy adapts to take advantage of
preferential margins.
Capital Flow
Foreign Loans
The US has been the ROK's principal source of
loan capital. The cumulative total of US-source loans
committed to Korea from 1959 through 1973 was $1.67
billion, or 42% of total loans from all sources. (Japan
was the next largest source with 24% of the total.)
Equity Investment
Private equity capital from the US has been lag-
ging for the past two years while Japanese equity has
been surging. The latter accounted for $129 million in
1973 to reach a cumulative total double that of the US,
namely $242 million compared to $122 million from the
US. Data for the first half of 1974 indicate an increase
in 1974 for the US and a decrease for Japan.
Promotion of Bilateral Relations
Intergovernmental Meetings
The ROK Ministry of Commerce and the US Depart-
ment of Commerce have met annually beginning in 1967
for discussion of mutual goals and problems. The
focus of the meetings is primarily commercial, with
emphasis on those practices that impede the flow of com-
modities and services. Non-commercial matters are not
within the responsibility of the Minister of Commerce
but they are noted with an indication that they will be
referred to the appropriate agency of the ROK govern-
1020
ment.
UNCLASSIFIED
UNCLASSIFIED
-3-
Trade Center
The US opened a Trade Center at Seoul in March
1974. This Center is not the customary Trade Develop-
ment Center (Commerce-staffed and Commerce-financed.)
The Seoul Center is State-staffed and State-financed
with construction modifications paid for by Commerce
and Commerce supplying limited support applicable to
a few types of presentations.
Private Missions
The David Kennedy Mission spent the better part
of a week in Korea in May and claims to have generated
$35 million in US private investment in Korea. The
US-Korea Economic Council spent most of one week in
Korea in September, primarily in response to the in-
vitation of its counterpart Korean organization, the
Korea-US Economic Council, and the Korean Government.
While no value result was attributed to the Council's
visit, the Council was reassured concerning the favor-
able climate for investment and considers that it ful-
tilled the need for establishing a high level of
rapport with Korean business firms.
Department of State
November 1974
UNCLASSIFIED
E
DEPARTMENT OF STATE
BRIEFING PAPER
Foreign Policy of the ROK
Overview
South Korean foreign relations grow out of being
half of a divided nation, militarily allied with the
United States and located at a confluence of major
power interest. For a quarter of a century mutual
hostility between the two Koreas paralleled the con-
frontation of the great powers. Seoul and Pyongyang
were ranged against each other even more rigidly than
were the U.S. and Japan against Moscow and Peking.
International detente and the U.S. drawdown of
its military forces in East Asia changed this situa-
tion, compelling Korean readjustment. In 1972 the
North and South agreed to hold reunification talks,
but direct relations between the two have not pro-
gressed. The reunification talks have been stale-
mated almost from their inception. In late 1973,
Pyongyang induced alarm over continued access to
several South Korean-held islands off the North Korean
coast; this and lesser incidents at sea in ensuing
months were a reminder that notwithstanding the
atmosphere of international detente, sudden North-
South tensions cannot yet be entirely ruled out.
Meanwhile a priority ROK effort to open diplo-
matic relations with Communist countries has been
mirrored by North Korean approaches in the opposite
direction. To date Seoul has far less to show for
its diplomatic campaign than does Pyongyang, which
has gained diplomatic recognition from 43 non-
Communist governments and substantially expanded its
trade with the West.
In preparation for this year's UN session, the
ROK, with U.S. support, has made a worldwide lobbying
effort to persuade the General Assembly not to call
for the withdrawal of foreign (U.S.) troops or to
terminate the UN Command without providing for
continuation of the 1953 armistice arrangements in
appropriately modified form. The issue will be
considered in the UNGA at the end of November. The
CONFIDENTIAL
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current estimate is that we will be able to defeat
the other side's resolution.
Economic goals have become more important in
Korean foreign policy over the past decade. Export
promotion has been a major aim of Seoul's diplomacy
since the mid-1960s. More recently, the oil crisis
and the desire to increase capital imports have
resulted in a major South Korean effort to improve
relations with Arab nations.
