North Korea and China: A zero-sum game

The recent nuclear test carried out by North Korea has had far reaching consequences on the geopolitical dynamics of the region. While Japan, South Korea and the US reacted unanimously, calling for further sanctions against Pyongyang and increasing their military presence on the peninsula, China sat on the fence.

China’s unclear position on the subject is a consequence of the delicate role that the Korean peninsula plays in serving China’s national interests. While Beijing’s main objective is regional stability, the path to achieve it is paved with mixed blessings. President Xi Jinping will soon have to decide which national interests to prioritise. Is a strong US military presence in South Korea more acceptable than having an unpredictable nuclear power just on the other side of the border? Or is the US Terminal High Altitude Area Defense (THAAD) programme such a threat that it will lead Beijing closer to Pyongyang? Whether China will decide to fully cooperate with South Korea or to continue its economic and diplomatic relations with North Korea, there is no doubt that the choice will have a resounding impact in the Asia-Pacific.

According to Dr. Tong Zhao, an associate in Carnegie’s Nuclear Policy Program and former Stanton Nuclear Security Fellow at the Belfer Center for Science and International Affairs at Harvard University, “China does not have good options in response to the latest North Korean nuclear test.”

On one hand, the US decision to develop the THAAD program in South Korea to enhance its defensive capabilities has made China (and Russia) nervous. Beijing has seen this as a direct menace to its borders. The US Defense Department has heavily stressed that the only purpose of the mission is to strengthen Seoul, not to pose a threat to the Bear or the Dragon. Despite US reassurances, the activity has sparked political outcry. Chinese Foreign Minister Wang Yi commented on the situation, saying “the recent behaviour from South Korea has undermined the foundation for our bilateral trust.”

The China Daily described the deployment of THAAD in harsh words. It stated that the event was a “stab in the back” and that “it is impossible for South Korea’s leader not to know America’s strategic plot. [She] is well aware of the real direction of the THAAD anti-missile system.” It concluded with a claim that the decision to adopt THAAD means the death of China’s collaboration with South Korea, Japan, and the US in countering the threat posed by North Korea’s nuclear program.

Daniel Urchick, a researcher for the online consultancy Wikistrat, states that “China will do anything aimed at North Korea. Any further sanctions will mean that China will be alone in supporting the North Korean state and with the economy boom close to an end, it doesn’t want that financial burden.”

However, if Beijing will not support future sanctions against Pyongyang it might face more dangerous threats than having US anti-missiles systems in its backyard or an increase in expenditures. The current disputes in the South China Sea, in addition to the refusal to stop economic relations with North Korea, could lead China towards an isolation that it does not want and cannot afford. China’s biggest export destinations, as well as import origins, currently comprise the US, Japan and South Korea. It is clear that as diplomatic relations worsen the economic links are jeopardised. That puts $686bn of external trade value at risk. In other words, a tenth of China’s GDP.

China’s decision to trade with DPRK while concurrently condemning US and South Korean military actions in the peninsula will also have direct security repercussions. The lack of a unanimous and coordinated diplomatic ultimatum and the absence of a strong military deterrent will convince Kim Jong-un to continue his nuclear program. Pyongyang will still have China as an economic partner and any military actions in the region are unlikely to happen without Beijing’s consent. While China’s choice to condemn THAAD is driven by national security concerns, the instability caused by DPRK’s growing nuclear acquisition is as much a direct threat to Beijing’s interests.

The alternative path for Xi is to accept the THAAD as an extreme compromise to maintain stability in the peninsula.

“China will accept THAAD. It doesn’t have much of a choice,” says Urchick, indicating that any attempt to punish Seoul will cause a backlash on Beijing that harms both its economy and international reputation. Moreover, from a technical point of view, the new ICBM China has been developing will make THAAD outdated because “offensive missile tech is always ahead of defensive to begin with".

However, while the direct threat arising from THAAD could be eliminated, China’s toleration of US military presence in the region is unlikely to last as, according to Zhao, “[…] it seriously undermines Beijing’s strategic interests”.

In order to respond to the nuclear test without threatening its national security, Zhao speculates that “China could work together with other members of the Security Council to impose tougher sanctions against North Korea.” However, even this scenario could prove hazardous “[should] the U.N. decides to impose a complete economic embargo against DPRK, I doubt China will support it. Beijing will have to be the one to implement it and doing that will certainly enrage North Korea – and may even make China a direct target of North Korea's military threat.”

We must also consider Kim Jong-Un’s strategic cunning.

“North Korea knows that China fears a collapsed state and use this to leverage them into support,” Urchick explains. Any further sanctions against DPRK will aggravate its already weak economy with the risk of causing an internal revolution which would be quickly followed by external intervention.

So China is trapped in the complex framework of protecting national security, maintaining regional hegemony and safeguarding international relations. For Dr. Zhao, this current impasse is the reason behind Pyongyang’s behaviour: “North Korea knew [China’s lack of favourable options] and it is precisely why it decided to go ahead with the test.”

But what is Kim’s endgame?

Wang Hui, deputy editor-in-chief of China Daily Asia, argues that “for decades, the country has faced great pressure from the military alliance between the US and ROK. It counts on the nuclear programme to enhance its security and force the international community to accept its status as a nuclear power. Such a status would also grant it more bargaining chips when dealing with Washington and Seoul.”

The latest nuclear test is without doubt a projection of force, but who is meant to be the audience? One or more of the nations involved in this fracas or the people of the DPRK itself? Jin Wook Choi, senior fellow and director of the Center for North Korean Studies at the Korea Institute for National Unification (KINU), once wrote that “North Korean domestic situation has a great impact on its decision to develop nuclear weapons…Pyongyang believes that the nuclear programme may provide a security guarantee for [the Kim regime], which suffers from declining social and political stability.” There is no reason to think Jong-Un would not have adopted his father’s tactics.

In many ways, this lack of a win-win solution makes North Korea a nightmare for China’s near-term aspirations. The latest events in the peninsula are not only threatening the fragile equilibrium of East Asia bur are jeopardising the economic and diplomatic alliances that Beijing has been building for decades. In this zero-sum game, Xi Jinping will soon have to take sides. The consequences of his choice will be felt not only across the APAC region, but worldwide.