China and the Korean Peninsula
Gordon G. Chang
Forbes.com
Abstract
Beijing has been losing influence in Pyongyang since Kim Jong-un
took power. Why is this occurring? Chinese authorities do not control
cash flowing to the North, the U.S. is bypassing China in its dealings
with North Korea, rising Korean nationalism is diminishing foreigners’
influence, Pyongyang is beginning to play the Russia and Japan cards,
and instability in the Kim regime prevents outsiders from influencing
events in Pyongyang. Moreover, despite China’s warming ties withSeoul, pro-North Korea elements still influence policy in Beijing andwill prevent a reversal of its fundamental approach to the Korean
Peninsula. So China’s new Korea policy, which would ordinarily give it
increased leverage in Pyongyang, may ultimately not have that effect,
especially if the Chinese initiative toward South Korea falters.
Keywords: China, North Korea, South Korea, United States, Japan,
Korean People’s Army, People’s Liberation Army, Rason, Kim Jong-un,
Jang Sung-taek, Xi Jinping, Park Geun-hye, Shinzo Abe, Sunshine
Policy, nuclear weapons, ballistic missiles

Xi Jinping, China’s ruler, visited Seoul in early July 2014, breaking
precedent and changing relationships in North Asia, perhaps for decades.
For the first time, a leader of the People’s Republic of China visited theSouth Korean capital before stepping foot in the Democratic People’s
Republic of Korea.
China’s Foreign Ministry cautioned others not to “over-read”1 thesignificance of Xi’s visit, but observers quickly saw a Chinese snub of
their long-time ally, a “cold shoulder”2 in the words of the New YorkTimes. Said John Delury of Seoul’s Yonsei University, “The message isthat if North Korea continues to keep Beijing at a distance and not work
harder to make China happy, then China will tilt towards South Korea.” 3

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The “tilt” that Delury then saw coming had already occurred,however. Xi Jinping had hosted South Korea’s president, Park Geunhye, in Beijing in June 2013, and even a year later, he had not extended
an invitation to his North Korean counterpart, Kim Jong-un, to visit. 4
Kim’s assumption of power following the unexpected death of his
father in December 2011 appears to have intensified infighting among
regime elements in Pyongyang. That infighting proved fatal for some,including Jang Sung-taek, executed in December 2013. Jang was, fromall accounts, corrupt, lecherous, and brutal, “a traitor to the nation for allages” as the official Korean Central News Agency called him.5 When hedied – probably by large-caliber rounds – China not only lost its mostinfluential contact in Pyongyang, but it was also demonized by the Kim
Family Regime as it explained why it had put Jang to death.
Jang’s fall from power was foreseeable, preordained even. Kim
Jong-il, the second member of his family to rule the North, picked his
sister, Kim Kyong-hui, and her husband, Jang, to be regents for his
youngest acknowledged son and designated successor, Kim Jong-un.
Jang and his wife, in that role, were to teach, guide, and protect the
younger Kim, eventually stepping aside when he was able to rule on hisown.
Yet Kim Jong-un dispatched his uncle from power much earlier, andin a far more final manner, than any observer had expected. And theregime, contrary to past practice, boasted about the purge. Since the1950s, North Korean state media has not publicly announced theexecution of a high-ranking Party member who was a Kim family
insider.6
Analysts can only guess why young Kim took the highly unusual
step of publicizing the death, but the crucial point for Chinese
policymakers is that Pyongyang justified this severe act by referencing,among other things, Jang’s relations with Beijing. In detailing Jang’s
crimes, the official Korean Central News Agency on December 13 madetwo references to the People’s Republic of China: his selling of “coal andother precious underground resources at random” and his “selling off theland of the Rason economic and trade zone to a foreign country for aperiod of five decades.” And the charge of Jang being “bribed byenemies”7 is probably a reference to the Chinese as well.

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Beijing genuinely appeared surprised by Jang’s purge,8 and that is anindication of how much access and influence it has lost in Pyongyang inrecent years. When Kim Il-sung and Mao Zedong both ruled, the twostates professed to be – and sometimes were – lips-and-teeth close.
Then, both leaders spoke the same language, literally and figuratively.
No wonder diplomacy was conducted on a leader-to-leader basis.
Yet despite the apparent comradeship, the two republics were always
uneasy allies. Kim Il-sung worked hard to minimize Chinese influencein Pyongyang, mostly by purging officials and military officers withclose ties to Beijing, such as the so-called “Yan’an faction.” The
Chinese, however, were always able to find new friends in the Kim
regime. Kim’s son, Kim Jong-il, worked even harder to remove
Beijing’s influence in the North Korean capital and had strained personal
relationships with his Chinese counterparts, Jiang Zemin and Hu Jintao.
Donald Kirk, the veteran North Korea watcher, has written that much of
the factional strife in Pyongyang occurs without affecting the regime’s
relations with China.9 However, that assessment, which had been
generally correct, has recently become inaccurate. Kim Jong-un had
given his uncle Jang Sung-taek nearly free rein to handle relations with
Beijing. Kim, therefore, risked his China ties when he ordered theexecution of Jang, but it appears the young leader was confident he could
repair relations with China afterwards. In fact, that is what he tried to do
by sending China a message after Jang’s death. “There will be no changeof policy, either inside the country or in its foreign outlook,” Kim, in thewords of a “New York-based diplomat,” signaled.10
If Kim had stopped the killing with the execution of his uncle,
relations with Beijing would have been largely unaffected, but hecontinued his “reign of terror”11 and systematically rooted out Jang’s
nationwide patronage network. As he did so, he eliminated underlings
who had handled China matters for Uncle Jang. In short, Kim,
presumably knowing the consequences, deliberately cut most contacts
with his most important benefactor.
At least for a time, young Kim tried rebuilding his lifeline to theChinese capital. For instance, he sent Kim Ki-sok to Beijing and
Shenzhen in February 2014 looking for Chinese money. The mission
proved to be unsuccessful, as the envoy returned home, according to the
Chosun Ilbo, “empty-handed.”12 Kim even rehabilitated some of Jang’s
allies because of their China expertise or knowledge. There are reportsthat he reinstated two such officials, in what the Voice of America called

