Editor’s Note: Oxford-Seoul Nexus–Sino-NK at Engage Korea and Asan Plenum
The month of May has been vibrant for the Sino-NK team. The Europe branch gathered at Oxford University to talk at the Engage Korea conference alongside former UK ambassadors, scholars and professionals focusing on the DPRK. Meanwhile, the Seoulites reported on all six panels at the 2013 Asan Plenum “New World Disorder.” Covering an academic spectrum from nuclear strategy to ideological narratives, we hereby brief you on the highlights.
CHRISTOPHER GREEN on Marketization and Yuanization | Speaking on the panel “International Roles in Economic Development,” Green parsed the impact of foreign currency on the lives of North Koreans and on regime stability. His essay “In Mao we trust: The increasing use of Yuan in North Korea” on this topic was published by NK News.
Foreign currency access is a crucial tool for the North Korean people not only because inflationary pressures are putting the North Korean Won (KPW) under increasing strain, but also because the North Korean government has demonstrated a readiness when necessary to take the assets of the majority for the benefit of a minority. In the case of North Korea, although other foreign currencies are also used for the purpose of storing value, the prevalence of the phenomenon in towns and cities along the border with China has led me to brand the process “Yuanization.”
There is rising demand for foreign currency in today’s North Korea. The phenomenon has been developing since 2002, and accelerating since 2009. It is clear that the growth in foreign currency usage is a direct outcome of a confiscatory state economic policy.
This is logical. DPRK citizens are inherently self-interested, meaning that when they first encountered evidence that domestic currency could no longer act as a reliable store of value, they began to seek other means of achieving the same end. As such, foreign currency access in the modern DPRK not only represents a positive contribution to human security in the country; now that it has become available to those outside the elite, it is also a very serious threat to the government of Kim Jong-un.
MATTHEW BATES on Information and Interpretations of the DPRK Economy | After moderating the panel on economic development, Bates gave an introduction to underlying sources of information on the North Korean economy and understanding the different interpretations of these sources by economists.
In making sense of differences in the interpretations of economists, the final section presented two archetypes of economists of the DPRK, preliminarily labelled the idealist-participant and the realist-analyst respectively. The essential difference is that the former are directly involved in (or at least strong advocates of) efforts to engage state institutions. Both play valid and important public roles.
The idealist-participant will focus on the purported intentions inferred from firsthand experience and official state media; whereas the realist-analyst will tend to focus on realities reported in refugee testimony. A related difference may be the sector of the economy focused on: the idealist-participant focuses mainly on the informal market and normal state economy observable first hand, whilst the realist-analyst was presented as typically giving greater emphasis to the military economy and illicit economic activities often closely related to central government.
Both types are motivated by humanitarian imperatives but the idealist-participant is most concerned with the preserving the humanitarian benefits of initiatives and the safety and well-being of their contacts, whilst the realist-analyst is motivated to give a picture of material conditions in the country as a whole that is true to the data and the testimony of those who they have been in a position to interview. An element of self-censorship may be inferred at least at the level of the questions chosen for consideration in publications. Insofar as this may be the case, such self-censorship should not be stigmatised as such caution reflects real risks to their contacts. This and related North Korean caution over the granting of visas to foreigners, are the key sources of divergence towards the two types.
ADAM CATHCART on the China-DPRK Relationship | Our Editor-in-Chief was a panelist on North Korea’s foreign relations, addressing recent developments in the DPRK relationship with China. His talk was primarily based on a draft written for the RUSI Journal.
Beijing wants to preserve regional stability and is unable to withdraw from its alliance with North Korea, but was clearly displeased following Pyongyang’s nuclear tests this year. As pressure is put on bilateral ties, China is concerned about the lack of economic reform in North Korea, but also wary of a shifting of North Korea’s regional balancing in the region as well as weapons proliferation.
A recent comment by a prominent Chinese thought leader about North Korea possibly “giving nuclear weapons to the Uighurs” indicates how deep the distrust of the DPRK has become, and the return to a Chinese conception of North Korea as a Koguryo-like entity (the Koguryo had active relations with China’s inner Asian rivals) does not augur well for future relations.
The Chinese leaders have an intuitive understanding of North Korea as many of the top CCP officials have studied in Pyongyang or worked on cross-border trade issues in Liaoning and Jilin provinces. It also remains relatively easy for Chinese to travel to and work in North Korea, although cell phone access for Chinese in DPRK cities like Sinuiju remains a sticking point.
Cathcart’s talk delved into three common misunderstandings about the Sino-DPRK relationship, and the need for these to be clarified.
1) “China does not want to see its borders flooded with refugees.” Documents from Chinese Foreign Ministry archives from the Korean War era indicate that the PRC had established a system whereby it would absorb about 10,000 refugees into Liaoning and another 10,ooo into Jilin in the early 1950s. Moreover, China’s ability to secure its borders has sharpened considerably since then, as recent events on the Myanmar frontier would indicate. Estimates of 2+ million North Korean refugees flooding into the PRC in the event of domestic instability are massively overblown.
2) “Beijing fears North Korea’s collapse.” In some ways, China is much more concerned about North Korean boldness and the drive toward a forced reunification via war moves toward the South. North Korean strength and arrogance is as dangerous as North Korean weakness.
