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Last Updated: 24-Jun-98
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This analysis is based on several assumptions. The starting point in assessing the goals and objectives of the four major powers (United States, China, Russia, Japan) in regard to Korea must be a recognition that the current Asian financial crisis, particularly in South Korea, has substantially altered the calculus of all the players. A second assumption is that the role of the Republic of Korea (ROK) in regard to the pace, scope, and content of North-South integration, and ultimately reunification, will be qualitatively different from that of the outside powers; that is to say, with the possible exception of a sudden collapse of the Democratic People's Republic of Korea (DPRK), Seoul will be the principal determinant of this process, while the outside powers can influence the pace and either facilitate or impede the integration/reunification process. At the end of the day, it is the Koreans'country.
Our third working assumption is that the basic objective of North Korea is the survival of the regime at the lowest cost in political and/or security terms. Another assumption of this paper is that Korean reunification is likely to be a "strategic shock" in the region, reshaping the geopolitics of northeast Asia in the first quarter of the 21st century. Thus, U.S. strategy in regard to managing change on the peninsula should be designed to begin conceiving a post-reunification security architecture that safeguards U.S. interests and leadership role. This is addressed in the second part of this paper.
The interests and objectives of all the major players must be viewed across a time-space continuum from present to long-term because the role and interests of various actors may change over time and in response to new realities. For example, at present there is a rough consensus that favors stability as a policy goal and seeks to avoid war, collapse, and nuclear proliferation. Each actor places these goals in different order of priority. The effect, if not the intent, is overlapping and loosely coordinated efforts to sustain the steadily eroding status quo.
The near-term objectives of U.S. policy toward Korea are to deter the use of force by North Korea, the nonproliferation of weapons of mass destruction, and the reduction of tensions on the peninsula. The medium-term goal is to foster an environment that will draw the DPRK into the international community and lead to a peaceful process of reconciliation and reunification under the direction of Seoul.
In a moment of clarity, President Clinton last year articulated the underlying logic of U.S. policy during a press conference:
They [North Korea] are better off having agreed to freeze their nuclear program. ...And I think they ought to go the next step now and resolve all their differences with South Korea in a way that will permit the rest of us not only to give food aid because people are terribly hungry, but to work with them in restructuring their entire economy and helping to make it more functional again....they need to lift the burden of a system that is failing.
Achieving such a result would create the basis for a revival of the DPRK's moribund economy, thus making it a more viable entity, a sine qua non for the much discussed "soft landing"--a gradual reconciliation and reunification process. An outcome along these lines, however, requires radical market-oriented economic reform in North Korea, which to date, Pyongyang has meticulously avoided, while experimenting at the margins with such policies. In any event, such goals are not realizable absent active collaboration and coordination with Seoul and Tokyo. This should be viewed as two innermost concentric circles of U.S. regional strategy for managing the Korea problem.
One core issue that connects both near- and medium-term goals is the top priority of reducing the North Korean military threat. This is a first-order national security interest. Pyongyang's forward-deployed conventional forces, 11,000 artillery tubes, rockets, Scud missiles, and chemical weapons deployed within 100 kilometers of Greater Seoul place roughly one-quarter of South Korea's population at risk. In addition, on any given day, some 75,000 American citizens are within range of the DPRK's arsenal. Moreover, Pyongyang's development of the No-Dong medium-range missile also places western Japan at risk--including Japanese civil nuclear facilities.
Thus reducing this threat must be a central goal in any politically sustainable diplomatic strategy. Washington should seek to move the political dynamic beyond the implicit blackmail of "feed me or I'll kill you," current policy to a process of reciprocal steps taken in mutual self-interest that advance the interests of both North Korea and the United States (and the ROK). North Korea has become one of the largest recipients of U.S. aid in East Asia even as the United States maintains an economic embargo against it. Congressional reticence to support the 1994 Agreed Framework, which froze North Korea's nuclear weapons program, underscores the fragility of U.S. engagement with North Korea.
Moreover, we are now in the third year of what appears an annual pledging contest to provide food aid to North Korea. World Food Program estimates suggest that the DPRK will have a structural deficit of between 1.5 and 2 million tons of food a year for the foreseeable future. Meeting such needs will require roughly $300 million in annual food donations from the international community. Given the donor fatigue factor and lack of diplomatic progress either in North-South or four-party talks, it is doubtful that such aid levels can be sustained.
An integral aspect of threat reduction is the 1994 Agreed Framework. The nuclear deal has been a principal source of international engagement with North Korea and the only element of current international diplomacy serving an integrative function with respect to both North and South Korea and DPRK involvement with the wider international community. The nuclear deal has capped its nuclear program, and if fully implemented it holds the potential for fostering a nuclear-free Korean peninsula. One aspect of the nuclear deal is confidence building, and the Korean Peninsula Energy Development Organization (KEDO) process has yielded small but nonetheless concrete results in this direction.
While the agreement is not without its flaws, it is important that the United States adhere to its solemn commitments under the agreement to the degree North Korea does so. The United States should be careful not to provide North Korea with an excuse for backing out of the accord. U.S. failures to adequately fund KEDO have in mid-1998 put the accord at risk, providing Pyongyang with a means to precipitate another mini-crisis
Moreover, the South Korean economic crisis further puts KEDO at risk, raising questions about Seoul's ability to fund the two light-water reactors promised in the Agreed Framework. There are some technical and legal problems, raising questions about Japan's ability to fulfill its commitment as well. At present there is insufficient funds allocated in both the South Korean or Japanese 1998-99 budgets for the light-water reactor (LWR) project. Pyongyang has also complained about the slowdown in construction of the LWR's, which is now roughly two years behind schedule.