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“a sign the regime may try to repair its economic relations with its
powerful neighbor.”13 For instance, the cloud over Ji Jae Ryong,considered a “linking pin” between Jang and China,14 was lifted,
apparently because he was needed in Beijing.
Yet it is clear that rebuilding ties to Beijing was not Kim Jong-un’s
main priority. After all, in May 2014 he demoted Choe Ryong-hae, thenconsidered to be North Korea’s No. 2 official. Choe’s removal meantthat one more figure with China experience had exited the top ranks of
the Pyongyang leadership. Charles Burton of Brock University has
called the demotion “another signal that cannot be pleasing” to theChinese.15
The Chinese, despite everything, have tried to build bridges fromtheir end, for instance by sending two Foreign Ministry delegations to
Pyongyang in the beginning of 2014. Xing Haiming traveled there inlate January, and his delegation was followed in February by one headed
by Deputy Foreign Minister Liu Zhenmin, who spent four days in the
North. It is unusual that the two Chinese missions were separated byonly weeks.
Yet the Chinese delegations were not successful. Since they traveledto Pyongyang, the North has, according to one account, “virtuallysuspended official exchanges with China.”16 Moreover, Pyongyang hasreportedly summoned, for the second time after the execution of Jang
Sung-taek, all trade officials in the People’s Republic. “On the surface,
they were recalled for ideological study, but in fact it’s a kind of silent
protest against China,” a source told the Chosun Ilbo.17
China has also been protesting, prolonging a cutoff of oil flowing to
the North. The stoppage, which lasted virtually the entire first half of2014, seems to have crippled the operations of the North Korean
military.18 Despite its severe effect, Kim Jogn-un has showed no signs ofbuckling, and, if anything, is now even more defiant of Beijing.
Chinese officials have to be asking themselves why their policies
have apparently failed, despite everything, to command the obedienceand respect of their destitute neighbor. Since the death of Kim Jong-il,
the balance of power has been tipping in favor of the weaker party in thisrelationship. As Cai Jian of Fudan University in Shanghai told the South
China Morning Post, there is concern in Beijing that the North Koreans
now do not place a high value on their ties with China.19

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The Chinese have every right to be worried. Not only did Kim purge
China-friendly officials with his regime-wide purge, but before that heundertook actions – long-range missile tests, a third nuclear detonation,
an abrogation of the Korean War armistice, to name just a few of them –that appeared to have genuinely upset his Beijing benefactor.
There are several reasons for the recent loss of China’s influence.
Chinese authorities do not control cash flowing to the North, the U.S. is
bypassing China in its dealings with North Korea, rising Koreannationalism is diminishing foreigners’ influence, Pyongyang is beginningto play the Russia and Japan cards, and instability in the Kim regime
prevents outsiders from influencing events in Pyongyang. Moreover,despite China’s warming ties with Seoul, pro-North Korea elements stillinfluence policy in Beijing and will prevent a reversal of its fundamental
approach to the Korean peninsula. So China’s new Korea policy, which
would ordinarily give it increased leverage in Pyongyang, may ultimately
not have that effect, especially if the Chinese initiative toward South
Korea falters. This article analyzes these reasons.
China Is Losing Control of Cash Flowing to North Korea
It is no secret why the North Koreans need China. They depend on
the flow of Chinese cash, both in the form of outright grants as well as
the proceeds of trade and investment. Due to, among other things,
excessive spending on the Korean People’s Army – a country of 24.9
million people supports the world’s fourth-largest military – and grosseconomic mismanagement, the North Korean economy has been
generally stagnant since its initial recovery from the 1990s famine.
Beijing has provided a lifeline since then.
China’s dominance of the North Korean economy is growing. Take
North Korea’s major legitimate export item: minerals. The Chinese areabout the only buyers of the DPRK’s anthracite – they purchased $1.37
billion of such coal in 2013 – and they bought $294.1 million of theNorth’s iron ore that year.20 Largely as a result of mineral purchases,
trade between China and North Korea jumped 10.4% in 2013, reaching arecord $6.5 billion. North Korea’s exports to China soared by 17.2%,
and imports from China increased by 5.4%.21
The People’s Republic has traditionally been the North’s largest
trading partner, and it appears that the Chinese substantially increased
their share of trade with the North in 2013. In 2012, China accounted for
68.4% of North Korea’s total foreign trade.22 Last year, that high120 International Journal of Korean Studies  Spring 2014

percentage increased to almost 90%,23 because North Korea’s commercewith the South, its other large trading partner, plummeted when
Pyongyang closed the Kaesong Industrial Complex for five months toshow its displeasure. As a result of the long interruption in production,inter-Korean trade dropped 42.4% in 2013, to $1.1 billion, from $2.0
billion the year before.24
As goes trade, so goes investment. Although there are few reliable
figures quantifying inward capital flows in recent years, China appears tohave retained its role as the main supplier of investment cash.25
And Chinese money is changing the DPRK. For one thing, the floodof China’s cash has created, or at least contributed to, a mini-boom, atleast by North Korean standards. According to the authoritative Bank of
Korea, the South Korean central bank, the North’s economy expanded by
1.1% in 2013, 1.3% in 2012, and 0.8% in 2011.26
Most analysts say that increased Chinese trade and investment isresulting in increased dependence on Beijing. That sounds logical, andin the modern restatement of the Golden Rule, it is the party holding thegold that makes the rules. In the reverse-reality world of North Korea,
however, the non-gold holder is in fact doing so. This anomalous
situation is attributable to two principal factors.
First, Beijing wants to make investments more than Pyongyang
wants to receive them. Apart from mining ventures, Beijing has
concentrated its large-scale projects near China’s border, especially inthe port of Rason in the east, where the Tumen River empties into the
Sea of Japan, or East Sea, and in the west near the Chinese city of
Dandong, where the Yalu flows into the Yellow Sea, or West Sea.
The North Koreans know that Beijing must have what they possess:
China controls the mouth of neither river. In these circumstances,
Pyongyang exercises a high degree of control over China’s riverine
investments. These investments are large-scale and need formal
approval from Pyongyang, which has set the rules and administers thegame, much the same way the Chinese did three decades ago when
foreigners wanted to invest in their then-closed country. Robert Potter,
who spent time in the DPRK on an exchange program, correctly notesthat big Chinese investors are at a disadvantage because they come up
against the North Korean state where it is at its strongest.27 That state,
therefore, makes the most of home field advantage, directing how China
invests its money.

