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In the agreement approved in Seoul, South Korea will pay $890 million for 28,000 USA forces, up from $870 million, Yonhap News Agency reported.

Seoul contributed around 960 billion won past year - more than 40 percent of the total bill - financing the construction of American military facilities and paying South Korean civilians working on USA bases.

The provisional pact was agreed to after Seoul reportedly accepted the U.S.'s demand of fixing a one-year contract from the previous five-year one while Washington agreed to adjust the South's contributions to around 1 trillion won.

Unlike past agreements, which lasted for five years, this one is expected to expire in a year, potentially forcing both sides back to the bargaining table within months.

"The United States government realises that South Korea does a lot for our alliance and for peace and stability in this region", he said.

President Moon Jae-in expressed high hopes for the upcoming North Korea-U.S. summit.

The South Korean ministry hasn't immediately revealed the exact amount of money Seoul would pay this year under the new deal.

Foreign Minister Kang Kyung-wha and Timothy Betts, the top USA delegate to the Special Measures Agreement talks, appeared at a signing ceremony.

About 70 percent of South Korea's contribution covers the salaries of some 8,700 South Korean employees who provide administrative, technical and other services for the US military.

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Trump told CBS' "Face the Nation" last Sunday that he has no plans to withdraw troops from South Korea.

In order to ensure that the Alliance remains ready to "Fight Tonight", defend the Korean Peninsula, and (if necessary) defeat North Korea, South Korea and the United States prioritize the development and deployment of a wide array of military assets.

Trump said in his annual State of the Union address to the U.S. Congress on Tuesday that he would meet North Korean leader Kim Jong Un on February 27-28 in Vietnam, following their unprecedented meeting in June in Singapore. During his election campaign, Trump suggested he could pull back troops from South Korea and Japan unless they took on greater a share of the financial burdens of supporting US soldiers deployed there.

North Korea's leader Kim Jong Un (L) with President Donald Trump at the start of their historic summit, at the Capella Hotel on Sentosa island in Singapore on June 12, 2018.

Trump has complained that maintaining troops in South Korea is too expensive and said in the past that he would like to bring them home. The big USA military presence in South Korea is a symbol of the countries' alliance, forged in blood during the war, but also a source of long-running anti-American sentiments.

"The two countries reaffirmed. the importance of a strong South Korea-US alliance and the need for a stable stationing of the US troops", it said in a statement issued after a signing ceremony.

Services had not been interrupted thanks to reserve funds, but USFK had warned the Korean Employees' Union that it would have to put local staff on unpaid leave beginning in mid-April if a deal wasn't reached.

"The South Korean leader also pointed out, the peace process that started a year ago is making progress in bringing the Peninsula closer to peace and prosperity".


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