ANGLO STUDÍS

§ngfllh ft'r Preferslmar¡

* §'fiffi**«u trf

A Kor eai;Vt ole and F'ree

Why Unifyirg the Peninsula'W'on't Be So
BadAfter All
Sue Mi Tbrry

Il
Sung, North Korea's founding.ul.r, died in 7994,
hen Kim
many outside obserüers predicted that his state would die
with him. That never happened, of course, and his son
Kim Jong Il managed to keep the regime alive until his own death, in
20t1. When his son Kim Jorrg Un took the reins that year, numerous ,
Korea watchers agunpredicted a collapse. Once again,they were proved
wrong. Despite its extreme poverty, North Korea is still very much
alive and a major threat to its southern neighbor.
But cracks are appearing. Last December, Kim Jr.g Un took the
unprecedented step of publicly executing his uncleJrrg SongThaek,
the second most powerful official in the regime. Although Jangt ,.
removal may help strengthen Kim's rule in the short run, it could have -
,

the opposite effect in the long run, convincing North Korean elites
that the 31-year--91_{ heir to the throne is too,bo=ttrgaded to be trusted.
The regim.L prtror,s in China, mednúhile, weié ürrdo.rbt.dly unsettled
by the execution of Jang, who was Pyongyang's chief envoy to Beijing
cs. ort
and a proponent of Chinese-style reforms. 4 É(}{ Ff!Qyan
But Beijing is unlikely to start putting more pressure on Pyongyang, It. ..,.i t

at least not anytime soon. China's leaders may not like the current
regime, but they like the alternative far less. North Korea's collapse
would likely flood China with refugees and precipitate a military ,, i "
intervention that would bring South Korean and U.S. forces to China's
border. So Beijing sees supporting Ki* as its least bad option.
Seoul, for its part, has also traditionally avoided doing anything
to destabil\zePyongyang, and for similar reasons. For South Koreat
leaders, living with the North's occasional pinprick attacks and the ever-
SUE M! TERRY is a former analyst at the CIA and a Senior Research Scholar at Columbia
University's Weatherhead East Asian lnstitute.

Iuly /August 2014

 },
Sue Mi Terry
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present threat of another war is preferable to bearing the crippling

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social and financial burdens that would accomPany reunification.

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r Even"the united States and Japan, which have much less to fear
.34.
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from North Korea's demise, have quietly decided to live with the
regime. Both the Clinton and the George W. Bush administrations
exCfrange for limits on
-struck generous aid deals with Pyongyang in

those deahl yggi Ágr".á Framework, to finance two light-water

;¿í¿

,nüói.ri r.r.tors in the North (a project that was formally suspended

"' in 2002), and To§o has contributed generous amounts of food aid.
Policymakers in Washington and Tokyo know that they have little
regime. But they also fear
-.[.r.r^ge to bring down the North Korean
hE:¡r,¡ ¿,*" ft {.{ , ,'' the re[ional chaás that regime change would bring.
S"ch concerns are legitimate, and all outside parties need to take
them into account when planning for the regime's inevitable demise.
Even under the best of circumstances, the reunification of North and
South Korea will prove more expensive and challenging than that of
East and West Gármany, given how far apatt the two Koreas are in
terms of their economies, education levels, and ideologies'
But it is a mistake to conclude that reunification should therefore
be avoided. Contrary to popular belief , trta'i$t would not spell
disaster for South Korea, nor would it pose an unacceptable risk for
the United States, China, andJapan. Rather, itwould produce massive
economic and social benefits foi the peninsula and the region. There
f'/,t ¡ r',':''r can be only one happy ending to the iong-rrrrrning saga of the North:
the emerg.rr.. of a iingle, democratic Korea. Outsiders should do all
they can to promote and plan for this outcome'

