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North Korea


 

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Area (sq.km)
120,540

Population

22,224,195 (July 2002 est.)

Capital
Pyongyang

Currency
North Korean won (KPW)

Leader
Kim Jong-il


Update No: 039 - (31/07/06)

Missile fallout
As in June, so in July missiles dominated the news regarding North Korea. But now this was front page news worldwide, because this time (against our expectation) Kim Jong-il did go ahead and actually order a launch - on the Fourth of July US time (July 5 locally), surely no coincidence. That George W Bush was holding an early 60th birthday party can only have added to the attraction, for the Dear Leader, of raining on his nemesis' parade. 

Moreover, as well as the anticipated long-range Taepodong-2, visible on its gantry to US spy satellites for over a month in advance, Pyongyang simultaneoulsy fired half a dozen smaller Rodongs and Scuds. The Taepodong seems to have broken up soon after launching, whereas the smaller fry - the staples of Kim's missile arsenal - flew satisfactorily.

All this brought North Korea the rare distinction of being condemned unanimously by the UN Security Council - including Russia and China - on July 15. Naturally it remained defiant. As the hubbub dies down, with attention shifting to a fresh war in the Middle East, the manifest disarray and impotence among his interlocutors over what to do next may be chalked up as yet another tactical diplomatic success for Kim Jong-il. Accordingly, this month's Update will focus mainly on the likely motives for and fallout from North Korea's missile launches. (For more detail on backround and preliminaries, see also June's Update).

Missile motives
North Korea had a range of motives for causing a big splash. One is simply to get attention. Kim Jong-il once told a Russian that if the world is talking about him, he must be on the right track. Before the missiles, the focus of world concern had largely shifted to the in some ways parallel (and not unconnected) case of Iran. The Dear Leader does not like to be ignored.

Going ahead with these tests despite being explicitly urged not to by everyone, including China and Russia, reminded friend and foe alike of North Korea's ultimate unbiddability: the heart of its state philosophy of juche. While it might not seem sensible for a small and economically weak (if militarily strong) state to unite the whole world against it, for North Korea being nobody's patsy is its core policy stance. Standing firm against foreign pressure also plays a key role in domestic political legitimation, instilling a sense of unity and pride.

6-party talks, RIP?
There were more specific goals too. Kim Jong-il may have wanted to unblock the stalemate in diplomacy around the peninsula. Not that he is in any hurry to return to six-party nuclear talks. These have not met substantively for nearly a year, since what now seems the false dawn of the joint statement agreed at the fourth round in Beijing last September 19. It is not even clear if this forum can be revived. In its abeyance, North Korea is free to push on with developing nuclear weapons on two fronts: the plutonium programme of which it openly boasts (but has never yet tested); and the suspected highly enriched uranium (HEU) project of which the US accused it in 2002, precipitating the current intermittent crisis.

The Dear Leader has several grievances. One is that Iran has been offered a better deal, at least in theory. Hypothetical as this may be, given the current flare-up in the Middle East, recent shifts in US policy allow the possibility of direct talks with Tehran: something the Bush administration has consistently refused with Pyongyang, to the bafflement of most observers. Also Iran's right to peaceful use of nuclear energy is not questioned, whereas the US opposes this for North Korea - on the not unreasonable ground that it already abused its supposedly civilian Yongbyon facility to reprocess spent fuel and create plutonium.

Kim wants his US$24m back
What really riles Kim Jong-il, though, is US pressure which last autumn saw the Macau-based Banco Delta Asia (BDA) freeze some 40 DPRK accounts, together worth US$24m. BDA was North Korea's main link to the global financial system, and this crackdown has hit legitimate businesses like the British-managed joint venture Daedong Credit Bank. But a gleeful Washington believes it has curbed some of Kim's personal slush funds: a view consistent with the vehemence of Pyongyang's wrath. North Korea insists on the lifting of these sanctions as a precondition for returning to the six-party talks or any other dialogue.

But no way can Bush back down, for the DPRK's alleged crimes include not only money-laundering but also counterfeiting US currency: seen by some, perhaps hyperbolically, as tantamount to an act of war. This was known for years, so one may still query US timing or even whether joined-up government exists in Washington. In late July press reports claimed that the Bank of China in Macau has followed suit in freezing DPRK accounts - even before the missile launches, which render Beijing more likely to signal displeasure. If confirmed, this combined pressure will be hard for Kim to resist. Further criminal enterprises exposed by the US Treasury Department's wide-ranging probe, include drug trafficking and other forms of counterfeiting, notably of cigarettes and Viagra: reportedly of excellent quality, like the almost undetectable $100 'supernotes.' Firing a few missiles may vent the Dear Leader's spleen, but he surely cannot imagine it will cut through this knot and force Bush to retreat. 

A marketing ploy?
Finally on motives, the technical and marketing fronts should not be overlooked. A credible weapon needs testing, and the Taepodong-2 never had been; the smaller Taepodong-1 flew only once, back in 1998. If the former's failure is a relief to North Korea's neighbours and the US - wild talk of even its theoretical range reaching California is unsubstantiated in any case - the half dozen which succeeded offer less comfort; especially in the light of US hints that a delegation from Iran, North Korea's best customer, was present at the launches.

