Connect with us

East Asia

Semiconductor War between Japan and South Korea

Published

on

Authors: Gleb Toropchin and Anastasia Tolstukhina

In the summer of 2019, a trade conflict broke out between Tokyo and Seoul and the matter is about more than the history between the two countries. The two developed economies have long been locked in a competition on the global cutting-edge technologies market. At the same time, they are links in the same technological chain.

At first glance, the exchange of trade restrictions that is taking place against the background of mutual accusations is nobody’s business but Tokyo and Seoul’s. Nonetheless, the consequences of the confrontation between the two countries have a global nature. The present article analyses the causes of the disagreements and looks at how the situation may develop

Introducing Restrictions and Removal from the “White List”

Despite the events of the colonial past [1], as well as the current territorial disputes that are so typical of Asia’s international politics [2], South Korea is one of Japan’s three largest trade partners. Japan exports into South Korea up to $54 billion in goodsThe key commodities include semiconductors and materials for their manufacture

The dependence of South Korean companies on imports of fluorinated polyimides and photoresists exceeds 90 percent, and their dependence on imports of hydrogen fluoride is around 44 percent (although this figure has fallen gradually from 72 percent in 2010)

However, on July 1, 2019, the Government of Japan announced restrictions on the export of commodities to South Korea that are of critical importance for microelectronics, and on July 4, the changes to the procedure came into force

Given the long-established delivery mechanism, such a political step was a surprise for many. The restrictions mainly affected three key materials for the microelectronics industry: fluorinated polyimides, hydrogen fluoride, and photoresists (these materials are used in the manufacturing of semiconductors and display panels). This measure does not mean that deliveries of these materials to South Korea have been completely stopped; however, from now on, it may take up to 90 days to approve transactions. Additionally, Japan said it would be taking South Korea off its “white list” of trade partners. The list includes states that are believed to be safe from the point of view of exporting strategic commodities and that are granted trade preferences

Let us try to understand why the Government of Japan took such steps

Pressure from Taiwanese and South Korean competitors

In 1986, an agreement was signed between Tokyo and Washington that prohibited Japan from undercutting global semiconductor prices. This step was initially intended to make the United States more competitive. However, even in those circumstances, Japan managed to take a significant chunk of the global semiconductor market from the United States in the late 20th century and retain its high positions until the 2010s. However, as early as 2012, experts noted that pressure from Taiwanese and South Korean competitors resulted in semiconductor sales of Japan’s four chip-makers, Toshiba, Renesas, Sony and Fujitsu taking a marked dip

Samsung Electronics succeeded in mastering the subtleties of developing technologies just at the right time, while Japan began to lag behind in R&D due to problems with formal education, and its revenues from global sales of microelectronics were falling against the backdrop of falling prices and the high exchange rate of the Japanese yen. Among other causes of this phenomenon, Japanese experts cite the desire to create hi-tech goods without account for high costs, and lack of innovative ideas

Today, South Korea is the leading manufacturer of memory microchips. Samsung Electronics and SK Hynix hold two-thirds of the global market. Additionally, both the United States’ Apple and China’s Huawei depend on the products produced by South Korean companies. Integrated circuit units account for 17 percent of South Korea’s exports (the entire microelectronics sector accounts for nearly a quarter of its exports), compared to less than 4 percent for Japan

An analysis of the global microelectronics market demonstrates that, currently, the market particularly values dynamic random-access memory semiconductors (DRAMS) that hold tremendous significance for such cutting-edge technologies as artificial intelligence, the Internet of Things and robotics. South Korea holds impressive positions in this area as well: Samsung and SK Hynix control 72.8 percent of the DRAMS market and 46.8 percent of the global flash memory market

Reasons for Introducing Restrictive Measures

The East Asia Forum reports that Japan’s strategy of opposing Seoul was developed jointly by the country’s Ministry of Economy, Trade and Industry, Ministry of Foreign Affairs and Ministry of Agriculture, Forestry and Fisheries. The Cabinet of Ministers subsequently supported these measures, thereby making the key decision to transfer the issue into the political realm

It appears that Japan’s decision to impose restrictive measures was prompted by the fact that the country has clearly fallen behind technologically on the global microelectronic market, which negatively affects both the country’s economic indicators and its national security

According to the expert June Park, the Government of Japan decided to institute the restrictive measures out of concern for national security, since, in exporting rare materials to South Korea, Tokyo cannot be certain they will be used properly

The Japan Times notes that Tokyo justifies the introduction of increasingly strict export requirements by claiming that confidence in South Korea has been undermined. In particular, some media outlets report that between 2015 and March 2019, no fewer than 156 materials, including hydrogen fluoride, were smuggled out of South Korea. There were also reports of hydrogen fluoride being exported to countries that are under international sanctions (Iran, Syria and even North Korea). Another reason for the restrictions is Tokyo’s concerns that South Korea violates intellectual property rights

