Choe Ryong Hae, the special envoy of Kim Jong Un, is now in Russia. Officially he is in Moscow to discuss economic relations between the two countries, as well as international and regional issues.
Choe has met with the Russian President Vladimir Putin and Foreign Minister Sergey Lavrov. He is also due to visit the Russian Far East. This makes sense, since this is where many joint economic projects between Russia and the North are likely to be based. This year has been marked by hitherto unprecedented intensity of contacts between post-Soviet Russia and North Korea.
Nothing like this has occurred since the collapse of the USSR almost a quarter of a century ago. It is difficult to deny that relations between Russia and North Korea are now, at least first glance, booming. There are serious potential problems, though, many of which are difficult or impossible to overcome.
The political rationale behind this rapid rapprochement is clear: Due to the Ukrainian crisis Russia is increasingly on a collision course with the United States and, broadly speaking, the developed West. In this situation, it makes perfect sense to establish better relations with other countries that have problems with the United States.
Nothing like this has occurred since the collapse of the USSR almost a quarter of a century ago
This is a good way for Moscow to retaliate against Washington, i.e. if the United States wants to make problems for Russia, Russia will do its best to do the same in return – nothing personal, you understand, just good old fashioned tit-for-tat diplomacy. North Korea also needs all the political support it can get, and naturally enough, has come to see Russia as a likely source of such support. However, it seems that economic concerns are of greater importance for Pyongyang, as Choe’s itinerary seemingly indicates.
Indeed, in the last seven or eight years, North Korea has found itself in a situation that the Kim dynasty has always been afraid of: it has been solely reliant on one sponsor, China. For decades, one of the cornerstones of North Korean foreign policy is to always have two foreign sponsors, whose contradictions and rivalries could be used by Pyongyang to maximize its own interests. When the Sunshine Policy of South Korea was abruptly ended in 2008 by Seoul, China came to dominate North Korean economic exchanges, and the North Korean leadership is not happy about this.
Such displeasure seems to be especially pronounced in Kim Jong Un, who seemingly has a personal dislike for China, having done what he can to distance his country from its mammoth neighbor. In their attempts to find alternatives to China, North Korea has tried many strategies and approached a number of potential partners, including, for example, Japan. However, it is Russia that is now looming large in their plans and strategic thinking.
North Korea also needs all the political support it can get, and naturally enough, has come to see Russia as a likely source of such support
This dream of a Russian sugar daddy is understandable: Russia is quite a success economically and also on rather bad terms with North Korea’s principal enemy, the United States. For North Korean policy makers it must also be eerily reminiscent of the 1970s, an era when the Soviet Union showered North Korea with aid while asking for very little in return.
Therefore, it is only natural that the North Korean leadership, still largely consistent of old people, are only too happy to return to happier times, when their country still enjoyed the largess of both Moscow and Beijing, while successfully maintaining a neutral stance in matters causing friction between those two communist behemoths. However, there is little chance that such fantasies will ever be realized.
Russia is often presented in the international media as the reincarnation of the Soviet Union and Vladimir Putin is often presented as a pretender to the Red Tsarist throne of Stalin and Brezhnev. The Western press warns readers of Putin’s alleged love of repression, and his dreams of imperialist expansion abroad. Thus, there is little wonder that North Koreans entertain somewhat similar ideas about Putin as being a want-to-be Soviet General Secretary.
However, such perceptions, while containing some truth, are far less accurate than most readers of the Western press might believe. There is a great deal of difference between Russia today and the Soviet Union of the 1970s or 1940s. One of those important differences is the attitude toward supplying economic assistance to countries that were not part of the former Soviet Union. Indeed, while Russia is willing to invest money to enhance its power and authority in what it sees as its “lawful sphere of influence,” that is, former Soviet lands, it has little or no interest in spending money to do the same outside of this sphere.
On the world stage, the Russian government believes that foreign policy should, in principle, earn money, and not be a financial burden. One can easily see this trend even in recent publications related to proposed Russo-North Korean economic projects. One such project is known as Pobeda (Victory). This project implies that a big Russian company will invest in the reconstruction of North Korea’s dilapidated Railway network. Tellingly though, company representatives when recently interviewed went out of their way to emphasize the fact that there would be no unilateral investment by the Russian side.
This dream of a Russian sugar daddy is understandable: Russia is quite a success economically and also on rather bad terms with North Korea’s principal enemy, the United States
They stressed that the entire project would be paid for by the North Korean side – apparently they will use their mineral resources, including alleged huge deposits of rare earths, to fund the project. It is not impossible, and from my point of view, it is actually quite likely (and advisable) that some smaller projects will be subsidized by the Russian state. However, the scale of such projects is not going to be large, contrary to the illusions seemingly being entertained in Pyongyang.
With regard to reciprocity, there is some space for growth, but there are also limits that are difficult to overcome. It is very often forgotten that, for the last twenty years, Russo-North Korean trade has been all but non-existent. In 2013, for example, Sino-North Korean trade amounted to $6.45 billion, while Russo-North Korean trade was a mere $0.11 billion. This gap is huge: 60-fold, to be precise, and this yawning gap speaks volumes about the level of compatibility between the Russian and North Korean economies. Indeed, when it comes to goods that Russian companies and consumers want to buy, North Korea has very little to offer.
Its mineral deposits, quite attractive to Chinese investors, are a joke compared to what Russia has in Siberia. There is a limited market for North Korean seafood, but once again, the Russian consumer is not known for its veracious appetite for squid and sea cucumber, and most of the consumers concerned live far away from Russia’s border with North Korea. Another area where North Korea does have competitive advantage is its supply of comparatively skilled cheap labour. Some cooperation in this area is possible indeed, but the demand for such labour in the Russian Far East is rather limited.
Indeed, when it comes to goods that Russian companies and consumers want to buy, North Korea has very little to offer
There are also much discussed projects that envision the use of North Korean territory for various transportation schemes connecting Russia with the flourishing South Korean economy. These projects include the proposed Trans-Korean railway, and Trans-Korean pipeline. While such projects probably have some long-term value, from a purely economic perspective, it is just too risky to proceed with such an undertaking in the unstable environment of the present-day Korean peninsula.
Therefore, the North Korean side can count on Russian support in some political issues, including votes at the UN, for example. It is also possible, and indeed likely, that they will find some ways to start mutually profitable cooperation with Russia in some areas. It might help that the North Korean government has started economic reforms, not dissimilar to measures that the Deng Xiaoping government introduced in China of the early 1980s.
However, Russia is not about to replace China as the major sponsor and trade partner of North Korea. Moscow is neither willing, nor able to do so, though it might take some time for people in Pyongyang to realize this.
Featured Image: KCNA
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