THE GOOD, THE BAD, AND THE UGLY

Reunification is likely to come about in one of three basic ways. The
.iBcenario South Koreans hope for most is a soft landing, in which
Pyongyang adopts the Chinese economic model, eschews militarism,
a"d
"n¿"rlrk
.
a gradual rapprochgmel!.yilh Seout. The second
. scenario is far less attractive: N,;i¿ñ.'Ifféi,' bt"ggering under the
' weight of economic and social forces, implodes and gets absorbed by
South Korea. The third scenario is even worse: the peninsula could
be reunified through military conflict, in which, following a major
attack from the North, South Korean and U.S. forces finally destroy
the regime. Of these three outcomes, a soft landing is the least likel¡
# g'S &
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FOREIGN AFFAIRS

I
 A N{3 L(} §TI.}DICI
A Korea Whole and Free
ffi Engllrh far gr oier¡lonals
given how little interest Kim has shown in reform. The third scenario
L dro improbable; for all his pugnacity,Ki* is no more suicidal than
his fathei or his grandfath", *ri. That leaves the second scenario, a
hard landing, as the most plausible. So that's what policymakers
should plan for.
tl -iu,, i.. ", i i . i'' . . i
The collapse of Kim's regime *o,rtd Po§ many tf^.{:te problems, s
f{*
the rnost p.ássing of which, from the standpoint of the United States,
being how to ,.Jrr. North Korea's nuclear weaPons. U.S. and South
Korean forces would have to maintain
the command stmcture of l{orth Korea's Contrar! to
factional fight- PoPular belief,
army in order to prevent
Korea
irg and attacks by die-hard elements. a n ergercf I'{orth
Theywould also need to provide security, and South Korea would
food, and basic public services, such as not sDell disaster.
water, electricity, and telecommunica- \ á*a*a'ee,*e '', '
tions, in order to avert a humanitarian
eriiii thát would send the long-suffering North Korean population
flooding across the borders into China and South Korea and across
the sea to Japan.
These are major challenges, but with enough planning, South :i; :r'
*r¡

Korea-backed by th. Uniteá States, the uN, ,ttá oth.. international

actors-could d.rl *ith them. In fact, South Korea's Ministry of !

Unification, in cooperation with U.S. .defense officials, has spent

decades preparing tá do just that. In the event of the North Korean i:
regime's .olirpr.l So.rth Korea's large, well-equipped, yd-lightl
tráned military should be able to rapidly assume control of North
Korea and provide basic services until a civilian government tgkt
ov-ef. The taskwould prove all the easier if South Korea could involve
i

óñ;;;,h";i;nning process. so far Beijing has retused to publicly '' ,

entertain the possibiiity that the Kim regime may not last forever.
But even witháut Chinese participation, South Korea and its partners
should be able to handle the fallout of collapse'
The real fear of South Koreans, however, is not that Seoul won't
be able to deal with the immediate effects of an implosion; it is that
the financial price would ruin them. Reuniting Korea would likely;:
cost more thrn reunifying Germany did: the Halle Institute for
Economic Research has estimated Germany's bill at $1.9 trillion over
20 years. According to South Korea's finance ministry reunification
would consume t.r"n percent of South Korea's current GDP-a share

Iuly líugust 2014

 Sue ñuti Terry

equal to $80 billion-ev eryyearfor a minimum of ten years' An advisory

Uáay appointed by Souti, Korean President Lee Myung-bak in- 2071
prrt'th" price of reunification even higher, at over $2 trillion'
trj
Whr,.r., the fin"al figure, there is little doubt that the endeavor will
prove expensive and"thar the difficulties will be exacerbated
by the
socirl .hrll.ng.s of integrating an isolated, impoverished, and brain-
washed population.

WHEN TWO BECOME ONE

..IJ1

Although South Koreans tend to focus on the obvious costs, those

costs would be outweighed by the benefits of reunification. Most
immediate among thet. would be the disappearance of Northeast
fuiat primary .orI.. of instabiliry. Assuming that the regime's nuclear
*".pon, ,ná br[istic missiles could be secured and its army Peace-
fully demobilized, its dissolution would leave not only Seoul but
,tro Wrrhington and Tokyo much more secure. The United Statesi
would no longer have to worry about North Korea selling n'clearl.
',
,

weapons ,b.Jrd or drawing U.S. forces into a second Korean war.