South Korea denies all accusations. Its arguments are logical: Iran and Syria are friends of North Korea, therefore, Seoul has no reasons to help their regimes. President of South Korea Moon Jae-in called for the differences to be resolved by diplomatic means. However, the talks held on July 12, 2019, in Tokyo did not yield any results. Consequently, Moon Jae-in instructed the relevant agencies to develop reciprocal measures. At about the same time, there were reports of South Korea possibly filing a grievance with the World Trade Organization. As a result, hearings on the issue were launched in Geneva on July 24, 2019

In late July 2019, news broke that Tokyo was considering further restrictions since Japan believes the re-selling of strategic materials by Seoul to be a violation of the non-proliferation regimes regarding both weapons of mass destruction and conventional weapons. In this case, the restrictions would extend to other types of commodities and materials. On August 2, the Cabinet of Japan approved the decision to take South Korea off its “white list” (where the Republic of Korea was the only Asian state), thereby depriving it of trade preferences in regard to the materials mentioned above. The full list exceeds 1100 items

Despite these events, several deliveries of these materials from Japan to South Korea were made in August. However, they did not result in a thaw in bilateral relations. Seoul reciprocated by putting Japan on a restrictive trade list and terminating the military intelligence-sharing pact with Tokyo

“Wu Wei” American Style

China holds leading positions in deposits of rare-earth metals. Moreover, approximately 90 percent of the world’s rare-earth magnets are manufactured in China. Japanese companies use China’s raw materials to manufacture fluorinated polyimides, hydrogen fluoride and photoresists that are subsequently supplied to South Korea, Taiwan and other countries to be used in manufacturing chips, displays, etc. The circle is complete when these commodities go back to China to be used in the manufacture of finished products (such as smartphones and tablets), creating a sort of a closed-loop. Thus, the manufacture of competitive hi-tech products today is impossible within a single economy, and Chinese companies depend on parts coming from other Asian countries

Tracing the entire technological chain, we can assume that the Japan–South Korea conflict is closely linked to the trade war between China and the United States. South Korea’s Samsung Electronics is hindered by the restrictions on deliveries of Huawei memory chips since the latter is under U.S. sanctions. In turn, interrupting the chain of semiconductors delivery from South Korea will slow down the development of artificial intelligence in China. And who benefits from this? This is a rhetorical question

It would seem that the United States should be interested in cordial relations between their allies in the region, allies that form a sort of counterbalance to China and are ideological antagonists to North Korea. The White House, however, intentionally or unintentionally, demonstrates adherence to the Taoist principle of inaction, or “wu wei” (无为 in simplified Chinese), which entails a conscious refusal to act and the assumption of a contemplative stance. From the outset of the confrontation in July 2019, the United States announced it would not interfere in the conflict. Despite individual experts calling upon the United States to act as an intermediary between the two Asian states, Washington did not change its position

We should also note here that the Japanese company Toshiba announced the construction of a facility for the production of NAND-type (from the English NOT-AND, that is, a binary logical element) flash memory devices in Iwate Prefecture in cooperation with U.S. chip manufacturer Western Digital. We can cautiously assume that the United States and Japan are progressing toward a “technological union” in order to defeat China in the race for domination of the semiconductor industry

Public Opinion

Speaking of the impact that the conflict has on public opinion in both countries, we can quote a survey conducted by Japan’s Asahi Shimbun in mid-September 2019. Overall, slightly less than one third (29 per cent) of respondents admitted that they had a negative opinion of South Korea. This was far more pronounced among older people, which can be linked to their conservative views and the “proximity aberration” phenomenon (put simply, the older generations remember the events of the 20th century well)

As for South Korea, an anti-Japanese “grassroots” campaign has been launched in addition to the “top-down” process. In the second half of the summer of 2019, slogans『 가지않습니다 사지않습니다 』 (Korean for “Do not visit, do not buy”) calling for boycotting trips to Japan and Japanese goods spread on Korean social networks. And it looks like they were successful to a degree. For instance, the Yonhap News Agency reports that the number of South Koreans travelling to Japan in August fell by 60 per cent compared to the same period last year

In the run-up to the 2020 Summer Olympics in Tokyo, the trade conflict has become a reason for manipulating public opinion in South Korea. Additionally, we cannot rule out the possibility that populists use the disagreements between Japan and South Korea to advance their domestic agenda on the eve of the elections to South Korea’s unicameral parliament scheduled for April 15, 2020

Forecast: Cloudy in the East

Losses from the Japan–South Korea trade war may exceed $80 billion. There has already been a drop in sales of South Korean semiconductors manufactured by Samsung Electronics and SK Hynix. Moreover, the conflict threatens to disrupt the entire global technological production chain in microelectronics. The expert Robert Farley described this conflict (and the U.S.–China trade war) as “weaponizing interdependence.” One of the analysts with The Economist Intelligence Unit called this situation “mutually assured destruction.”