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This dynamic is evident in Rason. China, with no direct access to
the Sea of Japan, craves control of that port to give its provinces of Jilin
and Heilongjiang a path to international water. Russia – not China – hassovereignty over the northern bank of the Tumen, so Beijing is
accelerating plans to control the south bank, which is North Korean
territory, by planning to dump about $3 billion of investment into it.28
Yet Kim’s bureaucrats have been able to continually frustrate theChinese with restrictions that have inhibited the growth of the port. It
may be true that “the place looks like a giant Chinatown,”29 but Chinese
investments there are not doing well. China’s “five star” hotel in Rasonis “empty” and the port area is “quiet”30 although the city by now shouldhave developed into a bustling commercial hub. The Chinese four-lane
expressway leading to the city has “thin traffic,” and Beijing’s plans tobuild a high-speed rail line to there look “misplaced.” A Jilin
government official, Reuters reports, says Chinese businesses are losing
confidence in Rason.31 In fact, the North Koreans are making it tougher
and tougher for their northern neighbor to do business. As one Chinese
trade association official recently said of DPRK officials, “Theirdemands are higher and higher.”32
The spiraling up of demands is a reflection that North Korean
officials are ambivalent about accepting Chinese investment, and so havesurprisingly little concern about losing it. In sum, Beijing does not havemuch leverage because its desire to invest is stronger than Pyongyang’s
desire to accept.
Chinese leaders may think they can flood North Korea with cash andcorrupt its officials, as John Park of MIT and Harvard’s Kennedy Schoolsays,33 but that does not necessarily give them power. The North
Koreans know the Chinese will keep the taps open whatever they do, sothey can afford to offend their benefactors.
The Chinese, despite what they may think or say, have apparently
made a decision to support the Kimist state with trade and investment,
whatever it does or doesn’t do to displease them. Despite Pyongyang’s
especially provocative behavior in 2013, for example, the Chinesecontinued with their economic relations, and the Kim regime certainly
took notice, realizing that Beijing had essentially delinked economic
relations from diplomacy. China’s patience – what some may call an
indulgent attitude – works against Chinese influence.
Second, Beijing has lost control of many of the investment flows into
the North because now much of the Chinese money is small-scale and so

122 International Journal of Korean Studies  Spring 2014leaves China under the noses of its regulators. Over the last decade,
China’s entrepreneurs have invested into North Korean restaurants,
shops, and factories, and in the aggregate these businesses aresubstantial.
In many respects, today’s North Korea resembles China at the
beginning of its reform era, so it should come as no surprise that plucky
Chinese entrepreneurs, who outwitted Chinese officials long ago, arenow sneaking under the nose of China’s border regulators as they build
profitable niche businesses in the North. “This place is just like China in
the 1980s,” says Hao Ze, a successful Chinese investor, who owns a
North Korean car parts factory, restaurant, and spa and who is now
putting the finishing touches on a deal to mine rutile, an ingredient inpaints and plastics. “It’s highly risky, but it’s also highly profitable if
you seize the opportunity.”34
Chinese investors, absolutely determined to seize opportunities, areremaking the North. Pyongyang knows that Beijing can no more shut off
this small-scale investment than it can stop the Chinese traders who carry
their goods into North Korea in the morning and return home in theevening, pockets stuffed with cash. China, consequently, gets no credit –or leverage – in Pyongyang for much of this Chinese money flowing
south.
If anything, this flow of capital, not under the control of Chinese
central government officials, is making Kim less dependent on China’s
government. For decades, Beijing had hectored the first two Kim rulers
to attract investment and open up their economy. Now, as Chinese
investment is finally transforming the North, as past Beijing leaders
wanted, the process of transformation is giving Kim Jong-un the means
to resist Beijing’s wishes.
A Frustrated Washington Is Taking China Out of the GameAt the beginning of this century, Beijing was becoming the center ofpeninsular diplomacy. The administration of George W. Bush, reasoningthat the Chinese had the most influence in Pyongyang, decided that
Beijing should be the focus of efforts to disarm the Kim regime.
Then, it seemed to hopeful American policymakers that China had
already begun a fundamental shift in its foreign policy and that it mightcomplete the process of shedding its self-image as an outsider and ending
its traditional role as an adversary of the existing global order. As aresult, it seemed to make perfect sense for China to lead efforts toInternational Journal of Korean Studies  Vol. XVIII, No. 1

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“denuclearize” North Korea. Washington, therefore, had arranged fornegotiating sessions to be held in the Chinese capital. Three-party talks– between China, North Korea, and the U.S. – in April 2003 led to thestart of the six-party discussions in August of that year, with the additionof South Korea, Japan, and Russia.
The Chinese at first assumed that prominent role with gusto,
mediating, cajoling, and at times threatening the five other parties to thetalks, especially North Korea and the United States. That, of course,
gave China’s diplomats great leverage in their dealings with, among
others, their North Korean counterparts.
The special role for the Chinese did not last, however. For manyreasons, Beijing proved unwilling or unable to fulfill the outsized hopesof Washington and other capitals. Representatives of the six parties havenot met since December 2008, and North Korea announced its
abandonment of the talks in April 2009. Among other consequences, thebreakdown in the six-party process lessened Beijing’s role at the centerof Korean Peninsula diplomacy.
The Obama foreign policy team, faced with the failure of China tobroker an enduring solution, essentially cut out the Chinese from thediplomatic process. The sudden ascension of Kim Jong-un after thedeath of his father gave Washington an opportunity to ditch unproductive
multilateral efforts and employ direct diplomacy with Pyongyang. In
early 2012, Glyn Davies, Obama’s North Korea envoy, had even reached
an interim arrangement, announced on February 29 and therefore termedthe Leap Day Deal. Pyongyang, in return for 240,000 tons of food aid,
promised to stop work on a uranium-enrichment facility in Yongbyon,suspend nuclear and missile tests, and permit International Atomic
Energy Agency inspectors to enter its facilities.
The arrangement did not survive two months. Young Kim fired off
what looked like a ballistic missile in April – his regime instead claimed
its Unha-3 “rocket” was carrying a satellite – and recriminations left
relations worse than at the beginning of that year.
The failure of the direct effort did not mean that China regained its
position at the center of global efforts to deal with Pyongyang. The
White House, obviously fearful of failure, does not now look like it will
try another diplomatic push, and given current challenges, it may nothave the time to devote to the Korean Peninsula in any event. This has
had the side effect of preventing China from assuming its former centralrole.

