North Korean reflections

The slew of recent, insightful articles on the Hermit Kingdom, namely North Korea, written with different approaches are well worth some comments. Although the focus and nature of every article is quite different, they can perfectly be analysed together, so that we have a better picture of the situation in North Korea.

The first article in the set is an academic paper by a reputed German expert on North Korea, Rüdiger Frank, Chair Professor of East Asian Economy and Society at the University of Vienna (you can find it here). In it, Dr Frank, who studied in Korea during the 90s and has visited the country again on several occasions, analyses North Korea's macroeconomic evolution and current situation based on the role of money in socialist economies and the recent monetary reform and the trouble it has caused the regime (see related article in Time Magazine), as well as its future implications.

This highly insightful paper argues that the regime "violated its own rules" with the limited open-market reforms it introduced in 2002 and 2003, and is now looking to revert the situation, with the clear goal of expropriating the new middle class and the possible one of setting the stage for yet another hereditary succession (although Dr Frank slightly disagrees on that) with a neoconservative swing that would counter the weakening position of Kim Jong-il.

However, the effects of monetization in the collective psyche of the North Koreans, coupled with leaked information and visual evidence of the Chinese rapid economic progress and the continued success of the South Korean economy, will be permanent. As Dr Frank says, "the North Korean state started to sell its people, its land, and its pride", and is now trying to go back in time, also trying to ignore the global setup of a globalized world. In the words, again, of Dr Frank, "from a long-term perspective, it seems safe to say that even if, and this is a big if, the currency reforms manage to achieve the goal [...] this is unlikely to remain stable for more than a few months or years, since the key problems of the North Korean economy remain."

The second article, recently published in The Economist, focuses on a recent book by Brian Myers, which argues that the North Korean regime has its ideological and political roots in the fascist dictatorship of imperial Japan under Hirohito. Although this argument seems reasoned enough and the book might be well worth reading, the approach is also polemic and probably a bit shallow.

First, while it might be correct, the argument that North Korea’s history is one of a child-race abused by foreign powers and, therefore, Koreans need a caring, protective leader, a maternal figure (as also shown by this collection of North Korean propaganda posters) is somehow biased and limited: not only North Korea does that, South Korea does this as well, and other nations are increasingly reacting that way in the midst of the current economic downturn. Moreover, the combination of fascism and race-based nationalism is not unique of Imperial Japan, nor is dictatorship coupled with a strong personality cult. Finally, it should also be remembered that the ideological extremes of communist and fascist ideologies tend to interweave, and this is a typical example thereof.

The third article, written by Sung-Yoon Lee and published in Foreign Policy, analyses what could happen in the case of a sudden power collapse in Pyongyang, arguing that, although a common contingency plan exists (namecoded OPLAN 5029 by the Pentagon), it might be insufficient to tackle any mid- and long-term effects. However, as also implied by The Economists' Banyan in a recent blog post, Mr Lee's analysis lacks an element: Chinese influence and interests. We must first take into account that a sudden demise of the Kim regime is highly improbable, as China is most interested in preserving stability in the region, and a good way of doing that is by preserving the current status quo in Pyongyang, as shown by a recent $10 billion investment in North Korea by the Chinese Government (as reported by Dr Frank).

China sees Kim's regime as a buffer state between them and americanised South Korea and Japan, and thus keeps it on life support: they don't want Koreans to starve and probably topple the regime, but they neither want to spur a sudden uncontrolled opening-up of the regime, as it might also hurt their main economic interests in the country, including mineral extraction  rights and toxic waste dumping sites (see related article in the Telegraph). In case the regime were toppled, China's reaction will be at least as important as America's and South Korea's. As suggested by Andrei Lankov, a watcher of North Korea at Kookmin University in Seoul, China could try to avert collapse by installing an authoritarian, pro-growth regime in North Korea, something along the lines of China's (and even at its mercy).

However, such moves would probably be insufficient to avert chaos should the North Korean regime suddenly fall, as it would create a giant tide of 23 million disoriented people. If Mr Myers' book is right in one aspect, it is the infantile hopelessnessof the North Korean people: they are thoroughly vulnerable in the hands of a global world of competitive capitalism. Despite some "green shots" (for instance, see this article from BBC News) and the clear signs of entrepreneurship, specially among females, noted by Dr Frank in his paper, North Koreans are not ready to immediately and seamlessly integrate in societies such as South Korea's and China's. as shown by the deep socioeconomic and psychological anxiety experimented by North Korean defectors in South Korea (see, for instance, this article).

As pointed out both by Banyan and Dr Frank, any comparison with Germany's situation 20 years ago is fully inaccurate for several reasons. First, West Germans were much wealthier back then that South Koreans are now, while East Germans were better of than our North Korean contemporaries, West Germans are still paying a special 10% tax that goes to the eastern Länder. Moreover, West Germany had a much higher population than its socialist counterpart, while South Korea's population is barely higher than the North's, making all economic needs related to reunification and reconstruction north of the 38th parallel even more daunting.

Secondly, as Dr Frank clearly explains, both Germanys had much closer and deeper ties back then than South and North Korea do now. In other words, East Germans received parcels and were visited by their West German relatives, saw Western Audis and BMWs rolling along their Trabants in highways to Berlin and were able to watch West German TV since the 1970s. North Koreans are thoroughly isolated of the outside world, and that of course includes their southern brothers. As attested by this humble writer in a recent visit to the Hermit Kingdom, even privileged members of the society (in this case, English-speaking tourist guides) felt compelled to ask foreigners for information about their own country's wheelings and dealings. While this shows that some members of the North Korean society realise that their Government is hiding important information from them, it also shows their thorough lack of knowledge of today's global context.

For a deeply alienated people such as North Korea's, sudden toppling of the current regime can cause a serious humanitarian crisis. The best possible scenario going forward would probably be a gradual political and economic opening under joint Chinese, South Korean, American and Japanese leadership. However, recent indications are not encouraging, chiefly the recent wheeling and dealing with currency reform, allegedly masterminded by the appointed successor, Kim Jong-il's third son Kim Jong-eun. Nothing is sure as of now, but the status quo of the Korean regime should not last forever. As Banyan points out in his blog, maybe North Korea will find a way forward, most probably with Chinese characteristics.