North Korea

North Korea ————————————————– —————————— North Korea: Policy Determinants, Alternative Outcomes, U.S. Policy Approaches (Rep. 93-612 F) Congressional Research Service, Report for Congress June 24, 1993 By Rinn-Sup Shinn, Analyst in Asian Affairs, Foreign Affairs and National Defense Division* SUMMARY North Korea is undergoing a wrenching phase of adjustment to an uncertain post-Soviet world. Its government is reined in by two major constraints: fear that any political or economic reform would have the same fatal consequence for itself as it had for the former Soviet Union and other erstwhile allies; and fear that the United States, South Korea, and other enemies would stop at nothing to overthrow the communist regime of the North. The United States has a major stake in the outcome of North Korea’s effort to deal with its daunting task.

The challenge in the North has become compelling as Pyongyang has come up far short of its core policy objectives: political self-preservation, undermining South Korea–and by extension, U.S. military presence in the South; and obtaining economic and security support from the outside world. Facing an obvious need to change, Pyongyang is caught in a dilemma about reform. In the wake of the Soviet collapse, a shaken Pyongyang reaffirmed its resolve to defend a) its centrally planned, autarkic command economy; b) its monolithic, one-party system identified with the persona of Kim Il Sung, the great leader (and now with that of his son and de facto successor Kim Jong Il); and c) its policy of reunifying the two Koreas on Kim Il Sung’s terms. The two Kims still talk as though time is on their side, and that they can outwait U.S. withdrawal from the South.

Nonetheless, they seem to recognize that they need to end their self-enforced isolation, to say nothing of their unaccommodating foreign policy posture. A sense of urgency and a siege mentality are real and growing in Pyongyang. In particular, the North’s economy, which it has long defined as the real underpinning of political stability and military preparedness, is shrinking by all objective criteria. Still worse, there is no immediate relief in sight. At the same time, Pyongyang is slipping further and further behind Seoul–a situation that has potentially unnerving security implications. Seeking economic help and greater international legitimacy, North Korea in recent years has sought to reconcile with South Korea by promising nonaggression, reciprocal cooperation, and denuclearization of the Korean peninsula.

But the regime remains doctrinaire, self-centered, and committed to political control, and has repeatedly undercut its soft approaches by reneging on such promises. The United States has also received numerous promises from Pyongyang. A number of policy approaches may be considered by the United States: engagement aimed at inducing Pyongyang into the community of nations; military, economic, and political pressure to underscore U.S. concern for the stability on the Korean peninsula; and outwaiting–letting Pyongyang chart its own transition by refraining from action that can be reasonably perceived in Pyongyang as provocative and threatening, while avoiding any actions that would give legitimacy or assistance to the North Korean regime. INTRODUCTION North Korea (Democratic People’s Republic of Korea–DPRK) is a major foreign policy challenge to the United States because of its intractability as well as its threat to 37,000 U.S.

troops in South Korea. Isolated and self-absorbed, its behavior is widely thought to be as irrational as it is unpredictable. The communist regime in Pyongyang regards the United States as its sworn enemy and the main obstacle to Korean reunification. It has denounced the United States for its forcible occupation and for allegedly turning South Korea into a forward military base from which to plot the collapse of North Korea or to launch a nuclear attack. Since the division of the Korean peninsula in 1945, North Korea has defined its self-preservation in terms of three policy priorities, or core interests: consolidating Kim Il Sung’s power base, undermining South Korea to hasten U.S. withdrawal from the South, and securing maximal support from the former Soviet Union and China.

These priorities were designed to assure the security of the Kim regime from domestic critics and against perceived threats from the United States and South Korea (Republic of Korea–ROK). Externally, Pyongyang has pursued anti-U.S. and anti-South Korean policies as interrelated and complementary approaches. Forcing the U.S. out of the South was judged necessary to lay the groundwork for establishing a docile pro-North Korean regime in Seoul.

North Korean leaders continue to believe that the end of the U.S. military presence will enhance their chances for overthrowing anti- communist South Korean regimes and for unification on Pyongyang’s terms. Pyongyang’s current concerns about its own survival are cumulative and derived from three main sources: slow economic productivity since the 1970s, South Korea’s insurmountable economic lead over North Korea in the crucial inter-Korean rivalry, and deepening isolation since the breakup of the Soviet Union–Pyongyang’s most important source of weapons and economic assistance through 1990. Pyongyang sees no relief in the short run. In the past, as North Korea became less secure, it sought to attribute its economic troubles to the actions of the United States and its allies, South Korea, Japan and others. But now, North Korean leaders seem convinced of the need to befriend these old enemies; nonetheless, they are wary about opening to these countries on terms over which they have little or no control. In seeking to relate itself to the rest of the world, Pyongyang is both cautious and ambiguous, mixing conciliatory signals with contradictory hardline messages.

