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February 19, 2012

Out of Touch with the North

by Mike M

More evidence of the transformation of North Korea:  A Post article on the growing role of foreign currency in an economy increasingly driven by markets and trading.  Meantime, reports suggest that China will be investing $3 billion in the North’s long-awaited Rason free trade zone in the northeast, including construction of an airport and a cross-border railway.  China’s share:  A fifty-year exclusive rights deal to the Rason port.

Another recent report suggested that, notwithstanding apparently invalid reports of bans on cellphone usage during the 100-day mourning period of Kim Jong-il’s death, over a million North Koreans had signed up to Orascom’s Koryolink cellphone service.

A few continuing themes from these developments:

  1. North Korea appears to be continuing down the path of emphasis on economic development, in part by allowing continued market operations and seeking outside investment, within strict limits.
  2. The influence of South Korea and the US is likely to continue deteriorating over time if the North’s progress continues along these lines.  Pyongyang’s measures of success likely do not relate as much to occasional bouts of hunger among the masses as to rising standards of living among the elite, which it appears to be achieving.
  3. China is conducting a creeping economic and social intervention in North Korea.  Its goal is no more than stability, but the process puts it in a strong position to dictate outcomes of any regime events in the North—and to gain leverage on any territorial claims it might want to press in the messy transition to a single Korea.  We have ample evidence that North Korean officials have no desire to become China’s vassal, but the trend of investments and economic dependence is clear.
  4. Political trends in the South favor Pyongyang.  The public is dissatisfied with the current, conservative government; while the North’s artillery and naval provocations provoked outrage, there’s a general sense that the Lee government’s generalized hard line didn’t produce anything.  Pyongyang has promising levers to pull here.
  5. At this point North Korea has zero practical reason to agree to denuclearization.  There is nothing the South and the United States can offer that it urgently needs.  Meantime it has watched others who took the Western offer be ejected from power—and massacred.  The talks now getting underway are likely to feature intermittent North Korean “concessions” to string things along and perhaps generate some rewards, but they are an exercise in time-buying.

So what’s wrong with this picture?  Nothing, really, from a grand strategic point of view.  North Korea is not a serious threat to anyone.  It’s boxed in and its main patron, China, is no analogue to Stalin circa 1954.  Beijing will remain a force for restraint, because an unleashed North risks instability, the one thing China abhors.

There are two risks, though, neither of which is arguably being attended to.  One is the problem of a de-facto Chinese absorption of the North; this is a serious problem for South Korea, and for the US mostly an issue during a transition—it’s likely to make talks over the disposition of a united Korea much more tense and introduce additional risks of miscalculation and escalation, especially with Beijing feeling its geopolitical oats.

The second risk lies between the two Koreas.  In the wake of the North’s pokes of the last years, reports suggest that South Korea formally changed the rules of engagement it claims it will use to hit back in future.  So we’re sitting now in a situation awaiting escalation risks:  North Korea provokes, as it usually does, at some point; South Korea smacks back triply hard; those around the young Kim Jong-un inform him that this is the first true test of his credibility, and he’d best be up to it …  And off we go.

All of which, it seems to me, points in the same direction.  A revised US-ROK strategy, not to use “engagement” to get North Korean “behavioral changes” as traditionally imagined, but to ramp up interaction—including simple, human exchanges like, believe it or not, an ultimate Frisbee game in Pyongyang—with the North Korean people to (1) accelerate domestic changes underway and hasten broad regime evolution, and (2) get some feet in the door to match China’s burgeoning profile.  Meantime, match all of that with some serious confidence-building measures; get everyone involved to warn the North off provocations; and when they do come, don’t overreact.

We may have a limited window to shift into a revised strategy.  Wait too long, and a small incident could spiral out of control—or we could become a spectator to the Sinification of North Korean society.

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