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     May 21, 2009
Pyongyang chokes on sweet capitalism
By Donald Kirk

WASHINGTON - North Korean leader Kim Jong-il may face a more pernicious challenge than either a "preemptive strike" by the United States or a power grab by generals eager to fill the power vacuum created by his illness.

Think Choco Pie, the thick wafer-like confection, all pastry and cream, served in the Kaesong Industrial Complex as a daily dessert for the 40,000 North Koreans who toil for 100 South Korean companies with factories in the complex.

"North Koreans love Choco Pie," said Ha Tae-keung, president of NK Open Radio, which beams two hours of news daily into North Korea from its base in Seoul. "It's an invasion of the stomach."

North Korean workers, and the friends and family members for


whom they save their daily treats, may salivate over Choco Pie, but it's giving a severe stomach ache to senior officials fearful of the infiltration of South Korean culture in all corners of their Hermit Kingdom.

Choco Pie - along with other favorite South Korean cakes and candies as well as instant coffee - has come to symbolize the image of the capitalist South as a multi-tentacle beast that may be impossible to digest.

For Kim Jong-il, suffering from diabetes, recovering from a stroke and hoping to survive a few more years while grooming his neophyte youngest son, in his mid-20s, to succeed him, the best way to deal with the Kaesong complex, 60 kilometers north of Seoul and just above the demilitarized zone between the two Koreas, may be to spit it out.

It's for this reason, said Ha, that North Korea has precipitously scrapped the agreements under which South Korean companies operate in the complex, built and managed by Hyundai Asan, an offshoot of the sprawling South Korean Hyundai empire.

"He's come to see Kaesong as a burden rather than an asset, and is inclined to shut it down," said Ha.

Kim signaled his strategy in a meeting on April 24 at which he congratulated those responsible for developing and launching the long-range Taepodong -2 missile on April 5, a mission that North Korea still insists was to put a satellite into orbit.

The danger of South Korean cultural infiltration apparently trumps the need for the hard currency that the North makes from the South in the form of pay for the workers and rent for the land occupied by South Korean factories. Or, as Ha put it, "It's money versus regime stability."

It's partly for this reason, South Korean media are reporting, that Kim ordered the execution last year of Choe Sung-chol, the senior official responsible for dealing with South Korea's Unification Ministry, Hyundai Asan and South Korean companies with factories in the Kaesong complex.

The 53-year-old Choe vanished from his post as chief vice director of the Unification Front Department of the ruling Workers' Party at about the time that Lee Myung-bak was inaugurated in February 2008 as president of South Korea.

When it became apparent that Lee would not shower the North with several hundred thousand tons of food and fertilizer each year, as had the two presidents who preceded him, the North began branding him "a traitor" and “lackey” of the United States.

North Korea, elevating the rhetoric after the United Nations Security Council condemned the launch of the Taepodong, has indicated it's preparing for another nuclear test similar to its first such test on October 9, 2006.

South Koreans believe Choe may have been an easy target for bribery, at least judging by the ease with which company managers are accustomed to paying off North Korean officials they come in contact with in the Kaesong complex.

"Now North Korea is afraid the North Korean workers are corrupted," said Paik Sung-joo, director of the Korea Institute for Defense Analyses.

The taste of Choco Pie, moreover, apparently is spreading like a poison that is contaminating the system. Since businesses in the complex began serving the snack four years ago “to boost morale", said Chosun Ilbo, the South's biggest-selling newspaper, it's had “explosive popularity among workers”.

A staffer in the complex estimated that 150,000 Choco Pies "are probably consumed each day at the industrial complex", according to Chosun Ilbo, and Orion, the South Korean manufacturer, ships between 10,000 and 20,000 boxes of Choco Pies each day.

Most disturbing, however, is the sale of Choco Pies on black markets near Pyongyang. Since failing to stop the flow of Choco Pies from Kaesong, one South Korean official was quoted as saying authorities "are now turning a blind eye".

Choco Pies, the official told Chosun Ilbo, are "sweet symbols of capitalism".

Choe, relegated to work on a chicken farm after his disappearance as a senior official, suffered the same fate as thousands of North Korean officials who have fallen out of favor over the years, including a number of generals for failing to conquer the South in the Korean War of the early 1950s and an agricultural minister held responsible for the massive famine that killed two million people in the mid- and late-1990s.

But encouraging favorable sentiment toward South Korea in the North, as reported in South Korea, was not Choe's offense. Rather, he failed to anticipate and effectively combat the South Korean government's shift from the "Sunshine" policy of reconciliation initiated by Kim Dae-jung during his five years as president from 1998 to 2003 and perpetuated by his left-leaning successor, Roh Moo-hyun, president from 2003 to 2008.

When it comes to South Korean cultural infiltration, however, North Korea has far more to fear from the entry of goods from China than from the Kaesong complex. South Korean DVDs and CDs, even soft-core porn movies made in the South, are now distributed surreptitiously throughout North Korea. Electronic gadgetry, MP3 and MP4 players, TV sets, radios and rice cookers, also shipped via China, are also available for those with the money to pay for them.

"The most important invasion is from China," said Ha Tae Keung of NK Open Radio. "It gets around the whole country."

Much of the traffic in electronic products and food is done surreptitiously with goods sold on the black market, often to members of the North Korean elite. North Korea can do little to stop such trade in view of its dependence on China, its only real ally.

South Korea's Trade-Investment Promotion Agency reported that North Korean trade last year reached US$3.8 billion, not including trade via sea with South Korea. That figure represents a jump of nearly 30% in trade with China, which enjoys a hugely favorable balance. China last year imported $750 million in North Korean products while exporting products worth $2 billion to North Korea.

While the North's exports are shrinking this year, said the report, "China's influence on the North Korean economy is likely to grow further."

Analysts believe the shrill attacks on South Korea, including demands for a new contract for doing business in the Kaesong complex, are an attempt to blame South Korea when Kim Jong-il finally closes it.

The arrest nearly two months ago of a Hyundai Asan engineer, accused of badmouthing North Korea, suggests this strategy. North Korea has not revealed the charge against him, but he's believed to have flirted with a North Korean waitress to whom he boasted of the good life in the South. The worker is to go on trial some time next month.

"Kim Jong-il wants to blame South Korea,” said Ha Tae Keung. "Choco Pie is aggravating the problem."

Journalist Donald Kirk has been covering Korea - and the confrontation of forces in Northeast Asia - for more than 30 years.

(Copyright 2009 Asia Times Online (Holdings) Ltd. All rights reserved. Please contact us about sales, syndication and republishing.)

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