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It is true that American diplomats still troop to Beijing to talk about
North Korea, as Secretary of State John Kerry did in February 2014, but
those efforts seem perfunctory, a check-the-box exercise at best. For
instance, while Secretary of State John Kerry did his best to show that
China was a partner of the U.S. in its effort to disarm the DPRK, there
was no joint statement to that effect during the February meeting, a suresign that the secretary of state knew he did not have Chinese support for
American initiatives.
Chinese diplomats, pursuing a policy that cannot be abandoned,
continually try to revive the dormant six-party talks. As Foreign
Minister Wang Yi, voicing his government’s hopes for denuclearizing
the Korean Peninsula, said in March 2014, “Some dialogue is better thannone, and better early than late.”35 As Wang Yi’s comments indicate,
China has never given up trying to put dialogue back on track.
It is natural for Beijing to try to restart the discussions that would
restore its prominence – and its leverage over Pyongyang – but after ahalf-decade it has not been able to come up with the formula to do so.
China’s current efforts look half-hearted, perhaps because Chinese
diplomats understand that they have missed the moment to put theirstamp on the peninsula. Their lack of enthusiasm may also be the resultof the realization that, as a practical matter, they can’t put more pressure
on the North Koreans. And in a larger sense, the dormancy of the sixparty talks looks like the result of a perception in Washington andelsewhere that Beijing policymakers no longer command the respect andattention of their North Korean counterparts.
In China’s case, repeated failure to move the Kim regime towarddisarmament has led to a general loss of influence.
Rise of Korean Nationalism Diminishes Outsiders’ Influence
The otherwise inexplicable Sunshine Policy of Kim Dae Jung and
the Peace and Prosperity Policy of his successor, the hapless Roh Moohyun, can perhaps best be explained not by a naïve desire to engage theKim regime but as an expression of Korean nationalism. In short, themost important goal of South Korean policy is the survival of Korea.
Korean nationalism has a rarely discussed byproduct: theminimization of foreigners’ influence in Pyongyang. And in many ways,
Kim and Roh, during their tenures in the Blue House, succeeded inpushing a foreigner, China, to the sidelines in the North Korean capital.

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Yet the goal of displacing China had a cost that was ultimately too
high for successive administrations in Seoul. Lee Myung-bak, who
followed Roh, and Park Geun-hye, the current occupant of the Blue
House, moved South Korea back to its more traditional posture. That has
meant, among other things, that cooperative projects between the two
Koreas, such as the Mount Kumgang resort, have failed. Even in fiercely
insular and proud Korea, nationalism wanes from time to time.
Yet even in fallow periods like the present, nationalism still guides
Blue House policy. South Korea is still trying to build a strong Korea,
and as part of that drive it is insecure about losing clout in Pyongyang,something evident in the way it handled – or perhaps mishandled – North
Korea’s closure of the Kaesong Industrial Complex in April 2013.
Pyongyang, for no reason relating to the project, forced the South Korean
managers of the 123 businesses there to leave the North, making thecomplex, a symbol of inter-Korean cooperation, a ghost town. Seoul
immediately began efforts to reopen the zone.
For many reasons, the zone is a misguided effort. For instance,
South Korean businesses in Kaesong do not pay their workers. Instead,they transfer hard currency – about $90 million a year at the time of theclosure – to a state recruiting agency and the government pays workers inlocal currency.36 In essence, South Korea, by trying to reopen the zone,
was seeking to funnel cash to a regime that was using its resources toundermine South Korean society. Because money is fungible, Seoul has
essentially financed Pyongyang’s attacks on South Korea, some of themmurderous.
South Koreans have justified Kaesong as a project that would
stabilize inter-Korean relations, but after the deadly incidents of 2010 –when the North killed 50 South Koreans in two incidents – and thedisruptive events of early 2013, that rationale can no longer bemaintained. As long as the Kaesong complex continues to operate,
however, China is not the only foreign country maintaining significant
economic relations with the regime.
Moreover, President Park has been subtly competing with Beijing for
influence in Pyongyang, and has been more willing to engage the other
Korea than Lee, her predecessor. So far, her signature “trustpolitik”
policy has not yielded dividends, but it appears that the outreach to theNorth has, by itself, undermined Chinese influence in Kim family circles.
For example, Park’s initiative is talked about as a replacement for the
six-party talks, which, if revived, would give Beijing increased clout in

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the North Korean capital.37
Korean nationalism may not be as evident today as it was during theadministrations of Kim Dae-jung and Roh Moo-hyun, but it is thedominant force on the peninsula, always present and always strong. And
in a land colonized for four decades and then divided into two to thisday, it remains on a general upward trend, something evident in the last
two years. That is not good news for those in Beijing who want tocontrol the Kim regime.
Pyongyang Is Beginning to Play the Russia and Japan Cards
In the Cold War, Kim Il-sung skillfully made Moscow and Beijing,his primary backers, compete against each other for his support.
Whenever one of them threatened to pull away, he threatened to movecloser to the other. This masterful balancing game meant that neither theSoviet Union nor China were able to dominate Pyongyang, at least notfor long.
An exhausted Soviet Union dropped out of the rivalry, and Beijing’s
embrace of Seoul, which culminated in its recognition of South Korea in
1992, meant that the North Koreans had to work to keep China, then
their sole supporter, happy. As much as Kim Jong-il detested his
Chinese counterparts, he had little choice but to heed their advice
because he absolutely needed their assistance.
Kim soon got a respite. The South Koreans, during the Sunshine
Policy years, looked like they were about to step into the role of theSoviets, thereby giving the North Koreans two parties to play off against
each other. Chinese influence, however, got a boost when Lee Myungbak took over as president from Roh Moo-hyun and ended Seoul’s broad
outreach to the other Korea.
Will Putin’s Russia now challenge China for influence in North
Korea? The Duma just approved the write-off of about 90% of $10
billion in Cold War-era debt held by North Korea, and the Kremlin is
expanding dealings with Pyongyang, in particular planning a gas pipelinerunning the length of the country into South Korea and an extension of
the Trans-Siberian Railroad to Rason.
A high-profile Russiandelegation, headed by Deputy Prime Minister Yuri Trutnev, visited
Pyongyang for three days at the end of April 2014 and signed an
economic cooperation agreement with the North.38
It’s not clear how much attention Putin will eventually devote to East
Asia, but he is interested in the region at this moment. The pipeline will

