About the Author
View more articles by Chad O'Carroll
Chad O'Carroll has written on North Korea since 2010 and writes between London and Seoul.
Since the late 1990s, plans for a Trans-Korean railroad that would connect Russia with South Korea have been carefully considered, picking up significant momentum during the early days of the Sunshine policy, but stalling following the sinking of the Cheonan in 2010.
Proponents for the railroad, which could one day connect Moscow with Seoul, say that besides providing numerous economic benefits to the partner countries, the cooperation required to build and maintain it would logically also reduce confrontation between the two Koreas.
Critics, however, have long argued that until relations between Seoul and Pyongyang improve significantly, the project would always come with too much risk to ever be considered seriously. Above all, the risk of the track falling hostage to North Korea during times of tension would be too much to swallow for potential investors.
Despite such disagreement, in 2008 Moscow unilaterally invested into the reconstruction of a rail link between Khasan in Russia and Rason, in North Korea, a port sitting in a strategically important location. Described as a pilot project, the new track opened in 2011 but has since seen little traffic, despite a few high profile test deliveries of coal.
And today, despite reaffirmation from Presidents Putin and Park about the logic of the project in late 2013, the project effectively remains on ice, having lost a lot of the initial enthusiasm in both Moscow and Seoul.
What will it take for the plans to now ever see the light of day?
In part 30 of an NK News expert interview series, Russian experts shared their thoughts, overall saying that significant hurdles remained for the plans to move into reality.
While some cited the need for a peace mechanism between the two Koreas as the most important short-term requirement, others said South Korea was primarily to blame for the lack of momentum, having been dragging its feet significantly in recent years.
Experts included in the survey include:
Q30) What are the biggest hurdles to Russia building a Trans-Siberian railway through North Korea to South Korea and how can they be resolved?
This project is a non-starter as long as the Korean War remains unfinished.
Moscow’s plans of linking the two parts of the divided peninsula with railway, natural gas, and electricity lines are thus nothing but a pipe dream. Nobody will invest in infrastructure in a war zone, were the belligerent sides remain poised to precipitate a “the sea of fire” upon each other.
Moreover, rivalry between Russia and China for control over the cargo and passenger traffic may further impede the development of railway and port facilities across North Korea.
This project is a non-starter as long as the Korean War remains unfinished
The major problem is political stability in and around Korea. We are talking about a large investment project, whose coats are measured in billions of U.S. dollars, being undertaken in a potentially unstable region.
If Russian companies make such a considerable investment, they will become hostages of Pyongyang, Seoul, Washington and Beijing (not necessarily in that order), and will exercise very little control over situation. Any confrontation in or around the Korean Peninsula might lead to the halt of work and significant losses for the Russian investors.
There are two ways to overcome the problem. The first is to achieve political stability. If the Korean peninsula remains stable and peaceful for, say, 10 years or so, the railway project could be seriously considered. In other words, we need a ‘sunshine policy’ implemented by at least two subsequent administrations in Seoul, and for that to be embraced by Pyongyang as well.
If other players have a large stake in the project, they are much more likely to behave themselves and avoid using the project for political gains
Alternatively, the railway might be developed as a joint venture, whose investment capital will come not only from Russia, but also from other interested parties (like, say, South Korea). If other players have a large stake in the project, they are much more likely to behave themselves and avoid using the project for political gains.
However, it is naive to expect that Russia will take a unilateral risk in the current situation.
During various bilateral contacts held during 2014-2015, North Korea reconfirmed its wiliness to participate in the railroad project. However, South Korea is dragging its feet.
In spite of an understanding reached during President Vladimir Putin’s visit to Seoul in November 2013, South Korean companies have failed to join even the limited joint Russian-North Korean project “Khasan-Rajin,” which is a pilot for the connection of a Trans-Siberian mainline with the Korean railroad.
One of the reasons for that is the so-called “May 24 measures”, or sanctions against North Korea, announced by Seoul in 2010 in response to the Cheonan incident. Consequently, Conservative circles in South Korea are against such cooperation because they fear it will inevitably strengthen the North’s economy, while they want quite opposite – North Korea’s collapse.
The United States is pushing South Korea to join sanctions against Russia because of events in Ukraine and doing everything possible to prevent Russia to increase her influence on the peninsula, which will be exactly the case if the railroad project would have been realized.
