Russia Expects N.Korea to Collapse by 2020

      November 04, 2011 12:54

      The Institute of World Economy and International Relations (IMEMO), Russia's foremost national policy think tank, takes the imminent collapse of the North Korean regime as a given in a special report published recently. IMEMO concludes that Korean reunification led by South Korea coincides with Russia's national interests.

      IMEMO spent years to prepare the report, which is part of the Russian government's 20-year master plan and was published in September.

      ◆ The End of North Korea

      The 480-page special report obtained by the Chosun Ilbo has five pages referring to the Korean Peninsula. It says the regime's collapse is "accelerating" and that although reunification may not be fully achieved, the two Koreas will take "actual steps" toward reunification in the next two decades.

      IMEMO believes the 2012-2020 transfer of power from North Korean leader Kim Jong-il to his son Jong-un will trigger the collapse of the North. The leadership crisis will lead to a power struggle between "bureaucrats" with foreign business connections and "military and security officials" with no outside links, the report said.

      Then over the following decade, a provisional North Korean government would be established under the aegis of the international community so that the North comes under South Korean control, while the North's military will be disarmed and modernization get underway, the report forecast. IMEMO said the North Korean economy will gradually be absorbed into South Korea's in the process and that around 1 million North Korean supporters of the old regime will flee to either China or Russia.

      ◆ South Korean-Led Reunification 'Beneficial'

      IMEMO said the emergence of a reunified Korea led by South Korea would have a "positive effect" on Russia's position in the Asia-Pacific region. And with the situation on the Korean Peninsula stabilizing, Russia would "strengthen its diplomatic power in the Far East" and gain a "reliable partner," it added.

      This would create opportunities for Russian businesses and the government to participate in massive transport, energy and industrial projects and create new demand for Russian energy, timber, metal and petrochemical exports, as well as machinery.

      A diplomatic source said, "It has been an established theory that Russia and other regional powers surrounding the Korean Peninsula favor the status quo rather than reunification, but here is a top Russian think tank publicly welcoming reunification led by South Korea."

      ◆ Economic Growth

      IMEMO forecast reunified Korea to see annual GDP growth of 3.5 percent before reunification (2011-2020), 2 percent during the process of reunification (early 2020s) and 5-6 percent in the final stage (late 2020s). The think tank projected that reunification would lay the groundwork for a new leap for the Korean economy.

      Korea's GDP, which stood at $1 trillion in 2010, would rise to $1.7 trillion by 2020 and $2.3 trillion by 2030, IMEMO projected. Reunified Korea would have a per-capita GDP of $30,000, and its population would stand at between 76 million and 77 million.

      The economic development of reunified Korea would have a strong correlation with the formation of a "three-sided" system in the region that includes China and Japan, according to the report. This would boost trade with other regions. By the early 2020s, North Korea's rapid economic development would lead to a trade deficit, but reunified Korea would be able to achieve a trade surplus by the late 2020s, the report added.

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