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Prospects for North Korean Economic Reform and Unification, a KEI Q&A with Andrei Lankov Part II


By Chad 0’Carroll

Last week we published the first part of an extensive interview by KEI’s Chad 0’Carroll with Dr. Andrei Lankov of Kookmin University on the prospects for economic reform in North Korea. In the second part of the interview Chad discusses with Dr. Lankov what the U.S. can do to encourage reform in North Korea, why Myanmar style reforms are unlikely, and why it is doubtful that reunification between North and South Korea will occur though a negotiated process.

Korea Economic Institute (KEI): This year we’ve seen reports that North Korea’s authorization of migrations to China for business purposes has been at its highest rate ever. That obviously comes with some risk, but why do you think North Korea is willing to now legally allow so many of its nationals to China for business purposes?

Andrei Lankov (AL): Obviously they want to control the migration because simultaneously they dramatically increased security on the border. Illegal crossing of the border has never been that difficult – never. A lot of border guards – very thorough control. So they obviously prefer to let people out, because they know who gets out, and they prefer to maintain control over people whom they know, whom they can to some extent trust, and whom they can blackmail if necessary. And they understand that such cross border movement is an important safety valve. Without such cross border movement, the economic situation of North Korea will become even more difficult.

KEI: Moving forward, is there any way the US can encourage reform in North Korea?

AL: Well, I don’t think so. I don’t think much can be done about it. As usual, I favor all kinds of exchanges, as well as support for broadcast and production of digital material to be smuggled inside North Korea and so on. In short, we should welcome everything which brings information about the outside world within the reach of the average North Korean, and especially the lower parts of the North Korean elite. However, it’s not a wonder bullet, but just a way to speed up the ongoing changes. And, of course, a policy of pressure doesn’t work well. So if Americans become more reconciliatory and less pushy, it will probably slightly increase chance for reform. But I would not be too optimistic. Right now I believe that as long as former advisors to Kim Jong-il remain in actual control of the young dictator, nothing is going to happen. It will be more of the same. Then, when Kim Jong-un takes actual power, and this is bound to happen eventually, things might change. But once again, reforms in North Korea should not be perceived as a dawn of a beautiful, shiny era of economic growth and gradual transformation. It might be the case, but I believe it’s much more likely that such reforms will be a sign of a dramatic and bloody crisis to happen soon.

KEI: So you would say the notion of Myanmar style reforms is probably quite unlikely then?

AL: Once again, Myanmar, Iran, China, Vietnam – none of these countries is a divided country. Their leaders can afford to be soft on the populace. In Myanmar, reforms are not really that dangerous, because even if this leads to collapse of the current regime, a vast majority of the current Myanmar elite is likely to enjoy a very comfortable retirement. North Korean elite, well, they’re much less certain about their future, because if they’re going to be overthrown, it’s quite likely that the country will be swallowed by the triumph from the South, and they believe, probably without much reason, but they do believe nonetheless that they will be pushed aside or maybe punished for their future misdeeds by their own subjects and the triumphant South Koreans.

KEI: In terms of unification, where we are currently standing – what do you think is more likely going forward? A unification scenario with the South Koreans, perhaps a few decades from now, or a further cementing of division, and perhaps creation of a Chinese client state?

AL: I would say that I do not believe, most emphatically don’t believe, in the gradual negotiated unification. In Korea it is plain impossible. Its unfortunate that majority of South Korean politicians either sincerely believe in such a probability, or behave as if they do believe it. The only event which might open way to unification, essentially, is a regime collapse in North Korea. However, even regime collapse will not necessarily produce unification, because it might lead to a Chinese intervention and an emergence of a pro-Chinese puppet state, probably under the same name of the DPRK, with the same constitution, the same coat of arms – everything remains as not ostensibly, but such government will operate under complete or near complete Chinese control. If this happens, unification is likely to be postponed for a long time, or perhaps forever, because now in South Korea and to some extent in North Korea we see the slow emergence of two different nations, two different identities. So far, this process seems to be reversible. But I am not so sure whether it will be reversible in twenty or thirty years’ time. After all, many of the present day nations emerged as a result of political division, which looked rather artificial, then it first happened. Look at Arab countries, or for that matter, countries of South America. The initial division was absolutely arbitrary, but they have eventually developed their own identities, they have become completely separate countries. It has not happened in Korea yet, but in the long run, it’s not impossible.

