The following is a re-up of my monthly post for the Lowy Interpreter for June. The original is here.

The fissure between North Korea and China is widely noted, and Kim Jong Il supposedly told Madeleine Albright when she visited Pyongyang in 2000 that he’d rather have a deal with the US than with China.

That’s somewhat understandable actually. The US is too far away, both geographically and culturally to really dominate North Korea if the two managed to strike a deal. But dealing with China – right next door, bullying, opportunistic – must be tough. There’s nothing Beijing would like more than for North Korea to be like East Germany: a completely dependent, completely controlled satellite. So the North Korean nuclear program is a great idea: even as North Korea becomes an economic semi-colony of China, the nukes can prevent the loss of political sovereignty.

The full essay follows the jump.

During the much-anticipated 7th North Korean Workers’ Party Congress last month, the first such gathering in thirty-six years, over one hundred foreign journalists were invited to Pyongyang to cover the event. Not surprisingly, they were treated with contempt: relentless surveillance, absolute restrictions on movement, and tightly-controlled access to the North Korean people themselves. Some insight did permeate through, however, namely dissatisfaction with China. That North Koreans were allowed to share their animosity towards Beijing suggests official approval of such feelings.

Though counterintuitive, experts have for some time been aware of the toxic relationship between the two countries, particularly in the years since Kim Jong Un assumed power in 2011. The very real understanding that the North would be crippled without Chinese political and economic maneuvering has grown increasingly troublesome for Pyongyang elites. The late Kim Jong Il himself supposedly divulged such reservations to former US Secretary of State Madeleine Albright during her visit to Pyongyang in 1999.

Not as Close as ‘Lips and Teeth’ Anymore

Cynically marketed by both as a blood alliance between two communist states, Chinese assistance to North Korea is instead almost entirely geopolitical in design and objective. Aid is funneled into sectors where China’s own needs lie: resource extraction and infrastructure development. The bilateral relationship, described by Mao Zedong himself to be as close as “lips and teeth,” is now dominated by the North’s heavy reliance on China. A Chinese aid cut-off would threaten internal Northern stability and severe its primary pipeline to the global economy. This leverage has grown as North Korea has fallen under ever-greater sanction.

Ensuring the continuation of the status quo on the Korean Peninsula ‘buffers’ China against South Korea and Japan, and their American ally. This is widely known. But there is a less often discussed an economic benefit too – Beijing’s creeping economic colonization of the North. There is virtually no competition for the Chinese, as multilateral sanctions have placed the cost of doing business with the Kim regime out of reach for most. And the bigger the benefit to China, the more likely Beijing will support development. Three high-speed railroads are under construction which would link northeast China to North Korean cities, providing valuable trade and economic avenues for an area that has lagged behind the rest of China (the border city of Dandong processes 80% of trade between the two countries and would be hub for the new rail lines). In order to pay for this, North Korea allegedly offered China exclusive development rights to seven major mines (Jang Song Thaek, Kim Jong Un’s uncle and leading diplomat to Beijing, was supposedly executed in 2013 for these kinds of one-sided deals). Special economic zones (SEZ) and deep-water ports are no exception: they are built by the Chinese for the Chinese.

To be sure, China’s conduct with the North does not deviate far from its modus operandi in other developing countries. Whereas the Soviet Union leveraged its military to bring vassal states in line, China uses its massive economy to influence decision makers from Pyongyang to Phnom Penh. Nearly 80% of all firms in China are state-owned enterprises, and the banking sector is dominated by Beijing bureaucrats. This gives the state remarkable control in funneling money to states which support its geopolitical goals, or punish states which do not.

Pyongyang decision makers are well aware of this dynamic, a key reason why they have not (and will not) abandon their nuclear weapons. The bomb protects the regime’s political sovereignty, even as economic control is slowly lost to asymmetric economic dependence on China. Indeed, the recently-announced Five Year Plan, the first in decades, may indicate that Pyongyang wants to lighten that dependence by finally igniting some domestic GDP growth. And there have been rumors for years that North Korea seeks an accommodation with America in order to check the erosion of its sovereignty to China.

A North Korean Accommodation with the United States?? Desirable, but Unlikely

During the Cold War, North Korea guarded its sovereignty despite weakness by pendeling back and forth between China and the USSR. The USSR’s collapse left it with China alone as a patron, which obviously dramatically improved Chinese leverage. Conversely, the late 1990s famine showed what happens when North Korea lacks a sponsor and goes it alone. Better than choosing between China and famine would be a return to the good old days of two, competing patrons. And, curiously enough, the US is not a bad choice for Pyongyang:

First, North Korea is far less likely to be dominated economically by the US than China. The US does not have the leverage over North Korean enterprises the Chinese do. The Obama Administration cannot guarantee Amtrak railroads in the North, nor can it claim ownership over mines and ports. Assistance to the North would likely come in the form of cash or raw materials, allowing Pyongyang decision makers to apply it as they see fit. Any kind of entrepreneurial incursions into the country would be initiated by non-state actors, affording Pyongyang a level of control it no longer has with Chinese investors.

Secondly, political domination is also less likely, as the US and North Korea do not have the same historical and cultural legacy which China and Korea share. America is both geographically and culturally far removed from East Asia, and so far less likely to dominate it or bully Pyongyang, which behavior would also its domestic liberal ideology of self-determination. A North Korea no longer threatening the US would cease to interest policy-makers or the public much. Post-accommodation, most Americans just would not care enough about Korea to meddle as China does now. China is the opposite. It has a long history of intervention in Korea; it is right next door, creating obvious interests in how North Korea is governed; and its cynical, bullying domestic government style is apparent in its foreign policy. Its inclination is treat North Korea as a satellite.

Nevertheless, this is unlikely. US-North Korean relations are unlikely to improve so long as North Korea retains nuclear weapons. But that puts Pyongyang in a catch-22: keep the weapons and be stuck with creeping Chinese economic domination, or surrender them and hope for a US deal. Both are unpalatably risky, which I believe is the reason for the new Five Year Plan announced at last month’s Workers’ Party Congress. If North Korea can actually function economically on its own, then its need for China, or a US deal, would recede.

Filed under: Alliances, China, Hegemony, Korea (North)