By Leonid A. Petrov

From Pyongyang's point of view, each worker in the Gaeseong Industrial Complex and the Mt. Geumgang tourist resort was like a poster advertising capitalism that was most damaging to the socialist system.

At least 20 affiliates within the Gaeseong zone of inter-Korean cooperation came under questioning for talking highly about South Korea and capitalism.

In 2007, there was a thorough cadre reshuffling in the party to stop people talking about Gaeseong or Mt. Geumgang. North Korea also purged key officials who had pushed for reconciliation with South Korea.

All this must have been a crucial consideration for Pyongyang, as the survival of the North greatly depends on maintaining myths about the ``poor and desperate'' South, which starves under the yoke of American imperialism.

In recent years, the spread of smuggled South Korean DVDs and firsthand communication with southerners in special economic zones has made this propaganda image unsustainable.

In this context, Gaeseong and Mt. Geumgang projects from the outset were a dangerous gamble. For some 10 years the top bureaucracy tolerated cooperation with the South because the monetary rewards were handsome and political risks manageable.

Perhaps when the principal decision was made in 1989 for Mt. Geumgang and 2002 for Gaeseong, they also wanted to check whether the spread of dangerous information could be contained.

At the time, North Korea was going through a period of unprecedented political relaxation and experimentation with reforms. However, the period of relaxation ended with the beginning of a nuclear crisis in October 2002.

Since 2003, North Korean leaders have worked hard to turn back the clock. All news coming recently out of North Korea has been about greater control and tougher restrictions. Busy markets are a nightmare for Pyongyang retrogrades.

The DPRK government is now confiscating land from individual tillers, while Japanese-made buses and trucks are taken from small businesses. The sale of many consumer goods at the markets is restricted, while the public distribution system, which dominated the country's economic life before 1996, has been reintroduced.

In the last couple of years, several instances of public unrest made the North Korean government nervous, but it managed to retain control and prevent the mutiny from spreading.

The November 2008 Cabinet Decision No. 61 stipulated that in 2009 all markets across the country should work only three days per month, similar to how they worked in medieval Korea.

Currently, there are reports that the government plans to close down the Pyongsong Market, the largest wholesale market in the country.

Ruediger Frank and Sabine Burghart, in their recent report, Inter-Korean Cooperation 2000-2008, compare the South-North cooperation with the Eastern European experience.

When analyzing South Korea's Sunshine Policy and describing its dangers for the North Korean regime, they remind us that ``everyone who has lived under socialism in Europe can confirm how this slow ideological poison spreads like cancer, how these cells grow and how they finally unfold their destructive, lethal power, hollowing out the system from within.''

In this connection, Frank and Burghart cite Kim Jong-il himself, who is recorded as saying in 1995 that ``the most serious lesson of the collapse of socialism in several countries is that the corruption of socialism begins with ideological corruption.''

North Korea cannot afford to emulate the success of China in transforming its economy as this would require a considerable relaxation of domestic police control. China has survived such a relaxation, but there is a great difference between North Korea and China.

The PRC leaders did not have to deal with the existence of a rich and powerful ``other,'' where people speak the same language but enjoy a significantly higher level of freedom and prosperity. The DPRK leaders believe that political unrest is unavoidable if their citizens learn how prosperous South Korea really is.

Over the past few years all this made Gaeseong and Mt. Geumgang something of an anachronism. These two projects, which could only function with a greater level of openness and transparency than in the rest of North Korea, became too dangerous for Pyongyang to tolerate and were put under the direct control of the People's Army.

The era of relaxation and experimentation, which prompted the beginning of inter-Korean cooperation, is well and truly over. Nowadays, North Korea is heading for a major retreat, back to military communism.

Only those elements of market economy which are necessary to keep the country afloat are being preserved. It already looks as if the government has turned the clock back, restoring the system that existed before the 1990s.

Conservatives in Seoul might hope that this decision will deprive the North Korean regime of revenue and bring its end closer.

But the truth is that the regime can survive much longer in isolation because poor and weak people do not have the energy or weapons to rebel, particularly when they have little knowledge and understanding of how different their life could have been.

Therefore, by closing the borders and shutting the zones of inter-Korean cooperation, the North Korean elite is buying extra time to stay in power at the expense of the common people's suffering.

The complexity of regional politics and the current state of global economy also contributed to the early demise of the inter-Korean economic experiment. Nevertheless, the last 10 years of the Sunshine Policy did make a difference and changed the Korean people's perceptions of each other, making a new attempt at cooperation possible.

Dr. Leonid Petrov is a research associate at the Research School of Pacific and Asian Studies at the Australian National University. He can be reached at leonid.petrov@anu.edu.au. The views expressed in the above article are those of the author and do not reflect the editorial policy of The Korea Times.