The Yonhap News reports that the consequences of the trade conflict have had greater negative effect on the Japanese economy than on the South Korean economy. For instance, in July–August, South Korean exports to Japan have fallen by 3.5 per cent, while Japanese exports to South Korea have dropped 8.1 per cent

The South Korean economy has also suffered against the backdrop of these events. Here, Seoul has only two ways out of this predicament:

-Transitioning to domestic analogues, which LG Display and Samsung Electronics already did in September of this year. Additionally, the country earmarked 2.1 trillion South Korean won in the 2020 budget to overcome the dependence on the export of rare materials from Japan

-Searching for alternative sources of hydrogen fluoride and other rare materials for microelectronics. Media outlets have reported that Russia might be a potential supplier of high-purity hydrogen fluoride. The head of the Korea International Trade Association said that Moscow had offered to supply hydrogen fluoride to Seoul. However, it is not easy for South Korean companies to transition to Russian imports of this and other materials for microelectronics. The physical and chemical properties of the products must be tested for a rather lengthy period of time (upwards of six months)

Apparently, the status quo on the microelectronic market will continue in the short-term, and both parties will seek ways to minimize losses. And we can already see evidence of this. In September and October, the Government of Japan approved deliveries of hydrogen fluoride to Samsung Electronics and SK Hynix

At the same time, if Tokyo and Seoul fail to find common ground in the medium and long term, then the current global technological chain in microelectronics may be dismantled, which will, of course, negatively affect the growth rate of the global economy. However, so as not to end our study on a pessimistic note, let us note that, under the current circumstances, many hi-tech companies around the world, including those in Russia, now have the chance to become new links in the value chain and occupy its niche in microelectronics

From our partner RIAC

[1] In 1910, the Empire of Japan annexed the entire Korean peninsula. Korea essentially became a Japanese colony. The Japanese language and culture were forced onto the Korean people. Up to 200,000 ethnic Koreans served in the Imperial Japanese Army during World War II (including future president of South Korea and “father of the economic miracle” Park Chung-hee). Today, Japanese war crimes are a subject of talks between South Korea and Japan. In 2015, Minister of Foreign Affairs of Japan Fumio Kishida promised 1 billion yen to the victims of violence in compensation, and Prime Minister Shinzo Abe offered a public apology for Japan’s actions during the war.

[2] The dispute concerns the Liancourt Rocks, a group of small islets that the Koreans call Dokdo (“Solitary Islands”) and the Japanese call Takeshima (“Bamboo Islands”). Back in the early 20th century, Japan claimed sovereignty over these islands; however, following its defeat in World War II, it was forced to abandon its colonial acquisitions. On the other hand, the 1951 Treaty of San Francisco does not mention this territory, which gives Japan formal grounds to dispute the sovereignty of the islands where South Korea maintains military and civil infrastructure.

Ph.D. in History, Associate Professor, Faculty of Humanities, Novosibirsk State Technical University; Associate Professor, Novosibirsk State University of Economics and Management; RIAC expert

Continue Reading
Comments

East Asia

Why does the Dragon do what it does

Moaaz Awan

Published

on

The recent stand-off between China and India has been the headlines around the world, especially since the stand-off went ugly with 20 Indian soldiers and an unknown number (probably less than 20) Chinese soldiers losing their lives in a vicious hand to hand combat. Since then, nationalistic sentiments in India are running high with immense public pressure to account for the Chinese for what happened in Galwan Valley. In order to understand the motives behind the recent clashes, one has to go back to 1962 or even before that.

This is not the first time that tensions along the LAC (Line of Actual Control) have flared up and definitely this is not the end of such events. Strategically, what was true in 1962, is true today. The real bone of contention is still Aksai Chin. Aksai Chin is the Dragon’s hanging sword on Delhi, which can be unleashed anytime keeping India continuously in a state of passive defensive. As long as China adheres to its strategy on Aksai Chin, it will always have the strategic initiative, and India’s “great power ambition” will continue to lay in the abyss of the Indian Ocean.

Aksai Chin indeed was a part of the State of Kashmir but since Kashmir already was being fought over between India and Pakistan and the region being far from both India and Pakistan was inaccessible to both claimants. Beijing saw an opportunity and with tacit approval from Pakistan, went ahead to control this “Sand Sea of China” which is the literal translation of Aksai Chin in Turkic.

Aksai Chin is strategically very important for China. It is the only possible land route that connects China’s Xinjiang Region to Tibet. China’s G219 Highway and the New Tibet Railway Line both pass through Aksai Chin. If there was not to be an Aksai Chin, the Chinese had to cross the hard terrain of the Kunlun Mountains to connect China’s two big landmasses. In 1962 when China took the initiative to cross the LAC, Beijing had several things on its mind. Firstly, it had to secure Aksai China so that a land link between Xinjiang and Tibet can be established. Secondly, China knew that controlling the heights over India is going to give it a long term strategic advantage and through it, it could always keep the initiative in its hands, keeping Delhi in a defensive position for an unprecedented time in the future. Thirdly, it wanted to support Pakistan which was having its own problems in the Kashmir sector. In case of any future Indo-Pak conflict, China would be in a better position to intervene. Lastly, and most important of all, Beijing wanted to ensure no future disturbances along the LAC. The main objective of the 1962 War was made very clear by Chairman Mao at the Xiangshan meeting: “At least 30 years of peace must be guaranteed.”

