Chinese Capitalism Floods North Korea

A op-ed of mine which I wrote last week on the subject of Chinese influence and the prospects for reform in North Korea was published yesterday in the Duluth News-Tribune.   The piece is linked here [Update: Full text below.]

Chinese Capitalism Floods North Korea

Pyongyang’s broad boulevards are gradually being emptied, as Workers’ Party officials filter home to the provinces.  The Party Congress – touted as the probable coming-out event for Kim Jong Il’s son-successor, indicative of possible change on the peninsula – has reportedly been postponed due to “natural disasters” such as recent floods.

Last month I witnessed frantic efforts in the northern border city of Sinuiju to stitch together defenses against the rising Yalu River.  The city was flooded anyway, and tons of crops were destroyed in one of North Korea’s few breadbasket provinces.  North Korea can still talk credibly about its nuclear deterrent, but the state’s inability to handle basic domestic matters like levy construction and grain distribution is now taken for granted.  The state is not only sclerotic, it is also tone deaf: even as Sinuiju was drowning in the Yalu’s waters, Pyongyang’s news boasted of new swimming pools in the capital and showed Kim Jong Il showering his attention upon an opera troupe.  Propaganda promised “opening the gates to a prosperous nation” in 2012, but the gates have opened instead upon a storm of rumors about Kim Jong Il’s declining health, possible bickering over the successor, and near-certain internal disputes about the degree to which the Stalinist economy can survive the shock of opening up.

The relationship between possible change and the dynastic Kim regime remains curious.  Virtually the entirety of Kim Jong Il’s adult life has been devoted not to economic matters, but instead to the expansion of a cult of personality in which loyalty to the Kim dynasty – not the Workers’ Party or the nation – is held up as the ultimate virtue.  Kim’s recent trip to northeast China and his snub of Jimmy Carter highlighted this North Korean quirk.  Even as Kim Jong Il continues to laud the ancient revolutionary exploits of his father (the regime’s founder Kim Il Song), he manages to reveal the primary flaw held by his son, the 27-year-old would-be successor, Kim Jong Un: a manifest lack of experience.  Like a newly reincarnated Dalai Lama, Kim Jong Un is a blank slate, and seems set to be directed by old hands.  In this case, the eminence grise appears to be his uncle Jang Song Taek, a ruthless bureaucrat who even the normally reserved Chinese media describe as the younger Kim’s “supervisor.”

While domestic acceptance of a possible Kim Jong Un regency appears unclear, much more open is North Korea’s growing embrace of Chinese tutelage and investment.  The Chinese Communist Party has been steadfast in its support of North Korean economic liberalization, not merely to avoid a North Korean collapse, but because China can make money in the process.  Leaders in Beijing are continually dispatching trade and tourism delegations to the North, dumping tons of industrial waste in North Korea, and helping Chinese firms to snaffle up lucrative contracts in the mining industry.  Having surveyed nearly the entirety of the 800+ mile length of the North Korean border with China over the past several years, I can state with confidence that no amount of American prodding is going to move China into the US camp in opposition to North Korea, or bring China to support vigorous sanctions against its neighbor.  The Chinese model is gradually winning in North Korea, and a class of North Korean entrepreneurs has developed along the border.  Moreover, China’s own local needs mean that developing the border region takes priority over punitive steps which might slow North Korea’s nuclear development.

The lives of the North Korean people remain difficult beyond imagining, but China’s path seems to lay out the most realistic, non-violent, and least costly path that will allow the population to increasingly take its own fate into its hands.  Whether or not the model that emerges is Chinese or the leadership remains that of the Kim family, it seems clear that North Korean Party delegates have a great deal of work to do in satisfying the basic needs of a hungry population starved also for change.

Destruction of the Old Customs House in Changbai, Jilin Province, PRC, across the Yalu from Hyesan, DPRK, Whose "Monument to the Pochonbo Battle" Can Be Seen In the Background -- photo by Adam Cathcart


  1. “Floods” sounds a little bit too strong. But hopefully this will lead to some degree of change in North Korea. Otherwise I think it would be good to be prepared for any outcome of the next development in North Korea, when watching from South Korea.

  2. I came too late to read the article without paying $2.95. 😦

    Have you seen Aidan Foster-Carter’s “How North Korea was lost – to China”? He speculates that “Beijing is making an offer no one else can match, and which North Korea can’t refuse” – security guarantees and massive investment in industry and infrastructure, in return for North Korea adopting a market economy and ending nuclear tests and other provocations like the Cheonan sinking.

    1. Gag, thanks for the visit and the comment. I enjoy’ed Foster-Carter’s article greatly, appreciating particularly its historical sweep. What is best about it is how it arrives at China’s primacy in North Korean external affairs by a process of default: why isn’t Japan in a stronger position of leverage at this moment? Because years of opposition to the DPRK by the LDP wasn’t even fixed by Koizumi’s 2002 visit. I like this point of view because it emphasizes that China is, in a sense, stepping into a vacuum when it comes to influence in the DPRK, and that in spite of Beijing’s flexibility/constancy in dealing with the North, that its current near-unilateral influence was not necessarily a fait accompli…

  3. You provide assertion in the form of “capitalism floods” back it with anecdotes in the form of “believe me I have seen traders”, but you provide not a shred of evidence or even a theoretical frame from which your assertions and anecdotes make sense.

    1. Thanks for the critique, Hyde Park, the data is rather easy to find, but which particular theoretical frame would you recommend?

  4. The data on what?
    By the theoretical frame I mean the basis of determining if a system is capitalist or not.
    For this there are different benchmarks here is one of the most influential. a. Dominant mode of production, or property form b. nature of state power and its relationship to private ownership of the means of production, c. nature of coordination mechanisms. (Kornai 1992) If one uses Marxian theory it places greater emphasis on state power and ownership and control of the ‘commanding heights’.
    The idea that North Korea meets the capitalist criteria using Kornai’s benchmarks is to be frank, absurd. To argue it meets such criteria using Marxian theory requires some sort of Marxism that equates Kim Il Sung or Mao Zedong in the 60s, or Stalin’s Russia in 1932 with ‘pure Marxism’ which would be is a dogmatic caricature of that theoretical tradition as a social scientific method.
    In fact China itself fits no simple capitalist model. As the majority of the economy is owned by the state (Huang Yasheng 2008) and (Szamosszegi & Kyle 2011) and the old levers of bureaucratic power still retain dominance in politics, the state and economic coordination. But at least here there is a significant capitalist sector of the economy to base an argument on, but to argue this for North Korea is completely without basis.

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