Korean missile strikes or
J"prn would no longe, h"rrJto fear North
ih. abdrrction of ,rrár" of its citizens. And South Korea could stop, .,

worrying about North Korea's artillery pulverizing Seoul, its- navy

,o,p"doI,,gSouthKoreanships,oritscommandostargetingSouth'
r#s**.*jffi uL-&L
Korean leaders. p+*s{.**s?.rffia*fl$

Even China would have reasoR to rejoice. It could replace its ,

unrequited transfers of fuel, food, and other goods to Pyongyang

withiapit,1investmentsthatyie1dedincome'An$.oye.itstopped
propping up the mosr despotic regime in the'world, Beijing would
h"d lt irr ersier to portray itself *t a resPonsible internatiolll ,,
stakeholder. r.i,1,,, ir ¡: "i'':
The end of thi-Kim regime would also have huge humanitar\an,'
benefits, freeing 25 million people from the grip of the-world's last
remaining Stalilist state andintegrating them into a modern democ-
rary.The majoriry of North Korea's 80,000 to 120,000 state prisoners
.oúld leave lh. gorr.rnment's slave-labor camPs, where most have
been consigned iot political, rather than criminal, offenses' Average
\
**'l North Koi."r, could move from a starvatlon. §iet, both literally
'' ;;;;;,;ii;atly to the plentiful availáÉl'Éy oi'iood, information,
consume, prodrcts, and ,tt ttt. other benefits of modern capitalism'
South Koreans, an intensely nationalist people, would also finally
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FOREIGN AFFAIRS
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get to celebrate the reunification of the Korean family. Korea would f?#*?#
once again become a single state,y'as it was from the year 668, when the
Silla dynasty unified the three Korean kingdoms, until 7945,when the
Soviet Union and the United States divided it at the 38th parallelr"
.. But the greatest benefits for the South would be economic. Re-
'/unification would be far more profitable than is commonly assumed.
For starters, Seoul could sharp!¡r reduce its defense spending, which
currently stands at $30 billion rr 2.5 perient of GDP-a figure
^i¡.u,
that excludes the $1 billion it gives every yeaÍ to Washington to
help cover the costs'of the U.S. military's Presence on the peninsula.
South Korea could end universal conscription and shrink its 680,000-
§ ¿**¿"ltt¡rriá-a?p
irrnt/ivs Yo f Ar (¡tlff?a¿r'rrrf'd Juty/August 2014
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Sue Mi Terry

man military to 500,000 personnel or fewer, freeing large numbers

of young Korean men to enter the work force years earlier than they
cuirently do. Also joining them would be the 1.1 million people,
s1 { most of them young, that North Korea now emPloys in its military.
The prospect of extra young workers should be especially tanta-
lizinggiven-the rapid aging of South Korea's population. Thanks to
- the .o,rrrt.y'i
§rówiñg wéalth, life expectancy in South Korea
has
reached 8l years and continues to improve, where.as its birthrate, at
only t.Z chíldren per woman, i, ,*otg the loweti it the world- As* "
a result, according to projections by the Otganization for Economic
Cooperation and Development, by 2050, South Korea will have the
s]*- *;'
second-oldest population in the developed world, with nearly seven. -
*

-*,t*'*b"'
f'' peop1eovertháageof65foreveryworking-ageadult.Absentreuni- F f\-

St
IJ. Fel h.riion, the number of South Koreans aged 15 to 64 will start to l
##,
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decline in 2017; by 2030, so will the overall population.
In North Korea, by contrast, 91 percent of the population is currently
I younger than 65, and the fertility rate is higher
than in the South, at
?l i.O .frit¿ren per women. Following reunification, North
t Korea would
] add more than 17 million potential workers aged 15 to 64 to the nearly
1 SO million already in the South. South Korea could thereby avoid
ft* *§
*/ turning to Southeast Asia or other regions for low-wage workers, who
,, i would be hard to assimilate. South Korean firms could even move
' i th"i, factories from China to North Korea, where wages would be even
. '-'",,;,rl:',.,'j.'' :; ¿ii{
: Reunification would yield big gains in the mining sector. South
.-' Korea's high-tech^ economy is among the most advanced in the
' world, but the country Possesses rlir¡ualfy no,mineral wealth an{
, must rmporr 97 perceni oi it. .n.rgy'át{ii'Ai"éiát heeds. North Korea,
l.