One may wonder that what does thirty years of peace do. What merited the risk of crossing over the LAC by the Chinese? The answer is rather simple: Integration of Tibet! Tibet was having internal problems and especially after the Dalai Lama fled Tibet it was getting harder for Beijing to keep it under control, but that couldn’t be possible unless and otherwise New Delhi would be completely knocked out of the Tibetan game and this is exactly what the 1962 War did.

Some analysts believe that instead of focusing on Aksai Chin which is a rugged piece of land, China should’ve gone for the Arunachal Pradesh, which the Chinese call “Southern Tibet”. The area is also much richer in natural resources than Aksai Chin. The point made then by Beijing was that Arunachal Pradesh was a more difficult terrain to be defended plus the aim was to stabilize the whole of Tibet, instead of just Southern Tibet. Another interesting reason why Beijing kept mum about Southern Tibet was that it was the “Granary of Tibet”, the absence of which meant that Tibet had to rely on Beijing for its basic necessities. Another well-calculated move by Beijing to reign in Tibet.

All along the 1962 War, Beijing was clear of its objectives. It was not expansionism that drove the war but rather strategic interests. The war was initiated by China, and China itself took the initiative to end it. It was clear to the Chinese planners that any War with India had to be swift, decisive and must set the tone for future engagements. That is why after the PLA took over control over large swathes of land across the LAC and the “McMahon Line”, then quickly retreated back to the “McMahon Line”. Since the battleground is usually too cold for battle, the PLA had only a two-month window to launch an offensive

Prior to the war, at the Beijing Xiangshan meeting in which it was decided to fight the 1962 War, Zhou Enlai specifically instructed that “logistics must be done well, and we must never increase the number of casualties due to logistical factors like in the Korean War.”

Learning on the lessons of 1962, India unilaterally decided not to build any infrastructure in the region surrounding the LAC, fearing that the same infrastructure might be used by the Chinese to come into the Indian mainland. Since now New Delhi is ascertaining its regional and global power, it is constructing new roads and infrastructure along the LAC and China is clearly not happy with India changing the status quo. Previously, the status quo maintained gave Beijing a strategic advantage. One border issue had pinned India for decades, wasting a lot of India’s national power, and has allowed China to develop with peace of mind for decades.

Continue Reading

East Asia

Escalation of conflict between two Koreas: Why now and what could it lead to?

Published

on

Observers worldwide signal a rapid deterioration of relations between two Koreas which began on June 9th, after North Korea’s authorities discontinued contacts with South Korea over the anti-Pyongyang leaflets circulated by North Korean defectors. While Seoul has announced readiness to take measures, the other party chose to ignore the announcement.

Pyongyang has blocked all communication lines with Seoul (except those between special services). North Korea has also blown up the building of the inter-Korean communication office in Kaesong, which was opened in 2018 for promoting cooperation between North Korea and South Korea. This is a precedent which sets one thinking: why is all this happening now and what could it result in?

Throughout the past few decades Pyongyang has repeatedly resorted to the “slam the door” tactic according to which it first broke contracts and then resumed them. There was a time when the participants in inter-Korean talks threw cookies at one another during a coffee break in a manifestation of mutual resentment. But no one blew up buildings.

Significantly, the measures in question have been reported by Kim Jong-un’s younger sister Kim Yo-jong, who described South Korea as a «foe». Deputy head of the propaganda department of the Central Committee of the Korean Labor Party, this pretty-looking lady with good manners were originally appointed to represent the North Korean regime with a “human face”. Now, she is playing the part of a “bad cop”.

So, why is it all happening now? The year 2020 began with radical changes about American-North Korean denuclearization talks, which ran into a deadlock. North Korea repeatedly voiced discontent over the US not lifting sanctions against Pyongyang and not calling off military exercises with South Korea despite the fact that North Korea has stopped nuclear tests, frozen intercontinental ballistic missile launches and closed nuclear testing sites. In response, Pyongyang chose to raise negotiation stakes by saying ‘no’ to talks on the lifting of some UN-imposed sanctions in exchange for major nuclear facilities of North Korea.

Apparently, North Korea considers it possible to repeat the same tactic in its relations with the South, which have been stalled, largely over the coronavirus pandemic.  Despite Pyongyang’s expectations, North-South relations cannot enter the specific cooperation phase, first of all, over the  position of Washington, which has been doing everything to thwart it.