All these factors underscore why Seoul places North-South dialogue high on its list of priorities. Seoul views inter-Korean talks and the nuclear deal as two tracks leading toward the larger imperative of reducing the enormous gap between a 21st-century information age society and a Stalinist dinosaur in a state of decomposition. In his extensive writings, now President Kim Dae Jung has outlined a three-stage process of national reunification. His initial moves toward North Korea--calling for direct talks, an exchange of special envoys, and easing restrictions on business and other private contacts--are part of what Kim has dubbed his "sunshine policy."
After relative quiescence following the December Korean elections, North Korea's positive response to Kim's new posture led to the vice ministerial-level talks in early April 1998. Pyongyang's main goal was to obtain fertilizer and food. Seoul was willing to cooperate but sought recognition of its humanitarian concerns about divided families. The talks broke down after the North refused to accept the principle of reciprocity in humanitarian issues. Instead Pyongyang accused the South of playing politics with its humanitarian concerns. Nonetheless, that high-level diplomacy occurred within weeks of Kim's inauguration is significant. The subtext in the first North-South official dialogue since 1992 should be seen as tacit recognition on the part of Pyongyang that Kim Dae Jung is almost certainly the most reasonable and fair-minded South Korean leader it is likely to see. Thus, a DPRK avoidance of seriously dealing with Kim Dae Jung would, in essence, send a message that North-South reconciliation, more broadly any comprehensive deal with North Korea, is not possible.
The hope for South Korea is to put in place a process of gradual integration that begins to knit these two disparate societies together. In short, reconciliation--and eventually reunification, at the lowest cost and least pain for the ROK. To achieve this, Seoul has reluctantly recognized that other actors must be involved. The challenge is to clearly define roles and types of involvement for external actors (the United States, China, Japan, Russia) that are politically acceptable. Both Kim Dae Jung and Prime Minister Kim Jong Pil have hinted that a six-party political framework may be desired as a supplement or replacement for the four-party talks.
The role of outside powers is a highly emotional issue, as was evident in the tortuous diplomacy leading to the 1994 Agreed Framework and continuing friction over the four-party talks. Importantly, South Korea has been an equal partner in the four-party process after being formally excluded from the nuclear negotiations. These sensitivities are a major challenge to U.S. leadership in managing the Korea problem.
The experience of KEDO is a reflection of Seoul's desire to be the central player in shaping the future of the peninsula. The ROK insisted that it be the principal supplier and contractor of the two LWR's to North Korea. Its willingness to assume the preponderant amount of the $5 billion project flowed from the idea that at the end of the day, they will be part of a Korean nuclear power network. It should also be noted that in the four years since the Agreed Framework was signed, by far the most significant interaction between North and South Korea has occurred in the context of KEDO. But the KEDO experience also demonstrates the tension between Seoul's desire to call all the shots on the peninsula and its ability to pay the price, thus underscoring the need for outside help in solving the Korean question.
Inherent in this definition of respective roles in dealing with North Korea is the longer-term pan-Korean interest of minimizing dependence on either China or Japan. This will loom larger over time, as both Tokyo and Beijing will seek to enlarge their respective influence and interests on the Korean peninsula. This is particularly difficult because the burden of history severely constrains Korean acceptability of any Japanese role in Korea, yet Tokyo has the resources and interest to help finance reunification. This is the paradox of Japan in regard to the Korea problem.
In contrast to overt and popular Korean hostility to Japan, Koreans tend to view China in a more favorable light. Nonetheless, the operative psychology is that of the "shrimp among the whales." Conflict in Korean-Chinese relations is further in Korea's past than that with Japan but nonetheless equally real. One can already discern uneasiness in North Korea's ties to--and growing dependence on--China. Certainly, the potential for conflicts of interest cannot be disregarded.
This in turn reinforces the importance to Korea of the most robust U.S. security, economic, and political involvement as possible in northeast Asia. Over the longer term, Korea will likely seek a delicate balance in the region, seeking in particular to avoid excessive dependence on either China or Japan
Despite lingering distrust in Pyongyang, China's willingness to prop up the DPRK with food and other assistance has led to a repairing of cool but proper Beijing-Pyongyang ties. As a result, Beijing enjoys better relations with both Koreas than any other major power. This is largely a reflection of geography and history combined with astute diplomacy. Precisely for these reasons, one predictable constant is a substantial Chinese influence in events on the peninsula. In the near term mutual concern about avoiding war, collapse, and nuclear weapons in Korea provides considerable overlap in U.S. and Chinese interests.
China's interests on the Korean peninsula are economic, political, and strategic. In just over a decade, China's trade with the ROK jumped from zero in the mid-1980's to $20 billion in 1996, and South Korean investments in China--much of it in ethnic Korean Jilin and Liaoning provinces--exceeded $4 billion as of 1996. For China's developing northeast, South Korean firms stand as sources of employment and manufacturing technology. The current economic crisis in the South will undoubtedly slow the expansion of Sino-ROK economic relations, but the proximity of China's markets will serve as an important outlet for ROK exports once recovery begins to take hold. Over the longer term, cooperative development of the Tumen River basin and Yellow Sea area is likely to be a shared interest among all the players in northeast Asia.
It was the drought, floods, and resulting famine beginning in 1995 that to a degree refocused Beijing's political attention back to Pyongyang. While uneasily reconciled to the eventual reunification of the peninsula, China is in no hurry to expedite it. Indeed, by all appearances, China has decided that maintaining the regime in North Korea is a near- to medium-term goal enhancing its political and strategic interests. Its stepped-up economic aid--800,000 tons in 1996, one million tons in 1997--to North Korea underscores this decision as its stepped-up aid and trade programs with the DPRK underscore.