In sum, Kim Jong-il had many motives for a missile test; albeit also, were he differently minded, good reasons not to. What of the consequences? Despite the frenzied attention of the world's media - briefly, before Lebanon blew up - once the smoke dies down the basic North Korean strategic situation and stand-off have not really changed much (it would have been different had the Taepodong-2 worked). While clearly it will be all the harder now, at least for a while, to get the six-party or any other form of dialogue going again, the Dear Leader will be satisfied with the disarray and discomfort which his big splash has caused.

UNSC: short-lived unity
The most urgent and striking riposte came from Tokyo. With rare initiative, and a militant tone which played badly in Seoul and Beijing, it was Japan which drafted and proposed a tough resolution for the UN Security Council (UNSC) - including potential invocation of Chapter VII of the UN Constitution, which allows for military force to back up a UNSC resolution. That was too much for China, which warned it would veto any reference to Ch VII. Though this was duly excised, the eventual Resolution 1695, passed unanimously on July 15 after ten days of busy diplomacy, is toughly worded. The fact that both China and Russia supported it, rather than opposing or abstaining, signals the real annoyance of both the DPRK's historic allies that their explicit warnings not to test the missiles were ignored.

Moreover, the resolution imposes limited sanctions. Besides telling Pyongyang to suspend all ballistic missile activities, it calls on member states neither to sell to nor buy from North Korea's missile and WMD programmes. In practice this may butter few new parsnips, since the missile trade is already squeezed by the US-led Proliferation Security Initiative (PSI); it has few customers left except Iran. Lax in the past when the damage was done, Japan and others are nowadays vigilant in scrutinizing DPRK-bound cargos for dual-use technology. 
Needless to say Pyongyang totally rejected this "brigandish" resolution - in 45 minutes: a world record, quipped the US's John Bolton - and stormed out of the chamber, a breach of etiquette. It says its missile tests are perfectly legal, and vowed to continue.

Japan ponders pre-emption
The UN unity did not last long. President Roh Moo-hyun of South Korea, whose row with Japan over the disputed Dokdo/Takeshima islets has flared up again, was quicker to chide Tokyo for "making a fuss" than to condemn the actual missile launches. Eyebrows were raised, and not only in Seoul, when the chief cabinet secretary Shinzo Abe, the front-runner to succeed Junichiro Koizumi as prime minister in September, said that "we need to deepen discussion" on "the view that attacking the launch base of the guided missiles is within the constitutional right of self-defence." While this was grandstanding to a domestic political audience - these latest tests added nothing to the threats Japan already faced, being in range of North Korea's Nodong missiles - it alarmed South Korea and China. Any beefing up of Japan's anti-missile capacities (in fact ongoing) is in truth aimed just as much at Beijing. 

Tokyo also lost no time in imposing its own sanctions: banning the DPRK Wonsan-Niigata ferry for six months, and reserving the right to do more. It is considering revising foreign exchange and trade laws, to require the 300-odd Japanese companies who trade with North Korea to disclose the destinations of any exports of about 40 items which could aid the missile programme. Although for decades it was Pyongyang's second largest trade partner until 2000, Japan-DPRK trade has already fallen sharply in recent years.

US urges moderation
In a reversal of the usual roles, while Japan fulminated it was the US that urged moderation. This could be a 'good cop, bad cop' move: the US, like other western powers such as the UK and France, backed Japan's hardline draft UNSC resolution with its Ch VII provision. But Washington's mainly honeyed words - John Bolton always excepted - worried hawks like Danielle Pletka of the American Enterprise Institute (AEI), who warned that "this new, gentler Bush is dangerous" in that America's foes will sense weakness and be emboldened.

6, 5, 10 at ARF
US diplomatic efforts climaxed at the end of July with the ASEAN Regional Forum (ARF) held in Kuala Lumpur, Malaysia. The DPRK is an ARF member, and its foreign minister Paek Nam-sun an intermittent attender. In happier days in 2002, at the 9th ARF in Brunei, Paek met his then US counterpart Colin Powell. This time, he and Powell's successor Condoleezza Rice - who was criticized for skipping last year's ARF, held in Rangoon, Burma - studiously ignored each other. Paek reiterated Pyongyang's stance, refused to join informal six-party talks, and threatened to walk out if the ARF criticized the missile tests.

It was thought the other five might meet, but in the end they did so on July 27 with a further five: the host Malaysia, plus Australia, Canada, Indonesia and New Zealand. It was stressed that this was an informal ad hoc meeting, not the start of some further regular framework.

US Treasury tightens
A day earlier Stuart Levey, the US Treasury under-secretary for terrorism and financial intelligence, said that pursuant to resolution 1695, UN member states should make a start by freezing the assets of 11 DPRK firms which the US designated last year as proliferators of missiles and weapons of mass destruction. Quite how this arm of US policy squares with a bid to reactivate nuclear diplomacy remains to be seen.