When a chess game enters a deadlock, the angry party, like in the Ilf and Petrov classic, is tempted to overturn the chessboard, or worse, to crush it on the head of the other party. This is the logic that the North Korean party could be driven by at the moment; such a behavior seems quite sensible, because it has yielded good results many times before. The question is why torpedo the inter-Korean dialogue now, under President Moon Jae-in, who is widely known for his commitment to the  North-South dialogue and has done a lot to promote it (and must have been getting ready to do more, thereby earning a credit for himself in history before he steps down from the post of president in 2022)?

It is not a secret that this dialogue has limits which are imposed by American-South Korean alliance. Since the North has always been against them, the current escalation could well be part of an attempt to “blow up” the existing system (or, at least, rock it out of balance). But this kind of move is hardly sensible and hardly feasible.

What will the current escalation which the North has been demonstrating so openly (“seven people hold me, or I break loose and crush everything”), lead to?  What sounds alarm is Pyongyang’s intention to deploy troops in areas which have been deemed as demilitarized since 1953, when North and South Koreas signed an armistice agreement. After that the two sides saw a number of intermittent setbacks but they never touched the border zone in the 38th parallel. Seoul and Pyongyang never attempted to reconsider the zone’s demilitarized status.  A violation of this “taboo” is fraught with danger – it could cause unintended military incidents on the demarcation line, particularly considering the fact that the 38th parallel has the world’s biggest concentration of military power and weapons.

Finally, what are external players to do? The UN secretary-general has urged the United States and South Korea to take joint efforts to normalize inter-Korean relations. After that the State Department issued a corresponding statement which ran into a rebuke on the part of North Korea. The day before the Trump administration extended sanctions against North Korea for another year, and the circle has been closed.

The Chinese Foreign Ministry and Russian State Duma coordinator for cooperation with North Korea Kazbek Taisaev have expressed hope that peace will be preserved. But this is not enough. Russian and Chinese diplomats have been acting in line with a consolidated position of China and Russia on the situation around the Korean Peninsula, which was enshrined in the Joint Statement of the two countries’ foreign ministers of July 4, 2017. Action for action, a step-by-step lifting of sanctions depending on progress at the talks is what Russia and China propose for a settlement. This principle, however, proceeds from the fact that North Korea is interested in such progress, not vice versa. For this reason, our countries’ foreign ministries may have to streamline their strategy with a view to make it easier to implement and boost its effectiveness.

From our partner International Affairs

Continue Reading

East Asia

Will There Be an End to the Korean War?

Gleb Ivashentsov

Published

on

The Korean War began 70 years ago, on June 25, 1950. This was not just a standoff between neighboring states. The Korean War, in fact, began as a civil war between the two Korean camps (the North, that sought to build the future of Korea according to the Soviet model, and the South, committed to American attitudes). In the context of the Cold War, it immediately developed into a large-scale military conflict. Great powers were directly or indirectly involved. This includes the USA, Great Britain, USSR, PRC, as well as the UN, which sent an international military contingent to Korea under its own flag to help the South.

Military Confrontation on the 38th Parallel

The inter-Korean confrontation continues to this day. Today, on both sides of the 38th parallel — the latitude line that roughly demarcates the two Korean states — military fortification is piled up, and thousands of troops with modern weapons and military equipment target each other. Moreover, in accordance with the Mutual Defence Treaty between the U.S. and South Korea, the latter is hosting a group of U.S. troops of 28.5 thousand people, subordinate to the ROK/U.S. Combined Forces Command (CFC).

And if Seoul does need the U.S. military presence in Korea in order to protect South Korean economic prosperity from the hypothetical encroachment of Pyongyang, then for Washington, it is only an element of the global system for ensuring “American leadership.” The Korean Peninsula is the only continental element of the U.S. military presence in East Asia. In addition, South Korea, as an ally of the United States, significantly strengthens American military power in the Pacific, doing so to a much greater extent than Japan, still fettered by Article 9 of its Constitution.

Nuclear Issue

In the 1990s, the tangle of security problems on the Korean peninsula was supplemented by the North Korea nuclear crisis. North Korea, in violation of the Treaty on the Non-Proliferation of Nuclear Weapons, announced the development of a nuclear missile program. Pyongyang remembered the calls of the American General Douglas MacArthur, who led the United Nations Command in the Korean War, to use the atomic bomb, and believed that the DPRK’s own nuclear weapons could prevent a potential strike from the United States in the event of a new inter-Korean war.

The United States confronted the North Korean nuclear missile program with a sanctions war and aggressive military rhetoric. This included direct threats of President Trump in 2017 to physically destroy the DPRK should it decide not to give up nuclear missile development. However, common sense prevailed. Mutual accusations gave way to dialog. Three inter-Korean and two North Korea-the U.S. summits took place in 2018–2019.