China has been urging North Korea to reform its economy for the past 15 years. It was in 1983 when Beijing gave Kim Jong Il a guided tour of the Shenzen Special Economic Zone. Discussions with Chinese officials and think-tank intellectuals suggest strongly that China is deeply pessimistic about North Korea's ability to reverse its economic decline. At the same time, the Chinese believe the North Koreans are tough and can muddle through, thus deferring developments China went to war to avoid nearly half a century ago.
China sees North Korea as a strategic buffer providing some distance from a freewheeling, democratic South and the U.S. forces stationed there. Perpetuating two Koreas also defers a possible crisis, the turmoil and costs of reunification, and resulting competition from a unified Korea. At a time when China's overwhelming focus is on having as peaceful an international environment as possible so it can attend to its immense internal challenges of modernization, such stability and predictability is not insignificant.
This is precisely why Beijing has thus far been willing to accept the increased cost of putting the DPRK on life support. Over the short term, this is particularly important as Beijing tries to divine and define the possibilities of the Sino-American relationship. Beijing has no illusions about the North Korean regime, and the relationship on both sides is based on practical interests, not bonhomie or ideological affinity.
Both short and long term, China's cultivation of South Korea must be viewed in the context of Sino-Japanese relations. The common Sino-Korean historical experience of a brutal Japanese colonialism reinforces a deep, mutual distrust of Japan. This leads to a shared interest in minimizing Japanese influence on the peninsula. The remarkable six-day visit to South Korea of Jiang Zemin in November 1995 and resulting anti-Japanese communique serves as vivid testimony of this point.
This cultivation of Seoul is also aimed at reducing U.S. influence on the peninsula derived from the U.S.-ROK alliance and the U.S. forward-deployed military presence. Over the longer term, i.e., through reunification, we should expect Beijing to see this positioning of U.S. forces below the demilitarized zone (DMZ) as a maximally tolerable outcome of reunification. This is in large measure because Beijing will be constrained against leaning too hard on the newly unified administration in Seoul, lest it invoke memories of tributary relations.
But Beijing's forbearance for a continued U.S. military presence should not be taken for granted. China's long-term objective is to displace preponderant U.S. influence and alliances in northeast Asia with a China-centric multilateral security arrangement. We should expect that Beijing will work to effect the withdrawal of U.S. forces from a unified Korea. To what extent this is pursued is likely to be a function of several factors.
First, the actual scenario of Korean reunification will shape Chinese behavior. For example, if a situation arises where ROK troops feel a need to cross the DMZ to maintain order, prevent refugee flows, or do something in connection with reconstruction, China may choose to exercise its leverage by trading cooperation for commitments to reduce or eliminate the presence of U.S. forces in Korea. Likewise affecting China's calculus will be the role, if any, played by U.S. forces in the reunification process, by the nature of Sino-American relations, and by the state of China's relations with Japan at the time of reunification. If, for example, China perceives a U.S.-Japan alliance designed to "contain it," at the point of reunification, it is more likely to press for U.S. troop withdrawal from Korea. Similarly, if Sino-American relations develop in an adversarial direction, we should expect Beijing to work toward the withdrawal of U.S. forces from Korea and to use the Korean withdrawal to foment a debate in Japan regarding the future of U.S. forward-deployed forces there. Already the idea of an alliance without a U.S. military presence has been raised in the media and by new thinkers in Japan's New Democratic Party and influential opinion shapers.
Over the longer term, in any event, at least from the moment of reunification onward, U.S. and Chinese interests are likely to diverge. In any event, it is imprudent to assume that the interests of Washington and Beijing will continue to converge. Moreover, in regard to formulating U.S. strategy it is important to note the probable limits of active collaboration with China. Beijing's consistent pattern of behavior toward Korea demonstrates a strong preference to avoid constraints and maximize its freedom of action . Thus, even when it pursues parallel policy goals with the United States, China has tended to operate in a completely independent manner. During the 1994 nuclear crisis, China quietly pressured the DPRK to cooperate, and also subsequently refused to participate in KEDO. It has pursued food aid to North Korea separately from other donors and the World Food Program. Similarly, Beijing only reluctantly and belatedly agreed to participate in the four-party talks.
As long as the price of propping up the North does not become excessive, Beijing's interest in extending the status quo will allow it to operate along two parallel but ultimately integrating lines. In the near term its emphasis is stability--maintaining the status quo in North Korea. At the same time, it is positioning itself for the eventuality of reunification or for a regime change in the North. Its posture toward the South is designed with the long term in mind, looking ahead to a reunified Korea. Ultimately, these near- and long-term strategies form an integrated whole.
Japanese and American interests vis-a-vis Korea overlap both in the near and longer term. Both seek a politically stable, economically prosperous, and open nonnuclear Korean peninsula. Geography gives Japan perhaps a larger direct stake in the outcome of the Korea question than the United States. Constraints in Japanese-Korean relations make Tokyo largely a dependent actor, relying on American leadership. Japanese diplomatic and financial assets largely complement those of the United States. But Japan will be severely circumscribed in the wielding of influence.
Politically, Japan's interests will focus on finding ways to maintain the best possible working relations with the South while also pursuing steps to normalize relations with North Korea. Both Tokyo and Seoul recognize the need to move beyond the past, but at the popular level history remains very much alive. In the always sensitive security field, modest defense contacts have been opened and expanded. These include personnel exchanges, regularized meetings, mutual port calls, and arrangements for prevention of incidents at sea. Culturally, both governments have been able to support the compromise on World Cup 2002. Yet, despite the best efforts and intentions, the relationship remains an uneasy political minefield, one seemingly programmed to go off regularly as some aging Japanese official, like clockwork, makes an inappropriate remark about the virtues of Japanese colonialism. On the other side, a Korean tirade on the lessons of history and the need for Japan to share its best technologies can and usually does create friction.