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tie the South Korean economy to Russia’s, and the proposed rail
extension to Rason could attract cargoes that would otherwise travel by
sea through the Suez Canal. Therefore, the Russian leader should remain
focused on economic relations with the North as long as these two
projects look like they are going forward.
Putin’s attention means Kim Jong-un is taking maximum advantage
of his new friend. “It seems like North Korea is diversifying its strategy
for economic development by moving away from an overdependence on
China and toward great cooperation with Russia, which also puts
pressure on its neighbor,” said Cho Bong-hyun of IBK Economic
Research Institute in Seoul to Arirang News.39 And as the Chosun Ilbo
noted in July 2014, “Since early this year, the North has been closer to
Russia than ever before.”40
Moreover, Pyongyang and Tokyo are in the early stages of courting
each other. Obtaining a full accounting of Japanese nationals abductedby the Kim regime is a high priority for Japanese Prime Minister Shinzo
Abe, and in early July 2014 his government eased sanctions on
Pyongyang when the regime promised to initiate an investigation into thefate of the abductees.41
Both Japan and North Korea have reason to improve ties with theother. The Japanese are seeking allies in the region against a China thatis attempting to seize their islands, and the North Koreans are looking forfriends as Beijing distances itself from Pyongyang. “Kim Jong Un wants
to show China he has choices,”42 writes noted Korea watcher Aidan
Foster-Carter. Previous reconciliation attempts between Pyongyang andTokyo have floundered and there are high obstacles between better ties
between the two states, yet as long as they continue to try to normalize
relations China cannot help but lose influence in Pyongyang.
The Kim regime is looking for friends in north Asia, and nations in
the region are reciprocating its gestures. That ultimately is not good for
China’s leverage over North Korea.
Regime Instability Means China Is Losing the Ability to Influence
Pyongyang
At the end of February 2014, the official Korean Central News
Agency carried Kim Jong-un’s comments on factional infighting.43 As
noted, the regime, beginning with the purge of Jang Sung-taek, haspublicly admitted to internal discord, something it has not done since thedays of Kim Il-sung.

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The Kim family has built its power on the notion it has the love,support, and devotion of all the people of the Democratic People’s
Republic of Korea, so talking about severe disagreements means thedivisions among elite elements must be serious. As noted, Korea
watcher Bruce Bechtol stated in February 2014, “Things are as tenuous
as I have ever seen them.”44 Since then, the turmoil inside the regime
has continued. As he points out, “The most easily discernable sign ofweakness in the power structure, or an inability to fully control agovernment, is purges – and in North Korea there have been plenty ofthem.”45 There have been so many demotions and executions that inMarch 2014, an unnamed South Korean official compared Kim Jong-un
to a driver of a car with no brakes.46
If the vehicle is indeed brake-less, it must mean China has lost
influence in Pyongyang, if for no other reason than that it can no longer
manipulate the traditional levers of control. And for as long as thisinstability in Pyongyang continues – and it could last for years – China
will, like everyone else, be looking in from the outside. In short, every
country has lost influence with a Kim regime in distress.
Pro-North Korean Elements in Beijing Still Influence Policy
By now it is almost certain that Kim has figured out that, in recent
years, the Chinese military has gained power in Beijing and that thistrend means he need not worry too much about China’s civilian officials,
even when they seem to be driving policy in favor of Seoul, like they areat this time.
The rise of the People’s Liberation Army (PLA) has coincided withthe transition from the so-called Fourth Generation leadership of Hu
Jintao to the Fifth, under the command of Xi Jinping. The dominantnarrative among China watchers is that Xi, who formally took power atthe 18th Communist Party Congress in November 2012, has rapidly
consolidated his political position. That assessment, even if it is correct,
appears incomplete in important respects relevant to Beijing’s ties to
North Korea.
Analysts like to say Xi heads the Party’s “Princeling” faction, butthat term merely describes sons and daughters of former leaders or highofficials. These offspring have views that span the political spectrum
and do not form a cohesive group able to compete for power with, say,the Communist Youth League faction of Hu or the Shanghai Gang of
Jiang Zemin, Hu’s predecessor.

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Xi became China’s supreme leader because he appealed to all
factions, in large part because he then had no faction. He was, in short,the least unacceptable choice. Today, he still is not identified with any
civilian faction.
Having no faction was a successful strategy for attaining power, but
in the Party’s highly complex and factionalized system, having no
reliable base of support can make governing difficult. Some politicalanalysts like the veteran Willy Lam even believe Xi, in order to ruleeffectively, has made the military his faction.47 If this assessment iscorrect – and there are reasons to believe it is – the new leader cannot say“no” to the top brass. In any event, Xi must be respectful of flag
officers’ views.
The People’s Liberation Army is probably the Party’s most powerfulinterest group, in part due to its size but also because in a time of chaotic
leadership transition, the military has been able to maintain its cohesion
while other political factions and groups have frayed or eroded. Generals
and admirals, therefore, are able to wield political power. So today, inthe complex bargaining that goes on in Beijing, it is not entirely clear
whether Xi commands the PLA’s flag officers or whether the flags of the
PLA command him.
There is evidence that, at least on some occasions and on somematters, flag officers are either making their own policies independentlyof China’s civilian leaders or are essentially telling civilian leaders what
policies they will adopt. The apparent ascendance of the military in
China profoundly affects ties between Beijing and Pyongyang because
the PLA is considered to have special equity on matters involving the
Korean Peninsula due to the heavy losses it suffered in what the Chinese
call “The War to Resist America and Aid Korea” and what the rest of theworld knows more plainly as the Korean War. Chinese military officers
are known to have views favoring the regime in Pyongyang.
And it is no surprise that they do. The ties between Chinese andNorth Korean officers are forged in blood, held together by sharedperceptions, and reinforced by business dealings.
Kim could
contemplate taking down Jang Sung-taek and his network because heknew that his back-channel military ties would remain intact. And
because he knew of this institutionalized military relationship, he could
be reasonably certain that the flag officers of the People’s Liberation
Army would exercise their power to favor his regime. Senior Chinese
military officers benefit from the current arrangements with North Korea

