Todd Crowell over at Asia Cable suggests that far from veering toward collapse, North Korea may actually be on the road to recovery. Read it on your own, but just to give you an idea of what to expect:
The figures seem to bear out a modest revival of the North Korean economy, which was knocked for a loop a decade ago when Pyongyang’s main patron, the Soviet Union, collapsed and took with it the subsidies that had underwritten the economy. But last year China’s investments jumped from about a million dollars in 2003 to $200 million.
This development has implications for American policy makers, who, for the past decade, have quietly hoped that if they out-waited Kim Jong Il, his regime would collapse and the issue of his nuclear weapons would disappear with it. Yet, far from being on the verge of collapse, North Korea seems stronger than it has been in years.
A friend of mine, quoting someone who would know, once said that despite the gloom and doom reported in the press, the economic situation in the North was actually getting better. Personally, I’ll believe it when I see it, and I wonder how much of North Korea’s reported economic recovery is due to improved rent-seeking (see RAND report) rather than economic reforms. But read the piece on your own and draw your own conclusions.
(Hat tip to Simon World)
13 Comments
The thing is, the DPRK is doign well enough to have their economy increase by some 6% but that they still NEED food and energy aid.
6% sounds high, but 6% of zero is still zero.
NK had a 6% growth of what? What exactly is being produced by starving farmers and a capitol city that has an empty pyramid? Has the heroin trade been *that* lucrative lately? Maybe they’re making meth.
“last year China?€™s investments jumped from about a million dollars in 2003 to $200 million.”
Now I get it - China’s propping them up. Not a bad idea….give the starving masses enough Cheetos and Cable-tv and they won’t care about anything else. It works in the USA.
American foreign policy can be short-sighted, but the idea that “if [America] out-waited Kim Jong Il, his regime would collapse and the issue of his nuclear weapons would disappear with it” is silly. We might have been thinking that way right around the time of the Soviet Union’s collapse, but the following years drove home the point that nukes don’t disappear with governments.
More: I doubt that, even when the USSR was collapsing, we seriously believed the nuke problem would disappear. As I recall, there was plenty of speculation going on at the time about porous borders and unguarded/poorly guarded weapons facilities. Journalistic speculation doubtless reflected governmental and think-tank speculation.
Kevin
Kevin wrote:the following years drove home the point that nukes don?€™t disappear with governmentsHaven’t we been fairly successful at disarming the former Soviet republicans other than Russia where nukes were located? (asking, not saying)
Kushibo,
Yes we have. As far as I know, they all dropped nukes except Russia. But let’s face, South Koreans would insist on keeping the North’s nukes if China didn’t get them first.
If the US didn’t make convincing promises to maintain the US-ROK alliance in a post-unification era, yes, I think they would want to keep them.
A must read from Aiden-Foster-Carter
http://www.koreaherald.co.kr/S.....080012.asp
last december south korea delivered 400,000 TONS of rice to north korea. it was bought in thailand for $300/ton. that’s $120,000,000 of food aid in one shipment. one boat.
I’m beginning to think this “gravatar” idea is a bad thing. Am having trouble taking my and other people’s comments seriously. We’ve got a fat chortling idiot (me) talking to a precocious child (Kushibo) talking to KJI as seen in “Team America” (Wedge) talking to what appears to be Noh Mu Hyon wearing a rainbow-gay version of Don king’s hairdo (judge judy– and I think that’s my favorite gravatar).
Kimbob seems content with the default gravatar. Can’t say I blame him. Maybe he’s the only serious commenter in the bunch. Heh.
re: judge judy’s “one boat” comment
That does seem to put China’s $200 million contribution in perspective. In the larger picture, it’s still not all that much, despite the quantum leap from 2003 to now. I can’t imagine China’s all that happy about upping its contributions so radically. Possible hospital analogy: it’s a bit like moving from a single IV drip to 200 simultaneous IV drips in a short period of time.
Kevin
I’m waiting for the experts to explain to me how the often much touted reforms of the North Korean economy, or these increases in material and financial aid coming in, are making North Korea a sustainable state.
The lesson from the end of the Soivet and China sponsorship should have been that, despite the fact North Korea claimed and many in South Korea and even in the United States believed, North Korea was a more developed nation than South Korea (even politically speaking — this thought had some sway up to the 1980s) it was a basketcase whose development was totally predicated on a life line to Moscow and Beijing.
In the late 1990s, some people seemed giddy with “economic reform” in North Korea — but all of it was predicated on one thing — that these reforms were a sign of “a willingness to change” on the part of Pyongyang. And as I’ve pointed out ad nauseum, to me, the fact that NGOs often pack up and leave North Korea, because the Kim Jong Il regime is so paranoid of the world it won’t let them distribute food and other aid to the people who are dieing without it, means North Korea is willing to suffer over the long term until it gets a new sponsor, and with the nukes, it is eyeing the United States for this (now that Japan has gone off the table over the kidnapping thing), and are willing to settle for Seoul and Beijing.
So, North Korea isn’t going to collapse. Who knows — how many people were saying the Soviet Union was on the verge of collapse, with all its vast material resources, back in the 1980s?
But, I don’t want to see the United States financing the North Korean regime.
Ummm, now the rest of the comment… So, that leaves the $200-$300 million in Chinese investments, along with industry partnerships and whatnot. The Kaesong work camp, uh, industrial complex is giving the regime a lot of money I’m sure, but I haven’t seen figures on how much. International aid usually doesn’t get factored in, because it’s considered noneconomic, but that’s in the tens of millions, and how much goes directly to the regime? Then of course there’s the myriad “revenue streams” from counterfeiting, selling missile tech, drug running, etc. Shouldn’t that be considered in N.K.’s economic growth? It would be interesting to see what is really shoring up an economy that seems to be running on fumes.
big hominid, glad you like the avatar. remember when gay used to mean happy?
evidently, there are trucks in the northern part of the country that run on wood. there’s a furnace in the middle and they have to keep stoking it. supposedly runs for four hours.
” It would be interesting to see what is really shoring up an economy that seems to be running on fumes.”
The blood and bones of thousands of North Koreans.
The worst part of the 1990s famine? —-
Kim Jong Il and crew learned how much North Korea can suffer and still maintain their style control of the nation.
Everything else is gravy to them now….