Inter-Korean Dialog

Inter-Korean dialog was facilitated by two circumstances. On the one hand, having created long-range nuclear missile weapons, the North Korean leader Kim Jong-un decided that the main strategic goal to ensure the security of the DPRK from the United States had been achieved, and that the nuclear-missile race could be suspended by putting more funds into economic needs. On the other, it was the behavior of South Korea that promoted a thaw in the relations. And this is not only due to the fact that from the very beginning, the current President of the Republic of Korea, Moon Jae-in, went to the polls under the slogans of restoring dialog with Pyongyang. The aggressive rhetoric of Donald Trump in 2017 regarding the DPRK also played its role. For the first time in several decades, the world was faced with the real threat of a new war on the Korean Peninsula at the initiative of the United States. South Korea would be the main victim of it, suffering a powerful blow from the North. Therefore, if Washington’s victory in the war would be the liquidation of the North Korean state in its current form, then for Seoul, the only option for victory would be to prevent the war.

There were a lot of expectations from inter-Korean summits. But these expectations were only met, perhaps, by the fact that there will be no nuclear or other war in Korea in the near future. The declarations adopted in Panmunjom and Pyongyang by Kim Jong-un and Moon Jae-in set a number of tasks to promote cooperation between the two Korean states. However, for the most part, these documents looked more like statements of intent. Many political and legal obstacles stood in the way of fulfilling these intentions.

Therefore, the inter-Korean dialog that pompously started in 2018 began to stall by the end of 2019. At the beginning of June of the current year, it even reached a dead end. Under the pretext that the South Korean authorities did not prevent various public organizations from sending balloons with leaflets wording the attacks on the North Korean regime, Pyongyang blocked all communication channels with Seoul. In addition to this, Kim Jong-un’s sister, Kim Yo-jong, who now oversees relations with the South and, in general, has practically become the second most influential figure in the DPRK power structure, promised Seoul to destroy the inter-Korean liaison office in Kaesong in the near future (which was done — Ed. note.), the next step to be made by the military of the North.

The point was not, of course, in sending the balloons with leaflets to North Korea, especially since many of them had not reached the DPRK. The reasons go deeper. On overcoming the coronavirus pandemic, the DPRK economy is in dire need of economic support, and Pyongyang makes it clear that they are dissatisfied with Seoul’s lack of any steps aimed at restoring inter-Korean economic cooperation. This was stipulated by the agreements reached at the summits of Kim Jong-un and Moon Jae-in. This is primarily about the Kaesong Industrial Complex (KIC) and the Kumgangsan tourist region. The KIC, located in the DPRK near the border with the Republic of Korea, was the largest and most successful inter-Korean project. It housed the production of more than a hundred South Korean small and medium-sized enterprises, which employed about 50 thousand North Korean workers. By 2015, through the work of the Kaesong complex, inter-Korean trade turnover reached USD 3 billion, which made South Korea the second most important trading partner of the DPRK after China. The Kumgangsan tourist region was open to South Korean citizens for ten years, from 1998 to 2008. During this time, almost 2 million South Koreans could visit it, giving the DPRK government an additional source of income.

Pyongyang seems to be counting on the large victory of the ruling Democratic Party in the parliamentary elections in South Korea in April this year, which might create new prerequisites for restarting the inter-Korean peace process. This is all the more since immediately after the elections, the Office of President Moon Jae-in stated that normalization of relations with Pyongyang remained a priority for the country’s leadership and the resumption of negotiations between the North and the South might occur in May-June.

However, the initiator of rapprochement with the North, President Moon Jae-in, found himself in a critical situation. The most important asset of his party in the elections was not an inter-Korean settlement program, but the successful actions of the South Korean authorities in the fight against the pandemic. Now that the unrest around the pandemic has more or less subsided, the economic problems in the country, aggravated by the pandemic and corruption scandals involving people close to Moon, are again coming to the fore in the public consciousness of the South Koreans. So today, the President of the Republic of Korea is clearly not up to talking with Pyongyang.

The pressure of the big ally certainly plays its role. Before the results of the U.S. presidential election, Washington will not only be unable to take any action on the Korean vector, but will also disallow Seoul to take the initiative.

Do all of Korea’s Neighbors Want the Reunification?

In the current alignment of forces near the Far Eastern borders of Russia, the establishment of Korea as a single independent neutral and nuclear-free state would be in its interest. The question, however, is that at this stage, neither North nor South Korea is ready for reunification. The partners of the two Korean states are not ready for this either.

Seoul is concerned that reunification will come at a very high cost, pulling it out of competition at the regional and global levels for a long time. Pyongyang, in turn, does not intend to surrender to the South. They examined the experience of Germany, where the capitalist West brought the socialist East to heel, making former GDR citizens “second-class” and subjecting members of the former East German power elite to all kinds of persecution, including imprisonment. The new young generation of the North Korean elite is actively blending in with the emerging North Korean business under Kim Jong-un. We have already seen something similar in Russia. Both of these classes — the current military party elite and the North Korean nouveau riche — have a vital common interest in preserving a separate North Korean statehood. The unification of Korea under the leadership of Seoul is equally dangerous for both, because in this case, the elite will lose power, and local business will simply be crushed by the South Korean chaebol monopolies.

