The broadcasts foreshadowed a string of fresh initiatives from the communist North. In recent weeks North Korea has agreed to unite more war-torn families and to open new road and rail links across the demilitarized zone. In addition, Pyongyang will send hundreds of athletes to compete in this month’s Asian Games in South Korea. The government has also made a few economic moves–including sweeping price reforms designed to emulate Beijing’s capitalist experimentation in the early 1980s. Most surprising, North Korea is mending fences with its former colonizer, Japan. In late August North Korean strongman Kim Jong Il invited Japanese Prime Minister Junichiro Koizumi to meet him in Pyongyang, and Koizumi quickly accepted. The summit is scheduled take place on Sept. 17. “The cumulative picture is one of more optimism that I’ve seen in a very long time,” says L. Gordon Flake, executive director of the Mansfield Center for Pacific Affairs in Washington.
To be sure, Pyongyang’s motives are as crass as ever. The world’s last bastion of Stalinism, North Korth is desperate for food and money, and Kim knows that cracking open the hermit kingdom occasionally is the best way to get them. In return for Pyongyang’s agreement to allow more family reunions and open transport links, for example, Seoul has offered 400,000 tons of rice and 100,000 tons of fertilizer. By courting Koizumi, Kim hopes to win an estimated $5 billion to $10 billion in war reparations for Japan’s brutal colonial rule–a payout that could happen if relations are normalized. Koh Yu Hwan, a North Korean watcher at Seoul’s Dongguk University, says the payment would be “seed money” to help rebuild the Northern economy. Pyongyang is also courting direct foreign investment from Japan and South Korea aimed at turning rust-belt Soviet-era factories into an export-oriented manufacturing base. As one Korea Herald commentator put it recently: “For Kim Jong Il there is one motive: money.”
In return, though, Kim may have to offer even more concessions. Japanese hope Koizumi will win the release of a handful of their countrymen abducted by North Korean agents in the 1970s and 1980s. (Pyongyang’s failure to acknowledge their existence has been a bilateral stumbling block for years.) Washington wants North Korea to open its nuclear facilities and to extend a self-imposed moratorium on ballistic-missile tests. South Korean President Kim Dae Jung, whose “sunshine policy” toward the North won him the Nobel Peace Prize in 2000, hopes to cement his legacy before he leaves the Blue House next February. His dream: that Kim Jong Il will travel by rail to the DMZ by year-end and meet him for a repeat of their breakthrough 2000 summit in Pyongyang.
A series of events has drawn Pyongyang back to the negotiating table. The most important, from North Korea’s perspective, is undoubtedly Washington’s tougher line since the September 11 terrorist attacks last year. While the North has predictably railed against its inclusion in the Axis of Evil, its leaders know better than to provoke the United States right now; many experts think Pyongyang is re-engaging out of fear that it could become another Iraq. By reaching out to Japan, the regime “is buying an insurance policy that will appeal to moderates in the Bush administration,” says Japanese lawmaker and regional security specialist Ichita Yamamoto. “They are scared, and they do not want to become the enemy of the United States.”
North Korea’s problems are a golden opportunity for Koizumi. According to his aides, Japan’s Foreign Ministry has worked for a year to reach a breakthrough with the North. He’s gambling that the release of the 11 abductees can rescue his sinking poll numbers.
Washington is watching for signs that Pyongyang will refrain from further ballistic-missile tests, and that it will hew to the 1994 Agreed Framework between the two sides. The provisions stipulate that Pyongyang open its nuclear facilities to International Atomic Energy Agency inspection, something the Bush administration wants to begin this year. Koizumi no doubt will convey Washington’s urgency. “Kim Jong Il must send peace signals to Bush now,” says Lee Jong Seok, a strategic analyst at the Sejong Institute in Seoul. “There is a growing concern that the 1994 nuclear crisis will revive next year.”
For his part, Kim’s biggest concern may be finding ways to create a quasi-legitimate economy in order to reduce the country’s dependence on aid. After years of study, the government seems finally to have launched Chinese-style reforms aimed at spurring growth and attracting foreign investment. In Dandong, a Chinese city near the North Korean border, people say North Korean businessmen have begun crossing into China touting a new slogan: “Economics is more important than ideology.” On Sept. 2, North Korea’s vice minister for Foreign Trade, Kim Yong Sul, told businessmen from some 40 major Japanese trading companies gathered in Tokyo that “we’ve spent more than two years to come up with an economic reform plan. It is not perfect, and there are many contradictions, but we are trying to solve our problems.”
Price reforms are a high-risk first step. On July 1 the government raised the cost of rice 550 times, increased bus and subway fares from 0.1 to 2 won and hiked wages eighteenfold. The won, meanwhile, was officially devalued from 2.15 to the U.S. dollar to 150 per greenback as the government began circulating once rare 1,000 won notes. The moves are aimed at rationalizing wages and aligning official prices with those on the black market. Foreign shoppers in Pyongyang reported a sharp increase in commerce, but the move could backfire disastrously if scarcity leads to runaway inflation. “Their flawed assumption is that the new prices will remain stable,” says Flake of the Mansfield Center. “But the reforms are a good thing because they will become engines for further change.”
Even if the latest round of goodwill gestures goes nowhere, at least the North Koreans now have something in common with the rest of the world–televised football to divert them from their cares. On Sept. 7 state television broadcast a friendly “reunification match” between the North’s national team and South Korea’s now famous squad. The match was held in Seoul’s World Cup stadium. Some 60,000 fans chanted “unified motherland” throughout the contest, which ended in a scoreless tie.
