It is no coincidence that South Korea recorded a shortfall in its trade with North Korea for the second straight year in 2009, given the ties between the two rivals have been soured over the past two years. According to the Korea Customs Service, the South's shipments of goods to the North fell 14 percent year-on-year to $883.4 million in 2008. The annual sum also dropped 17 percent to $732.6 million last year. Partly driven by the decline, the South recorded a shortfall of $54 million in the inter-Korean trade in 2008. The imbalance widened to $200 million in 2009.
The inauguration of conservative President Lee Myung-bak two years ago chilled inter-Korean ties, which led to the reduction of economic exchanges between the two sides. Of course, the recalcitrant North should get the blame for the strained relations as it has slid back to saber rattling and brinksmanship. However, we have to admit that Lee's hard-line policy toward the communist state has played a certain role in angering the Kim Jong-il regime and prompting its return to hostility and confrontation with the South.
It is regrettable that the two Koreas have reneged on their tacit principle that economic cooperation should not be linked to political or military factors on the peninsula. Actually such a principle has not been easy to maintain under any circumstances regardless of the ups and downs of the inter-Korean relationship. Nevertheless, it is all the more disappointing to see that the two sides suddenly discarded a decade of active engagement with each other under the Sunshine Policy advocated by former liberal Presidents Kim Dae-jung and Roh Moo-hyun.
The South had suffered a deficit in the inter-Korean trade until 1997. But it began to enjoy a surplus the next year when Kim Dae-jung, the architect of the Sunshine Policy, took office. He was awarded the Nobel Peace Prize in recognition for holding the first South-North summit in June 2000. Roh held the second summit in October 2007. It goes without saying that the two rounds of summitry led to thawing the world's last Cold War frontier, raising hope for reconciliation, peace and co-prosperity, not only on the peninsula but also in Northeast Asia.
During the 1998-2007 engagement period, the South's annual shipments of products to the North saw an eightfold increase from $128.9 million to $1.02 billion. As a result, the South boasted of a sevenfold rise in its trade surplus with the North from $37.9 million to $262.2 million. But the heydays of the inter-Korean reconciliation and cooperation have been on the wane, especially since the world's last Stalinist state launched its long-range missiles and conducted its second nuclear bomb test last spring.
There is no doubt that economic exchanges and collaboration are the backbone of better relations between Seoul and Pyongyang. If the groundwork for an economic union and the eventual unification of the divided nation are to materialize, these economic ties cannot be affected by geopolitical risks. Political leaders, officials, businessmen and the people both in the South and the North should remain patient, narrow their differences and break out of the deadlock. Most of all, it is urgent for Pyongyang to return to the six-party talks and faithfully implement its commitment to complete denuclearization.