As for the United States, it is not really in its interest to have Korea reunited rather than having status quo on the Korean peninsula, maintaining tensions there. This is the most convenient way to keep and, if necessary, strengthen the U.S. military-political presence in Northeast Asia.

China is considering the alignment of forces on the Korean Peninsula primarily through the prism of its confrontation with the United States. Beijing will support the reunification of Korea only if it is sure that a united Korea will be pro-Chinese. There is no certainty about this: Korea, united under Seoul conditions, will, at best for China, become a powerful independent state with strong ties to the United States, and at worst, like Japan, the outpost of Washington’s deterrence of China in the region.

The Japanese, in turn, say that the main question for them is who will get the North Korean nuclear weapons. Tokyo will support the reunification of Korea, only being sure that these weapons are destroyed or withdrawn. In fact, the Japanese are simply afraid of the emergence of a united Korea as a powerful competitor in the regional and world arena, similar to the way England and France tried to delay the unification of Germany in the late 1980s.

Therefore, speaking about the reunification of Korea in the current conditions is at least premature. It should be a matter of inter-Korean reconciliation, building bridges between the two Korean states.

Trump and Pyongyang

In 2018 Donald Trump’s transition from the threat of a military attack on Pyongyang to a dialog with Kim Jong-un was largely forced. Both the insistence of South Korean President Moon Jae-in on the issue of inter-Korean detente and the general international attitude against the risk of a nuclear war against North Korea played a role. Special attention should be given to, firstly, the “road map” for settling the nuclear issue on the Korean peninsula put forward on July 4, 2017, by the Ministries of Foreign Affairs of Russia and China. And, secondly, to the unwillingness of the U.S. allies to engage in new American adventures in Korea, which was clearly shown in January 2018 at Vancouver meeting of the foreign ministers of those states whose troops fought in the Korean War of 1950-1953 on the side of the South as part of the so-called UN forces in Korea.

In dialog with Donald Trump, Kim Jong-un voiced the new relations between the DPRK and the U.S. as the main condition for the denuclearization of the Korean Peninsula. These relations should be based on mutual trust and free from mutual demonization. It is clear that this is not an easy task for Pyongyang and Washington. But there are examples of how similar challenges were solved in due time in China-the U.S. and Vietnam-the U.S. relations. The future relations of the DPRK and the U.S. could reach the level of today’s communication between Vietnam and the U.S., when they still remember the war, but the memory of the past does not prevent them from working together in the present.

Pyongyang could stop the development of ICBMs, freeze the production of nuclear materials, and open its nuclear facilities for international inspections. And Washington, in return, would officially recognize the DPRK, establish diplomatic relations with it, exchange diplomatic missions, limit military activities at its borders, reduce and ultimately lift sanctions, and provide economic and energy assistance to the North.

The problem, however, is that at least for the coming year, any progress in the U.S.-North Korea dialog is ruled out. Trump is concerned about preparations for the presidential election, the extremely unfavorable situation in the country due to racial unrest, and not about Korea. Both now and in case of winning the elected position, there will be more important issues — China, Europe, Russia, the Middle East. Korea will not be among the U.S. foreign policy priorities even if Biden wins the election (all for the same reasons).

Inter-Korean Reconciliation Matter is in the Hands of Koreans Themselves

The main result of the inter-Korean summits was Seoul being reconciled with the existence of the DPRK and adopting the policy of peaceful coexistence with respect to it. The urgent need for the Republic of Korea today is to recognize the status of the DPRK as a sovereign state, the rule of law and constitutionality of its leadership, and shift the relations between the two Koreas into a bilateral format.

The UN is called upon to play its role in this situation. It has been dealing with the “Korean issue” from the moment it arose in the late 1940s. Yet after the approval of two resolutions on this issue at once during the 30th session of the General Assembly in November 1975 (one initiated by the USA and the other by the USSR (both remained unfulfilled)), it basically removed the issue of a political settlement in Korea from the agenda.

First of all, it is worth changing a completely unnatural situation when, formally it is not the Republic of Korea, that is in the military confrontation with the DPRK, but the UN. To assist South Korea during the Korean War, in accordance with UN Security Council Resolution No. 84 of July 7, 1950, the United Nations Forces in Korea were created — the multinational armed forces of 16 states led by the United States. Since these forces participated in the Korean War under the UN flag, and the 1953 Korean Armistice Agreement was signed on the behalf of these forces opposing the Korean People’s Army and Chinese People’s Volunteers (and in fact on behalf of the UN), the latter is still formally at war with the DPRK, that since 1991 is a full member of the UN.

It is time to adopt the UN Security Council declaration and to declare that the Korean War was a page of the past, that the UN Security Council turns this page and, accordingly, there is no need for the UN Command in Korea.