KEI: Frankly speaking, do you think, from your experience of being in South Korea, the average person on the street worried about the future of their family livelihood and so forth – do you think they would prefer the two countries to stay separate with the possible risk that North Korea does become that Chinese client state? Or ultimately that it’s more advantageous for them for an eventual unification for the two?

AL: I believe the average Korean will get much from unification. The problem is, however, that the positive results of unification will come in the long run. The immediate result will be economic hardships and a great deal of social disturbance and friction. Then, the first positive results might show in a couple of decades, if not later. For the average South Korean, it might be too lengthy. It essentially means that South Koreans should sacrifice their lives for the better lives of their children and grandchildren. I am not sure whether they are ready to make this sacrifice, especially now, when they increasingly perceive North Korea as a foreign country, whose population just happens to speak Korean as their native language.

KEI: You mentioned that reform is not possible in the North because the elites believe it would lead to collapse and an unsecure future for them. Would not a negotiated reunification allow them to secure their own future status and avoid the peril of reform or the failure to reform leading to the collapse they fear?

AL: I am afraid, not. They will not believe such security guarantees – and, I would admit, with good reason. Do you remember what has happened to South Korean President Chun Doo-hwan? He also relinquished power on the conditions of personal security, but nonetheless he stood the trial in less than a decade. And South Korean military strongmen were harmless kittens if compared to the North Korean dictators. Once the former deeds of these people will become widely known, they are in trouble. There will be a public pressure from below to punish them, and it will make perfect political sense to make them scapegoats as well. While I support the idea of general amnesty in the case of regime collapse, I do not see why the North Korean leaders would take initiative in negotiating such a dangerous deal.

KEI: For the final question, I’d like to pick you up on something you said in 2007. You said a “sudden death or even a serious illness of Kim Jong-il is almost certain to trigger a serious crisis.  If this happens, all bets are off, but it seems that the collapse of the system, Romanian or East German style, is one of the most likely outcomes.” Why do you think this didn’t happen, and do you still think it’s a risk in the imminent future?

AL: It still remains a risk, but I was wrong because I underestimated the cohesion and the unity of the North Korean elite – and of course it is important that in 2010 Kim Jong-Il appointed a successor. Kim Jong-un is clearly a young and inexperienced leader, who just a couple of years ago, was a complete unknown. Nonetheless, he is seen as a symbol of unity, and the North Korean decision-makers, few hundred families who have been running the country for 60 years by now, they understand that they have to hang together in order not to be hanged separately. So they have demonstrated impressive unity so far. But once again, if the new leaders choose to start reforming the country, it will become very unstable. They might find a right proportion of terror and material rewards to stay in control. They might succeed, but it’s a very risky game.

KEI: Do you think we still have a potential for the Kim regime to be around in say, two or three decades from now?

AL: Yes, I do. If they behave carefully, there are three options why they can be around in, say, 2040. First, they might choose to strictly follow Kim Jong-Il’s line, not to change anything – use clever diplomacy and nuclear blackmail to squeeze unconditional aid from the outside world, to silence dissent. If they do so, with some luck they will muddle through, and they can stay in control for another few decades. The second option is that they will take the risky gamble of reforms and succeed – frankly, against my expectations. They will start reform, and will find the right balance of police control, terror, persuasion and, of course, economic incentives. It will be very difficult to find and maintain such balance, it will be an exercise in rope-walking, and personally I don’t think they will succeed – but who knows? Maybe they will. If so, Kim Jong-un will still be in control of his people, as an aging strongman of a developmental dictatorship. The third option – China will take over. Maybe as a result of crisis, maybe as a result of some deal between North Korea elite and Chinese government may be as a result of some other circumstances. If so, we are going to see a puppet state, which is still likely to be run by the same Kim family, and will use the same rhetoric and ideology, which will be very similar to the North Korea of today ostensibly.  However, for all practical reasons, it will be a classical developmental dictatorship, more or less similar to present-day China, or South Korea of the 1960s, or Taiwan of the 1970s, and will be controlled by China (pretty much like countries of Eastern Europe were once controlled by the Soviet Union).

Photo from expertinfantry’s photo stream on flickr Creative Commons.

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The Peninsula blog is a project of the Korea Economic Institute. It is designed to provide a wide ranging forum for discussion of the foreign policy, economic, and social issues that impact the Korean peninsula. The views expressed on The Peninsula are those of the authors alone, and should not be taken to represent the views of either the editors or the Korea Economic Institute. For questions, comments, or to submit a post to The Peninsula, please contact us at ts@keia.org.