North Korea's Political, Economic Gamble
Analysts Say Risks Include Loss of Key Regional Aid

By Anthony Faiola and Maureen Fan
Washington Post Foreign Service
Tuesday, October 10, 2006

TOKYO, Oct. 9 -- North Korea may have gained bragging rights on Monday as the world's newest nuclear power, but the pivotal question now is whether the secretive communist government can survive the political fallout.

While the United States and Japan have long pushed for a hard line against North Korea, there were early indications Monday that South Korea and China, the North's chief benefactors, may be reconsidering their support for the government of Kim Jong Il. There were also concerns that Pyongyang's claims of a nuclear test could touch off an arms race in Northeast Asia.

Analysts said any major development would threaten stability in the strategically vital region, in which the United States has long maneuvered diplomatically among friend and foe.

China and South Korea have poured billions of dollars in aid and investment into the North, effectively propping up Kim's government under the assumption that any collapse there would send millions of desperate refugees pouring across the country's borders. The risk of such an economic calamity, they have gambled, has outweighed the risk of a nuclear-armed North Korea.

But the announcement of a test, analysts said, may have represented a tipping point. In a telephone call with U.S. Secretary of State Condoleezza Rice, China's foreign minister condemned North Korea for having "ignored universal opposition of the international community," the Chinese Foreign Ministry said in a statement. The minister, Li Zhaoxing, also stressed that the Chinese government was "resolutely opposed" to the nuclear test.

South Korea, meanwhile, immediately halted delivery of an emergency assistance package to help the North deal with recent floods. President Roh Moo Hyun suggested that his country's "sunshine policy" of engagement -- of which he was a vocal supporter -- had failed.

"The South Korean government at this point cannot continue to say that this engagement policy is effective," Roh said in a nationally televised speech. "Ultimately, it is not something we should give up on, but objectively speaking, the situation has changed. Being patient and accepting whatever North Korea does is no longer acceptable."

Any shift in policy by China or South Korea would be at least partly based on the anticipated reaction of Japan, the nation that today feels most threatened by North Korea's ballistic missiles. Analysts have assumed that a nuclear-armed North Korea would lead Tokyo to accelerate plans to redraft its pacifist constitution and rearm itself with a more aggressive military.

Last week, a U.S. congressional report went as far as to suggest that a test by the North could set in motion a domino effect in which Japan, South Korea and perhaps Taiwan pursue their own nuclear weapons, touching off an arms race that would dramatically escalate the consequences of any regional disputes.

Although some observers were quick to caution that China's criticism of North Korea might not necessarily translate into action, there was little question that the reported test had deeply embarrassed China. The Chinese government has taken the lead in the diplomatic effort to denuclearize North Korea at long-stalled six-party talks in Beijing, bringing the United States, Japan, Russia, and South Korea and North Korea to the table.

"It's a big slap to China," Zhu Feng, a professor of international studies at Peking University, said of the North's test. "It's time for a new approach, because we just got humiliated. For four years, we have been so good to North Korea, trying to make the right conditions for Kim Jong Il to abandon nuclear weapons in exchange for normalization with the U.S. and Japan and a lot of economic aid. China's goodwill has been relentlessly wasted."

Analysts said China will now be faced with heightened international pressure to accept tougher economic sanctions and reduce or even cut its aid -- including oil shipments -- to coerce Pyongyang back to the negotiating table. China's options are limited now, and although analysts say it will probably harden its stance against North Korea, it has in the past drawn the line at any action that would endanger Kim's government.

In effect, Beijing will have to make a difficult decision.

"If China votes for sanctions at the U.N., the China and North Korea relationship will break up," said Shi Yinhong, a professor of international relations at People's University in Beijing. "And if the United Nations really passes financial sanctions toward North Korea, the risk of a society collapse of North Korea is high."

For its part, Japan is likely to take an even harder line than before. The country's new prime minister, Shinzo Abe, on Monday vowed a tough response, saying he would "immediately consider taking stern measures."

Those are likely to include a ban on millions of dollars' worth of annual remittances sent home by North Korean nationals living in Japan.

But even coupled with sharper sanctions from the United States, analysts say, the pressure brought to bear on North Korea is unlikely to be enough without the full support of Beijing and Seoul.

Analysts say Kim has already succeeded in at least one way. With its declaration of a nuclear test, North Korea has made the price of a military solution to the standoff -- something Bush administration officials had largely dismissed given North Korea's arsenal of ballistic missiles and its million-man army -- even higher. Some suggested Monday that it may already be too late to turn back the clock.

"North Korea's message is that no matter how hard South Korea, Japan, the United States gang up on them, they won't budge," said Seung Joo Baek of the Seoul-based Korea Institute for Defense Analyses. "They want to be recognized as a nuclear power. They are assuming that it is the only thing that will keep them safe. We will have to wait and see if they are right."

Fan reported from Beijing. Special correspondent Joohee Cho in Seoul contributed to this report.

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