NORTHEAST ASIA PEACE AND SECURITY NETWORK
***** SPECIAL REPORT *****

The following "DPRK Report" is the product of a joint project between the Center for Nonproliferation Studies (CNS) of the Monterey Institute of International Studies (Monterey, California, USA) and the Institute for Contemporary International Problems (ICIP) (Moscow, Russia). It is written by Russian analysts associated with the ICIP and edited by the CNS.
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1.  North Korea's Internal Situation

According to North Korean officials and journalists, Pyongyang's recent diplomatic achievements have greatly improved Kim Jong Il's image. After six years of unimpressive and uneventful rule accompanied by continuous economic decline, Kim Jong Il now comes across as a strong, effective, wise, and skillful leader who has managed to make major countries bow to the DPRK.  As North Korean representatives point out, "the beloved leader does not ever have to travel anywhere.  Instead, Americans, Chinese, Russians, Japanese and others rush to Pyongyang to meet the beloved leader and to accommodate the DPRK". North Koreans, as can be judged from conversations with officials and journalists, are not only impressed with Kim Jong Il, but are also now much more optimistic about prospects for their country. The fear of another Korean war has certainly diminished.  Moreover, North Koreans now expect more foreign aid, a better food supply, and improved living
conditions in general. In response to rising expectations of citizens, "various administrative and economic measures are being taken to boost agricultural and industrial production."  The increasingly relaxed mood is becoming so widespread that North Korean representatives claim the "central authorities have had to take countermeasures to prevent negative repercussions of ideological impurity."  These countermeasures include "articles in the official press and internal documents explaining that the DPRK must be on guard against tricky imperialist aid and that the country will continue its policy of self-reliance."

2.  DPRK-US Contacts

North Korean diplomats confirm that their country's current foreign policy priority is "to patch things up" with the United States. A high ranking diplomat stated in a private conversation that "President Clinton is quite anxious to leave behind him a legacy of achievements in Korea, so we want to use the opportunity, especially since nobody can predict how American policies will evolve under the next president." North Korean diplomats say the most important goal is to secure normalization of political relations between the DPRK and the United States. To achieve this goal, Pyongyang is reportedly prepared to abandon its program to develop an intercontinental ballistic missile, as well as to stop missile exports to the Middle East. North Koreans warn that the current policy does not signify that the DPRK has changed its basic negative view of the United States. The leadership in Pyongyang continues to believe that the ultimate American plan is to destroy socialism in Korea. However, Pyongyang views the current diplomatic game with Washington as important since it may permit the
institutionalization of U.S.-DPRK bilateral relations, secure DPRK recognition by American allies, and yield greater access to foreign capital and technology. One DPRK official noted that "some of the benefits of the rapprochement with the U.S. are already materializing," adding that "by the time Mr. Clinton leaves office next January the DPRK will have reaped a bigger harvest." According to this official, "even if the next U.S. president decides to reverse the trend, it will be too late, and in any case North Korea will be in better shape by that time."

3.  DPRK-Japan Relations

DPRK officials complain that it is much easier to negotiate with Washington than with Tokyo. One official said that "while Americans want to achieve progress in bilateral relations and are ready to make certain concessions to do so, the Japanese don't really care about improvements in interstate ties and refuse to give in, even when they should." However, North Korean representatives are not pessimistic about the outcome of negotiations with the Japanese. They insist that Pyongyang is not in a hurry and "will not soften its stand in demanding that Japan apologize for the past by providing economic aid and reparations for the colonial period." One North Korean official said, "We know that the approaching normalization of relations between the DPRK and the U.S. will make it inevitable for Tokyo to accommodate our just demands". In the meantime, Pyongyang will continue negotiations with Japan but will be in no rush to conclude any agreements.

4.  DPRK-Russia Relations

In the wake of President Putin's visit to Pyongyang, North Korea is becoming increasingly active in economic contacts with Russia. DPRK authorities have requested Russian assistance in the reconstruction of a number of facilities built by the Soviet Union in the 1950s and 1960s. The problem is that the DPRK does not have money to pay for the services and insists on barter deals and low-interest credits instead. However, the Russian government cannot agree to such conditions. Barter is impossible since Russia now has a market economy and government authorities cannot force Russian companies to accept goods they don't need or want. The DPRK has presented a list of goods it could export to Russia in exchange for Russian goods and services. But Russian
officials say that most of the items on the North Korean list are of no interest to Russian companies.  One possible way out of the predicament is to have South Korean banks and firms provide credits to the DPRK to
exchange for Russian technical assistance. Attempts are currently being made to find interested parties in the ROK. Meanwhile, Pyongyang has asked Russian authorities to allocate logging areas for the DPRK in the Russian Far East. Russia needs help with its timber industry and North Korean wages are very low. However, North Korean workers have created problems by asking for political asylum and by becoming involved in
illegal activities such as smuggling. On the whole, DPRK-Russian economic ties do not look very promising. Russians complain that the DPRK still wants to build economic relations "along the lines of the old Soviet-DPRK model-getting things free-of-charge." On the other hand, North Koreans say they have economic partners that are much better than Russia-with money, quality products and the willingness to
make concessions."

5.  Chinese Anxiety over US-DPRK Contacts

Chinese officials in Russia have demonstrated displeasure with the way Pyongyang has been handling its current rapprochement with Washington. As the Chinese point out, it was Beijing that put consistent pressure on Kim Jong Il to open up the DPRK and reach accommodation with the ROK and the U.S. However, Beijing is dissatisfied with the way things are developing. The Chinese suspect that the United States is accelerating
contacts with the DPRK with the aim of minimizing China's political and military influence over North Korea. Some Chinese officials argue that is why Clinton's moves towards Pyongyang have been welcomed and supported by the American establishment. They claim that "Washington rushed to capitalize on the softening of Kim Jong Il's position to score additional points in its struggle against Beijing." The Chinese are especially unnerved by the fact that the DPRK appears to be enjoying its interactions with the United States.  For example, Kim Jong Il gave an incredibly warm welcome to Secretary of State Madeleine Albright "right on the eve of the 50th anniversary of China's entry into the Korean War."  Moreover, Pyongyang has yet to consult with Beijing on how to handle the dialogue with the Americans. Chinese officials say that China remains supportive of U.S.-DPRK détente, but emphasize that Beijing is determined "to be on top of events in Korea."

6.  Inter-Korean relations

North Koreans visiting or residing in Moscow hint that the DPRK leadership might be deliberately slowing down contacts with the ROK, especially in the political and military spheres.  They explain that Pyongyang is now concentrating on a breakthrough in its dialogue with the United States. According to this view, a breakthrough in U.S.-DPRK relations would put Pyongyang in a much stronger position to negotiate
important issues with Seoul.