Japanese economic interests are significant, and many business ties date back to the Japanese occupation. Japanese-Korean two-way trade exceeded $48 billion in 1996, along with $6 billion in direct investment. The Korean financial crisis revealed Japanese banks with exposure of at least $24 billion in South Korea. At the same time the combination of trade and remittances to the DPRK by Koreans in Japan is believed to be in the range of $500 million annually.
In any reunification process, the Japanese will look to protect and expand their economic interests, yet they will be keenly aware of their exposures with respect to Korean nationalism. At the same time, failure to adequately support a process of peninsula integration would only serve to confirm lingering Korean suspicions that Japan is at best ambivalent about reunification and reinforce anti-Japanese nationalism.
South Korea views itself--and is viewed by Japan--as an economic competitor. In key sectors such as autos, shipbuilding, semiconductors, and consumer electronics, such rivalry is clearly manifest. Thus, as Japan contemplates a unified Korea it will remain cautious in regard to technology transfer. This in turn will reinforce Korean resentment of Japan and the ambiguity of needing Tokyo's help in integrating and reconstructing North Korea. Japan's protracted flat growth and financial-sector problems suggest that certainly in the near term (one-three years) Tokyo may be less able if not less willing to take on major financial commitments either to North Korea in the context of normalization or to a unifying Korea.
Viewed from Tokyo, a unified Korea allied to the United States is the best possible outcome of reunification. A strong U.S.-ROK alliance can serve to moderate continuing tensions in Japanese-Korean relations--Takeshima/Tokdo and the fishing rights controversy being two current examples--while at the same time reassuring Japan against dominant influence being exercised on the peninsula by either a revived Russia for the foreseeable future or China. Japan has no interest in seeing the peninsula again become the magnet for great power competition. Finally, a confident U.S.-ROK alliance can serve to restrain recent ROK defense modernization efforts that have for the past decade focused on the acquisition of air and naval assets that appear to be designed with Japan in mind.
Other outcomes of reunification, either a neutral Korea or one aligned with China, would raise concerns in Tokyo. The inherent stability and staying power of any neutralization arrangement would be questioned, and history would tend to be on the side of the skeptics. A unified Korea aligned with China would be the least welcome outcome. The worst case for Japan would be a heartland-rimland divide with a Sino-Korean alliance pitted against the U.S.-Japan alliance. This is the least likely outcome and one a reunified Korea would be unlikely to pursue of its own volition.
Russia The collapse of the Soviet Union set in motion a process that as much as any single factor accelerated the decay of North Korea. The end of Moscow's subsidies, particularly oil, dealt a major blow to the already fragile DPRK economy. At the same time, the USSR's demise ended an alliance with a global superpower, further isolating Pyongyang. In addition, the erosion of the Soviet/Russian alliance reduced if not eliminated Pyongyang's ability to skillfully manipulate Beijing and Moscow for its own ends that characterized intercommunist diplomacy since 1949.
Even in the Gorbachev period, Moscow in roughly the same time frame as Beijing began to shift partners on the Korean peninsula, as dramatized by Gorbachev's sensational meeting with Roh Tae Woo in San Francisco in 1990, successfully inaugurating a relationship with South Korea. This further isolated the DPRK, narrowed its diplomatic options, and generated outrage at Moscow in Pyongyang. Subsequently, Moscow has worked to repair the diplomatic damage, including recasting its alliance as a friendship treaty absent the security guarantees--and the aid--of the previous era. The focus of Russian diplomacy on the peninsula remains South Korea.
Russian strategic objectives toward an integrating peninsula will be to seek to avoid a unified Korea under the dominant influence of a single outside power, while continuing to build economic and political relations with a new Korea. It should be recalled that Russia does share a border with North Korea. This view was underscored by a senior Russian official who explained last December that "we have important interests in the Peninsula; we are neighbors, and we want to be players in any outcome."
Russia has a particular interest in integrating the Russian Far East into the sub-regional northeast Asian economy, of which a reunified Korea would be a major component. Russian economic interest will concentrate on the development of the Tuman River basin, exploiting Russian raw materials, and integrating Russian oil and gas into the subregion's energy supply network.
Russia will also look to Korea for technology transfer and direct investment. Moscow's desire for economic involvement in the subregion has a strategic dimension. It supports Moscow's hope of weaving itself into the geopolitical fabric of the region and ultimately into any post-reunification political/security architecture that may emerge.
As a practical matter, Russia is a marginal actor in the Korean drama. Nonetheless, it has tried on several occasions to write itself into the Korean script. In 1994, in the midst of the Korean nuclear crisis, Moscow proposed a six-party peace conference on Korea, an initiative that has been repeated on several occasions. As a nuclear weapons state bordering Korea, Moscow clearly has some role to play in the transformation of Korea. Diplomatically, this may include guaranteeing a denuclearized peninsula, and perhaps as a guarantor of a peace treaty or final agreement between the two Koreas. It certainly merits a voice regarding the disposition of Korean military forces and capabilities in a unified national state, an issue of northeast Asian import.
Russia's economic and political interests on the Korean peninsula appear generally compatible with those of the United States. One underconsidered aspect of the four-party proposal was the exclusion of Russia (and Japan) from a diplomatic process in whose outcome they have a stake. This continues to be a source of Russian resentment; while a six-party framework as recently suggested by incoming ROK Prime Minister Kim Jong Pil would have provided Moscow a sense inclusion as a major power in the region.