130 International Journal of Korean Studies  Spring 2014

– including weapon sales – and they are not about to permit a complete
reversal of policy.48
There are many in Chinese policymaking circles who believe that
Beijing’s long-term support for the Kim family is not in China’s longterm interests. In recent years, it seems that almost every foreign
diplomat has relayed conversations with Chinese counterparts expressing
real frustration with the North Koreans, and there have been various
reports that Beijing has been on the verge of breaking with its long-time
ally. Yet despite the real push for a change in China-North Korea ties, itappears the fundamental policy remains in place, even though today theshift in thinking is resulting in a tactical embrace of Seoul. There havebeen spats between Beijing and Pyongyang in the past, and today we arewitnessing a long one as Xi Jinping puts his mark on China’s external
policies. There does not, however, appear to have been an abandonmentof decades-old approaches. Chinese foreign policy, in sum, has merely
taken on a less passive tone.
The rise of the Chinese military is occurring while Chinese
diplomats, since the era of Hu Jintao, have been trying to end China’s
special relationship with Pyongyang by changing the nature of its ties.
Up until now, the Communist Party’s International Department has been
primarily responsible for conducting dealings with the Kims.
“Communications with the International Department usually stresses
more on the relationship between the ruling parties ... and that usuallyconveys a sense that the two are brothers or allies,” said Fudan
University’s Cai Jian. “With the involvement of the foreign ministry, it
is more like nation-to-nation routine exchanges, stressing less on
brotherly ties.”49
As the Foreign Ministry gets its way, China has the potential toincrease its pull in the North Korean capital. Yet so far, the move does
not appear to be working, as the young Kim has not responded as Beijing
hoped he would. So it’s possible that we will see a return to party-toparty relations, which would be a victory for the North Koreans.
Moreover, we have to remember that in the day-to-day struggles between
the People’s Liberation Army and the country’s diplomats, the generals
and admirals almost always win. The prospect of a long-term change in
the nature of ties, therefore, seems unlikely.
Of course, Beijing’s new approaches could fail for other reasons.
China will have difficulty switching sides on the Korean Peninsula
because, among other reasons, it is unlikely to abandon its territorial

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claims on seas that Seoul believes are its own. The flashpoint is Socotra
Rock, a formation about 15 feet below low tide in the Yellow Sea.
Seoul, which calls it Ieodo, has built a research station over it and claims
it to be within its exclusive economic zone. The Chinese also think theformation is theirs, despite the fact that the rock lies 80 nautical miles
from South Korea’s Marado Island and almost twice that to the nearest
part of the People’s Republic of China.
And if China is to successfully woo Seoul, it will have to end thefrequent incursions of its fishing fleets into South Korean waters and put
a stop to the violent – and sometimes deadly – clashes between its
vessels and the South Korean coast guard. It is not entirely clear that anincreasingly assertive Beijing has the will to pull back in such a manner.
Conclusion
Not everyone agrees that the Chinese are losing clout in the North
Korean capital. In fact, it appears that the majority view is that Beijing is
now more powerful than before. “Pyongyang always tries to play off its
interlocutors against one another,” writes Aidan Foster-Carter in a
provocative essay, “South Korea Has Lost the North to China.”“Conceivably, the mercurial Mr. Kim might suddenly try to ditch China
and re-embrace South Korea. But Beijing will not let him and thecautious Ms. Park would not have him. Uncle Jang’s men may havefallen from favor but the trade ties he built will last. Seoul blew its
chance. North Korea’s future now lies with China.”50
Most observers, especially in a nervous South Korea, believe China
is gaining influence in Pyongyang by default, largely because Seoul has
supposedly left the playing field wide open for the Chinese. Yet, as
discussed above, Seoul has not in fact done so, and in any event Beijing
is in no position to benefit from such developments. The Chinese, inshort, are bound to have difficulty navigating in Pyongyang politicalcircles. For one thing, they act more arrogantly these days – thereby
making sure they irritate the North Koreans, who are already sensitive
about being victims of big powers – and they also seem to have lost
touch.
It is telling that the Chinese have now been cut-off from theirtraditional sources of information in North Korea. Fudan’s Cai Jian saysthat Beijing has had to seek information from South Korean sources. 51
Zhang Liangui of the Communist Party’s Central Party School says
Chinese scholars rely mostly on Rodong Sinmum, the official article of

132 International Journal of Korean Studies  Spring 2014

the Korean Workers’ Party, as well as the Korean Central News
Agency.52 That’s a big comedown for a country that used to get its
information on North Korea when Kim Il-sung spoke to Mao.
And it is also telling that from the middle of 2014, the Korean
People’s Army has been “ratcheting up denunciations of China, calling ita ‘sworn enemy.’”53 That followed reports from the Chosun Ilbo in lateMarch 2014 that Kim Jong-un had ordered the Kang Kon Military
Academy, training ground for the country’s top officers, to hang signs
with a quote from his grandfather that China is a “turncoat and ourenemy.”54 The signs were also put up at training schools for Workers’
Party officials. Kim Il-sung supposedly uttered those words in 1992,
when Beijing extended diplomatic recognition to Seoul.
It is not clear what caused Kim Jong-un to order the posting of thesigns. The Chosun Ilbo reported that Kim was angered by Beijing votingfor UN sanctions in 2013. It’s true that Chinese officials irritate
Pyongyang from time to time, but it is unlikely that any one event is thereason for the long-term friction between the two states.
A more likely explanation for deteriorating relations is that, over thelong term, China poses a fundamental challenge to the regime. The
People’s Republic represents modernity and progress, and modernity andprogress are critical threats to Kim’s state, which can only survive in aclosed environment. Kim rulers know they cannot follow China’s path,
which makes Beijing’s recent hectoring about economic reform
inherently baneful to them.
And perhaps that is the ultimate reason why, when the current Kim
ruler looks so insecure, China is losing even more influence in the
Democratic People’s Republic of Korea.
Notes:
1“With Seoul Visit, China Leader Sends Message North,” Associated Press,
July 2, 2014, available at: http://www.washingtonpost.com/business/with-seoulvisit-china-leader-sends-message-north/2014/07/02/cecb733e-01c2-11e4-9a6a955ebcaa3334_story.html.
2

Jane Perlez, “Chinese President’s Visit to South Korea Is Seen as Way to
Weaken U.S. Alliances,” New York Times, July 2, 2014, available at:
http://www.nytimes.com/2014/07/03/world/asia/chinas-president-to-visit-southkorea.html?_r=0.