China chafes
The bedrock fact is that brief unity at the UNSC does not gainsay the real, major, ongoing divisions over strategy and tactics between North Korea's various interlocutors. Thus China is annoyed, and signals this in small ways: eg letting three DPRK asylum seekers who got into the US consulate in Shenyang fly directly to the US, rather than the usual face-saver of travelling via a third country. Yet fundamentally China still values North Korea as a buffer state, and fears the risks if it collapses, more than the odd missile test. It is not about to stop aiding Kim Jong-il, nor is anyone else in a position to check what may or may not go across the long and remote Sino-DPRK border formed by the Yalu and Tumen rivers.

Seoul squirms
The party whom Kim's missiles have hurt most is South Korea, whose 'sunshine' policy of the past eight years, in a volte face from the previous half-century, has meant more or less unconditional engagement. While North-South contacts have grown greatly, critics see this as one-sided: all carrot and no stick. Despite broad support in South Korea for engagement, there was already anger when in May the North reneged at the last minute on already much-postponed test runs of two reconnected North-South railways; the tracks have been ready to roll since last year, but lie idle. 

Domestic politics is a factor too. The missiles were a blow to President Roh and the ruling Uri party, already reeling from a drubbing in local elections on May 31 by the conservative opposition Grand National Party. The GNP may well win back the presidency next year; if so, it would certainly demand more reciprocity from Pyongyang. Hence it is puzzling why the Dear Leader would act in a way which can only encourage hardliners, be they in Seoul, Tokyo or Washington.

Wrong calls
Politics is also an art. The South Korean public's disillusionment with their present rulers is about incompetence as much as ideology. Seoul's first reactions to the North's missile tests made some questionable judgment calls. Its immediate riposte was to cancel rare military talks already set for July 7 at Panmunjom in the Demilitarized Zone (DMZ). Yet this would have been a fine chance to read the riot act directly to the Korean People's Army (KPA) - whose hawks are probably behind the missile tests and train delays, to the dismay of pro-reform technocrats who want to end their country's isolation and build up the economy.

Business yes, food no
Conversely, regular quarterly cabinet-level talks the following week in the southern city of Pusan went ahead. Cancelling these would have been a better bet. As it was, the Northern team predictably refused to discuss missiles - and went home a day early, when the South in turn refused to consider food aid. Seoul usually sends half a million tons of rice at this season, but has suspended this as so far its sole tangible protest against the missile tests. 

Yet business cooperation - like the Kaesong industrial park just across the DMZ north of Seoul, or tourism to Mt Kumgang on the east coast - will continue, on two counts: these are private ventures, and long-term projects for national reunification. The latter can be argued, but the former is specious. Though notionally run by Hyundai, both Kaesong and Kumgang are heavily subsidized and largely directed by Seoul as instruments of state policy.

But withholding rice only hurts North Korea's long-suffering people; whereas freezing, for a time, Kaesong or Kumgang would hit Kim Jong-il's pocket directly. This is an odd stick to choose. Pyongyang of course reacted in kind, suspending reunions of separated families: again a cruel blow to innocent citizens, rather than government or politico-business elites. Moreover, using food aid as a political weapon violates global norms. Even the US under Bush has sent maize, via the UN World Food Programme (WFP) - whose aid Pyongyang has sharply curtailed this year, partly because of Seoul's separate rice generosity in the past.

Immoral, untenable
As well as immoral, Seoul's position looks untenable. The storms that battered the Korean peninsula in July have done even more harm in the North than the South. The Red Cross on July 20 reported at least 100 deaths and 9,000 families homeless, with severe flood damage to crops awaiting harvesting. With a food shortfall of up to 1m tons already expected before this, the South will be pressed to reconsider. It will no doubt cave in: rightly from a humane viewpoint, yet with diplomatic egg on its face owing to such an ill-judged choice of lever.

A further dilemma of realpolitik for Seoul is that even if it withholds aid or investment to a degree, Beijing will have no such scruples. China and South Korea agree that engaging North Korea is preferable to confronting it, but at the same time they are geopolitical rivals for influence in Pyongyang - which allows Kim Jong-il to play them off, much as his father Kim Il-sung successfully did with Moscow and Beijing during the Sino-Soviet dispute.

Same difference
In conclusion: once the dust cleared and the smoke eased, North Korea's missile tests may not have changed matters as much as was initially feared. Kim Jong-il just reminded us all that he is his own man, and we ignore him at our peril. No new information there. All the same dilemmas of whether and how to engage the DPRK, and what to prioritize, remain.

Kim's regime is obstreperous and obnoxious, yet arguably more a nuisance than a menace - except to its own longsuffering citizens. Even irresponsible acts of braggadocio like the missile tests may have been more carefully calibrated than at first appeared. In the absence of either the possibility of or any appetite for regime change, sooner or later the DPRK and its assorted interlocutors will wearily return to the diplomatic dance. La ronde continue.

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