This report contains four parts.1 In the first, North Korean policy determinants are identified and examined in terms of motives and rationale as Pyongyang itself appears to have defined them. Variable factors likely to affect economic development and prosperity are also part of the strategy for survival, for they are portrayed as the material foundation of political stability and military effectiveness. Self-preservation has also meant an unwavering commitment to a Stalinist command economy that, from its inception, was identified with Kim Il Sung’s philosophy of self-reliance. Since 1947, he has maintained that a self-supporting economy was the foundation of true national freedom and political independence. He has continued to favor an inward- looking development strategy based on the primacy of a heavy industrial base. Suspicious of even Soviet intentions, he opposed Moscow’s attempt in the 1950s to induct North Korea into the now defunct Council for Mutual Economic Assistance (CMEA), the Soviet-sponsored instrument for intra-communist bloc trade and economic coordination.

Although Pyongyang liked to appear self- sufficient in its own domestic expertise and resources, in fact North Korea depended considerably on Soviet technology and economic assistance. Through the 1980s, Soviet largess was critical to North Korea; it supplied nearly 70% of North Korea’s oil needs at friendship discount prices and on barter. Many of North Korea’s industrial facilities were built or rehabilitated with Soviet assistance.2 For decades, the two Kims held the notion that ideology was more important than pecuniary incentives in motivating workers, and that North Korea had the abundance of resources and high levels of science and technology to become an industrial power. A case in point was their optimism in March 1974, when North Korean leaders declared that in the next several years North Korea would catch up with and outpace the advanced countries of the world in terms of per capita output of key industrial goods. By the mid-1970s, Pyongyang had concluded it was losing out to Seoul in the economic race. Since the mid-1980s, it has begun to modify its rigid self-sufficiency policy, emphasizing foreign trade and readiness to accept foreign investment and tourism, and, by the late 1980s, even some economic cooperation with South Korea.

Pyongyang is now faced with the challenge of how to realign its foreign economic relations without losing its tight grip on controls over the population. Along with political control and economic development, military preparedness remains vital to North Korean survival. Since the end of the Korean War, Pyongyang has invested heavily in a military buildup to counter has appealed to South Korean leaders for mutual reconciliation, while covertly seeking to destabilize what it calls the military fascist clique. But Pyongyang also has resorted to assassination, dispatching killers to Seoul in 1968 and 1974, both an attempt on President Park Chung Hee; to Rangoon, in 1983, to kill visiting President Chun Doo Hwan; and terrorists to the Middle East, in 1987, to blow up a South Korean airliner en route to Seoul. In dealing with Seoul and others, North Korea is widely seen to have behaved unpredictably.

Even as it prides itself on being unfailingly consistent and principled on Korean nationalism or unification, Pyongyang has clearly made tactical changes in its South Korea policy, reversing itself in a number of important instances including the following: Pyongyang unilaterally suspended the historic dialogue with the South in 1973, saying it was a waste of time, but in 1985 resumed the dialogue, concluding that circumstances now favored engaging the South. In 1979, Pyongyang rejected a South Korean-U.S. proposal for a tripartite conference as a scheme to promote a two-Koreas policy, but had a change of heart in January 1984. In September 1981, in bitter opposition to Seoul being chosen as host city for the 1988 Summer Olympics, North Korea reportedly voted for Nagoya, Japan, calling into question its devotion to Korean nationalism, which Pyongyang claims should transcend its ideological differences with South Korea; in 1986, Pyongyang turned around to propose cohosting the Olympics with South Korea.4 In 1991, despite its years of principled opposition to the idea of a separate United Nations seat for North and South Korea, Pyongyang changed its mind and applied for UN membership, vowing at the same time it would continue to struggle for a one-Korea policy. Pyongyang announced on March 12,1993 that it would withdraw from the nuclear nonproliferation treaty (NPT); on June 11, it reversed itself stating that North Korea would temporarily suspend its withdrawal from the NPT–but without agreeing to special inspections demanded by the International Atomic Energy Agency (IAEA).5 North Korea’s approach to Seoul has undergone further, more subtle shift since the early 1980s, when Pyongyang decided to place more emphasis on anti-Americanism in its propaganda activities aimed at South Koreans. The shift helped Pyongyang capitalize on rising anti-American sentiments among South Korean student activists in the wake of a bloody suppression of an urban uprising in Kwangju in May 1980. In 1983, Pyongyang stepped up an anti-U.S. consciousnes-raising propaganda, asserting that the United States was neither protector nor partner of the South Korean people.

