Asia Report N°101 - North Korea under Tightening Sanctions

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Outwardly, the Democratic People's Republic of Korea (DPRK, North Korea) appears stable. However, the country has been shaken by constricting international sanctions, extremely poor policy choices, and several internal challenges that have the potential to trigger instability. International sanctions have reduced foreign exchange earnings, while humanitarian assistance, which feeds millions of North Koreans, has declined due to political factors and donor fatigue. In addition to sanctions, Pyongyang has been dealing with the internal pressures of a disastrous currency reform as well as a chronic and deteriorating food security problem. The aggregate pressure is already taking a toll on North Korea's human security and could have a number of unanticipated consequences for regional and international security.

Some analysts and policymakers believe international sanctions have pressured North Korea to seek a face-saving return to the Six-Party Talks and better inter-Korean ties. Although Pyongyang's opaque policymaking process makes it nearly impossible to understand regime motivations, the pressures of cascading and overlapping "mini crises" are unmistakable just as the country has had to face difficult succession issues. However, the DPRK has demonstrated an extraordinary ability to survive under pressure. Any of the current challenges - as singular problems - should be manageable. The state security apparatus and the barriers to collective action make a "revolution from below" virtually impossible. But despite the loyalty of elites in the party and the military, a sudden split in the leadership, although unlikely, is not out of the question. Signs of any fissures would not be observable from the outside until a power struggle, a coup d'état, collapse or similar crisis was already unfolding.

The first half of 2009 was marked by bellicose and defiant posturing from the North, but in the latter half of the year, Pyongyang began to express a desire to improve ties with the Republic of Korea (ROK, South Korea) and the U.S. Frequent shuttle diplomacy has led to speculation that the Six-Party Talks could reconvene soon and that an inter-Korean summit could be held in 2010 or 2011. On the other hand, the [North] Korean People's Army (KPA) has been conducting a winter exercise that is expected to last until late March. The KPA has issued several provocative statements and in late January 2010 fired live artillery rounds towards South Korean islands off the west coast. The shells landed in the sea in the vicinity of the Northern Limit Line (NLL), the western sea boundary that Pyongyang does not recognise. Nevertheless, despite KPA rhetoric, there have been no unusual troop movements or mobilisations.

Human security has not been at the top of the North East Asian security agenda given the prominence of traditional security issues, historical legacies, and strong sovereignty norms. It is generally defined along two dimensions: freedom from want; and freedom from fear. Throughout most of East Asia, even undemocratic countries have sustained relatively strong economic growth for long periods; living standards have thus improved in many countries that have experienced little or no progress in expansion of civil liberties and human rights. In contrast, North Korea's human security has been a long-term crisis. Human rights abuses and economic deprivation have been widely documented, but the international community has no effective policy instruments to produce improvements. The recent tightening of economic sanctions, compounded with domestic problems, is exacerbating the DPRK human security tragedy. This does not mean the international community is responsible for North Korea's current plight, of course: the DPRK government itself holds the key to easing the human security crisis.

The Korean peninsula has lived with the threat of war for over half a century. Mutual deterrence is robust, but inadvertent escalation or miscalculation is always possible. The balance of power has shifted against Pyongyang, and the DPRK leadership is not likely to start a war it knows it would lose. However, the leadership's motivation to survive could result in more dangerous proliferation activities as sources of foreign exchange - both legitimate and illegitimate - disappear. Kim Jong-il's political machine requires hard currency to operate, and there are several signs that the regime is increasingly desperate to earn it.