Is the N.Korean Regime Unraveling?

      January 20, 2011 07:27

      Chun Young-woo, the presidential secretary for foreign affairs and national security, reflected government views when he said Friday that North Korean regime would face "a short cut to its demise," experts believe. Chun was speaking in an interview with the U.S.' PBS. Why does the government believe that the regime is on its last legs?

      According to government data, the South gave the North a total of US$6.96 billion during the decade of the Kim Dae-jung and Roh Moo-hyun administrations. The figure covers aid in rice and fertilizers and cash provided under inter-Korean economic cooperation projects. It is 3.7 times the aid China gave North Korea during the same period and equivalent to 90 percent of the North's entire exports of $7.7 billion.

      "The North saw an annual trade deficit with China of between $700 million and $800 million, which it covered with aid and trade from the South," a government official said. Last year the North exported some $1 billion to China and imported about $1.8 billion.

      But under the Lee Myung-bak administration the North has received no aid from the South in the past three years, in contrast to 2.7 million tons of grains and 2.56 million tons of fertilizers a year under the previous administrations. The aid was worth $3.2 billion.

      Pyongyang used to earn some $300 million a year through trade with Seoul, mainly from fishery products and sand, but trade was stopped after the North sank the Navy corvette Cheonan in  March last year. The only hard currency the North earns now from the South is $50 million a year in wages for the joint Kaesong Industrial Complex.

      As the North resumed nuclear armament and military provocations, aid from the international community also dried up. Radio Free Asia, quoting an official of the UN Office for the Coordination of Humanitarian Affairs, reported in December that international aid to the North in 2010 was about $20.6 million, a mere 35 percent of the $58.75 million that flowed there in 2009.

      North Korea's domestic economy is a mess. Grain production this year is estimated to reach 3.8-3.9 million tons, which is 200,000-300,000 tons less than last year, the Institute for National Security and Strategy under the National Intelligence Service said. The food situation in the North is directly linked to public support for the regime. During the spring lean season last year, the North nearly coped with the food shortage by diverting rice from military storage, which according to a senior government official may not be feasible this year.

      In addition, the North Korean regime is strained by leader Kim Jong-il's ill health and the spread of waves of capitalism through South Korean drama. "Even if it won't collapse right away, the North may face a situation where it may have to agree to the South's demands in inter-Korean dialogue," said a government source.

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