Specific ROK Foreign Policy Goals
Preserving U.S. and Japanese Ties. Although
the ROK is far less dependent on the United States for
military and economic support than in the past, Seoul
continues to consider close ties with the U.S. essential
to its survival. Close consideration is also given to
Japan, a new ally -- diplomatic ties were established
in 1965 -- but an important one. The complications
of Korean-Japanese relations are treated in a separate
paper.
Developing Relations with Communist Countries.
Following U.S. initiatives to improve relations with
the Communist powers, President Park in August 1971
declared the ROK's willingness to develop relations
with "any nation -- irrespective of political system
or ideology -- that respects our national independence
and does not engage in hostile acts against us". In
1973 Foreign Minister Kim Dong Jo declared that he
gave top priority to normalizing relations with the
Soviet Union and the PRC. But the results of ROK
efforts to implement this new approach have been
meager:
-- The Soviet Union initially displayed a
moderately receptive attitude. In early 1973 Moscow
expanded private contacts with Seoul and allowed
several ROK citizens to visit the USSR. But when
the Soviets issued visas permitting the ROK to com-
pete in the August 1973 Universiad Games in Moscow,
the incensed North Koreans withdrew from the games.
CONF IDENTIAL
CONF IDENTIAL
- 3 -
Moscow then cancelled the projected visit of two ROK
musicians and has not subsequently admitted ROK
nationals to the USSR nor made other conciliatory
gestures toward Seoul.
-- The PRC has given no distinct response to
repeated approaches from the ROK directly and through
third parties. (Recently, a British journalist alleged
an approach by a PRC representative that the PRC was
prepared to consider contacts if the South Koreans
would agree to sever all ties with Taiwan.)
-- Contacts with Eastern Europe, never extensive,
have been particularly limited this year. Occasional
ROK official travelers and tourists had visited Poland,
Bulgaria, and Romania, but applications this year have
been turned down. Romania admitted a ROK delegation
to an International Parliamentary Union meeting in
April but refused to admit a delegation to the World
Population Council in August.
Diplomatic Recognition. In the continuing
race for formal diplomatic recognition, North Korea
has gained considerable ground on the ROK. In 1971
the DPRK was recognized by only 35 countries compared
to 82 for the ROK. The respective figures today are
70 for the North and 94 for the South. Among the more
important nations newly according recognition to
Pyongyang are Australia, Malaysia, and the Scandinavian
countries. The South has gained significantly by
raising its relations with India and Indonesia to the
diplomatic level.
Economic Aims. As part of the Park govern-
ment's efforts to foster economic growth, the ROK since
the mid-1960s has strenuously promoted exports. Korean
diplomats are briefed on what the ROK has to sell and
are urged to find customers. Their career advancement
depends in part on their success as salesmen. The
international economic crisis of the past year has
prompted a special ROK effort to expand ties with
Arab countries. The ROK has had visits from officials
of Saudi Arabia and there is talk of joint Saudi-
Japanese investment in an oil refinery in the ROK.
Department of State
November 1974
FORD
CONFIDENTIAL
10.1080
DEPARTmEnt OF STATE
BRIEFING PAPER
The Korean Question in the United Nations
The post World War II history of the Republic
of Korea has been closely linked with the United
Nations. Only in recent years has the ROK re-
assessed the pros and cons of this linkage as the
United Nations itself has become more dominated by
the "third world" and the ROK has begun direct
contacts with North Korea. Day-to-day developments
on the UN Korean item are followed closely at the
highest levels of the ROK Government.
Background
Following the unsuccessful efforts of Soviet
and American military negotiators in 1946 and 1947
to arrange for the establishment of an all-Korean
Government, the United States placed the question
of Korean independence before the UN General
Assembly in September 1947. Two months later, the
Assembly established a UN Commission for Korea and
outlined detailed steps, including elections under
UN supervision, for establishment of a national
government. While the North Koreans rejected all
aspects of the UN plan, it was reaffirmed by sub-
sequent UN General Assemblies through 1970 as the
basis for a Korean settlement. During this period,
the ROK derived substantial political support from
annual "endorsement" by the United Nations and the
UN Commission continued to reside in Seoul.