.,. j by contrast, has vast deposits of coal, uranium,

magnesite, and tare-
\ earth metals-together valued at $6 trillion-but it cannot currently
. i- access them,AMith technology from the South, however, this mother
lode could be unlocked at last, providing a welcome b-oost to the
4 e*wi €
global economy. / * por^;J;rew;'ar" * p"rwan';n
A reunified Korea would also boaít a newly expanded domestic
market, experience a spike in tourisrn revenues since some of the
most scenic parts of the peninsula lie in the North-and see its
sovereign risk rating improve. As the risk of war finally disappeared,
credit would become cheaper and foreign capital would flow more
freely into the country.

FOREIGN AFFAIRS
 NG LO STUPIO
Englhlr far prol etskxral¡
,&i'n
etd/,( A Korea Whole and Free
Hrt

Once the landmine-fr¡rtifi ed demili tarized zene vanished, moreovet

trade would get easier and cheaper. South Korea currently functions #"$ e'{i
f-f # efrd{
\ as an island economy, paying high transportation prices for raw
1*"r.rials. With the boider á"".1 a long-gnvisioneá gas pipeli¡e #d¿¿ft&
I ., from Vladivostok to Seoul could finally built, sending badly needed
be
Russian oil and gas south. Energy costs, which drag down the South
Korean economy, would fall drarnatically. Korean cornpanies could
also begin shipping goods to China and Russia over land.
Over time, a reunified Korea, with a hard-working population of , :""
- dk§
75 million, could emerge as a consumer and industrial powerhouse- #
the Germany of Asia. As two ecc¡nomies became one, abundant new
a$ti:-_ L 5

investment opportunities would arise. Accordirlg to a 2009 report

by Goldman Sachs, within 30 to 40 years, the peninsula, if reunified,
A
could overtake Fiance, German¡ a¡rd even Japan in terms of cop. {n tlil

South Korea's current trading partners--especially the biggest two,

China and the United States-.-wc¡uld benefit irnmensely from this
newfound source of economic vitality. , ,'l ¿,:-,ilr{ iiír;
'.t',':,:.,

: '',,';:,''.: :r-r'r: :" ¡ ::': ¡ i i u;,',

¿r5 y'llr- l l:' , ..! r ;: , . "¡",.'. ¡'n ?' 'i'.tt"r.
NEIGHBORHOOD WATCH
"'Despite all these benefits, selling Korea's neighbors on the geopolitical
sl
f

¡
consequences of reunification will be difficult. Leaders in China fear- lor\Y
h Kon'
losing a bulwark against U.S. power, but Washington could assuagg these
\ f,-Jo dt

ge4cqrns by privately assuring Beijing that following reunification,

. no U.S. troops would be stationed n<¡rth of the current demilitarized
,zone-or on any part of the peninsula, if that's what it takes to win
- ' Chirr.re support. Nationzrlist Stuth Koreans might insist on this anfwafl
:i
,relieved of the threat from the North, they could well demand that
,,1 Washington withdraw its forces.
'"-h 5**f §t f' q,ur" ,.,
! ' Although such a move might feel jarring in Washington, it _would
not be a foreign policy setback. If anything, the departúíá of U.S. '
forces would represent a happy culmination of the long U.S. commit-,. * §nl¿d'n
ment to the peninsula, which began in the dark days of the Korean
War. The United States c<¡uld stitl hedge again§t Chinese expansion-
ism from its bases in Japan and Guam, and it would undoubtedly. eJ*§l
maintain good relations with a reunified Korea, just as it does with
a reunified Germany. ", ,.,1."'i''
* i*
As for Beijing, its qies with Seoul are already better in some ways
than its v-g¡ing relations with Pyongyang-and they should stay
,' that way áfter reunification. Historically, Korea was a tributary
(#, ¡ July /August 2014
 Sue Mi Terrl