Any politically sustainable American policy must, as a first order of business, be sharply focused on reducing the security threat posed by North Korea. This answers much of the key question: what do we (United States and ROK) want? This in turn requires posing the question, what does Pyongyang want? These are two sides of the policy equation best conceptualized as a Grand Bargain. North Korean intentions and decision-making are unknowable. But the track record of recent diplomacy, the situation on the ground, and discussions with North Korean officials all point in one direction: the overriding priority is regime survival. This suggests that their legitimate interests are focused on obtaining economic benefits and security assurances.
If the desired outcome is a "soft landing" and a gradual reunification process, then we must test the idea that, given the right incentive structure, the North would make the least bad choice in its small universe of options and opt for economic reform and opening its economy. We are dealing with a failing state, thus far unable to take the necessary steps to revive its economy for fear that doing so will unravel the regime politically. Yet if it continues on its present trajectory, it will eventually grind to a halt.
In the end, no deal with North Korea resulting in a major reduction of its military capabilities may be possible. But until the hypothesis of a Grand Bargain is tested adequately, we will not know. The idea here is that we (collectively) must be prepared to put a serious offer on the table if we seriously expect the North to consider placing its military assets on the table. Simply offering the political symbolism of removing sanctions is not sufficient incentive.
The idea is to offer Pyongyang a clear choice: continue as you are and you are definitely dead; open up and you have the possibility of a viable economy and a new social contract with your citizens. This is the question that current policy--as implemented--has sought to defer. Before assuming office as assistant secretary of state for East Asia and the Pacific, Stanley Roth told the Senate Foreign Relations Committee, "From a Machiavellian perspective, 'buying time' is in our national interest." While this does not appear to reflect the goals President Clinton has stated as cited above, it is the effect, if not the intent, of current U.S. policy.
The current U.S. approach essentially offers to reduce the U.S. trade embargo and move toward normalization of diplomatic relations if North Korea takes equally small steps regarding renunciation of terrorism, missile exports, and so-called confidence-building measures such as a hot line or advance notification exercises. But for a North Korea in profound crisis, facing a collapsed economy and widespread famine, the political symbolism of ending the embargo is of limited utility. Nor does the U.S. approach create the prospect of achieving threat reduction in a substantial manner, which along with facilitating North-South reconciliation is a core objective.
If there is a Grand Bargain, a comprehensive package, the broad trade-off would be reducing the security threat and realizing North-South reconciliation for economic blandishments along with some security assurances. Behind this approach are some essential operating principles:
The diplomacy should be viewed as a series of overlapping concentric circles. In the first circle is the United States and the ROK; Japan is in the second circle; China and Russia are in the third; the European Union, the Association of Southeast Asian Nations (ASEAN) and the remaining international community are in the outermost circle.
There must be a common approach agreed to by the United States and the ROK, then Japan must be brought into a trilateral consensus. This entails a clear sense of respective roles and responsibilities in a carefully orchestrated diplomacy, which requires sustained, high-level attention.
Executing such a strategy requires full-time attention at a level of responsibility as proximate to the President and secretary of state as possible. This is the only assurance of maintaining top-level attention on the Korea problem. Given current international realities, recent history, and de facto foreign policy preoccupations, this is best managed by a special coordinator modeled on the role Dennis Ross plays in Mid-East negotiations or that Richard Holbrooke played in putting the Bosnia deal together. It should be recalled that Ambassador Robert Galucci was designated by such a title in 1994 and answered directly to the President and secretary of state while negotiating the Agreed Framework. Another model might be the envoy role of former Senator George Mitchell in Northern Ireland, an issue of far less strategic consequence for U.S. interests than Korea. The position requires someone with real stature and credibility both in Congress and in Seoul, Tokyo, and Beijing. It would be inadequate to simply appoint an actor within the current bureaucracy to be the negotiator for four-party talks. Such a choice would be structurally impeded from an ability to force the integration of policies and coordinate diplomacy required to implement it unless his chain of command was directly to the president and secretary of state .
To have a chance of success, a policy must be built on reciprocity. For each step taken toward North Korea, we must be able to demonstrate a reciprocal action on the part of Pyongyang. This is a multidimensional confidence-building process: building trust between executive and legislative branches, between Washington and Seoul, and among Washington and Seoul and Pyongyang.
The starting point is to recognize that our respective objectives are asymmetrical: reducing the threat and laying a basis for a soft landing or no landing versus existential problems of regime and state survival. The growing needs of the North are the starting point of our leverage.
We cannot lose sight of the political imperatives. There is little political support for substantial humanitarian aid over an extended period in either Seoul or Washington. As a practical matter, no aspect of policy toward the DPRK should be segregated from the larger policy. To make the reciprocal approach work, it needs to be placed in a larger structure so that all parties--especially the congressional leadership--have a sense of where each individual step leads and how it fits into the larger strategy. Whether you want to use the word or not, it is a road map.
Phase I: "Norms for norms." This stage begin with demands that are most likely to be met. The last thing the North will trade in is its million-man army and ability to do unacceptable damage to Seoul.
DPRK: The DPRK would adhere to the MTCR, join the biological weapons treaty and the CWC (surrenders chemical weapons), and accelerate the timetable for "coming clean" on its nuclear past. Call the DPRK and the ROK to a hot line and reconvene the joint economic commission of the 1991 North-South accords. Begin talks--either trilaterally or under four-party auspices--revise/update the armistice, including the establishment of a "Checkpoint Charlie" cross-border arrangement. Either trilaterally (United States, DPRK, ROK) or in North-South Joint Military Commission begin a CFE-type conventional force-reduction process. Progress on divided family exchanges.
