North Korea  

For current reports go to EASY FINDER

North Korea



In-depth Business Intelligence

Books on North Korea


Area (


22,224,195 (July 2002 est.)


North Korean won (KPW)

Kim Jong-il

Update No: 034 - (23/02/06)

Marking time
February, a bleak month in North Korea, was also a largely uneventful one. Domestically, it saw as ever the birthday on the 16th of the DPRK's supreme leader Kim Jong-il, who this year officially turned 64 (though he may really be 65). The usual celebrations brought no word on naming an eventual successor, although outsiders' speculation on this persisted.

Internationally, meanwhile, a resumption of six party talks - both Koreas, China, the US, Japan and Russia - on the nuclear issue came no closer. Pressure from Washington on the separate issue of DPRK counterfeiting continued to rile Pyongyang, amid some evidence that it was also hurting. But rather than force North Korea back to the conference table, the effect may be to drive Kim Jong-il further into the arms of his Chinese semi-protector.

Synchronized warbling; Kimjongilias bloom
Kim Jong-il's birthday on February 16, a holiday in North Korea ever since 1974 (six years before his status as successor to his father Kim Il-sung was made public), was marked with the usual extravagance. Normal for North Korea, both the mode and intensity of this cult seem bizarre to the rest of the world. To take just one example of dozens, the official Korea Central News Agency (KCNA) reported a synchronized swimming gala on the great day. Evidently singing was synchronized as well, since besides the "graceful rhythms … and refined teamwork", the Changgwangsang Health Complex swimming pool resounded to such ditties as "Thunder on Jong Il Peak", "Our General Is Best", "Ye, Bright Moon over My Country", "General and Children", and "Let's Advance Faster for Higher Goal."

Like his late father, Kim Jong-il also has his own flower. Whereas Kimilsungia is an orchid from Indonesia, Kimjongilia is a begonia bred by a Japanese admirer. The latter is now the subject of an annual Kimjongilia Festival. This year's, the tenth, saw over 23,000 potted plants sent in by more than 100 organizations: "including military organs, commissions and ministries of the Cabinet, national institutions and servicepersons, working people from all walks of life, school youth and children … and overseas Koreans, foreign embassies … and friendship and social organizations in different countries" (KCNA again). 

On top of this, each province also held its own separate exhibition, with thousands more of the blooms. Delusions of grandeur apart - Kimjongilia is "recognized as the world's most famous flower": you heard it here first - in a land chronically short of electricity and where child malnutrition is widespread, the greenhouses needed to nurse these blooms through the harsh Korean winter are an appalling waste of scarce resources. Politically too, there is an air of competitive feudalism: woe betide anyone whose flowers fall short, one supposes.

Succession speculation
While Kim Jong-il was lauded to the skies, with (inter alia) a national seminar on February 8 devoted to his "immortal feats", no further clues emerged as to what plans, if any, he has for his own succession. While no doubt such a genius will be a hard act to follow, leaving a vacuum is also very risky. With long and impenetrable articles on inheriting the revolution starting to appear in the Pyongyang press, there is clearly much thinking behind the scenes.

Meanwhile speculation in Seoul added contradictory new twists to the rumour mill. On the one hand it is claimed that Kim Jong-chol, the dear leader's middle son, dined with China's president Hu Jintao; and that a Party campaign to honour him is under way. Against this is a comment of Kim Jong-il's former sushi chef that his father regards this son as too "girly." Rather than sexism - Kim Jong-il also has at least two daughters, who by most accounts are not in the running by definition - this may be more literally true. On February 18 the Korea Times reported a rumour that Kim Jong-chol has a fatal and incurable disease: an excess of female hormones, "which makes him even bosomy." There is of course no confirmation.

Bottom dollar: tightening the screws
In an unwelcome birthday present to Kim Jong-il, Banco Delta Asia (BDA), a Macau-based bank accused by the US of being a conduit for DPRK counterfeiting and money-laundering, said on February 16 that it has severed all ties with Pyongyang. BDA thus hopes to head off implementation of the Patriot Act, which would bar US banks from opening or maintaining correspondent accounts with it. A formal US threat to do this last September caused a run on BDA, forcing the Macau authorities to take it over. Two South Korean banks recently cut ties with BDA, whose responses include hiring Ernst and Young to review its DPRK business (it has, or had, some 50 customers there) and Deloitte and Touche to advise on anti-money laundering measures. It has put $25 million in a suspended account under the direction of the Monetary Authority of Macau. 

While the US obviously has every right to protect its currency, two problems arise. This is a blunt instrument, snaring innocent and guilty alike. The 50-odd North Korean accounts suspended by BDA include that of Daedong Credit Bank (DCB): a joint venture with UK investors (originally by the now defunct Hong Kong-based Peregrine), which not only serves other JVs in the DPRK but is at pains to stress its transparency and anti-laundering procedures. If the idea is to show Kim Jong-il that crime does not pay, making life difficult for legitimate business in Pyongyang seems an odd way to go about it.

What is Bush playing at?
Secondly, as we have noted before, this new US pressure on financial crime hands North Korea a fresh pretext to boycott the six-party nuclear talks. Not for the first time, one has to wonder what Washington's strategy is. Unless it was sheer coincidence that long-running probes into Pyongyang's dodgy dealings came to fruition just as the six-party talks reached a hard-won if vague statement of principles last September, the suspicion must be that US opponents of engagement - vice-president Cheney is usually cited - were glad to stymie a process which at last looked as if it might be making some progress.