In 1971, ROK policy was undergoing transition
and in 1971 and 1972, the US (and others) success-
fully urged the UN General Assembly to postpone
debate on the Korean issue. In this period the
North-South (Korea) communique was issued July 4,
1972, and President Park made a dramatic announce-
ment on June 23, 1973, inter alia removing ROK
objections to North Korean participation in inter-
national organizations. By pre-arrangement, the
UN Commission recommended its own dissolution in
its September 1973 report to the General Assembly.
In November 1973, both North and South Korea's
supporters in the UN agreed to a compromise
"consensus" approving the dissolution of the UN
Commission and endorsing the North/South dialogue.
is
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The UN Command
The UN Security Council in 1950 authorized the
establishment of a "unified command" under the
United States, and the use of the UN flag, to coor-
dinate the military contributions of 16 UN members
to repel the North Korean attack. The organizational
instrument through which the US exercises the uni-
fied command is the UN Command. Although the US
commander in Korea wears the hat of Commander-in-
Chief UN Command, US troops in Korea are not part
of the UN Command and are deployed under the US-ROK
Mutual Defense Treaty of 1954. The UN Command now
comprises only token units from the UK, Thailand,
and Philippines. We have been engaged since June
1974 in a sensitive negotiation with the PRC for
terminating the UN Command while maintaining the
1953 Armistice Agreement. (See separate paper.)
Recent Events in the UN
In light of last year's consensus statement,
the Korean question did not appear on the provisional
agenda of the 1974 Assembly session. North Korea's
supporters nevertheless called for a discussion of
it, and to protect its tactical interests, the ROK/US
and friendly countries also submitted an agenda item.
Debate is scheduled to begin on November 25 in
New York.
The North Korean proposal, supported mainly by
East Europeans, the PRC, and the more militant non-
aligned, seeks Assembly approval of "withdrawal of
UN foreign troops under the UN flag from South Korea"
(tantamount to the dissolution of the UN Command).
The North Koreans have said they consider this to
include the withdrawal of US troops from the ROK.
The friendly draft resolution endorses the 28th
UNGA consensus, urges continuation of the North-
South dialogue, and expresses hope that "the
Security Council will in due course give consideration,
in consultation with the parties directly concerned,
to those aspects of the Korean question, including
the future of the UN Command, which fall within its
responsibility. We have made clear that this means
we are prepared to dissolve the UN Command provided
that the Armistice Agreement remains in effect.
SECRET
SECRET
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Given North Korea's adamant opposition to
concurrent UN membership for both Koreas and PRC
support for this position, our resolution (unlike
last year and as a conciliatory gesture) does not
refer to this subject.
The US, ROK, and other co-sponsors are con-
sulting closely in New York on lobbying efforts
and other aspects of the forthcoming debate.
While vote counts are still tentative, we
calculate a seven to ten-vote majority for our
draft resolution which, having been introduced
first, is expected to be voted on first. A vote
to defeat the other side's resolution would be
much closer, but it may not be put to a vote if
our resolution is, as we expect, adopted.
Our overall objective remains prevention of
adverse Assembly action on the UN Command or US
troop presence in South Korea. By building support
for our conciliatory draft resolution while con-
tinuing to indicate that we are willing to consider
another consensus outcome, we best protect our
interests at the UNGA without damage to possi-
bilities of success in our talks with the PRC on
termination of the UN Command.
Department of State
November 1974
FORD
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DRAFT COMMUNIQUE
FORDO is 090350 LIBRARY
TO BE PROVIDED
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BIOGRAPHIC SKETCHES
BERGLO B. FORD VIDROUP
1v. 1V, 1x, 1Y, 12, 1AA, 18B, 1", 1DD, -
1EE, 1FF, 16G, 1HH, 1II, 155
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President Ford's Trip to Seoul,
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