Pyongyang seeks continued economic relations with Beijing

2014-01-17

Analysis by Martin Sieff

South Korea analysts say North Korean dictator Kim Jong-un plans to maintain cordial economic ties with China even after publicly executing China’s main ally and friend in Pyongyang for 30 years, his uncle Jang Sung-taek.

Jang was shown on national television being humiliated and hauled out of a ruling Politburo Dec. 12 meeting before beingexecuted.

South Korea’s National Intelligence Service says Kim is confident he has come up with a strategy that will ensure China continues its support of his country.

“North Korea is cozying up to China after executing former eminence grise [Jang], who had close ties with Beijing,” South Korea’s Chosun Ilbo newspaper reported. The newspaper often breaks stories from the South Korea’s intelligence community.

The newspaper said the Chinese media were continuing to report favorably on continued relations with North Korea. Chinese newspapers covered North Korean participation in an exhibition in China’s Hubei Province, Chosun Ilbo reported. “The exhibition features traditional crafts, liquor, stamps, paintings and other products from China, North Korea, Taiwan and Vietnam,” the newspaper said.

Asian newspapers also have reported that Kim recognized the importance of reassuring China about continued economic relations after the execution of his uncle. The Hong Kong weekly newspaper Yazhou Zhoukan reported that Pyongyang sought Beijing’s understanding after Jang’s execution and asked to discuss a visit by Kim. So far, the government of President Xi Jinping has held Kim at arm’s length.

Vice Marshal Choe Ryong-hae, who traveled to China in May, is the highest-ranking North Korean envoy to visit China in the two years Kim has held power.

The Yazhou Zhoukan report confirmed that the choice of Choe as “point” envoy to Beijing was meant to inform the Chinese that Choe would replace Jang as the key liaison between the countries. But the paper said Chinese leaders did not draw this conclusion from Choe’s visit at the time.

In the short term, Kim has succeeded in persuading China to continue business-as-usual relations. South Korean newspapers report that China continues to crack down on North Korean defectors attempting to escape their country across its northern border to Chinese Manchuria across the Yalu River, just as Pyongyang wants.

Kim takes control

Kim’s behavior following Jang’s execution indicated that the leader was determined to maintain his country’s crucial relationship with China, but also that he had feared Jang’s long control of Pyongyang’s bilateral ties gave him too much power, Ralph Winnie, chief of the China program at the Eurasian Business Coalition, told Asia Pacific Defense Forum [APDF].

“It is all about control,” Winnie said. “Jang had enjoyed full control of the relationship with China for decades. Kim Jong-il [Kim Jong-un’s father and predecessor, who died in December 2011] was comfortable with this arrangement, but Kim Jong-un was not. He was determined to rule on his own terms. Taking control of the China relationship into his own hands will send that message to the Chinese. It sends the same message to his own people.”

However, taking control of the relationship does not mean that Kim wants to terminate it or endanger it, Winnie said.

“Kim Jong-un certainly wants to retain the support of the Chinese leadership,” he told APDF. “But he also is determined to show them who really runs the show in North Korea. And he wants to increase his leverage with the Chinese.”

“Removing the people they have always relied upon to implement cooperation and keep track of internal developments in the North will certainly increase the uncertainty of the Chinese government in its dealings with Pyongyang,” Winnie said.

At China’s foreign ministry briefing on Dec. 13, authorities described the execution of Jang as purely internal affairs for Pyongyang. Foreign ministry spokesman Hong Lei reiterated the standard line that as a good neighbor, China only wants to have stability in North Korea and see its people living in happiness.

Hong also expressed the standard sentiment that bilateral economic relations remained mutually beneficial and that China looked forward to expanding them.

Economic projects with China could be in jeopardy

Relations with China could be endangered if Kim expands his purge to topple or execute hundreds of officials who played key roles in projects with China that Jang oversaw as part of his economic empire. The Chosun Ilbo reported this could happen.

“The sharply worded article in North Korea’s state media that accused him [Jang] of treason also said he personally profited from deals with outside countries in the Rajin-Sonbong special economic zone. It also accused him of being bribed by enemies,” the article said.

Daniel Pinkston, deputy director for Northeast Asia at the International Crisis Group, told the Chosun Ilbo there is a real danger that Jang’s execution could hurt the North Korean economy by disrupting many of the vital cooperation projects with China.

“The next person to come in to run these operations that Jang had been running, I think will be under orders to renegotiate the contracts and renegotiate the prices, but of course the Chinese businessmen on the other side will want to fulfill the contracts they’ve already signed, so this will damage the poor reputation that North Korea already has, and it will have a negative impact on their ability to conduct international business,” he told the newspaper.

“China has long provided an economic aid to North Korea as well as much of the country’s food aid. Exports from China to North Korea totaled $590 million last year,” the Chosun Ilbo said.

China is ‘embarrassed and disgusted’

Veteran Asian affairs analyst Pepe Escobar agreed with Winnie’s assessment that Kim might well try and use the purge of his uncle to extort more favorable treatment and terms of cooperation from China.

“Jang was close to Beijing – and he wanted a lot of Chinese investment,” Escobar wrote in Asia Times Online. “No one knows how this purge will affect business. Those subscribing to the view of North Korea as a Mob operation will see the purge as a tactic to raise the price for North Korean ‘cooperation’ with the Chinese.”

“That’s not so far-fetched. Pyongyang does depend on China, but it will never allow itself to become a mere puppet,” he said.