state of China, and although that subrrrissive relationship will never

bg re.g_st?_p_lishedrChina need nr¡t f"éu re unification.'l'he new Korea
t.*orld hceoriré""íir even better trade partrrer, and given its desire to,
,",.
ft"* rt
,,' avoid a hostile relationship with its giant rteighbc,r to the north, it
f would likely triangulate its {ureign polir-y between Beijing and
,,i Washington. #*de §
Ñ3&-4
,., Japan, for its part, would rro doubt look askance at the emergence #f#tuf'dtrt#q
-*****-'**-'-
'' /of a stronger, single Korean state. Nearly 70 years lfte-r World W¿r ' 1

i II, the Japanese-St¡uth Korean relationship rerrráins fraught thanks *' r * _

v{
' to Japan's dark colonial legacy. But the eiiiergertce of a democratic, ltrv*w* " lx*wa

t** *su{ # { capitalist Korea would not truly threaten the region's other big
democracy. h fact, reunification would givc lbkyo a golden opportu-
nity to-dispel anti-Japarlese sentirnent among Koreans by donating
,,.- food and medicine and sending ai_d wtrrkers and tnedical personnel.
Japan already ranks as otle of the to¡r fbreigu aid donors in the
world, and it could w-iu currsider¿ble goudwill by helping rebuil.d
the North. i,", ,.,r* **,r

READY FOR REUNIFICATION

Given all these advantages, the intertrational colnlnunity should
promote reunification, llot püstpt ne it.'f'here may be little that any
outsider can do to rirake Pyongyang change course. But regional
powers, notably St¡uth Korea ¿nd the Unite*4_Stateg, shoufd stop p-r_op- a d*
*__"p_i!&gp
the Kim dynasty ig.lgt-U:-t¡ {cr,f TIeSUW .assüfenc"e-¡of hettér ¿r'r"1*
behavior, as they have in the KirrrJorrg Un is no more likel/to'ri llt'i
r-&$r{§ keep these pronrises than his ¡rast; father or his grandfatherwas. ,'*.;,ñ -
?rrri,;: ,0,.e"-'4/' Ñrrr shoulá ifre-W¿st resisfthe-ur¿e to qfihtenlirrcllirns oi'rdfáfiáté1""
'*"{' ";"- tn

proportionatély in rls¡-,o,o. ü Nñ¡, XoI}r piüvóéatilins for Gf\* i?rrsrrtirr

of destabilizing the cr,runtry. Everi if the-N,g*l!r,;g..teto implode'ii"".,*ot#'ii
now, that would be ¡rreferable to allowing the §táré t-a.!!1p along t ,l.or"'
for decades and waiting ft¡r refornrs that will never corne. South-',
t "

r Korea has the nlost to gain frorir reu¡rification, so it sh<¡uld confront k«**rni&d
,{ the prospect with confidence, not trepidation. South Korean President e'n?n*"fiJi*tt*
$r:r;{,t,, f 'rrd' P..k Geun-hye caused rstrq.:*Lljsr:trjtJ-g*.yk*shg-g+l.lg*g-qnlfica-
r

i1:J .: _",.:,&rr tion a possible "bonanza," arrd rhe fivé á iirajor pro-unifi.áiión ipeéCñ"* ár¡*us L*
in Germany (a symbolic choice) at the end of March. Her government
should continue with its public relations canrpaign to get South Koreans
educated and excited about the benefits of reunification-a task that is
particularly important as the youngel generatiou in South Korea grows