As for the American troops in South Korea, their presence should be regulated exclusively by interstate agreements between the Republic of Korea and the United States. In this case, it would be worthwhile to decide on the issue of Operational Command (OPCON) by the ROK/US Combined Forces Command. Now, under bilateral agreements, in peacetime on the peninsula, South Korea commands both its own troops and the U.S. military contingent. However, with the outbreak of war, the command automatically transfers to the United States, which means, in fact, that the President of the Republic of Korea, as the Supreme Commander-in-Chief of the country’s armed forces, becomes subordinate to the Lieutenant General of the U.S. Armed Forces.

Peace Treaty

The question about the need to replace the 1953 Armistice Agreement in Korea with a peace treaty repeatedly arose in connection with the inter-Korean summits. At the same time, there is a wide range of opinions expressed as to which states should be parties to this treaty.

The Armistice Agreement of 1953 was not an interstate document. It was an agreement between the commanders-in-chief of the warring parties on the suspension of hostilities, the withdrawal of troops and establishing a demilitarized border between them. Neither the Republic of Korea, nor the United States, nor China in state capacity were involved in the armistice agreement. Moreover, the United States and China did not participate in the Korean War as states.

The peace treaty on the Korean Peninsula should be the treaty of two sovereign independent states — the DPRK and the Republic of Korea. There are certain preconditions for this. A joint communique of the Republic of Korea and North Korea was issued on July 4, 1972, calling for an independent and peaceful reunification of the divided country, without depending on foreign powers and without foreign interference, on the basis of “great national unity.” In December 1991, the heads of government of the North and South for the first time formally recognized the equal existence of two Korean states by signing the Agreement on Reconciliation, Non-aggression and Exchanges and Cooperation. Five inter-Korean summits took place from 2000 to 2018, joint declarations being adopted at each of them — a program for the development of bilateral relations aimed at a gradual shift from confrontation to reconciliation and phased rapprochement. None of these documents provided for the participation of any third states in inter-Korean communication. It was and should be about the interaction of the two Koreas exclusively in a bilateral format.

It is noteworthy that during the 2018 Pyongyang Summit the Agreement on the Implementation of the Panmunjom Declaration in the Military Domain was signed by the Ministers of Defense of the DPRK and the Republic of Korea. This is a fundamentally new and, most importantly, a practical step towards reducing military tension. Confidence-building measures between the military are being strengthened, communication channels are opening up, the parties are going to take all measures to prevent any clashes and conflicts with the use of military force in any territory. This is all the more important, firstly, since the ROK in its own capacity did not sign the Armistice Agreement in Korea in 1953. Secondly, the leaders of the two states announced that they would pursue a joint bid to host the 2032 Olympic Games. That is, the ROK recognized that it did not expect, as in the previous years, the regime to fall in the DPRK and that the North and South would exist separately even in 15 years.

The Korean War that started 70 years ago, has not ended yet. The Korean crisis today is one of the main threats to international security. This crisis has two components: the division of the Korean nation over decades into two separate states and the DPRK nuclear missile program.

These two components of the Korean crisis are interconnected, but their impact on each other is unequal. Pyongyang’s refusal from nuclear development alone will not end the confrontation between North and South. At the same time, normalization of inter-Korean relations is a prerequisite for ending the Korean War matters and solving the denuclearization issue of the Korean Peninsula.

From our partner RIAC

Continue Reading

Publications

Latest

Americas1 hour ago

Revisiting Fukuyama’s ‘End of History Thesis”

There are few names in the America, when it comes to the interpretation of American political and cultural history. Francis...

Middle East3 hours ago

The Causes and Effects of the United States “Long Goodbye” to the Middle East

A glance at a world map reveals one great reason why the Middle East (ME) claims the attention of great...

Newsdesk5 hours ago

Vietnam: New WB Support for Higher Education and Urban Development

The World Bank Board of Executive Directors today approved financing for two projects worth a total of US$422 million to...

Economy7 hours ago

Armenia’s inability to solve pandemic-related economic problems

According to data from the Armenian government, in 2019 the country’s economy grew by about 7.6%,which was the highest figure...

Terrorism9 hours ago

Attack on Pakistan Stock Exchange: A Fuel-to-fire in Southeast Asia

On June 29th, four armed men opened fire in the premises of Pakistan Stock Exchange, Karachi. All four terrorists were...

Central Asia11 hours ago

30 years of Nazarbayev’s foreign policy: What Kazakhstan can teach the world in the new era

The COVID-19 pandemic has completely shaken the very foundations of the world order that we were all accustomed to. The...

Reports13 hours ago

Major Impact from COVID-19 to Thailand’s Economy, Vulnerable Households, Firms

Thailand’s economy is expected to be impacted severely by the COVID-19 pandemic, shrinking by at least 5 percent in 2020...

Trending