U.S.-North Korea: Stalemate

North Korean leader Kim Jong-Il is reportedly scheduled to visit China for a visit that would likely include China urging a return to the Six Party Talks on denuclearization, which have been at a standstill since last December when Special U.S. Representative for North Korean Policy Stephen W. Bosworth held talks in North Korea. It will be an impasse difficult to break, according to Scott Snyder, adjunct senior fellow for Korea Studies at CFR, with the United States demanding denuclearization and North Korea demanding a peace treaty. "The United States is not going to accept a nuclear North Korea," says Snyder. "As a result, it really limits the bandwidth for conducting a negotiation."

The United States has not been able to get North Korea back to the Six Party Talks aimed at denuclearizing North Korea, and North Korea seems to be biding its time. What’s going on?

The Obama administration, through Ambassador Bosworth, delivered a message to North Korea that the Six Party Talks is the vehicle by which the administration wants to engage, and that the primary subject should be denuclearization. Ambassador Bosworth basically has allowed the North Koreans to consider the various options that they have. The U.S. government is not rushing to pursue North Korea, in contrast to the approach taken in the past.

Another way of putting Bosworth’s approach is that we can’t want to talk to North Korea, or we can’t want denuclearization, more than the North Koreans. So time has passed. Bosworth took another trip out to the region at the end of February and early March to consult with various parties including the Chinese. The Chinese have been making recent efforts to try to follow up and encourage the North Koreans to come back to the talks. They sent senior Chinese Communist Party official Wang Jiarui to Pyongyang in February, and he had conversations there. In fact, Kim Kye-Gwan, North Korea’s primary nuclear negotiator, came back on the same flight to Beijing with Wang.

Wang visited the United States last year, didn’t he?

Yes. There is an invitation out from American think tanks to Kim Kye-Gwan to come to the United States for unofficial talks, but the Obama administration has indicated that we’ll only approve that visa in the context of a North Korean commitment to return to the Six Party process. This is one of the subjects discussed during Ambassador Bosworth’s visit. Let me just add one additional piece: In late February, the North Korean prime minister, Kim Yong-Il, traveled to China for some discussions.

There’s been a recurring report in the Japanese and South Korean press that Kim Jong-Il is planning a long visit to China. What do you think about that report?

There’s been speculation that Kim Jong-Il might come to Beijing since the beginning of the year, and the recent visit by the prime minister suggests that the logical next step in the dialogue between China and North Korea should involve Kim Jong-Il, but there’s not yet any official confirmation that that visit will take place. Some of this speculation is reinforced by various kinds of activities that one sees at the border area between Dandong on the Chinese side of the border, and Sinuiju on the North Korean side. Those traders who are engaging in speculation are really not connected with the management of the diplomatic relationship, so they’re not necessarily reliable sources. Having said that, the premier’s visit and the contacts between the heads of state security organizations that occurred late last year are activities that might possibly signal a future visit by Kim.

There are two other worries that Kim Jong-Il may have. Last time he visited Beijing, upon his return, there was an explosion at a train station in North Korea that occurred within an hour of his passing through the station. And we also don’t know whether there might be concern that travel to China would reveal more about Kim Jong-Il’s health condition than perhaps he is interested in having revealed at this time. So those are two countervailing concerns that would have to be overcome for Kim Jong-Il to make that visit.

Late last year the North Koreans revalued their currency?

Yes, they revalued their currency; they removed two zeros from the value of the currency. This is an extraordinary blow for the general population.

And they limited sharply the amount of old money you could turn in.

That’s right. There were limits to the amount of old money that could be turned in. It was clear that one of the hidden purposes behind the revaluation was to identify and eliminate sources of illicit wealth, and it was also a blow against people who were making a living in the markets.

Black marketers--speculators, essentially?

Not only speculators these days. Generally speaking, there are a lot of people who are trading in the markets, but what the state wants to do is to recover control. The problem is that they didn’t have enough resources in the pipeline to restore their public distribution system. In other words, a strategy would basically be to go back to the past situation in which the state was the main source of goods for the population. But that was an extraordinarily short-sighted policy. The North Korean prime minister in fact issued an unprecedented public statement of apology for that policy in February. It’s the first time that we’ve seen, I think, such a public admission of a policy mistake in North Korea.

What was the result--a great shortage of goods on the market?

They tried to shut down the markets for a few weeks, and then the government found itself basically forced to reverse that policy. It is a policy blunder that appears to have severely damaged the credibility of the government.

You wrote an article recently about North Korea’s strategy of attracting foreign investment. Are any countries interested in investing in North Korea?

It’s not clear who would invest. There may be some Chinese companies that might have some interest, but generally speaking, even though the North Koreans appear to be getting the formal language in their new regulations right, they haven’t proven that the regulations themselves are worth the paper they’re printed on, in terms of their willingness to honor those regulations. The currency revaluation further reduced the credibility of the government. So the task of attracting foreign investment in North Korea is likely to be an extraordinarily difficult task. The one area where they might find some success is in allowing shipping rights in the far northeastern part of the country, the port of Rajin-Sonbong, essentially to China and Russia. That northeastern port is ice-free year round, and the Chinese northeastern provinces are essentially land-locked.

So goods could come into North Korea and ship by rail or truck to China.

Exactly, and it would represent a great improvement for the Chinese goods distributors or for foreign goods to arrive in China through that northern port.

When Bill Clinton went to North Korea last summer and got the two American journalists released, everything seemed very cordial. There was a dinner given for him by Kim Jong-Il, and everyone was beginning to expect they’ll be back at the Six Party table. But the United States and North Korea are playing a sort of "who blinks first"?

Given North Korea’s record and the level of mistrust between the two countries, the United States is essentially looking for a commitment based on action by the North Koreans to come back to the denuclearization process. At the same time, the North Koreans have declared that they want to separate the issue of denuclearization from the possibility of diplomatic normalization, and in fact what they are doing is pushing the idea of discussing a peace treaty between the United States and North Korea. They’re trying to change the subject. So it makes it very difficult to have a dialogue, and frankly there is an increasing pessimism about the prospect of diplomacy as a viable vehicle for denuclearization. But there’s also--especially if we look at it through the lens of the regional context--not much support for alternatives. That’s the core dilemma. Alternatives to diplomacy are hard to muster, and yet hope for diplomacy to be successful is quite limited.

The main focus right now has been on leaving the door open for a dialogue, but also trying to use the UN sanctions as the vehicle by which to pressure the North Koreans back to the table. But since not all the neighboring parties, including the Chinese, are approaching this issue with the same priority and in the same way, it’s making a challenge of moving forward very difficult.

Why not say: "OK North Korea, we’ll have a dialogue with you if you agree to go back to the Six Party Talks."

The North Koreans have already reached our bottom line. That is, the United States is not going to accept a nuclear North Korea. As a result, it really limits the bandwidth for conducting a negotiation, especially when the North Koreans take steps that are designed to use implicit if not explicit recognition of their status as a precondition for a talk.