I am writing this on my way back from Pyongyang where I was on a mission to promote language studies.

No one should suspect that I am North Korea apologist. But after 40-odd years of experience in Korean affairs I feel I can make some conclusions, especially concerning the burning issue: how to stop North Korean nuclear potential’s increase in the wake of the fifth nuclear test, and what immediate measures should be taken by the international community?

This issue becomes more urgent day after day, as the continued unchecked increase in Pyongyang’s nuclear and missile capabilities is almost certain to lead to a reaction by its adversaries, triggering a regional arms race and increased geopolitical confrontation with the  participation of major powers, particularly the U.S. and China. It also brings even closer the probability of the nuclear armament of regional powers and a shift in the global strategic balance.

THE PUSH FOR A CRACKDOWN

Proposals for new sanctions seem fairly radical. Among them is a ban on Air Koryo flights and the prohibition of ships which have visited North Korean ports entering other countries’ ports. This is a de-facto air and sea blockade, especially if coupled with measures to end the loopholes for mineral supplies across the borders and a ban on textile and sea products exports and a crackdown on cash flows and measures to deny North Korea access to international banking infrastructure.

Critics point to a danger that, if successful, such a blockade could lead to a severe economic and social crisis in North Korea and could push a cornered North Korean leadership, with nothing to lose, to military adventurism under the cover of an already existing nuclear shield.

Proposals on new sanctions seem fairly radical. Among them is a ban on Air Koryo…. and the prohibition of ships which have visited North Korean ports entering other countries’ ports.

I am skeptical about the feasibility of such a scenario, as the sanctions simply cannot get that far. But could increased pressure, supported by all UN member states, finally work and make North Korean leaders change their mind as to nuclear development and “Pyongjin” policy?

I think this is a dangerous illusion. It gives the semblance of action while such a policy makes the problem more acute and the future price for solving it less and less affordable.

All previous experience has shown that sanctions are next to impossible to implement. They attack the wrong culprits, loopholes to circumvent them cannot be closed, and new ones appear constantly –  this is the nature of international business.

It is hard for a serious analyst to endorse the opinion that some minor inconveniences might prompt North Korean elite to give up their only guarantee to a conditional security and their physical living, as well as the major source of pride and basis for power.

Even the undeclared goal to “stifle” the elite by cutting income sources seems unattainable. At least this is what the empirical data collected by me over the current year after the beginning of the implementation of more “biting” sanctions shows.

It is difficult for a serious analyst to endorse the opinion that some minor inconveniences might prompt North Korean elite to give up their only guarantee to a conditional security and their physical living

HERMIT KINGDOM?

It is difficult to speak about a total isolation of North Korea from Pyongyang. In the five days that I was in North Korea, several major international events took place, not including diplomatic events like the visit of the vice-governor of the neighboring Primorsky province of Russia and others. But even public international events were quite numerous.

They included Pyongyang 10th international book exhibition, involving over 70 companies from 27 countries, which started right after the International Film Festival in Pyongyang.

Simultaneously an international conference with the participation of around a hundred scholars and guests from a number of countries took place on the occasion of the 70th anniversary of Kim Il Sung University, and days before that the air show in Wonsan also attracted many foreign guests.

Of course, these visitors might be attested as “marginal” by critics, but I see no decrease in international contacts similar to the one that was noticeable after the previous nuclear and missile tests. It looks like the psychological mood has changed: many partners got used to Pyongyang’s nuclear ambitions and see them as something to live with.

Estimates were published recently that the per capita GNP of North Korea recently exceeded $1000 for the first time since the 1980s. This matches my observations in Pyongyang: its citizens have never lived so well, and the average standard of living of the middle class is incomparably higher than in the 1980s. Of course, the social and territorial differentiation has become much more pronounced.

It looks like the psychological mood has changed: many partners got used to Pyongyang’s nuclear ambitions and see them as a thing to live with.

But my visits to rural areas (not always guided) also show general improvement in the lives of large swathes of the population. This could mean that less might be spent on the military sector, while nuclear development might be cheaper. So is “pyongjin” actually working?

FEELING ON THE GROUND

What’s more, there is a genuinely more optimistic mood, sharply different from the feelings of despair I witnessed in 1990s. And this is not just a propaganda show for foreigners (although there is a lot of that as well, to be sure).

Common people seem to be genuinely proud of the indisputable successes of the country  this year in the fields of nuclear and space development (reminding me of the enthusiasm of the Soviets in the wake of Gagarin’s first space manned flight). North Koreans seem to be obsessed with spacecraft and things nuclear: you can see the symbols virtually everywhere.

What’s more, there is a genuinely more optimistic mood, sharply different from the feelings of despair I witnessed in 1990s.

The economic situation is not worsening at all in the wake of sanctions: the energy supply is stable, as well as the market exchange rate of the North Korean Won, construction is booming (though affected by the need to repair the damage inflicted by the floods in the north of the country). The number of cars on roads is growing, as well as that of restaurants and shops, and the range of food products accessible in these places is widening (and I saw no decrease in customers).

From a macroeconomic point of view this means two things. Firstly, sources of growth and investment within the country seem not to be drying up. If anything, they are boosted by the increase in agricultural production and business activity due to a more lenient market-oriented economic policy, coupled with government investment in the demand-oriented industrial production sector. I’ve seen many goods which were probably produced in joint venture plants, including, by some indications, in the Kaesong industrial zone.

Secondly, external sources of income have not suffered much – the export of coal is even growing by August figures.

After an initial blockade on North Korean exports, Chinese have in general returned to “business as usual,” using not only “humanitarian clause” loopholes, but maybe some new ones, even benefiting North Korean manufacturing (i.e. anthracite granules instead of prohibited coal).

CHINA’S ROLE

Given the row around THAAD, when China felt betrayed, Beijing was hardly going to get onboard and agree to stricter sanctions, even taking into account its resentment over North Korea’s provocative behavior. They understand that they won’t be effective.

It looks like there are additional business channels where trade is being done, maybe through off-shore and other business techniques: fresh Japanese products are at their usual places in Pyongyang shops.

Even in a hardly imaginable case of total closure of borders by China the country would still manage to survive.

…fresh Japanese products are at their usual places in Pyongyang shops.

But sources of growth in the future need to diversify and will not be based on restoring outdated heavy industrial potential (although still considerable), but rather the shift to a more knowledge-based economy. Such a concept requires considerable educational capabilities, well demonstrated by North Korean engineers through the indigenous inventions leading to the progress in nuclear and missile achievements.

North Korea’s young generation seems to be feverishly stimulated to study and accumulate knowledge, and technological progress is becoming, not only in words but deeds, the priority for development.

Waiting for the regime collapse is hardly a choice. And continuing doing nothing by trying to “punish” North Korea by sanctions does not address the root causes of the problem.

The only alternative is engaging North Korea in an attempt to find a new balance of interests, combining the desirable with the possible.

The minimum results of a resumption of the diplomatic process would be at least a freeze on the nuclear and missile programs starting from a moratorium on nuclear tests.

This is something the next U.S. administration should think about. While North Koreans remain very suspicious and skeptical regarding U.S. intentions, as my meetings in Pyongyang show, they would not reject such an advance.