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3

Teddy Ng, “Xi Jinping Sends Pyongyang a Message by Making First Korea
Trip as President to Seoul,” South China Morning Post (Hong Kong), July 2,
2014, available at: http://www.scmp.com/news/china/article/1544521/xi-jinpingsends-pyongyang-message-making-first-korea-trip-president.
4

See Jane Perlez, “Chinese President’s Visit to South Korea Is Seen as Way to
Weaken U.S. Alliances.”
5“Traitor Jang Song Thaek Executed,” Korean Central News Agency, December
13, 2013, available at:
http://www.kcna.co.jp/item/2013/201312/news13/20131213-05ee.html
6Bruce E. Bechtol, Jr., e-mail message to author, February 15, 2014.

7“Traitor Jang Song Thaek Executed,” Korean Central News Agency.

8

See Jane Perlez and Choe Sang-hun, “Public Ouster in North Korea Unsettles
China,” New York Times, December 9, 2013, available at:
http://www.nytimes.com/2013/12/10/world/asia/a-gamble-for-north-korealeader-kim-jong-un.html?pagewanted=2&pagewanted=all.
9

See Donald Kirk, “Mad, Bad North Korea May Just Be an Act,” South China
Morning Post (Hong Kong), March 17, 2014, available at:
http://www.scmp.com/comment/insight-opinion/article/1450116/mad-bad-northkorea-may-just-be-act?page=all.
10

Benny Avni, “North Korea Is Losing China, Does It Have a Friend in
Russia?” Newsweek, May 13, 2014, available at:
http://www.newsweek.com/2014/05/23/north-korea-losing-china-does-it-havefriend-russia-250849.html.
11“N. Korea Calls for Apology from S. Korea for ‘Slander,’” Yonhap News
Agency, March 14, 2014, available at:
http://english.yonhapnews.co.kr/northkorea/2014/03/14/36/0401000000AEN201
40314007200315F.html.
12“N. Korean Official Secretly Courts Chinese Investments,” Chosun Ilbo
(Seoul), February 26, 2014, available at:
http://english.chosun.com/site/data/html_dir/2014/02/26/2014022601787.html.
13

Shannon Van Sant, “Report: North Korean Official Made Secret Trips toChina,” Voice of America, February 27, 2014, available at:
http://www.voanews.com/content/secret-trips-reported-by-north-korea-tochina/1860373.html.
14“N. Korean Envoy Attended Ceremony of China’s Legislature Session,”
Yonhap News Agency, March 4, 2014, available at:

134 International Journal of Korean Studies  Spring 2014

http://english.yonhapnews.co.kr/northkorea/2014/03/04/14/0401000000AEN201
40304007800315F.html.
15Charles Burton, interview by John Batchelor and Gordon Chang, The John
Batchelor Show, Cumulus Media Networks, May 14, 2014, available at:
http://johnbatchelorshow.com/podcasts/2014/05/14/second-hour.
16“N. Korea Miffed at Xi’s Visit to S. Korea,” Chosun Ilbo (Seoul), July 2,
2014, available at:
http://english.chosun.com/site/data/html_dir/2014/07/02/2014070201623.html.
17

Ibid.

18

See “Chinese Oil Embargo Paralyzes N. Korean Army,” Chosun Ilbo (Seoul),
July 2, 2014, available at:
http://english.chosun.com/site/data/html_dir/2014/07/02/2014070201995.html.
19

Teddy Ng, “Beijing ‘Exploring Whether to Change Tactics’ Over North
Korea Relationship,” South China Morning Post (Hong Kong), February 23,
2014, available at: http://www.scmp.com/news/china/article/1433689/beijingexploring-whether-change-tactics-over-north-korea-relationship.
20“Trade Between N. Korea, China Hits Record $6.45 Bln in 2013,” Yonhap
News Agency, February 1, 2014, available at:
http://english.yonhapnews.co.kr/northkorea/2014/02/01/4/0401000000AEN2014
0201000800315F.html.
21

Ibid.

22

Audrey Yoo, “Nearly 90pc of North Korea’s Overseas Trade with China, Says
Report,” South China Morning Post (Hong Kong), September 4, 2013, available
at: http://www.scmp.com/news/asia/article/1303171/nearly-90pc-north-koreasoverseas-trade-china-says-report. China’s share of overall North Korean trade,as reported by various South Korean organizations, is probably understatedbecause much of that commerce is conducted by day-trippers from China, whocross into the DPRK with goods for sale. See, e.g., Robert Potter, “The Perils of
Investing in North Korea,” Diplomat, February 11, 2014, available at:
http://thediplomat.com/2014/02/the-perils-of-investing-in-north-korea/.
23

See Christine Kim, “UPDATE 1-N.Korea’s Economy Creeps Ahead in Black
Thanks to China Trade,” Reuters, June 27, 2014, available at:
http://www.reuters.com/article/2014/06/27/northkorea-economyidUSL4N0P81EN20140627.
24

Bank of Korea, “Gross Domestic Product Estimates for North Korea in 2013,”
June 27, 2014, available at:
http://www.bok.or.kr/contents/total/eng/boardView.action?menuNaviId=634&b

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oardBean.brdid=14033&boardBean.menuid=634&boardBean.rnum=2. For asimilar estimate of inter-Korean trade from the Korea International Trade
Association, see “Inter-Korean Trade Hits 8-Year Low in 2013,” Yonhap News
Agency, February 23, 2014, available at:
http://english.yonhapnews.co.kr/northkorea/2014/02/23/21/0401000000AEN201
40223001700315F.html
25

In 2012, the amount of foreign direct investment into the DPRK increased by
41% from the year before, hitting $79 million, according to the United Nations
Conference on Trade and Development. The U.N. agency concluded that mostof this money came from China. See “Foreign Direct Investment in N. Korea
Gains for 3rd Year,” Global Post, July 11, 2013, available at:
http://www.globalpost.com/dispatch/news/yonhap-newsagency/130703/foreign-direct-investment-n-korea-gains-3rd-year. U.N. figures
on total inward investment – $1.61 billion by the end of 2012 – are hard toreconcile with either private estimates or Chinese Ministry of Commerce
numbers. Private estimates show much larger capital flows into the DPRK.
See, e.g., Kristine Kwok, “Chinese Businessmen Seek Profitable Opportunities
in North Korea,” South China Morning Post (Hong Kong), November 18, 2013,
available at:
http://www.scmp.com/business/commodities/article/1358724/chinesebusinessmen-seek-profitable-opportunities-north-korea.
26

Bank of Korea, “Gross Domestic Product Estimates for North Korea in 2013.”