United States/ROK/Japan: Large-scale, multiyear food aid and agricultural assistance. The United States lifts the embargo, opens liaison office, and steps up normalization process, and supports DPRK entry into the World Bank and ADB (Asian Development Bank). Joint initiative for a Korean Reconstruction window in the World Bank with an initial $500 million-$1 billion pegged to agricultural projects, infrastructure, and training. ROK eases restrictions on business and other private-sector contacts. United States/ROK/Japan offer business management training, help in writing commercial codes, training to DPRK nationals. South would offer agronomists to assess structural damage and reform requirements. Japan offers to help pay for the burning of DPRK chemical weapons and makes a contribution to the window; opens liaison office.
China/Russia/Japan. Within four-party or other multilateral framework involving the major powers, begin discussions of a peace treaty and economic cooperation as well as the fate of weapons of mass destruction.
Phase II: Building a peace structure. DPRK: Comes clean to IAEA satisfaction on nuclear history. Remove portion of Scuds and artillery tubes out of range of DMZ. Tangible progress in negotiations on a CFE-type force-reduction regime. Reciprocal access to DMZ (observers on each other's side). By this stage, if not in the previous one, conclude agreement for a Checkpoint Charlie mechanism for cross-border traffic in context of revising/updating armistice. Reach accord on family visits.
United States/ROK/Japan: United States and Japan further accelerate normalization process. Increase contributions to World Bank/ADB window; discuss larger reform-oriented economic assistance package. Aid for clean-coal technology. ROK allows larger-scale direct investment in North. Hydrographic surveys of ports.
Phase III: Discussion of confederation plans, and four-power guarantees move forward. At this stage we would have achieved "cross-recognition," the process of North-South reconciliation would be well entrenched. U.S. forces in Korea could be put on the table as North-South force large-scale reductions occur.
The diplomatic process suggested above, if successful, can create new diplomatic patterns and lay the foundations for a pos-treunification political/security architecture. If one believes that the current status quo in North Korea is viable and enduring, then there is no reason to substantially alter present policy. However, we believe that a status quo does not exist--the DPRK is decaying by the week. North Korea's economy has, in many respects, already collapsed as a national entity. It is neither economically sustainable for any extended period of time, nor is it politically sustainable in Washington, Seoul, or Tokyo. We do not intend to underplay the enormous difficulties entailed in this enterprise. The Asian financial crisis should serve as a profound warning at the rapidity with which an entire political/economic universe can be turned upside down. For starters, North Korea could implode at any moment. Can we discount the possibility that China, for example, will undergo a similar bursting of the bubble as occurred in Korea? Or can we preclude the possibility of a crash of the Japanese banking system that would trigger a global recession?
The point here is that unless we begin to put greater intellectual rigor into the conceptualization of policy, we heighten the risk of having outcomes shaped by the slings and arrows of outrageous fortune.
This is a necessarily speculative exercise designed to assess the impact of Korean reunification on economic and security relations in northeast Asia and, in particular, for the U.S.-ROK alliance. The starting point must be the internal political and economic dynamics of a newly united Korea and the interaction of its interests with those of the major powers.
As a prelude, one variation that must be considered with respect to the internal dynamics of the Korean peninsula is an intermediate outcome between the end of North Korea as a nation-state and a fully integrated single Korean nation. It is possible that the most likely soft landing--if one is realizable--will involve Seoul's exercising sovereignty over the entire peninsula, with what was North Korea functioning as a Korean territory under U.N. auspices. Seoul would administer the territory for a determined period of time (five years) as part of a process of economic and political integration toward a democratic Korea. Such a scenario would require persuading the top echelon of DPRK leadership that exile was its least-bad choice. Given the spectrum of reunification scenarios, this could be the least-bad option for both the North and the South.
Korean needs at the point of reunification will be staggering. It is difficult to fathom the depth of the failure of the North Korean state. Not only is North Korea decades behind in technological development, but its infrastructure and industry have degraded to the point where integrating the two economies will mean tearing down existing plants and building from the ground up. Economists in both Korea and the United States who have tried to assess in quantitative terms the cost of reunification have arrived at varied conclusions, ranging from $200 billion to $1.7 billion, depending on the model and assumptions employed. In any case it will be an enormous challenge, one of necessity requiring assistance from the international community.
For the major powers, this need will be an opportunity to influence the course of events shaping a new Korea, particularly in the case of both Japan and China. There will be a continual tension between Korean nationalism and the requirements of international assistance in the Herculean task of reconstruction. The preferred mechanism for external assistance will tend to be multilateral, either by creating a Korean reconstruction window in the World Bank or ADB, floating bonds, or some other instrument that minimizes foreign influence over the reconstruction process. In all likelihood private capital flows will constitute the bulk of investment in the new Korea.
Timing will be an important factor. If reunification occurs in the near to medium term (five to eight years), the Korean financial predicament, with $57 billion already extended from the IMF, will constrain the ability of international financial institutions to substantially increase capital flows to a new Korea. In regard to foreign direct investment, the emphasis of multinational companies in the near term will be to bargain hunt in a restructured South Korean economy. The enormous requirements for infrastructure and energy in the former North Korea will also tend to limit near-term private investment. But once the process becomes orderly and predictable, it is conceivable that a unified Korea may grow at double-digit rates for an extended period.
