2 Koreas View New Trade Ties With Hope--and Suspicion

An innocuous-looking, 88-pound shipment of clams arrived at the southern port of Pusan last November, opening a bewildering new chapter of hope--and suspicion--on the Korean Peninsula.

It was the first time a product had been imported directly to South Korea from North Korea since the two hostile halves of this divided land ostensibly stopped shooting at each other 35 years earlier.

The clams, a sample shipment ordered by South Korea’s Hyundai Corp., arrived less than one year after the Seoul government accused North Korean agents of murdering 115 people in the terrorist bombing of a South Korean civilian airliner.

Those historic mollusks have been followed by an array of goods and materials from the Communist north, reportedly bartered for such things as color television sets.

Last Tuesday, a 20,000-ton load of North Korean coal arrived without passing through a third country, as a token flow of coal had done in the past. On Thursday, there was even bold talk of South Korean tourists someday traveling north through the barbed wire and past the land mines of the demilitarized zone to visit Mt. Kumgang, reputed to be the peninsula’s most scenic peak.

Although political rapprochement between the two Koreas has sputtered without substantial progress since South Korean President Roh Tae Woo declared a startling new policy of tolerance last July, intra-Korean trade has gotten off to a surprisingly strong start.

So startling is the sudden pace and potential scope of the new economic ties that both sides, ambivalent and still distrustful, show some signs of recoiling. Each has accused the other of attempting deceit.

But one recent development would have been unthinkable before Seoul’s hosting of the 1988 Olympic Games gave it a diplomatic windfall that spawned trade ties with the Soviet Union, China and other North Korean allies--and shattered some rigid attitudes here about communism.

A leading South Korean businessman was invited to North Korea and allowed to travel there late last month on a private trade mission.

Chung Ju Young, founder and honorary chairman of the Hyundai conglomerate, whose general trading subsidiary brought in the clams, returned to Seoul on Thursday bearing gifts from his capitalist pilgrimage to the north.

Chung, 74, had signed an agreement that, if approved by the Seoul government, would involve Hyundai in joint projects to develop an international tourist resort at Mt. Kumgang, to cooperate with North Korea on economic development in Soviet Siberia, and to invest in a shipyard and railroad rolling stock factory in the North Korean city of Wonsan.

But even while Chung was visiting, the official North Korean media, monitored in Tokyo, blasted South Korean authorities for making false claims that economic exchanges were fostering a “new age” of improved north-south relations. In covering Chung’s trip, the reports emphasized his contacts with long-separated relatives, not his deal-making. Chung is originally from a town now located in the Communist north.

Back in Seoul, the industrialist’s North Korean gift package was viewed in many quarters as a Trojan horse of sorts.

“We don’t yet know how North Korea will act,” said Yu Suk Ryul, assistant dean of the government-sponsored Institute of Foreign Affairs and National Security. “Their attitude hasn’t really changed yet and we have to be very cautious because they may well have a dual strategy.

“They might pursue economic ties,” he said, “at the same time they prepare militarily for other objectives.”

Yu suspects that the north intends to take advantage of unofficial links with the south to divide public opinion and fan anti-American sentiment, ultimately hoping to achieve its longstanding goal of having U.S. troops withdrawn from the peninsula.

Even independent analysts are as skeptical as they are optimistic.

“They’re using Chung Ju Young for their own purposes,” said Kim Chang Soon, director of the private Institute of North Korea Studies. “His visit was a breakthrough and it presents some opportunities, but a lot of doubts remain. It’s a situation that can’t be entirely trusted.”

Words of Caution in Seoul

Words of caution were prevalent last week as South Koreans digested the news of Chung’s triumphant return from the north.

A statement from the government said that it “in principle takes a favorable view of the proposed projects, regarding them as possible pilot projects that could contribute to efforts to achieve national unification.”

Dong-A Ilbo, the top daily newspaper, said in an editorial that more serious thought should be given to the “winds of reconciliation” stirred by Chung’s trip.

“This beginning of a stream could stop at any time, or it could overflow to ruin our rice fields as well,” Dong-A Ilbo said.

North Korea’s long isolation and its stubborn adherence to “ juche ideology”--the autarchic philosophy of totalitarian leader Kim Il Sung--raises serious questions about its ability to guarantee investment rights or deal flexibly with market economies, analysts say.

Sees Benefits for North

Hong Won Tack, an economist at Seoul National University, is upbeat about the positive influence expanded trade might have on the north’s economy. It could make that system more pragmatic, he said. But the benefits for the south are not so clear, he added. “I don’t think South Koreans will be able to make any money out of the exchange,” Hong said. “If they can break even, they’d be doing well.”

Still, since the Seoul government announced it would permit direct trade with the north last October, a number of South Korean companies have jumped on the bandwagon. There have been some hitches at this end, however, such as the impoundment of a shipment of paintings suspected by South Korean authorities of having a propaganda motif. One source close to the transaction explained that there was concern over a hidden “psychological message” in the artwork.

Hyundai’s Chung announced plans to go back north in April to conduct a feasibility study for the mountain resort. This time he will try to travel through the truce village at Panmunjom on the DMZ, rather than repeat the circuitous route via Tokyo and Beijing.

For now, it does not appear that other tycoons intend to copy Chung. A spokesman for the Daewoo Group, the nation’s fourth-largest conglomerate, said its chairman, Kim Woo Choong, had no immediate plans to visit Pyongyang. Kim is too busy working out arrangements for a joint-venture hotel in Moscow, he said.

Last Monday, Ho Dam, a North Korean Politburo member who was the host for Chung’s visit, invited the heads of the political parties and other prominent South Koreans to visit Pyongyang.

But Pyongyang’s attempt to deal directly with the South Korean people, circumventing the Seoul government, is a touchy point.

“We are losing with Nordpolitik,” said Rhee Sang Woo, director of the Institute for East Asian Studies at Sogang University. “North Korea’s purpose in rapprochement is to get rid of the South Korean government.”

Prospects for genuine reconciliation between the governments will be tested later this week. Teams of negotiators are scheduled to meet at Panmunjom on Wednesday to begin preparations for a high-level meeting that would include the prime ministers of both countries and again Friday to resume protracted talks aimed at convening a parliamentary conference.

No breakthroughs are anticipated, however. North Korea is likely to press its demand that Seoul abandon plans to hold annual Team Spirit military exercises with the United States. South Korea is expected to reject that demand, as it has done ever since the exercises began in 1976.

Meanwhile, local newspapers reported in their Saturday editions that a close aide to President Roh met secretly with a high-ranking North Korean official in Singapore two weeks ago to negotiate terms for a possible summit between Roh and Kim Il Sung later this year.

Culture and Information Minister Choe Byung Yul quickly issued a statement saying: “It is true that the government is making multifaceted efforts to bring about a south-north summit.” But Choe denied that this was the purpose of the Roh aide’s trip to Singapore.