Pyongyang Report

Vol 3 No3 June 2001



In this issue-


n      South Koreans urge Bush to contribute to Korean peace

n      ROK government pressures US with fighter deal

n      US resumes negotiations with DPRK

n      US university programme in Pyongyang

n      NGOs call for increased aid

n      NZ Delegation to DPRK



June has been an important month in Korean affairs,  Firstly it marked the anniversary of the historic Pyongyang summit. This has given rise to celebrations and meetings, and appraisals about how much and how little has been achieved in the 12 months.  The summit put DPRK-ROK relations on to a new level and locked both leaders into a commitment to reconciliation. There were high profile family reunions – on far too small a scale but significant nonetheless.  Mail was exchanged for the first time in half a century and there were a number of high ministerial meetings. Some progress was made on the economic front, but whether the target date for reconnecting rail and road links through the DMZ by September will be achieved is uncertain.  The Kumgangsan tourism venture faltered and looked likely to collapse, though recent initiatives by North and South seem to have rescued it.


However, the most important factor influencing inter-Korean relations was the change in US administration.  Kim Dae-jung, concerned at signs that the new administration was going to dump his Sunshine policy arranged an early meeting with President Bush in March.  The summit was widely regarded as a failure and President Kim was seen as being personally humiliated.  The DPRK responded  to the US suspension of talks by cancelling ministerial meetings at short notice and by putting a general, but not complete, freeze on relations with the ROK.


Nevertheless, it was not all bad news.  Bush was criticised by segments of the US media not merely for discontinuing negotiations with the DPRK but also for his treatment of a ‘loyal ally’.  The European Union, under Swedish presidency, sent a delegation at the highest level to Pyongyang , and opened diplomatic relations with the DPRK. The DPRK for its part continued its diplomatic offensive and notched up further relationships (including NZ) making nine since the beginning of the year.


Kim Dae-jung, buffeted by economic and political adversity at home, made strenuous efforts to restart the reconciliation process.  In this he was helped  by, amongst other things, a further revision of Japanese history textbooks which generated protest throughout East Asia and gave Koreans, North and South, yet another common cause.


Whilst Seoul put pressure on Kim Jong Il to make good his promise to make a return visit in 2001, the main focus has been on the Bush administration which is correctly seen as the cause of the freeze, and its solution.  One way in which ROK is applying pressure is to do with arms purchases, and particularly the next generation fighter plane.  Seoul, already offended by Powell’s strong-arm advocacy in March of the Boeing F-15 has been flirting with alternatives, including the Sukhoi 35 but mainly the French Rafale   There is a huge, and rather obscene, irony here.  Many see the military industrial complex and its desire for National Missile Defence (NMD) as the ultimate driver of Bush’s Korea policy. NMD needs a rogue state and the DPRK is seen to fit the bill.  Washington has now resumed negotiations with Pyongyang but its commitment to real progress is debatable. The next couple of months should tell.


Within the DPRK, whilst there have been signs of economic recovery, the drought which has afflicted the region has had a significant impact on harvest prospects and aid agencies have stressed the need for continued aid and assistance for rehabilitation


The current economic situation, the international aid effort and the role that NZ might play will be among the issues to be explored by the NZ delegation visiting DPRK in July.  We will report on that in the next issue of Pyongyang Report, in the media and on our website.

Tim Beal

US-ROK-DPRK Relations

Letter to  Bush

On 3 May, 2001, an open letter was sent to President Bush by 120 prominent South Koreans.  They included university presidents, church leaders, NGOs, artists, union leaders, retired general and politicians.


../..In spite of our positive assessment of the US-ROK Summit, we have some concerns. First of all, we are concerned that recent remarks from leaders in Washington regarding labels used for the North and the stability of its regime may not be helpful in improving inter-Korean relations. ../... Yet at this moment, certain remarks by U.S. leaders may have been misunderstood as inappropriate defamation against a partner in dialogue. Such misunderstandings, if any have indeed occurred, may lead North Korea to hesitate in approaching a negotiation table with either South Korea or the United States. This is the backdrop upon which some South Korean citizens are expressing a degree of skepticism toward U.S. intent to contribute to Korean peace; concern has also been voiced as to whether the U.S. is even willing to remain engaged in negotiation with the North.


Secondly, we wish to stress our concern regarding the NMD program of the US…/..


Lastly, we need a more cautious approach with regard to the issue of reduction of North Korea's conventional military threat that the US emphasizes. If that becomes an issue, North Korea will definitely bring out the threat of US troops stationed in South Korea. US concern about the conventional military threat of North Korea is well grounded. However, this matter is not something that can be dealt with separately, and is directly related to security on the peninsula and lessening of military tension between the two Koreas. We have to examine first the possibility of implementing the Inter-Korean Basic Agreement that affirmed non-aggression and reconciliation between North and South. ../..