27

See Robert Potter, “The Perils of Investing in North Korea.”28

See “China Secures Right to Use 3 Piers to Be Built on N. Korean Port for 50
Years,” Yonhap News Agency, February 15, 2012, available at:
http://english.yonhapnews.co.kr/northkorea/2012/02/15/88/0401000000AEN201
20215007600315F.HTML.
29

Kate Whitehead, “Things Are Brewing in North Korea’s Rason Zone,”
Forbes, November 20, 2013, available at:
http://www.forbes.com/sites/forbesasia/2013/11/20/things-are-brewing-in-northkoreas-rason-zone/.
30

Robert Potter, “The Perils of Investing in North Korea.”

31

John Ruwitch, “Insight: China’s Freeway to North Korea: A Road to
Nowhere,” Reuters, April 15, 2013, available at:
http://www.reuters.com/article/2013/04/15/us-korea-north-china-insightidUSBRE93E16P20130415.
32

Ibid.

33

Ibid.

136 International Journal of Korean Studies  Spring 2014

34

Kristine Kwok, “Chinese Businessmen Seek Profitable Opportunities in North
Korea.”
35

Ministry of Foreign Affairs of the People’s Republic of China, “Foreign
Minister Wang Yi Meets the Press,” March 8, 2014, available at:
http://www.fmprc.gov.cn/eng/zxxx/t1135385.shtml.
36

See Kwanwoo Jun, “A Rundown of the Kaesong Industrial Complex,” WallStreet Journal, April 3, 2013, available at:
http://blogs.wsj.com/korearealtime/2013/04/03/a-rundown-of-the-kaesongindustrial-complex/.
37

See, e.g., Song Sang-ho, “Park’s Peace Initiative Gets Mixed Appraisal,”
Korea Herald (Seoul), April 30, 2014, available at:
http://www.koreaherald.com/view.php?ud=20140430001102.
38

See, e.g., Ankit Panda, “Russia and North Korea Boost Bilateral Ties,”
Diplomat, May 2, 2014, available at: http://thediplomat.com/2014/05/russia-andnorth-korea-boost-bilateral-ties/.
39

Connie Kim, “North Korea-Russia Ties Improve as North Korea-China Ties
Deteriorate,” Arirang News, May 4, 2014, available at:
http://www.arirang.co.kr/news/News_View.asp?nseq=161892.
40“N. Korea Miffed at Xi’s Visit to S. Korea.”41

See Alexander Martin and Toko Sekiguchi, “Japan to Lift Some Sanctions on
North Korea,” Wall Street Journal, July 2, 2014, available at:
http://www.marketwatch.com/story/japan-to-lift-some-sanctions-on-northkorea-2014-07-02.
42

Aidan Foster-Carter, “When Two Triangles Fall Apart: The New Korean
Geopolitics,” NK News, July 2, 2014, available at:
http://www.nknews.org/2014/07/when-two-triangles-fall-apart-the-new-koreangeopolitics/.
43

See “N. Korea Warns Against Factionalism in Ruling Party,” Yonhap News
Agency, February 26, 2014, available at:
http://english.yonhapnews.co.kr/northkorea/2014/02/26/73/0401000000AEN201
40226002100315F.html.
44

Bruce Bechtol, interview by John Batchelor and Gordon Chang, The John
Batchelor Show, Cumulus Media Networks, February 26, 2014, available at:
http://johnbatchelorshow.com/podcasts/2014/02/26/second-hour.
45

Bruce E. Bechtol, Jr., North Korea and Regional Security in the Kim Jong-un
Era: A New International Security Dilemma (New York: Palgrave Macmillan,

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137

2014), p. 118.
46

See “N. Korea Calls for Apology from S. Korea for ‘Slander.’”47

See Willy Lam, “Members of the Xi Jinping Clique Reviewed,” China Brief,
February 7, 2014, available at:
http://www.jamestown.org/programs/chinabrief/single/?tx_ttnews[tt_news]=419
33&tx_ttnews[backPid]=25&cHash=c97424fda6de2f64e09ee0e2456c6bb3#.Uzi
GuqLF-hq.
48

Charles Burton of Brock University points out that there is a politicaldimension as well: “There are significant elements in China who benefit fromthe current arrangement with North Korea and those are in the Chinese military
and these are people who feel that the North Korean system supports the
Chinese system because they have the same political system. If North Korea
changed it would threaten the domestic arrangements inside China because
Chinese people would see that China would be the last country with this kind of
Stalinist political organization in the region.” Charles Burton, interview by John
Batchelor and Gordon Chang, The John Batchelor Show, Cumulus Media
Networks, May 14, 2014, available at:
http://johnbatchelorshow.com/podcasts/2014/05/14/second-hour.
49

Teddy Ng, “Beijing ‘Exploring Whether to Change Tactics’ Over North
Korea Relationship.”50

Aidan Foster-Carter, “South Korea Has Lost the North to China,” Financial
Times, February 20, 2014, available at: http://www.ft.com/intl/cms/s/0/f8fca4909a23-11e3-a407-00144feab7de.html#axzz2xT7w8wZI.
51

See Teddy Ng, “Beijing ‘Exploring Whether to Change Tactics’ Over North
Korea Relationship.”
52

Ibid.

53

“N. Korea Miffed at Xi’s Visit to S. Korea.”

54“N. Korean Military Warned Not to Trust China,” Chosun Ilbo (Seoul), March24, 2014, available at:
http://english.chosun.com/site/data/html_dir/2014/03/24/2014032401520.html.

138 International Journal of Korean Studies  Spring 2014