Thu. 8:52 a.m.: S. Korea cancels Japan intelligence deal amid trade dispute

South Korean protesters shout slogans during a rally demanding the South Korean government to abolish the General Security of Military Information Agreement, or GSOMIA, an intelligence-sharing agreement between South Korea and Japan, today in front of Japanese embassy in Seoul, South Korea. The letters read "Abolish the General Security of Military Information Agreement," or GSOMIA. (AP Photo/Lee Jin-man)

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

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

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

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

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

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

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

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

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