Seoul Set to Use Fighter Jet Purchase to Soften US' Tough Stance on NK

Korea is moving to use its $3-billion fighter jet procurement project (F- X), which has boiled down to a three-way competition between the U.S.-made F-15, the French Rafale and the Eurofighter, in order to soften Washington's negative stance toward Seoul's ``sunshine'' policy of engagement toward Pyongyang.


``We would have less reason to buy the American aircraft should the U.S. continue to block every step we try to take,'' said a senior government official, with knowledge of the selection process.


The official said on condition of anonymity, `` It is only natural that all available tools be used to get our stance conveyed to the U.S.''


Seoul and Washington are currently at odds on how to handle North Korea.


President Kim Dae-jung has expressed frustration over the stalled inter- Korean relations, for which Seoul blames U.S. President George W. Bush's strict principle of reciprocity in dealing with Pyongyang.


Meanwhile, Seoul has recently decided not to expedite big-ticket military purchases, including the F-X.


This decision made during a recent National Security Council (NSC) review is not unrelated to Seoul's conveying its intention to tie the F-X program to a change in the U.S. attitude toward the North, according to industry sources.


Until quite recently, the F-15 was considered the top candidate for the F- X project. Korea relies on the U.S. for security and has 37,000 troops on its soil, so Boeing, as a U.S. contractor, is seen as having an advantage over its competitors.


Some experts see the race as more of a two-way competition between Dassault's Rafale and the F-15 as a result of a strong French effort to overcome its politically weak position.


Boeing is facing the prospect of shutting down its F-15 production lines and letting go hundreds of workers, unless it is able to win the Korean deal.


Sources expect the U.S. will push for the purchase of the F-15 during the meeting of the two countries' defense chiefs in Washington on Thursday.


In March, U.S. Secretary of State Colin Powell asked then South Korean foreign minister Lee Joung-binn to give a favorable consideration to Boeing's F-15 during their first talks in Washington.

Source: Korea Times 20 June 2001

Engaging North Korea

THE BUSH administration's renewal of talks with the North Korean government this week could yield some quick benefits even if the negotiations themselves go slowly. The president's decision to freeze the contacts four months ago and his suggestions that agreements with North Korea couldn't be trusted had roiled U.S. relations with the South Korean government and effectively frozen the promising efforts by President Kim Dae Jung to reach out to the Pyongyang regime. Now that the administration has reopened the diplomatic channel, it can, at least, avoid sabotaging Mr. Kim's initiative and encourage the scheduling of a promised visit by North Korean leader Kim Jong Il to the South. A diplomatic effort will also help assure U.S. allies in Asia and Europe that the administration does not see missile defense as the only means of addressing the threat of nuclear proliferation. Beyond that, results will depend on the unpredictable decisions of one of the world's most isolated regimes -- and on the seriousness and skill with which the initiative is pursued…/...


By adding them [conventional forces and nuclear inspections], however, the administration risks stalling the dialogue, or diverting it away from the areas -- such as the missile program -- where progress is most possible. Much will depend on the administration's specific objectives. For example, some experts believe that North Korea might be induced to speed up an inspection by the International Atomic Energy Agency called for by the 1994 nuclear accord in exchange for new deliveries by the West of energy supplies. But if the administration seeks to reopen the accord and withdraw from the commitment to supply nuclear power plants -- as some Republicans have advocated -- it could prompt a confrontation with the North and renew tensions with the South, which is committed to building the plants.


President Bush is right to be both cautious and skeptical in dealing with North Korea. Still, the administration should look hard for ways to help Kim Jong Il open up his country -- if that is what he wants -- and not allow the larger agenda of change it seeks to obstruct smaller but potentially very important accords, such as a deal to end the missile program. To be effective, negotiations with the North must be conducted at a high level, and they must include senior administration officials. Having frozen the diplomacy for several months, the administration must do more than simply return to the table; it should show that its commitment to the dialogue is serious.

Washington Post 16 June 2001


Mt. Kumgang has been a looking-glass from which South Koreans have been able to actually see the North ever since the historic tour program kicked off in 1998.


For three years, Hyundai's tourism venture has allowed masses of Southerners to catch a glimpse of their neighbor, albeit on a limited level.


Considered by many as the place where all changes surrounding the peninsula began, last week's event in Mt. Kumgang was further proof of the more open and flexible North Korea of 2001.


As the three-day grand forum on unification - to commemorate the first anniversary of the inter-Korean summit - wound up on Saturday, most of the 423 South Korean participants noted the willingness for change and the surprising flexibility Pyongyang's rulers showed at the event. They surmised that the event was a significant stride in inter-Korean civilian-level exchanges and cooperation. ../..While plans for such exchanges may have led to a certain blandness in the official discussions - the joint statement was criticized by some as lacking in content - the unofficial, unannounced part of the forum made up for such shortcomings. The open and more or less free contact between South and North Koreans has rarely been experienced before.


