The United States and South Korea announced on Friday that an advanced missile defense system, called as Terminal High Altitude Area Defence(THAAD), will be installed in South Korea. The decision was made public by Yoo-Jeh-Seung, the deputy minister for policy of the South Korean defense ministry and Lt.General Thomas Vandal the commander of U.S eighth army in Seoul,South-Korea. This comes as a result of North Korea testing nuclear ballistic missiles in the Korean peninsula. In a joint statement released by both the countries said that shield will only be to counter the North Korean threat. China, however, has expressed dissatisfaction and said that it would greatly affect the security balance of the Korean peninsula.
U.S.A, has denied the claims by China by stating that THAAD would be solely used against North Korea and not against China or any other nation. Various nuclear and missile test by North Korea in the past few months have prompted U.S.A and South Korea to this decision. Another factor here is the North Korean missiles can now hit the U.S.A’s pacific fleet. Experts suggest, as a result of this decision China would move closer to North Korea and also the fact that it would have an adverse effect on the South Korean economy, as South Korea is the largest tourist hub for Chinese travelers. Local villagers in South Korea are also against this move since they believe that installation of THAAD defense system can also cause harmful radiation , which could spread in nearby areas. North Korea has yet to provided any response to this move.

Sources: http://www.nytimes.com/2016/07/08/world/asia/south-korea-and-us-agree-to-deploy-missile-defense-system.html?_r=1 (NEWYORK TIMES)