Conservative circles in South Korea are against such cooperation because they fear it will inevitably strengthen the North’s economy, while they want quite opposite – North Korea’s collapse
Moscow is trying to engage both North and South Korea into the implementation of multilateral economic projects (railroad, gas pipe-line and electricity). This is because Russia hopes that the inter-Korean dialogue and cooperation expected in the process of the implementation of those projects will have a positive impact.
Firstly, such cooperation could remove the threat of a military conflict right next to Russia’s Eastern borders, and secondly, promote a more favorable environment for the development of Russia’s bilateral economic ties with the two Koreas, as well as for Russia’s integration into Northeast Asia’s economic network.
Russia made a bold move by unilaterally investing into the pilot project of Khasan- Rajin railroad reconstruction and port facilities construction from 2008 onwards, the equivalent of more than U.S.$ 300 at the then rate.
This pilot project by itself makes little sense economically, barely having a profit margin. When the project begun in the 2000s there was a tacit agreement with South Korean companies to allow them to transport shipping containers along the route. However, due to the policy of conservative South Korean governments, that never materialized. As such, Russia had to switch to less profitable coal transit.
In 2013, after a Putin-Park meeting in Seoul, South Korean companies were allowed to study the possibility of investing into the joint Russia-DPRK company operating the railroad. However, low profit margins have so far prevented them from doing so, and no support from the government (inter-Korean cooperation fund) is expected.
At the same time, Russia is eager to continue the Trans-Korean railway project (in 2002 the “central route” through Cheorwon was approved by Kim Jong Il personally, although Russia would prefer the “eastern route” from Wonsan to Pusan – but it demands much more investment and also purchasing land from private owners). Today, North Korea welcomes both variants, as this would mean restoration of their railroads.
It is true that Pyongyang would hold a privileged position and their demands on investment and other points might be hard to swallow if the project were to go ahead
It is true that Pyongyang would hold a privileged position and their demands on investment and other points might be hard to swallow if the project were to go ahead. However, the project would first need to get approval on the ROK side.
The August 5 2015 Gyeongwon line restoration ceremony at Baengmagoji Station in Cheorwon – that would, according to ROK President, “link Yeosu, Busan, Seoul, Cheorwon, Wonsan, Rajin and Khasan and reach further into Siberian and eventually European regions- connecting China’s ‘One Belt, One Road’ initiative, Russia’s ‘New Eastern Policy’ and the U.S.’ ‘New Silk Road’ initiative” is of special interest.
The real intention of the ROK government is currently unclear, for this ceremony was perceived in Russia as a propaganda show. And unless some government support for the Rajin-Khasan project is allocated, this opinion will not change. However, it might signify an important shift in Seoul’s position towards the Trans-Korean railroad linkage (North Korea many times expressed support of it to Russians). Yet current political tensions make such a development unlikely- it would need to be part of a broader process of reconciliation between the two Koreas.
Russia has shown its willingness to develop economic ties with North Korea, in close cooperation with South Korea. The Trans-Korean railway is therefore viewed as a potentially beneficial project that could accelerate the economic development of North Korea, as well as increase Russia’s integration in the Asia-Pacific economy.
The construction of a South Korea – North Korea – Russia gas pipeline s is perceived as an even more attractive project for Russia’s largest energy corporations. These projects could contribute to peace and stability on the Korean peninsula and increase economic cooperation among Russia, North Korea and South Korea. However, nowadays the prospects for the realization of these projects are dim.
The obstacles are of both Russian and Korean origin. First, private businesses in Russia don’t have a desire and incentive to develop cooperation with North Korea. Second, the Russian government has few resources for any significant investment in North Korea. Third, there are no real guarantees that money would return from North Korea to Russian investors. Fourth, there is a risk of irresponsible and aggressive North Korean behavior that could result in the destruction or cutting of the transport or gas lines. Fifth, the South Korean government as well as private corporations are also hesitant to believe in the project’s success.
These projects could contribute to peace and stability on the Korean peninsula and increase economic cooperation among Russia, North Korea and South Korea
Thus I think we should be rather skeptical about recent announcements of Russian officials to increase bilateral trade volume with North Korea or to develop any projects, especially those on a bilateral basis without cooperation with South Korea.
Main picture: Rason port, September 2015, by NK News