FOREIGN AFFAIRS
 AHGLO STUDIO A Korea Whole and Free
Englhlt fcr Prole¡slon¡l¡
trf. t: ..,i ¡,

increasingly wary of it. And Park should make good on her pIédge to
stay resolute in the face of the Northt th59,r,tt a3d,provocations, even as
she attempts to establish a renewed dialogde *itf, the Kim regime and
pursue initiatives such as holding cross-border family reunions. Seoul F,
ha¡t'Von&A
should not shy away from retaliating-which it has never really done-
the next time Pyongyang torPedoes a South Korean vqssql or sffi a *-#¡
South Korean island for fear that doing so could destabilize or aggra-
$#o**":*
vate North Korea. Even China would be well advised to stoP pouring
resources into Pyongyangt unless a new cadre of reform-minded rulers
takes power. t'*.,4 §*eT
To get China and Japan on board, the United States and South \
Korea should launch a diplomatic initiative aimed at preparing for I ffi**.ffifr.
the contingency of an unexpected collapse. Washington and Seoul T,ü.f#r#.
should augment their joint military
planning by c{4ftl.g,^ comprehensive R gional
political, diplohátiC, economic, and ?owers, notably
legal strat egy for reunification ./Both §outh Korea and the
ft¿fv*

governments should designate diplo- United States, shoLtld sto?

matic and political representatives to
come up with a civilian counterPart ?roP?ing u? the Kim Ünost!.
-
to the joint milit ary plans that would
be activated in the event of a conflict with or instability in the
North. Both states have much to offer: South Korea's Ministry of
t} € yF*&irn-c'IR
Unification and other agencies could contribute years of e¿pgrtlsb
on_prec_,isely this scenario, and the United States could contribute
the lessons learned from its experiences, good and bad, with nation
building in Germany,Japan, Kosovo, Iraq, and Afghanistan.
rd, Once the United States and South Korea develop a common
vision, they should encourage Japan to join the planning. Tokyo
has legitimate interests in the future of the peninsula and would
benefit from preparations designed to address its concerns, such as
the prospect of a massive i4fl-ux,of"refugees by sea. Japan's logisti-
.rl ,,rpptrt and economi. ,*lrt?ildé *ould prove crucial during
reunification.
As a final step in this process, the trilateral dialogue among the
United States, South Korea, and Japan should expand to include
China and possibly Russia. All these key players should be asked
to.b_g31 some of the costs of reunification in return for a say in
how the new Korea behaves in the region. For example, China and

July /A.ugust 2014

 Sue Mi TerrY

reconstruction-
Japan could be asked to contribute to the North's
the former could help develop the North by providing discounted
, . 1""'''E electricity and assistance in rebuilding infrastructure, and the
t'"s't'i rl latter could provide humanitarian and financial aid, investment, and
; '' o<pertise_it"Igtyl, fo-.*g€uarantee that Seoul will not keep North
io,,.,.' 'r
d,.'.,,lri
iii '
i'i it '
.''Kórea's nucléáiáiienal. Striking such a deal would solve two big
.:t

í problems$orrth Korea's fears about the costs of integrating North

J kor." ,rr#th. rest of the region's fears about an un§3¡h-ed Korea as
*r,'{r*:|t{" .- a military and economic competitor.
lü *i*.n,r"¡r.-,,
The Kim regime will probably not come to a neat end; the col-
lapse of a state is always messy, and it will be particularly so for e
r'"'

..,,""
1"¡, .," regime so militarized and desperate. But that reality should not
4 ,t ' .
1..
!
blind outside powers to the many upsides of what will come after,
f' r ' nor should it cause them to put off planning for the inevitable. In
i''
'r'i-ii-

bgst y3y,"t9,,§.gpe with future instability in the North and

'- ,f+SLJh-S
reduce the costs of reunification is for the principal powers to
.,¡,-"'
,,.t' start cooperating now. North Korea has the worst government on
'tt
I a
,. the planet. Despite all the challenges a transition will entail, every-
-!'

i,r , '
'' ;''
one will benefit immeasu rably from the rise of a new Korea, whole
1

and free.@

FOREIGN AFFAIRS