This diplomatic torpedo apart, there are signs that the US pressure may be hurting. Japan's Kyodo News claimed on February 11 that Kim Jong-il told Hu Jintao on his visit to China in January that US sanctions could cause his regime to collapse. That the dear leader made this hastily arranged trip, just weeks after the two men had met in Pyongyang, suggests he is worried. Yet US advocates of regime change should control their glee, and ask whether driving North Korea into China's arms is a net gain. Kim Jong-il's warm welcome suggests that Hu is prepared to support him; including, one may speculate, not only quiet pressure to end criminal enterprise but perhaps compensation for so doing, and legitimate alternatives. A face-saving formula for both sides on the financial issue must be found if the six-party talks are to restart. That will not be easy, so there may be no new talks till March or April.

Talks with Japan remain deadlocked
While six-party nuclear talks in Beijing have yet to resume the brief and uncompleted fifth round held in November, the Chinese capital did host talks between North Korea and Japan. Technically this was the 13th round of bilateral talks on normalizing Japan-DPRK relations: a long and tortuous road. The first 8 rounds were held back in 1991-92, while the 12th was in 2002. Relations have never been worse, so the wonder (and faint hope) is that they even bothered at all. To avoid deadlock they adopted a new triple-track format, with separate tranches for abductions (still a dealbreaker for Tokyo), diplomatic ties and security issues. 

Despite this, there was no progress. On abductions, Pyongyang stuck to its tall tales of how 8 of the 13 young Japanese whom it admits to kidnapping died, and insists there were no more. That did not impress Japan, especially with widening evidence that individuals from several other countries including Thailand and Lebanon were abducted too and are still held in North Korea. Public opinion aside, a tough-minded Tokyo has no reason to ease its stand - whereas Pyongyang could gain an aid package worth up to US$10 billion if diplomatic ties are ever sealed, which seems a remote prospect. The ball is in Kim Jong-il's court.

Meanwhile Seoul sources reported on February 12 that Japan-DPRK trade fell last year to US$190 million, its lowest since 1977. Japan was long North Korea's second largest trade partner and main source of hard currency earnings; but chilly relations of late have seen Tokyo tighten up, both on financial flows and banning rusty DPRK vessels from its ports.

Mixed messages to Seoul
There were no major developments on the inter-Korean front in February. With typically mixed messages, although Pyongyang media continued to warn (as every year) that routine US-ROK military cooperation could jeopardize North-South ties, the North pleased Seoul by agreeing at last to hold a third round of high-level military talks; albeit at Panmunjom on the border, rather than the more exotic venue of Mt. Paekdu as originally envisaged. This meeting is due on March 2, so we shall see if North Korea is ready to move on matters like a joint border fishing zone - agreed in principle, but no details have yet been worked out - and cross-border railways, reconnected but not yet in use; let alone the more substantial security issues which the South would like to discuss, such as force level reductions.

Meanwhile Red Cross talks at the North's Mt. Kumgang resort, ongoing as of February 22, found Pyongyang continuing brazenly to deny holding any ROK abductees or prisoners of war (POWs), despite much evidence to the contrary. Seoul is unlikely to press the matter, for fear of jeopardizing hard-won family reunions (which have in fact included a handful of abductees). The contrast with Japan is striking. There, driven by public opinion whipped up by right-wing politicians, the kidnap issue tops the agenda; its full settlement is a sine qua non of progress on any other front, let alone aid. In South Korea, by contrast, abductees' families struggle to get much sympathy from either the public or the present government.

Defending the North against Uncle Sam
Changing attitudes among South Korea's young were highlighted by a newspaper survey of 18-23 year olds, published on February 21. Almost half (48%) said that if the US attacked Northern nuclear facilities, Seoul should take Pyongyang's part and demand Washington desist. 41% thought the South should stay neutral, while 11% said it should act in concert with the US. While ambiguous phrasing makes it unclear whether defending North Korea or opposing a military solution was the key point, this is a striking result; consistent with earlier polls, which have sometimes found younger South Koreans citing the US or Japan (but not China) as greater threats to peace on the peninsula than Kim Jong-il's regime. 

As this implies, the old Cold War certainties on the peninsula are no more. Attitudes like these in Seoul must give pause to even the Bush administration's most rabid hawks. Even if they view this as rank appeasement, they have their work cut out to win back the hearts and minds of South Korea's rising generations - or the future of the US-ROK alliance is bleak. A posturing hardline new US ambassador, Alexander Vershbow, is not helping matters.

Meanwhile Kim Jong-il looks well placed to play off Beijing against Seoul, just as his late father Kim Il-sung once milked both China and the USSR during the Sino-Soviet dispute. Now in effect protected by all three of these immediate neighbours - a strikingly post-Cold War troika - the dear leader has little to fear from his foes in Washington or Tokyo. In that sense, despite no sign that the nuclear issue will be resolved any time soon, North Korea's short-term position at least appears surprisingly stable. But the succession is another matter.

 « Top  

« Back


Published by 
Newnations (a not-for-profit company)
PO Box 12 Monmouth 
United Kingdom NP25 3UW 
Fax: UK +44 (0)1600 890774