Marcus Noland Expert on North Korea

By Michael Ha
Staff Reporter

A leading expert on North Korea says the winds of change are blowing in the secretive Stalinist state. The expert forecast that within the next decade, major economic and political changes are likely to take place in the communist regime.

North Korea in 2018 could look very different from the North Korea of 2008, according to the forecast.

``I would be very surprised if we sat down 10 years from now and North Korea had not changed significantly,'' said Marcus Noland, an expert on the North Korean economy at the Peterson Institute for International Economics in Washington.

N. Korean Economy Could Easily Grow 7% Annually

In an interview with The Korea Times in Seoul this month, Noland said that under more favorable conditions, North Korea's moribund economy could easily grow by 6-7 percent every year. With the right incentives and reform measures, the reclusive nation could be transformed into a dynamic emerging economy in the 21st century.

``At the moment, of course, the North Korean economy is not doing well at all. It is an increasing anachronism with each passing day,'' Noland said.

But consider its geographic location, he said; ``it is bordering China, which is growing 8-to-10 percent every year, and bordering South Korea, which is also still growing pretty well. And it is a short distance away from Japan, the world's second-largest economy.''

Noland, one of a few international economists with expertise on the North Korean economy, said the country's economy should easily be growing by up to an annual 7 percent.

The fact that it is not, however, is grim testimony to real significant internal problems within Pyongyang, he said. ``The way I would describe North Korea today is that its government is extremely insecure about the domestic political implications of a potential economic change. As a consequence, it is highly risk-averse.''

Major Changes

But with recent news about North Korean leader Kim Jong-il and his health concerns, the regime could be in for some real change over the next 10 years.

Noland said most analysts seem to agree that if Kim were to die or be incapacitated, then what would emerge in the short term is ``some collective form of leadership based on the National Defense Commission'' ― perhaps with a member of the Kim family as the titular head of the regime or as a figurehead, as a signal of legitimacy and continuity.

However, even that arrangement may not be sustainable. Then what could be next? Noland said South Korea's political history could offer a valuable lesson.

``I am not sure if this outline of a collective form of leadership is sustainable in the long run. I would expect a new situation, perhaps analogous to the situation experienced by South Korea following the assassination of former President Park Chung-hee, where there was a real uncertainty for months about who exactly was running the country before General Chun Doo-hwan eventually emerged as the supreme leader,'' he said. ``I think something like that is likely to be the case in North Korea in coming years.''

He observed all authoritarian regimes face problems with succession. ``But this regime is likely to face unusually profound issues with respect to succession. And so if Kim Jong-il were to depart the scene within the next five years, I think one could see some potential for real change. I would be very surprised if we sat down 10 years from now and North Korea had not changed significantly.''

Two Paths to Unified Korea

Could there be a unified or federated Korea in the next decade, or at least within the next few decades? There are a couple of scenarios that could lead to a single Korean nation: one could happen slowly, possibly spread over several decades, while the other scenario could take place rather suddenly, in a matter of days or weeks.

``There are basically two ways that Koreans could achieve national reconciliation and ultimately national unification. One is through a protracted consensual coming-together of the two sides. But that also means there has to be real changes from the North Korean side,'' Noland said.

He argued that under the previous Roh Moo-hyun administration, ``the South Korean government drifted away from the notion of engagement as an instrument to pursue change, and it became engagement for engagement's sake, as a goal in and of itself.''

The other scenario is ``obviously some sort of North Korean collapse and absorption by the South, such as what happened in Germany. And I don't think either of those possibilities can be ruled out, over the timeframe of the next several decades.''

Uniting Korea on Seoul's Terms?

Would the major world powers welcome a unified Korea? It would depend on what the nation looks like politically and economically following unification. The United States would support a democratic, capitalist nation that remains a U.S. ally on the peninsula. On the other hand, China's communist government probably would not be eager to see a united, stronger democratic Korea and a U.S. military partner right on its doorstep.

``The U.S. is probably the only outside power that supports the reunification of Korea as a democratic, capitalist country, basically unification on Seoul's terms,'' according to Noland.