In another effort to disrupt South Korea’s relations with the United States, Pyongyang launched an anti-nuclear war movement in the early 1980s. The movement had two aims: first, to evoke fear of a nuclear holocaust that North Korea claimed was imminent due to the U.S. nuclear presence in the South and, second, to link the initiative to the Pyongyang-directed pan-national anti-nuclear movement for the denuclearization of the Korean peninsula. Pyongyang hoped the anti-nuclear card would force withdrawal of U.S. nuclear weapons and troops from the South–and eventually undermine South Korean stability and pave the way for reunification with the South.

6 FRATERNAL SUPPORT The third determinant of North Korean policy was based on Pyongyang’s presumption that it would receive economic and other support from fellow communist countries. Since 1953, Kim Il Sung has had to cope with the presence of U.S. forces in the South–the bitter and costly legacy of his failed unification venture in invading the South in June 1950. Rhetoric of military self-reliance notwithstanding, Kim’s strategy for self-preservation presumed that Soviets and Chinese would render strong support for his eastern outpost of socialism. From its inception, North Korea has defined its friends and foes in terms of where they stand on anti-Americanism. Thus, North Korea was allied with Mao Tse-tung’s China, which Kim Il Sung judged was more anti-American than the revisionist Soviet leadership was.

Kim’s 1962 decision to build a foundation for military self-reliance apparently was a function of his growing skepticism about the reliability of Moscow where his own national security was concerned. Nevertheless, military support from Moscow and Beijing was the centerpiece of Pyongyang’s security environment, the crucial counterpoint to perceived U.S. threat. In the years after the Soviet collapse, Pyongyang has sought periodically to improve its sometimes cool relationship with China, now its only major source for economic and military support. But with China seeking expanded U.S. trade and investment and having normalized relations with Seoul in 1992, the North’s security environment has grown increasingly precarious.

Pyongyang’s paranoia about its national security can be gauged in part by its shrill reactions to the annual U.S.-South Korean team spirit joint military exercise, but more importantly by its determined efforts to develop a nuclear weapons capability and to refuse compliance with the IAEA’s demand for special inspections. KEY VARIABLES AFFECTING POLICY DETERMINANTS Few would question Pyongyang’s survivability during the next two years. For the longer term, however, North Korea’s future seems to hinge on four main variables: leadership succession, military loyalty, economic recovery, and relations with South Korea and the major powers. KIM JONG Il, THE SUCCESSOR In recent years, observers have suggested that Kim Jong Il, the chosen successor, would not survive long after his father’s death. The younger Kim, referred to as the Dear Leader in North Korean media, is said to be impulsive, unstable, and of weak character, and to lack his father’s leadership charisma and military background.

Without them, observers say, he could be either eased out in an intraparty power play or toppled in a military coup. So far the 51- year old Kim junior seems to be holding up without any overt sign of opposition. He is also being built up in the North Korean media as the most outstanding strategist in our age and ever-victorious, iron-willed, brilliant commander; these are honorifics previously reserved for the senior Kim. As heir to leadership, the junior Kim is required in time formally to assume the two posts still held by his father-mentor: president of the state and general secretary of the Central Committee of the ruling KVVP. That will be the easiest part of de jure succession.

A more daunting part will be whether he can inherit the senior Kim’s charisma as a family right, or inspire the same unquestioning faith that Kim Il Sung has inspired from his followers. In the 1990s and beyond, the true test of succession seems to be whether and how Kim Jong Il can help handle the problems he inherited–the decades-long, unfulfilled promises to ease the shortages of food, clothing, and shelter. Kim Jong Il’s chances of firming up his power and carrying out some reform, observers say, will be greater while his father remains a formidable presence. His strength rests heavily on his control of party ideology and organization. MILITARY LOYALTY From his early days as an anti-Japanese guerrilla leader in the 1930s, Kim Il Sung has had an abiding faith in the power of the military for political survival.

The Korean People’s Army (KPA)–the collective term for the North Korean armed forces-is a contemporary expression of his faith in the military and in his capacity to endure through adversity. The formidable war machine he built and presided over as supreme commander has been passed on to Kim Jong Il, named supreme commander in December 1991. The looming question is whether Kim Jong Il can inspire the same undivided institutional, but more importantly personal, loyalty from the KPA as his father has. The question is critical, since the KPA is the only organized group that can make or break Kim Jong Il’s succession. The KPA is more than a professional institution. It not only is the guarantor of power, political instrument, and security blanket for the two Kims but plays economic and foreign policy roles as well.

