On Friday, the president’s office in Seoul reversed a decision to end an intelligence-sharing pact with Japan, just hours before the deal was due to expire.
South Korea had been threatening to withdraw from the 2016 General Security of Military Information Agreement, which ensures intelligence-sharing with Japan, because of a burgeoning trade dispute. The pact is key to military co-operation between South Korea, Japan and the US in dealing with North Korea so under pressure from Washington, Seoul also dropped a formal complaint about Japanese trade restrictions at the World Trade Organisation – at least for now.
Continued tensions, some of which date back to the brutal Japanese occupation of Korea before and during the Second World War, are likely and a trade war remains possible. Japan’s increasing uncertainty about US reliability and anxiety about North Korea are prompting new levels of re-armament and regional assertion that can only feed South Korean suspicions.
However, Mr Moon wisely placed national imperatives above his political interests and jingoistic sentiment in South Korea to drop the trade complaint, salvage the intelligence agreement and preserve the three-way alliance with the US.
Rather than building on this significant achievement, US President Donald Trump is demanding that Seoul pay vastly more to support the American military presence in its country. Two years ago, South Korea agreed to pay just under $1 billion annually, about 20 per cent of the US cost.
This year Mr Trump is demanding more than five times that. This isn't just belligerent or unreasonable. It seems intentionally designed to be practically and – especially – politically impossible.
Indeed, under the rubric of "America First", the Trump administration has pioneered a radical departure in US foreign policy from that of all its Democratic and Republican predecessors since the Second World War. This administration’s approach to international relations breaks with tradition by showing a willingness to pander to autocratic adversaries while taking a harsh, even bullying attitude towards traditional, democratic allies.
The downsides of both approaches seem to be coalescing in the Korean Peninsula.
This is an unprecedented crisis in relations with South Korea. Mr Trump’s vacillation between threats and sentimental overtures towards North Korea could be catastrophic.
Meanwhile the crisis with South Korea is particularly perplexing. South Korean President Moon Jae-in shares Mr Trump's enthusiasm for improved relations with North Korea and he has showered effusive praise on the US president for facilitating greatly increased dialogue between Washington and Seoul with Pyongyang.
Moreover, it was the combined efforts of Mr Moon and Mr Trump that led to Friday’s announcement, averting a deterioration in relations between Seoul and Tokyo, a crucial element in the tripartite alliance.
But no matter how much he treasures the alliance with Washington, Mr Moon cannot accede to such a radical increase in costs, especially when South Korea has just paid 90 per cent of the $11 billion price of a new US military base at its largest overseas installation, Camp Humphreys.
To rub salt in the wound, the US delegation summarily walked out of the last set of negotiations, apparently in a theatrical gesture to convey its pique at Seoul balking at what looks and feels like a shakedown.
Underlying all of this, of course, is Mr Trump's long history of insisting that US troops ought to be entirely withdrawn from South Korea. That is the most obvious explanation for why he might be making impossible demands on what is otherwise regarded as a crucial and trusted ally. Similarly extortionate demands for vastly increased funding of overseas US forces are being made of Japan, among others.
South Korea is so alarmed by all this that earlier this month, it signed a far-reaching defence agreement with China, an act of considerable desperation.
The main beneficiary of any US military drawdown, let alone withdrawal, from South Korea – and even the tensions between Seoul and both Washington and Tokyo – is, of course, North Korea. The raison d'etre of the Pyongyang regime is the expulsion of US forces from the Korean Peninsula and its reunification under the Kim dynasty.
Yet if South Korea is one of the prime examples of how Mr Trump's bullying approach with traditional allies is leading to disaster, his love-hate relationship with Kim Jong-un is a textbook illustration of the pitfalls of his equally unorthodox approach to adversaries.
Mr Trump likes to claim that, had he not been elected in 2016, the US would have engaged in nuclear warfare with North Korea. That is hyperbole but he did inherit a tense situation from his predecessor Barack Obama, who pointedly told him that Pyongyang would be his biggest foreign policy problem.
Mr Trump’s response to the ongoing conundrum of North Korea's nuclear weapons and missile development and testing was to threaten "fire and fury such as the world has never seen". But then he initiated an affectionate dialogue with Mr Kim, even saying more than once that the two had "fallen in love". Melodramatic but ineffectual summits took place in Singapore, Vietnam and the Demilitarised Zone between the two Koreas and the US.
All Mr Trump has been able to extract from Mr Kim is some human remains, possibly of US soldiers killed in the Korean War, and a few hostages. There has been no agreement by North Korea for nuclear disarmament and not even an inventory of its nuclear assets.
Mr Kim is increasingly showing every indication of running out of patience waiting for sanctions relief. North Korea recently tested new rockets and has shown signs of activity at several nuclear weapons centres. It appears Mr Kim is ready to return to a policy of provocations if he remains frustrated and he does seem to be in a position to squeeze Mr Trump, his “beautiful letters” notwithstanding.
Bullying allies for extortion creates senseless crises. Alternately threatening and cajoling adversaries, and relying on personality and made-for-television photo opportunities does nothing to extract concessions from hostile dictators.
Both burden-sharing negotiations with the South and nuclear talks with the North expire on December 31. Mr Trump doesn't seem to have an alternative plan in either case.
The ineffectiveness of trying to coerce friends while seducing enemies could backfire in both halves of the Korean Peninsula.
Hussein Ibish is a senior resident scholar at the Arab Gulf States Institute in Washington