``But some other countries may prefer to see the Korean Peninsula remain divided. And also obviously in South Korea, there are both desires for national unification but concerns about the costs and disruptions that would accompany it.''

Washington's N. Korea Policy: Back to the 1990s

As for the on-again, off-again denuclearization process, Noland said much would depend on who gets elected as the next U.S. president. The next White House occupant will likely shape the U.S.-North Korea relations for years to come.

``A lot depends on who gets elected in the Nov. 4 U.S. presidential election,'' Noland said. ``At this point, it appears to be more likely that Barack Obama will be elected president than John McCain. Obama will bring with him basically advisors from the Bill Clinton administration ― so that in some sense, it will probably resemble a continuation from the 1990s Clinton-era policy. Also, Obama has been supportive of the removal of North Korea from the terrorism list.''

On the other hand, if McCain were to be elected U.S. president, ``I think his advisors would actually reproduce the conflict and discord of the first George W. Bush administration. His advisors include both traditional realists as well as neo-conservatives.

``McCain himself has made harsh statements about North Korea and has come out against the removal of North Korea from the terrorism list. So I think the problem with McCain is, you might get internal struggles in his administration, like you had with the first Bush administration.''

Interestingly, Noland noted, another point worth mentioning about McCain is that his wife, Cindy McCain, is heavily involved in humanitarian activities.

``So although a President McCain might be making harsh statements about North Korea, maybe first lady McCain would be out there distributing food and medicine.''

Will Pyongyang Ever Give Up Its Nuclear Ambition?

Noland said it's unclear whether North Korea has actually made the strategic decision to denuclearize. ``At the end of the day, there will be some irreducible degree of uncertainty about whether the nuclear history that we have constructed is complete and accurate.

``That is to say that at the end of the day, there will be some uncertainty about whether North Korea has retained enough fissile material to produce a limited number of nuclear weapons.'' So any prudent military planner would have to assume that North Korea had retained a small number of nuclear weapons, he remarked.

``In the best-case scenario, what is likely to occur is that we will reach an agreement with North Koreans that gives us a high degree of confidence that we have shut down the plutonium-based program, based on a limited number of easily identifiable facilities at Yongbyon.

``We will have less confidence that we have halted any activities involving a second program based on highly enriched uranium. And we will have the least amount of confidence that we have halted any technology transfer or proliferation activities with respect to third parties.''

Addressing Human Rights

North Korea must also acknowledge its dismal human rights record if it ever wants to become a responsible member of the international community, Noland added.

``The human rights problem in Korea is a situation of enormous concern. What the diplomats need to communicate to North Korea is that we understand North Korea is resistant to talking about this issue,'' he said.

``But if North Korea wants to join the community of nations, if it wants to globalize and achieve greater material prosperity, it will have to deal with the human rights issue.''

It doesn't necessarily have to be the number-one item on the agenda, he said. ``But it is something that has to be dealt with. The international community should indicate that it is open to trying to deal with this issue in a constructive way, that other countries are not trying to use human rights as a cudgel to beat the North Koreans. But this issue will have to be dealt with; that's just part of 21st century life.''

michaelha@koreatimes.co.kr

Who Is Marcus Noland? Marcus Noland is senior fellow at Peterson Institute for International Economics, a Washington-based think tank. He has written extensively on the economy of North Korea and is one of a few international economists with expertise in this area and the prospects for Korean unification. His books include ``Korea After Kim Jong-il'' (2004); ``Avoiding the Apocalypse: The Future of the Two Koreas'' (2000); and ``Famine in North Korea: Markets, Aid, and Reform'' (2007). Noland recently observed that in the short term, Pyongyang might very well make good on its threat to impose a freeze on ties with South Korea and the conservative Seoul government. It's clear, he said, that North Korea and its population have much to lose by severing inter-Korean relations. Cutting off all ties with Seoul would have significant adverse economic effects but the Pyongyang officials making that decision would largely be insulated from the impact, he predicted.