3) “China fears that the DPRK’s military development will stimulate a Japanese military revival.” China’s fears over Japanese rearmament are not inherently related to North Korea’s behaviour, and have been a core CCP point (both in domestic discussion and in external propaganda) since before the founding of the People’s Republic. The notion that the Chinese leaders are pinning their hopes for a peaceful Japan on the DPRK overlooks this history. In some ways, the CCP is just as worried that North Korea would spurn ties with China in favor of an opening to Japan, which Kim Jong-un certainly was flirting with this spring.
NATHAN BEAUCHAMP-MUSTAFAGA on Bureaucratic Politics and China’s North Korea Policy | In the context of China’s North Korea Policy, Beauchamp-Mustafaga addressed the evolution of the bureaucratic politics that drive policy-making, leverage and the US angle.
China’s policy management structure is increasingly bifurcated – centralized decision-making with decentralized implementation. This has created bureaucratic inertia, which entails that China’s policy will not change in the future despite the third nuclear test.
Chinese leverage over North Korea is separated into two distinct types – absolute leverage, which means China undoubtedly controls the survival of North Korea, and practical leverage, which means that China is unwilling to exert its full leverage thereby making its leverage less intimidating to Kim Jong-un. Chinese pledges and actions on sanctions enforcement might signal a temporary shift towards better enforcement but this is likely not a long-term change and will be a bargaining chip in the US-China relationship.
The US government has used a combination of cooperation and coercion in an attempt to induce a change in China’s policy, but historically coercion has been more successful for forcing a short-term but dramatic shift in China’s policy more in line with US goals on the Peninsula.
ROBERT WINSTANLEY-CHESTERS on Ideology and Production of Landscape in the DPRK | Winstanley-Chesters finished his PhD thesis this spring at the University of Leeds and at this conference presented his research, addressing which role the natural world plays in the ideologically constructed North Korean world view.
This research has demonstrated a clear evolution of thinking about development and the environment in the DPRK, driven in large part by wider changes to the regime’s ideological and political framework. This thesis analysed evidence of an ideological, developmental and institutional approach in the DPRK which asserted that the state was a space of “lived” utopian fulfillment, a condition achieved in part because of a conscious environmental dimension to development policy.
Attention to institutional practice in the DPRK does, indeed, reveal a philosophical approach, derived from “Juché thinking,” which through its radical metaphysical and ‘humanocentric’ conception has tended to include environmental perspectives within its wider narratives of nationalism. This is not to assert that the DPRK’s ideology is cohesive or coherent in a way consistent with other ideological constructions. Brian Myers, for one, has revealed an important void within the DPRK’s ideological superstructure. In part, however, it is the sheer utopianism of the DPRK’s ideological approach which serves to compensate for such voids or failures in cohesion. The ideological orientation of institutional practice within the environmental sector of the DPRK, including the tideland reclamation and forestry sectors, sets practical projects within a framework of nationalism and the regime’s related presentational narrative. Thus the forests and tidelands of the DPRK become part of the wider ideological narrative of the nation as much as any human participant might be.
The specifics of this utopian narrative have been rewritten during the time period covered by this thesis. In the present day the ‘lived’ utopia evident in the DPRK’s presentational narrative is essentially exactly that, the space in which the DPRK currently “lives.” It is a geographic utopia of the everyday, the realised and the possible, rather than grander historical schemes of nature remaking. Landscape has not become a political project, rather, it might be argued, politics itself has become the landscape.
SABINE VAN AMEIJDEN on Economic Reform and SEZs | Van Ameijden discussed development in North Korea’s six Special Economic Zones (Mt. Kumgang, Kaesong, Sinuiju, Hwanggumpyong, Wihwa, and Rason) and their relevance for national economic reform.
Why do we not see more action in the SEZs? Beijing is eager to aid its neighbour towards Chinese-style reforms. Firstly, cheap labour, access to the East Sea and natural resources are enough reasons for Chinese businesses to explore investment opportunities in North Korea. Plus, economic development contributes to a more stable North Korea and preserving stability in the region is China’s utmost priority. Secondly, besides regional economic development, Beijing also has an interest in preserving North Korea as a geopolitical buffer zone against South Korea and the United States and therefore invests in its ally. China is not abandoning North Korea, this is supported by the fact that China still does not explicitly criticise North Korea’s provocations or that rising tensions in Korea do not seem to affect trade relations between China and the DPRK.
However, the government in Pyongyang seems to be reluctant to push these capitalist hubs forward. On the one hand, Chines-style reforms are a model to consider for Pyongyang to introduce a free-market economy while maintaining its government structure. On the other hand, the current leadership might fear that capitalist reforms might unleash forces it cannot control. Considering Pyongyang’s reluctance, perhaps these zones are not part of a grand reformist strategy, but merely an illustration of North Korea’s bilateral ties with its neighbours. Kaesong has been directly affected by inter-Korean relations and progress in Rason seems to be thanks to the Chinese efforts, not because North Korea is trying its best to promote itself as the next best investment opportunity.
ASAN PLENUM 2013 | The Seoul-based members of Sino-NK attended the Asan Institute for Policy Studies 2013 Plenum on April 30-May 1 as rapporteurs. Their session sketches are available on the Asan Institute website: