Reunification of the Korean Peninsula from the Context of Northeast Asian Regional Integration


    We have to manage North Korea, a special country of old regime and young leader. Therefore we need patience, a balanced perspective between the pessimistic and the optimistic, and a comprehensive approach combining integration and unification.We should admit that regional integration and unification will take a long time. But they could come true earlier than we expect if we are successful in deriving and implementing a master plan combining the Northeast Asian version of a regional integration model and a system change model based on the strategy of unification through regional integration.


    North Korea , unification , integration , North East Asia

  • 1. Introduction

    Kim Jong-il died on December 17, 2011. It is difficult to predict precisely which policy directions Kim Jong-un, his young successor, will pursue in the near future.

    On April 11, 2012, the Workers’ Party declared Kim Jong-un to be ‘supreme leader’ and awarded him the title of first secretary during a party conference – the country’s first major political gathering in one-and-a-half years. A generation change among the elite groups has been unfolding since Mr Kim was officially designated as his father’s successor in the last party meeting, held in September 2010 (The New York Times, April 12, 2012).

    Ironically, Kim Jong-il’s death occurred just before the start of 2012, the year the regime had been promoting as not only the 100th anniversary of Kim Il-sung’s birth but a year in which the country would show significant progress toward becoming a ‘strong and powerful state.’

    Many experts agree that Kim Jong-un will primarily focus on winning the trust of seasoned party veterans and military leaders, shoring up the power of the state. During this critical period of transition, he will most likely stick to the  old political line in order to avoid making mistakes and incurring criticism from the party and military elites. The ruling team that will guide the new leader and help him face political challenges has not changed after his father’s death and will continue its old policy. It could be argued that no drastic changes will take place in this country’s domestic and foreign policy in the short term, at least during the official three-year mourning period.

    This paper analyzes the prospects of North Korea and reunification after the succession of Kim Jong-un from the context of Northeast Asian regional integration. In Section 2, the theoretical surveys will be considered regarding the  prospects of system change of North Korea based on the system change model. A comparison between the post Kim Il-sung period and the post Kim Jong-il period will be made. The reasons why there has been no real system change during last 18 years will be analyzed. Section 3 will summarize the main issues of Northeast Asian regional integration. In Section 4, these two analyses will be combined to get some intuition of reunification of the Korean Peninsula from the context of Northeast Asian regional integration. Section 5 summarizes discussions as a conclusion.

    2. The Prospects of System Change of North Korea

    Here we compare two periods of post Kim Il-sung and post Kim Jong-il. For that purpose,we introduce the model of system change. The model is a revised version of Montias et al.’s (1994) model.


    sk is the system change in the economy of k,

    ek is the environmental factors,

    Uk is the utility function of people or participants,

    ok is the system performance or the system output,

    pk is the policy.

    Figure 1 shows that the system change is determined by the environmental factors, the system performance (or the system output), the utility function of people or the policy. There are two tracks by which the system performance and the environmental factors induce the system change. One is the case where the former directly induces the latter. The other is the case where the system change Downloaded by is caused indirectly by the mediation of the policy variable.1


    The utility function is influenced by the environmental factors, the system and the system output. Generally, it could be said that in socialist economies the preference of the planner matters, whereas in capitalist market economies the  preference of capitalists or consumers matter.


    Equation (3) indicates that the policy variable is determined by consideration of the utility function, environmental factors and the system performance. This overall relationship and mechanism is depicted by Figure 1.

    Based on the model, we may compare the prospects of system change of the post Kim Il-sung period since 1994 on the one hand, and post Kim Jong-il period since 2011 on the other.

    In 1994, there were three scenarios of North Korea’s future after the death of Kim Il-sung. One was the scenario of the regime collapse. This was regarded as having the highest possibility at that time. The second was a scenario of reform and opening by the initiative of Kim Jong-il. The third was a scenario of muddle through. Looking back to the last 18 years of the Kim Jong-il period, the third scenario was realized. In other words, there was no big change in the system and the regime of North Korea. This paper will try to analyze why it has been the case in the comparison of the situation of 2012 based on the system change model.

       2.1 Environmental Factors

    North Korea is an isolated small country and has been relatively independent of the influence of its neighboring countries, and even from China and the former Soviet Union. This is one of the reasons why North Korea has not collapsed  even after the collapse of the former socialist countries. However, after the South–North relationship deteriorated following the Lee Myung-bak regime, the dependence ofNorthKorea on China is rapidly increasing. Entering 2012, the relationship between North Korea and China is getting worse due to North Korea’s failed missile launching.

       2.2 The System Performance

    The economic conditions in 2012 are much worse than those in 1994. As can be seen in Figures 2 and 3 and Table 1, the North Korean economy has experienced a long-term decline. It could be said that in the last 5–7 years the economy has slightly recovered from the 1990s’ economic crisis, but it is still in the recession.

    Lankov (2011) suggests three explanations for the obvious improvement in North Korea’s economic situation compared with 5–7 years ago.

    First, the private economy contributed to the economic recovery. ‘The last 15 years have been a period of time when the non-official market economy began to play a major role in the lives of North Koreans. Estimates vary greatly but it seems that the average North Korean buys between 35–80% of food he or she consumes at the market place.’

    The second factor is the partial recovery of the state sector. ‘North Korea’s industrial managers have learnt how to work under different conditions. Thanks to their efforts, their enterprises have, at least partially, recovered from the shock which was inflicted by the sudden withdrawal of the Soviet subsidies and disintegration of the entire economic system in the years 1990–95.’

    The third factor is foreign aid, notably fromChina. ‘Even though American and South Korean aid has been scaled back dramatically, the increase in the amount of aid coming from China has made up for these losses. If the situation seriously deteriorates, China is all but certain to increase their supply of aid to the North, so widespread starvation will most probably be avoided.’

    He points out an irony of the situation that most of these improvements have happened in the last 5–7 years, that is, in a time when North Korea was subject to intensifying international sanctions. ‘For most of the period we have heard much of “sanctions starting to bite”. In real life, this has been a time of modest but still palpable economic recovery. Judging by much anecdotal evidence and some statistics, it seems that the average North Korean nowadays has roughly the same living standards as he or she had some twenty years ago, in the 1980s.’ Therefore, these standards essentially mean bare survival for the outside world, but for a majority of North Koreans this constitutes a remarkable improvement on the nightmare of the late 1990s.

       2.3 The Utility Function

    The utility function of North Korea is completely controlled by the great leader. The 2001 summit meeting between South and North was regarded as a good opportunity for the change of utility function of the leader to the direction of  reform and opening. Unfortunately his utility function did not change at all so that North Korea developed its own nuclear program.

    One of the most important differences between 1994 and 2012 is the fact that the utility function of North Korea cannot be completely controlled by the leader. North Korea is now moving to a collective leadership backed by the party and military elites. Kim Jong-un is less prepared for leadership than his father. The overall environment is less favorable than in 1994. In the short run, there will be no big change. Even in the intermediate term there is no significant possibility for big change. This is because Kim Jong-un will not have strong enough leadership to achieve reformand any significant system change. Domestic and foreign policy changes will only become possible in the future when Kim Jong-un gains a firm grip on the reins of power.

    It could be said that the crises have contributed to the regime security or the system maintenance rather than the regime or system change. Lankov (2011) argues that, surprisingly, recent economic improvements give some reason to be optimistic for thosewhowant to see a dramatic political transformation in the North, because, contrary to the common assumption, times of moderate, but insufficient improvement are usually more dangerous for authoritarian governments. Another factor is that the polarization in income distribution is deteriorating recently due to the breakdown of the traditional socialist food distribution system. As the third factor for increasing the system risk in North Korea, we may point out the generational change. The proportion of young people who are less loyal to the regime is increasing. To sum up, we may say that North Korea is entering the stage of political instability or crisis due to changes in the utility function of the people.

       2.4 The Policy Variables

    Since 1994, North Korea has taken two important policy measures: the July 1 reform in 2002 and the monetary reform in 2008. But these efforts both turned out to be failures and could not reverse the trend of deteriorating economic  condition, which was most dramatic in the late 1990s.

    After experiencing the ‘era of the March of Hardships’ in the 1990s, North Korea has started to look toward a new direction that would allow it to solve its economic problems and develop its economy in the twenty-first century. On July 1, 2002, North Korea carried out its ‘July 1 Economic Management Improvement Measures’ (hereafter referred to as the July 1 Measures) that included goals such as (1) raising prices of commodities (25 times)wages (18 times) exchange rates (70 times); (2) expanding the autonomy of corporate management; (3) strengthening the incentive system for farmers; and (4) abolishing the low-price distribution system.

    There are three interpretations about the goal of these measures. The first is that it aimed at normalizing the socialist economy or introducing limited reform within the system. The second is that this is a kind of reform toward a partially   reformed economy benchmarking Eastern European socialist reform. The last is that these kinds of changes seem to be aimed at stimulating the market economy and the beginning of the system transformation. For now, the first view turned out to be right.

    On 30 November 2009 North Korea launched a surprise confiscatory currency reform aimed at cracking down on burgeoning private markets and at reviving socialism. The confiscatory currency reform could be interpreted as the latest in  a series of moves designed to re-assert state control over the economy. In effect, this wiped out considerable household savings and the working capital of many private entrepreneurs. The result has been a literal disintegration of the market, as traders, intimidated by the changing rules of the game, withheld supply, reportedly forcing some citizens to resort to barter (Noland, 2010).

    In order to understand recent North Korean behavior, we should consider the so-called ‘succession policies’. The policy was believed to start when Kim Jong-il suffered a stroke in September 2008. During the process of preparing the succession for his son, Kim Jong-un, there have been two aggressive incidents.The first one is the Cheonan sinking on March 26, 2010. The second is the artillery attack onYeonpyeong Island onNovember 23, 2010.The first incident,which took 46 lives, led to chaos on the Korean Peninsula. Frictions among South Koreans intensified during the investigation process, and inter-Korean relations sunk to Cold War-era levels. The second one killed four South Koreans, including two civilians, and injured 19. The attack came after nearly two years of deteriorating relations between the two Koreas, which reached a nadir after the sinking of the Cheonan. Analysts have noted that the last handover of power in North Korea was also accompanied by a series of aggressive acts intended to strengthen the new leader’s relationship with the army. An internal power struggle in North Korea, between hardliners and reformists, is also thought to be underway, and could have sparked military action (The Telegraph, November 23, 2010).

    We don’t knowa lot about the younger Kim’s leadership of NorthKorea yet, but the most widely-proclaimed element is his determination to uphold his father’s military-first policy of seongun. The recently revised North Korea’s constitution declares that North Korea is a nuclearized country. Therefore, it seems unlikely that North Korea will give up nuclearweapons. There seems to be little possibility the country will become strong economically in the coming year, but the regime can still celebrate its elevation to the status of a nuclear power.

    For now there could also be three scenarios for North Korea’s future. At least in the short run, the scenario of collapse is not regarded as having the highest possibility, unlike in 1994. Most neighboring countries do not want regime collapse, including South Korea and the US. They think it could cause instability and crisis in the region. So they rapidly acknowledged the succession of Kim Jong-un. The third scenario – muddle through – thus emerges as the highest possibility in the short run. However, in the medium and long term, which scenario will have the highest possibility depends on whether or when China is democratized. The lesson from the Kim Jong-il period is that China is the single and the strongest supporter of the regime. If China continues to support North Korea, the regime will not collapse. If we assume that the democratization of China takes 20 to 30 years, the maximum life expectancy of the regime will be 20 or 30 years.2

    1Montias et al. (1994) distinguish two basic types of system change: (1) change in the RCP (rules, customs and procedures) of organizations producing goods and services induced by new or altered states of the environment affecting economy (or any of its component parts); and (2) change in the system rules issued by government organizations or other change brought about through collective  action.   2McNair (2012) makes an interesting analogy with the post Mao period and the post Kim Jong-il period. He argues that China in 1976 was in a similar position to North Korea’s in 2012, following the death of Mao Zedong as to the transfer of power to his hand-picked successor, Hua Guofeng, who was revealed only just before Zedong’s death. McNair’s thought is that Kim Jong-un is a nearperfect analogue to Hua Guofeng. Hence he is not expecting North Korea to reform immediately in this analogy, because China did not reform under Hua. He points out the similarity to Kim Jong-un’s absolute adherence to the rule established by Kim Jong-il. So, sooner or later powerful people in North Korea will realize that Kim Jong-un, like Hua in the late 1970s, has no real power or ideas of his own. He concludes that the country is already in need of a new economic model and the ascent of someone new: a reformer, someone like Deng Xiaoping.

    3. Northeast Asian Regional Integration3

    Park (2008) suggested the following possible models for Northeast Asian regional integration. The first model is the Marxian model for regional integration. It is a long-termmodel for economic integration,where markets directly influence state, society and institutions, although state and society, also exertweak influences over institutions. The market is considered to be the strongest force and player in the model. It takes a rather long time for institutions to emerge, which is consistent with the arguments of the evolutionary view in the New Institutional Economics. This model explains relatively well the EEC model or the EU model since the 1970s.

    On the other hand, the Weberian model for regional integration is a short-term model for security cooperation, where the state directly influences official institutions. In this regard, political leadership or human will play a critical role in  building official institutions. This model explains relatively well the early EU model of ECSC or the Financial Sector - Oriented Model.

    Generally speaking, theWeberian model is more applicable to Northeast Asia than the Marxian model because of the needs to formulate driving forces for institutionalization of regional integration in Northeast Asia. This is because the  level of functional integration is not low compared with the level of the EU in the early period of integration. However, the Weberian model alone is not sufficient to establish a unique model for regional integration in Northeast Asia. Based on the factors and the general theories and models of regional integration, we may consider the following sets of possible models for Northeast Asia according to each field or sector of state, society and market.

       3.1 State

    3.1.1 Crisis model

    We may prefer and anticipate a Marxian or a gradual model for regional integration in Northeast Asia. We should, however, consider and prepare for the possibilities of a big-bang. The North Korean nuclear crisis could play a double  role in regional integration. It is easy to understand that the current crisis is an evident barrier against regional integration. From a different angle, however, the crisis could be a catalyst for regional integration in that the procedure for  resolving the current crisis (like the Six Party Talks) could become the forum for reinforcing broader regional integration. The crisis model could belong to the above-mentioned Weberian model. In addition, we may call this ‘a reduced or a compressed integration model’ in the sense that regional integration is achieved in a rather short term compared with other cases, such as the EU.

    3.1.2 Political leadership model

    The crisis model could lead to an appreciation of how political leadership plays a critical role, considering the fact that the state still has stronger power than the market and civil society in Northeast Asia. Strong political leadership is therefore essential to resolve the current crises in the region. European experiences, especially those of Jean Monnet teach us that a ‘genuine integration leadership’ comes from the strong conviction for uniting people as well as from ‘ideologically unbiased and politically neutral leadership’ (Monnet, 1976). But it should be noted that Jean Monnet’s political leadership model for institution-building through sudden change is to be distinguished from the evolutionary arguments of New Institutional Economics, for instance, of North (1990).

       3.2 Society

    3.2.1 Intellectuals model

    An epistemological community build-up by intellectuals matches the Northeast Asian tradition of scholar-officials on the one hand, and that of the knowledge society in the twenty-first century on the other. Intellectuals or academic NGOs  could play a key role in regional integration, although it is likely to take time for China to allow genuine NGO initiatives. Academic NGOs could be developed into key organizations such as Jean Monnet’s Action Committee for the United States of Europe.

    3.2.2 Education model

    Roland (2007) suggests a kind of Northeast Asian version of the Erasmus program saying that ‘in the goal of bridging the cultural and historical gaps between nations, it would be useful to organize large scale programs of exchange of students between China, Japan and South Korea, in the spirit of the European Erasmus program.’ Education takes rather a long time to influence regional (or other) development. It could, however, be a short cut for tough tasks like regional integration.

    3.2.3 Glocalization model

    The experiences of NAIS Korea (Incheon Metropolitan City government sponsored their activities) provide a good case of Microregionalism. Authorities at the local level are often on the frontlines of regionalism. ‘Glocalization’ is suggested as one way to forge regional ties through joint efforts of global and local forces (Rozman, 2004, p. 9). Rozman ‘examined the links forged in Northeast Asia by local and regional (as opposed to national) governments in China, South Korea, North Korea, the Russian Far East and Eastern Siberia, Japan, and Mongolia’ (Pempel, 2005, p. 27).

    Figure 4 depicts and summarizes a Northeast Asian version of the regional integration model.

    Among the possible models for Northeast Asian regional integration proposed by Jehoon Park (2008), two models, i.e., the crisis model and the political leadership model, apply to the current situation in Northeast Asia as well as Asia more generally

    The relationship between crises or bottlenecks in regional integration and political leadership, as Hatoyama (2009) pointed out, contains a paradox. ‘I would suggest that the issues which stand in the way of regional integration can only really be resolved through the process of moving towards greater regional integration.’ Han Sung-Joo (2009) stresses the relationship between crises and political leadership, saying that ‘regional community is at once both the end-result of peace and reconciliation among its members and the facilitator of future harmony among them. But a threshold has to be crossed before a happy, mutually reinforcing process can begin. Overcoming past grievances and present and future disputes will take leadership and political will, which unfortunately are lacking in East Asia and Northeast Asia in particular.’ However, history tells us that crises could provide an opportunity for uniting peoples and enhancing regional integration, as was the case during the 1950s in Europe.

       3.3 Applications of Crisis Model4

    Contrary to conventional belief, the crisis model assumes that crises can contribute to the enhancement of regional integration. With regard to Northeast Asian regionalism, three crises should be mentioned. One is the global financial  crisis. The second is North Korea’s nuclear test. The last and recent one is the 2011 Tohoku earthquake.

    As the first organized global effort for resolving the global financial crisis, the G20 summit was held in Washington, DC, on November 15, 2008. Right after this global meeting, a regional effort began with the first Trilateral Summit held  on December 13 in Fukuoka, Japan. President Lee Myung-bak, Japanese Prime Minister Taro Aso and Chinese Prime MinisterWen Jiabao focused their talks on howtheir countries could help Asia – and theworld – get out of the looming recession. Since that first meeting in 1999, the trilateral summit has been successfully held on an annual basis. The 2008 trilateral summit was exceptionally significant in terms of its historic meaning and timing. First, this was the first Trilateral Summit to be held independently from other multilateral occasions. Prior to this summit, all eight rounds of trilateral summit took place in Southeast Asia, at the annual ASEAN+3 Summit.That is, cooperation betweenKorea, China and Japan had been an integral part of the cooperation within the ASEAN+3 framework.

    In their 2008 meeting, the three leaders announced a Joint Statement forTripartite Partnership, which sets forth the direction and basic principles for trilateral cooperation in the years to come. In particular, the three leaders endorsed the  Action Plan for Promoting Trilateral Cooperation, inwhich they agreed to launch a Trilateral Cooperation Cyber-Secretariat in 2009 to deal with secretariat affairs of trilateral meetings and consultations. Even after the third trilateral summit,  whichwas held in Cheju, South Korea,May 2010, therewas no concrete road map for the creation of an East Asian Community. Nonetheless, the summit is becoming an important stage on which to demonstrate the role of the three nations in contributing to peace and prosperity, not only in the region but elsewhere in the world. As a tangible outcome of the trilateral summit, the trilateral cooperation secretariat was established in Seoul, Korea, in 2011. Therefore, it could be said that the global financial crisis also contributed indirectly to Northeast Asian regionalism by increasing the roles of the three countries, especially in so far as the platform of the G20 replaced that of the G8 and also in facilitating the cooperation among these three countries.

    Asecond major crisis that contributed to Northeast Asian regionalism involved North Korea. The North Korean nuclear program brought together five other major powers to deal with that crisis in the form of the Six Party Talks, which  began in 2003. Then on October 9, 2006, North Korea conducted its first nuclear test. In less than 3 years, onMay 25, 2009, North Korea claimed to have successfully carried out its second test of a nuclear weapon, one that was as powerful as the atomic bomb that destroyed Hiroshima. That second test came less than two months after the North enraged the US and its allies by test firing a long-range ballistic missile. The South Korean Lee Myung-bak government announced its proposal for a ‘Grand Bargain’ to deal with North Korea’s nuclear issue, which has gained support from other countries in the Six Party Talks. In this sense the nuclear crisis has been a stimulus for making the countries of the region gather and cooperate.

    The third crisis is the 2011 earthquake off the Pacific coast of Tohoku, also known as the 2011 Tohoku earthquake, the Great East Japan Earthquake, and the 3.11 Earthquake, which was a magnitude 9.0 (Mw) undersea megathrust earthquake off the coast of Japan that occurred at 14:46 JST (05:46 UTC) on Friday, 11 March 2011. It was the most powerful known earthquake ever to have hit Japan, and one of the five most powerful earthquakes in the world since modern recordkeeping began in 1900. The earthquake triggered powerful tsunami waves that reached heights of up to 40.5m (133 ft) in Miyako in Tohoku’s Iwate Prefecture, and which, in the Sendai area, travelled up to 10 km (6 miles) inland. The tsunami caused a number of nuclear accidents, primarily the ongoing level 7 meltdowns at three reactors in the Fukushima Daiichi Nuclear Power Plant complex, and the associated evacuation zones, affecting hundreds of thousands of residents. On 12 March 2012, a Japanese National Police Agency report confirmed 15,854 deaths, 26,992 injured, and 3155 people missing across 20 prefectures. Japanese Prime   Minister Naoto Kan said, ‘In the 65 years after the end ofWorldWar II, this is the toughest and the most difficult crisis for Japan’ (CNN, 13 March 2011). This disaster caused a movement for making the nations and peoples in the region realize the necessity and the urgency of regional cooperation and community building in order to meet potential disasters in the region.

       3.4 Political Leadership Model

    If the Roh administration (2003–2008) focused its approach on Northeast Asia with a tilt toward China, its successor, the Lee Myung-bak government has been emphasizing the US–ROK alliance while expanding economic cooperation toward East Asia in the formof its ‘NewAsia Initiative’.When he visited Jakarta, Indonesia on May 8 2009, President Lee announced the establishment of this ‘New Asia Initiative’. Under it, Korea will play a central role in representing the interest of Asian nations in the international arena. President Lee laid particular stress on the importance to Asian nations of Korea’s specific diplomatic ties to four major neighboring countries, the US, China, Japan and Russia.

    The global financial crisis contributed to a leadership change in the US. In his inaugural address on January 20 2009, President Obama mentioned several points that are relevant to our topic. Regarding the nuclear issue, he stressed the  following: ‘With old friends and former foes, we will work tirelessly to lessen the nuclear threat, and roll back the specter of awarming planet.’Healso underscored the necessity for change saying that ‘for the world has changed, and we must change with it.’

    The most significant leadership change affecting Asian regionalism occurred in Japan. In September 2009, the Japanese people chose a big change, which represented not simply a party shift, but a change in the whole system of governance. The leadership change has a direct implication for Northeast Asian regionalism. Premier Hatoyama distinguished his own government from his predecessors’ in declaring his foreign policy thrust will move from a monotonic focus on the US alliance to a pro-Asian neighbor policy, most symbolically represented with the creation of an East Asian Community.

    The year 2012 has been seeing consecutive leadership changes in major countries such as Russia, China, the US and South Korea, even though there is no high possibility of significant changes to the existing policies. For now it is not certain whether leadership change could lead to a new momentum for renewed efforts for the regional integration in the region.

    3This part is a revised version of Park (2008, pp. 155–158).   4This part is a revised version of Park (2010, ch. IV).

    4. Reunification of the Korean Peninsula from the Context of Northeast Asian Regional Integration

    Here we analyze the issue of reunification of the Korean Peninsula from the context of Northeast Asian regional integration. We may consider the following sets of possible models for Northeast Asia according to the field or the market  sector. In this case there could be two possible models that will be directly related to the reunification of Koreas.

       4.1 Transition Model

    If we consider the North Korean transition as endogenous, we may construct a ‘Transition Model’ for regional integration. There could be four types in such a model. The first is a ‘radical type’, where the collapse of the North Korean system comes first, leading to reunification followed then by transition and integration (U – T – I). A second option is a ‘gradual type’, where integration comes first followed by transition, with unification coming last (I – T – U).The third process involves what might be called ‘transition type I’ where transition or reformcomes first, then integration follows, with unification coming last (T – I – U). The fourth type, ‘transition type II’ would see transition or reform come first, and then unification, with integration coming last (T – U – I).The ‘radical type’ is the  option for groups who are against the Kim Jong-il regime or who believe there is a high possibility of some big-bang scenario involving North Korea. The ‘gradual type’ could be the best option in the sense that it could minimize the so-called unification costs. It is also consistent with the strategy of ‘Unification through Regional Integration’where unification of the Korean peninsula could be attained only after or through regional integration.The fact that the October Inter-Korean Summit in 2007 was proceeding simultaneously with the Six Party Talks confirms the usefulness and the applicability of this strategy. ‘Transition type I’ presents a rather realistic model, considering the fact that in order to be integrated, theNorth Korean system would have to be reformed to a certain degree. ‘Transition type II’ presents an option for perspective from which integration would be achieved only after unification and as the final result of an engagement policy such as the ‘sunshine policy’ toward North Korea. The gradual type is most preferred here. However, we have to prepare for the contingency case of the radical type.

       4.2 Development Model

    In order for regional integration in Northeast Asia to have any feasibility, we should take into consideration the fact that there are many relatively underdeveloped parts of the region, such as NorthKorea, the Northeast provinces  of China and the Russian Far East. Therefore, any model for regional integration in Northeast Asia should be constructed based on considerations of development as well as transition. The ‘Industry-Oriented (or Planning-Oriented) Model’, which is based on the ECSC model could be applied here. As a comprehensive program for reinforcing development and transition of North Korea after the nuclear issue is resolved, a ‘Northeast Asian version of Marshall Plan’ could be proposed under a US initiative.

    In order to analyze the issue of reunification of the Korean Peninsula from the context of Northeast Asian regional integration,we should consider the following two factors, i.e., the US role and the China factor.

       4.3 US Role ? Dichotomy between Economy and Security5

    Han (2009) raises a significant question regarding the role of the US in East Asian regionalism. ‘The United States, although neither a member ofASEANPlusThree (APT) nor the EAS, and perhaps because it isn’t, used to have more misgivings than blessings toward an East Asian grouping.’ Regarding the recent position of the US, he states that ‘rather than expressing opposition, it has decided to do something about it–like working in FTAs with such countries as Singapore and South Korea.’ It should be noted that the US and Russia began to participate in EAS meetings since 2011.