Similarly, internal political dynamics in a newly unified Korea will shape the character of major-power involvement on the peninsula. Traditional patterns of regional divisions or factionalism in Korea show few signs of abating. This will be compounded by the newly absorbed North, which contains its own regional divisions.
The absence of nationwide unifying political institutions suggests that individual leaders will form the cores around which parties will form, dissolve, and reform with the new element of competition for an additional constituency of 22 million. Resource constraints may compel some parties or factions to look to external sources of support. This all suggests a dynamic and unstable political reality at the time of reunification.
The challenge of integrating the remains of North Korea into a new social entity is daunting and raises a host of key questions. What can be gleaned of ROK planning suggests that South Korean officials will be appointed as carpetbagging governors and administrations in North Korean provinces. What will such governance look like? Will it bear any resemblance to Reconstruction in the American South after 1865? What will be the fate of some one million KWP party members, government bureaucrats, and rank-and-file military personnel? Will they be reeducated and allowed to fully participate in national life? One large but underappreciated question is that of transitional justice: Will patterns of retribution in Korean politics persist such that senior levels of leadership can expect to face war crimes tribunals, or will the model pursued in South Africa and that toward many former European communist regimes of truth commissions designed to heal by preserving history be the path chosen? How this problem is addressed will be a significant factor in regard to the postures of the international community, particularly the United States, and perhaps the European Union (EU) toward a unified Korea.
Similarly, the problem of reducing economic disparities also has international ramifications. Will the new Korean government move rapidly toward full integration and allow freedom of movement, residency, and employment? Or will subsidies or penalties be employed to keep the Northern population above the 38th parallel?
In regard to this problem, the intermediate option referred to above may have some appeal to Seoul.
In regard to the geopolitics of northeast Asia at the time of reunification, the two key factors will be the state of U.S.-China relations and that of the U.S.-Japan alliance. Under the best of circumstances, Beijing will not greet with enthusiasm the prospect of a unified, democratic, free-market Korea allied with forward-deployed U.S. forces on its border. The afterglow of the Clinton-Jiang summit with its proclamations of building a "strategic partnership" obscure the thrust of Beijing's approach to security in East Asia. The point here is that the present congruence of U.S. and Chinese interests in Korea--no war, no collapse, no nukes--is unlikely to endure after reunification, at which point those interests will begin to diverge. We cannot expect China to adopt a collaborative posture in regard to security to the degree that Washington-Seoul security ties remain close.
For the past year or so, Beijing has appeared to attach priority to reducing the U.S. footprint in the western Pacific. In its response to the U.S.-Japan defense guidelines, criticism of "Cold War" alliances, and calls for new multilateral security arrangements in East Asia, Beijing as clearly sought to attenuate U.S. bilateral alliances, particularly with Japan, but also to lay the basis for persuading Seoul that a unified Korea might be well advised to rethink its security ties to the United States. However, if Beijing is heavy-handed in its efforts regarding the U.S.-Korea linkage, it could be counterproductive and reinforce a Korean desire for close security ties with the United States, lest the 21st century begin to resemble the beginning of this century.
At the same time, Seoul will closely watch the strength of U.S.-Japan security relations in gauging its approach to regional security. A strong U.S.-Japan alliance that constrains Japanese power projection would have a confidence-building effect on Seoul's strategic vision and force development. Conversely, a diminished or more problematic alliance and movements by Japan toward autonomous capabilities would spur strategic competition in northeast Asia. Certainly, any diminution of the U.S. forward-deployed presence in Korea would likely trigger more heated debate in Japan about the U.S. force presence there. That in turn would force Korea to rethink its defense options.
From the perspective of U.S. interests, the worst possible outcome would be a Sino-Korean alignment. In its most extreme form, it could mean a heartland-rimland divide either to counter or as insurance against the U.S.-Japan alliance. Given China's historic relations with Korea, or even the evolution of PRC-ROK ties since the 1995 Jiang Zemin visit to Seoul, Korean fears of a kind of neotributary status suggest that this would not be Seoul's preferred option. The rapid expansion of Sino-Korean relations in the 1990s initially produced a romantic interlude at Japan's expense. More recently, discussions with Korean officials suggest that a more sober post-honeymoon period has set in. This phenomenon is similar to Seoul's experience with the Soviet Union during Roh Tae Woo's Nordpolitik in the late 1980s.
Similarly, neutrality does not comport well with history either. At the time of reunification a relatively weak and vulnerable Korea would likely harbor too much distrust of its larger neighbors to place its security on good faith alone. Korea's pathological fears of Japan make it difficult to envision a unified Korean government entrusting its security to cooperative arrangements not resting on a foundation of military balance.
Absent some form of security ties with one or more major powers that included credible security assurances, strategic independence, while more appealing than neutrality, is unlikely to be the option of choice. Yet an attenuation of the U.S.-ROK alliance, one probable outcome (at least in the short term) of the unification process, could push Seoul in such a direction as least as a hedging strategy. A Korean posture of strategic independence holds a realistic possibility of renewed efforts to obtain nuclear weapons capability. From a Korean perspective, this is not a wholly unreasonable quest. Perpetual fears that Japan is a virtual nuclear weapons state and the reality of being surrounded by China and Russia offer a window into Korean logic. Moreover, it is probable that Seoul would inherit intermediate-range missile capabilities, chemical and biological weapons capabilities, and possibly also an opaque or overt nuclear capability.
This nuclear temptation has been underappreciated by most analysts in assessing post-unification security options. But South Korean efforts to attain nuclear weapons in the 1970s, when there was a less ambiguous U.S. security umbrella and far less Japanese capability (e.g., no potential delivery system or source of fissile material) warrant such post-unification concern. Discussions with South Korean officials and writings of the scientific and military elite reveal a continued interest in acquiring fuel-cycle capabilities--reprocessing--with a clear intent of maintaining at least the option.
Moreover, the combination of burgeoning nationalism attendant on unification, and the probable reduced if not vacant American force presence in Korea, will almost certainly generate interest in exploring the nuclear option. This temptation will be even greater if it turns out that a unified Korea results in a Ukraine-type problem of nuclear inheritance. At present, the quantity of plutonium possessed by North Korea is unknown and unknowable--at least until the International Atomic Energy Agency (IAEA) is permitted to excavate its nuclear archeology. Nor is it known whether the DPRK has succeeded in weaponizing the quantities of plutonium it could possess, which could be enough for one to two warheads.
While many in the defense establishments in both Washington and Seoul may argue for continuing the 1954 U.S.-ROK Mutual Defense Treaty and keeping U.S. forces in Korea after reunification, this will become increasingly problematic. The strategic problem will be the evaporation of the rationale for American troops in Korea. The intent of the security treaty and the mission of today's 37,000 troops is deterring and if necessary defeating North Korea. The principle stated argument for maintaining the status quo is stability. In large measure, this argument is camouflaged bureaucratic inertia: we're here because we're here. This will be challenged in Congress and the media. After holding up the North Korean threat as the single most compelling post-Cold War rationale for the U.S. forward-deployed presence in the western Pacific, any national security official will face the unenviable task of explaining to Congress why the U.S. should continue subsidizing Korea's security.
Moreover, not only will reunification undercut the rationale for U.S. ground if not air forces in Korea, but a financially strapped unified Korean government is unlikely to sustain, let alone increase, host nation support. Another complicating factor will be the awkward possibility of the U.S. defending one ally (Korea) against the other (Japan).
One important consideration affecting the future of any U.S. deployments on the peninsula post-reunification will be some understanding with China. Clearly U.S. troops stationed above the 38th parallel will be a major source of contention with China. It might be another question if there was a modest U.S. military presence on Cheju-do island. It is at best an open question as to whether some understanding about the quantity and quality of U.S. forces in a unified Korea could be obtained. A second critical factor in determining U.S.-Korean security ties post-reunification will be the status of any U.S. nuclear guarantee. The experience with NATO expansion, e.g., the absence of U.S. troops in Poland, the Czech Republic, or Hungary, suggests the possibility of maintaining such a nuclear umbrella without forward-deployed forces if some treaty relationship continues, whether the current treaty or a successor.
One wildcard is China. An adversarial China could emerge as a new U.S. rationale to maintain the status quo in Korea. While this cannot be ruled out as a possible result, history suggests that it is extremely unlikely as a practical matter that any Korean government would adopt an openly adversarial relationship with China. One can look back at the Korean posture during the March 1996 Taiwan Strait crisis to see the degree to which Korea would like to avoid having to make the choice between the United States and China.
In sum, our judgment is that from a U.S. perspective, the best case that is in the realm of the possible will be some variation or combination options no.2 and no.3. One can envision access, prepositioned equipment, and joint training and exercising in the context of a revised security treaty up to and perhaps including a small logistics unit sustained in Korea.
Perhaps a better template might be the Madrid Mid-East peace process. The core issues there were principally Israeli-Palestinian in character (with a U.S. mediating role in some instances). Some issues such as economic development, water, and arms control lent themselves to broader regional participation. Negotiations in these areas were based on the principle of form follows function. Who sits at the table is determined by who has a stake in the outcome.
In the case of Korea, most issues would seem best suited to North-South dialogue (e.g.. economic and political cooperation, family reunions, cultural exchanges) with the December 1991 accords on reconciliation, cooperation and confidence building serving as an excellent framework. Some issues such as the armistice, arms reductions, and peace treaty, while largely North-South in character, would necessarily involve the United States in some role as a function of the U.S. forward-deployed presence and security treaty with the ROK. Other issues such as guaranteeing a peace treaty, honoring a denuclearized Peninsula, reconstruction of a reunified Korea, levels of armaments, and Korean international economic cooperation would logically suggest some role for the four major powers.
One can envision a six-party chapeau for the Korean peninsula diplomacy with the involvement of the outside powers limited to areas such as those defined above. For example, an arms reduction process that might be initially pursued through the Joint Military Commission of the 1992 accords could at some point expand when addressing the question of the final disposition of forces in Korea. The future of weapons of mass destruction and the size of a unified Korean military, which if maintained at present levels would leave a unified Korea with one of the largest military forces in the world, are issues of subregional concern and legitimate interest.
Out of such an exercise, a six- (eventually five-) party political framework for northeast Asia could emerge. Other issues that lend themselves to multilateral cooperation are the development of the Tumen River basin and Yellow Sea area, natural gas pipelines from Siberia and the Sea of Okhotsk, and environmental pollution. All could be managed by such a northeast Asian entity. Another significant possibility is for a regional nuclear cooperation institution, an Asia-Pacific version of EURATOM. Track-two discussions about the creation of a PACATOM have been underway for more than a year in various forums. Given the heavy reliance on nuclear power for electricity by Japan, Korea, Taiwan, and, if current plans are realized, China, this could become an important nonproliferation instrument.
During the Bush administration Secretary of State James A. Baker III proposed a six-party forum for northeast Asia in a 1992 Foreign affairs essay. More recently, then Prime Minister-designate Kim Jong Pil suggested a six-party arrangement to guarantee peace in the Asia-Pacific. The dearth of multilateral institutions in East Asia suggests that any such developments are likely to be evolutionary in nature.
Last Updated: 24-Jun-98
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