Many pairs, one South Korean and one North Korean, drifted from the main event to the shade offered by the nearby trees and struck up a private conversation, ignoring the speaker at the pulpit…/..On the last day of the forum, Confucian scholars donning traditional white clothes were helped up the mountain trail leading to the Nine Dragon Falls by North Koreans wearing badges of their late leader, Kim Il-sung. ../..

"I think this event will greatly help us in conducting future scholastic exchanges, now that we have acquainted ourselves with the North Koreans who are actually working in similar fields," remarked Prof. Suh Dong-man of Sangji University, regarding his meetings with North Korean academics. This is really extraordinary. In my two years as a guide here, I have never seen the North Koreans allowing so much freedom," remarked a tour guide from Hyundai…/..

Korean Information Service (ROK) 17 June 2001

N. Koreans Get Free-Market Lessons

Professors from Portland will teach the free market ways of international commerce to an unlikely group of students: would-be business leaders in North Korea.

"This is very significant," said Don Oberdorfer, a Korea expert at Johns Hopkins University's Nitze School of Advanced International Studies in Washington, D.C. "They literally have nobody – maybe a handful of people – who have any idea how the world market works."

Portland State University was informed last week by North Korea that it had received the go-ahead to start the courses in the fall. That permission closely followed President Bush's decision to restart talks on security matters with North Korea, but it is not clear that the two are related.

Six instructors will be selected from PSU's faculty and the local business community to teach parts of the program, probably at Kim Il Sung University, said Earl Molander, a business professor who will direct the program. The program, believed to be the first of its kind among any American university or college, will be launched with a two-week session in late August or early September, and followed by a more extensive, six- to eight-week program in late fall or winter.

The programs will focus on the practical aspects of international transactions, Molander said. Participants are expected to include people manufacturing items for export, people in export companies and academics responsible for teaching managers in those kinds of occupations, he said.

"We are not going into North Korea to try to teach them free-enterprise capitalism and private business management. Our focus is entirely external," Molander said Wednesday. "The international marketplace is what we're teaching."

Molander's Free Market Business Development Institute, which runs the programs, has offered similar training courses in 15 socialist or formerly socialist countries, including China, Poland, Russia and Vietnam. ../..

"The experiences of the past decade have shown it's difficult to go from ... a socialist economy to a market economy," he said. "Most countries have had a considerable amount of difficulty making that transition. On the other hand, the Chinese have for the past decade been the fastest growing economy in the world."

Source: Washington Post 14 June 2001

NGOs call for greater developmental aid to N.K.


Non-government organizations (NGO) running humanitarian missions in North Korea yesterday called for an increased effort to ease the food and health crisis there.


They also stressed the need for more long-term, development-oriented assistance to rehabilitate the North's industry, energy infrastructure and human resources.


"The humanitarian crisis is not over in North Korea, although improvements in the overall situation have been noted," said Oh Jae-shik, co-chairman of the organizing committee of the third International NGO Conference on Humanitarian Assistance to the North Korea.


Food shortages continue in North Korea after a poor harvest last year, and could grow worse with the recent drought, Oh said. ../..


Linton (Eugene Bell Foundation) said there are hopeful signs in the North Korean government's attitude towards NGOs operating in the North.

"North Koreans are learning about us and beginning to realize that they need to work in partnership with NGOs to attract assistance," he said.

The conference participants provided a strong support for South Korea's engagement policy.

"There is no viable, or sensible, alternative to the 'sunshine policy' that seeks to reach out to the North Korean people, separating humanitarian and business issues from political issues," said Giorgio Maragliano of the Humanitarian Aid Office of the European Union.


Source: Korea Herald 21 June 2001

NZ Delegation to DPRK

A small New Zealand delegation will be visiting the DPRK 3-9 July.  The members are:


Graham Kelly, MP, Chairman of the Select Committee on Foreign Affairs, Defence and Trade (Leader)


Rev Don Borrie, Chairman, NZ-DPRK Society (Deputy Leader)


Dr Tim Beal, Secretary, NZ-DPRK Society


Dr Stephen Epstein, Vice-President, Korean Studies Association of Australasia


Mr Verne Winitana, Chairman, Te Runanganui O Taranaki (Maori Education and Health Group)


Reports will be issued on its return. In the meantime further details may be obtained from Don Borrie or Tim Beal.



Further information may be obtained from:

Dr Tim Beal

19 Devon Street, Kelburn Wellington, NZ

Tel: +64 4 463 5080 (day);+64 4 934 5133 (evening)

Fax: +64 4 934 5134


Rev Don Borrie

7 Thornley St., Titahi Bay, Porirua, NZ

Tel/fax: +64 4 236 6422