    I agree with his observation that ‘the fact that the United States is linked to East Asia through APEC should be a good reason to welcome the emergence of an East Asian community, not a ground to have misgivings.’

    Morrison (2009) suggested three different conceptions of region with regards to assessing the US role – an East Asian region, a trans-Pacific or Asia-Pacific region congruent with APEC, and a North Pacific region. According to him, ‘the North Pacific has hardly any identity as an international region. The one existing multilateral intergovernmental process is the Six Party Talks.’ He added that ‘there have also been proposals for G-2s and G-3s of North Pacific countries, but for the purpose of promoting bilateral or trilateral cooperation, and not with the purpose of developing a sense of North Pacific cooperation as a whole.’

    Considering all of those factors related to regionalism in Northeast Asia in particular or East Asia in general, I want to suggest, first of all, that we need to separate out economics and security. Economically, the US should allow a  coalition or a bloc to formamong East Asian countries.APECprovides a sufficient vehicle for the US engagement in East Asian economic affairs.On the other hand, the US should actively participate in security issues, particularly in Northeast Asia, for instance through the framework of the Six Party Talks.Without the US, no security arrangement can be feasible in the region.

       4.4 The China Factor6

    One of the key uncertainties regarding Asian regional integration is howto evaluate the future of China. A champion of pessimism regarding China, Guy Sorman argues as follows.

    On the other hand, Pempel (2011) suggests a rather balanced view.

    In order to control the risks from the China factor, Asian regional integration should involve China as one of the active players.

    5This part is a revised version of Park (2011, pp. 160–161).   6This part is a revised version of Park (2011, pp. 161–162).

    5. Conclusion

    In order to minimize the uncertainty or risks related to the unification, we need a strategy of so called ‘Unification through Regional Integration (URI)’. This strategy is consistent with the above second option of a ‘gradual type’,where integration comes first followed by transition, with unification coming last (I –T– U). The strategy has three components. The first is to give priority to integration over unification. In a sense it is a gradual or long-termapproach to unification.The second is to emphasize a regional ormultilateral solution rather than a direct contact between South and North. It should be noted that North Korea is very sensitive to South Korea’s initiative and nervous about its influence to North Korean people. Even in order to teach North Korea an international rule, a regional or international organization will bemore effective than SouthKorea’s bilateral partner.The third is to pursue a peaceful unification based on a democratic process. At the same time, the strategy does not exclude the possibility of NorthKorea’s hard landing or sudden collapse. Therefore, again, the necessity of a regional cooperation mechanism in the region is emphasized. Roland (2008) already noted the importance of themultilateral cooperation mechanism towards North Korea’s contingencies:

    This argument confirms the fact that North Korean issue is not the bilateral but the regional one.

    In conclusion, we have to manage North Korea, a special country with an old regime and young leader. Therefore we need patience, a balanced perspective between the pessimistic and the optimistic, and a comprehensive approach combining integration and unification together. We should admit that regional integration and unification will take a long time. But they could come true earlier than we expect if we are successful in deriving and implementing a master plan combining the Northeast Asian version of a regional integration model and a system change model based on the strategy of unification through regional integration.

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  • [Figure 1.] Model of system change.
    Model of system change.
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  • [Figure 2.] Per capita GDP, 1990?2008 (Lee, 2011).
    Per capita GDP, 1990?2008 (Lee, 2011).
  • [Figure 3.] Growth rates 1999?2009 (Lee, 2011).
    Growth rates 1999?2009 (Lee, 2011).
  • [Table 1.] GDP and Growth Rates of North Korea, 1991?2008, 100 million dollar, Lee (2011)
    GDP and Growth Rates of North Korea, 1991?2008, 100 million dollar, Lee (2011)
  • [Figure 4.] A Northeast Asian version of regional integration model.
    A Northeast Asian version of regional integration model.