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business newsTrending: North Korea Gets a Crash Course in Capitalism
A delegation of 12 DPRK officials visits the US amid speculation the last Stalinist state may be open to economic reform.
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A delegation of 12 North Korean economic envoys flew back to Pyongyang on Sunday after spending two weeks touring companies that “represent main strands of the US economy.”
The group visited Google (GOOG), Home Depot (HD), Bloomberg, Citigroup (C), Qualcomm (QCOM), Sempra Energy (SRE), Union Bank, and Universal Studios, as well as a mushroom farm, a seafood wholesaler, and the Port of Los Angeles, where they leaned about trade infrastructure.
Journalists were not permitted access to the visitors (they entered the Googleplex through a back entrance under tight security), and no mention of the trip appeared in the American media. I stumbled upon the story after striking up a conversation with a DPRK official at the North Korean embassy in Berlin, Germany.
Located on Glinkastraße, an avenue in what was once East Berlin, the North Koreans built an 87,788 square foot compound during the 1970s. After the Cold War ended, staff numbers were significantly reduced, and, according to the surprisingly friendly official I spoke with through the embassy’s rear gate, two of the DPRK’s three buildings were leased out to private companies.
In nearly-unaccented English, he pointed out the main tenant -- a youth hostel which opened for business in 2008:
Though the North Korean flag flies out front (visible in the upper right), the decision to become landlords was strictly capitalistic, as years of economic sanctions have taken a tremendous financial toll on the DPRK.
After learning I was an American, the embassy official told me that a group of North Koreans happened to be in the States at that very moment.
Before I could inquire further, he was gone.
One of the few sources providing any details regarding the affair, South Korean newspaper JoongAng Ilbo, managed to obtain a copy of the delegation’s itinerary.
According to the report, “Six director-level officials were in the group, including the delegation’s head, Yon Il, a director at North Korea’s trade ministry. The other directors work for the trade ministry, agriculture ministry, finance ministry and industry ministry.”
Other delegates included lower level North Korean directors and managers, two advisors, and a researcher from a North Korean trade bank.
While Russian news outlet ITAR-TASS maintained that “[T]he initiator of these meetings is unknown,” the North Koreans were in fact invited to the US by Susan Shirk, director of the Institute on Global Conflict and Cooperation at the University of California, “to see firsthand what improved relations with the United States might mean in terms of economic cooperation.”
From 1997-2000, Shirk served as Deputy Assistant Secretary of State in the Bureau of East Asia and Pacific Affairs from 1997-2000, and is the head of the Northeast Asia Cooperation Dialogue, an organization engaged in “track-two” diplomacy.
As described by Tong Kim, a research professor with the Ilmin Institute of International Relations at Korea University and an adjunct professor at Johns Hopkins University's School of Advanced International Studies, the track-two approach “refers to contact, exchange of views, and other conduit activities between civilian organizations or individuals of two countries that are in dispute with each other.”
An email to Shirk seeking further details of last week’s visit was met with a terse “Sorry, no comment.” But sources say the North Koreans attended lectures at Stanford University and NYU, where they learned about “the market economy, consumer protection, what a CEO does, corporate strategies in the US, and an overview of the western legal system."
North Korean delegates at Stanford
This is one of the pillars of the track-two strategy. In “North Korea Inside Out: The Case for Economic Engagement,” a December, 2009 policy paper from an independent task force chaired by Dr. Shirk and Charles Kartman, former director of the Korean Peninsula Energy Development Organization, the case is made that:
The United States should adopt a long-term strategy of economic engagement with North Korea. North Korea’s attitude toward the world is closely related to the underlying structure of its domestic political-economy: a closed, command economy that favors the military and heavy industry and is isolated from the sweeping economic and political changes that have transformed the Asian landscape in recent decades. Encouraging a more open and market-friendly economic growth strategy would benefit the North Korean people as a whole and would generate vested interests in continued reform and opening, and a less confrontational foreign policy. In other words, economic engagement could change North Korea’s perception of its own self-interest. China’s economic transformation stands as an important precedent, showing how a greater emphasis on reform and opening can have positive effects on foreign policy as well. Economic change has the potential to induce and reinforce the D.P.R.K.’s peaceful transition into a country that can better provide for its people’s welfare and engage with other countries in a non-hostile manner.
Some, more hawkish Korea-watchers brush aside track-two diplomacy as a rube’s game being played with a staunchly anti-American entity that already knows far more about the outside world than it lets on.
However, there aren’t many other options in this increasingly unstable era, as a North Korean power handoff from Kim Jong Il to his son, Kim Jong Eun, is said to be in the offing.
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