It can be likened to a state within the state and, more than any other institution (including possibly the party itself), is crucial to Pyongyang’s self-preservation. It may not be an exaggeration to say that, in the North Korean perception, if the KPA cracks, so will the foundations of the DPRK. Probably this explains why the two Rims have taken pains to assure for themselves an iron-fisted grip on the military.7 In the elder Kim’s case, he had built an army before he did the party; and understandably, he wants to have Kim junior gain the same firm control over the KPA. With his blessing, the younger Kim took familiarization trips to military bases on his own as early as 1964. From 1973 onward, when he started to involve himself actively in the party’s organizational and propaganda affairs, Kim Jong Il also sought to place his own youthful trusties in the KPA hierarchies. Between 1975 and 1979, he asserted himself forcefully in trying to imbue the KPA with the philosophy of self-reliance–apparently antagonizing some of the KPA veterans who regarded his intrusiveness as incompatible with military discipline and professionalism.8 By 1980 (when the junior Kim was formally presented to the world as second in command) and certainly by April 1985, the KPA had supported Kim Jong Il, prompting one analyst to suggest that it had become Kim Jong Il’s private army; the following year, Kim Il Sung let it be known that the leadership succession issue was brilliantly solved.

In 1990, Kim junior assumed the senior vice chairmanship of the National Defense Committee, became the KPA’s commander-in-chief in December 1991, a marshal of the army in April 1992, and the chairman of the National Defense Committee in April 1993. Grand Marshal Kim Il Sung and Marshal Kim Jong Il are joined by defense minister Marshal O Jin U to make up the three-member presidium of the party political bureau. This means the fusion of power at the top, potentially blurring functional boundaries between the KPA and the party and possibly skewing policy decisions toward military options.9 Under Kim Jong Il, the KPA in the short run seems likely to have a preferential claim to state resources. Some analysts say this now amounts to one-third of annual budget outlays, or as much as a quarter of Pyongyang’s gross national product. In the yearly battles over resource allocation, the military has always prevailed, presumably because of its primary mission.

But that does not tell the whole story. The KPA’s economic role is considerable. It is called on to provide the bulk of the labor force for major state construction projects. More importantly, arms sales controlled by the KPA have accounted for an estimated $500 million a year in recent years, or nearly a third of Pyongyang’s annual export earnings. Lately, Pyongyang’s oil crunch seems to be forcing the KPA’s attention to the Middle East, reportedly to seek oil in exchange for North Korean Scud missiles and other military supplies.

No less significant is the KPA’s role as an instrument of foreign policy toward the Third World. In the 1980s, Pyongyang is known to have dispatched military advisors to 33 nonaligned countries, had a military training program for 18 countries and exported or granted weapons and other kinds of military aid to 35 countries. 10 This military diplomacy is linked to Pyongyang’s overseas propaganda, which pursues sympathy and support from the Third World. As resources available for foreign arms, crude oil, and food imports continue to dwindle, the KPA’s attitudes will become pivotal to the future of the DPRK. The KPA and Kim Jong Il will have to decide whether to channel more resources to the military at the expense of the economy; whether to press for major inter-Korean arms cuts and balanced force reductions; and whether to abandon the nuclear weapons program in exchange for concessions from Washington and Seoul.11 ECONOMIC PERFORMANCE Kim Jong Il will have to depend on performance rather than charisma to succeed in leading North Korea in the future, says a 1991 report by a study group of prominent American scholars and specialists on Asian affairs.

12 The performance alludes to an economy whose lackluster record has had Pyongyang worried since the 1970s, long before the stagnant economy was severely shaken by the unexpected collapse of the Soviet bloc. In 1984, Pyongyang began approaching the West, albeit unsuccessfully, for joint ventures, expanded trade, and advanced industrial technology. Cheap labor and some abundant underground mineral ores aside, the North has had little to offer except promises of riches for would-be investors. Nearly at the bottom in international credit ratings, it has a decidedly unappealing investment climate, given its leadership unpredictability and the secrecy of its economic data. Unable to sell its capital import and trade policy on its merits, Pyongyang appears to believe it has no option but to turn grimly inward and practice rigorous austerity.

A sense of urgency was evident in Pyongyang’s behind-the-scenes contacts with South Korean trading firms beginning in 1987–until then politically unthinkable in light of the North’s public disparaging of South Korea’s economic achievements. To make matters worse, the crumbling of the Soviet bloc proved devastating for the North’s economy, which had depended on the former Soviet Union for half of its trade turnover. Ensuing economic dislocations led to negative economic growth in the 1990-92 period, estimates ranging from -2% in 1990 to -10% in 1992.1a In December 1991, the North announced it would set up a special economic zone. The following year, it sent an unprecedented government economic delegation to Seoul for first-hand observation of South Korean factories. Since then, the government has announced more steps to make the country’s economic climate more attractive to foreign investors. Future prospects for North Korea’s economic development are not encouraging, as Pyongyang seems opposed to internal reforms.

For a command regime used to doing things its own way, economic reform could be very painful and possibly frightening, particularly given Pyongyang’s stormy past relations with the world’s major economic powers. Since North Korea’s centrally planned, autarkic command economy has been an integral part of Kim Il Sung’s vaunted infallible leadership, structural reform appears unlikely for now. Incrementally adjusting th …