Pilger and Campbell on Cooling China-DPRK Relations

This blog always appreciates new research on the DPRK, and Michael Pilger and Caitlain Campbell have obliged with a short, punchy report  on China-DPRK diplomacy for the U.S.-China Economic and Security Review Commission. Using Director of National Intelligence Open Source data from 2009 through 2014, the report tracks all reported bilateral diplomatic exchanges between the two countries, breaking them down in a variety of ways. The innovation in the report is to code the visits by the level of the top political representative on either side. The report distinguishes between upper- and lower-level exchanges, and within those categories makes finer gradations that run from minor delegations all the way up to ones in which the President/Supreme Leader is involved as one of the parties (see Figure 1 in the report and also the footnotes to understand the coding).

The findings are neatly summarized in Figures 1 and 2, which we reproduce from the chart below. The picture is clear: lower-level exchanges have trended up steadily since 2009 but upper-level exchanges have witnessed a secular decline since 2010.

Figure 1. Upper-Level Exchanges between Chinese and North Korean Officials, 2009 - 2014

Source: Direct reproduction of figure 2 in Pilger and Campbell (2015)

Figure 2. Lower-Level Exchanges and Total Exchanges between Chinese and North Korean Officials, 2009 - 2014

Source: Direct reproduction of figure 3 in Pilger and Campbell (2015)

The two trends may or may not be related. For example, the rise in lower-level visits could reflect a mutual diplomatic downgrading, with lower-level visits substituting in part for upper-level ones.

But it is more likely that the trends are explained by different factors. The rise in lower-level exchanges reflects the growing integration between the two countries, as functional delegations do their thing below the radar of major diplomatic back-and-forth. The fall in upper-level exchanges, by contrast, reflects increasing mutual disenchantment. China had plenty to be annoyed about, from the Cheonan-Yeongpyeong messes of 2010 through the December 2012 satellite launch and February 2013 nuclear test.

Convincing evidence of this interpretation is that high-level party exchanges actually fell to zero in both 2013 and 2014. In addition to disenchantment, China could be steering the conduct of bilateral relations out of the fraternal party channel—through the more tolerant International Liaison Department—and toward the foreign ministry.

Pilger and Campbell conclude that this should not be read as signaling a change in policy, noting all of the reasons to believe that Beijing will remain conservative. But the trends they describe could themselves be read as a change of policy, although possibly emanating from both sides. For China, the game is signaling disapproval but could well have material implications. Aid requests, for example, are typically discussed at high-level meetings. The Chinese government might even be signaling disapproval of purely commercial transactions. We now have data on bilateral trade for 2014 (see figures 3 below), and for the first time since the global financial crisis, bilateral relations have seen a pause and even slight decline.

Figure 3. China's observed total goods trade with North Korea, 2004 - 2014

Source: ITC Trade Map

For North Korea, the game is different: “we are not taking your phone calls, including with respect to any messages you may have in re our nuclear program and preconditions for convening the Six Party Talks.” Could even more overt Chinese pressure be next?

Update (7 April 2015): An astute commentator pointed out a caveat to China-DPRK 2014 trade data that bears explicit mention here. While figure 3 depicts “observed” trade reported by China, it does not account for crude oil exports to North Korea, which have been absent from the trade data throughout 2014 despite it being unlikely that oil shipments actually stopped. If one assumes that North Korea imported roughly 50,000 tons of crude per month – and they are paying somewhere around market rates (or higher) – then total bilateral trade in 2014 would have registered an increase. However, even if we account for oil, this still implies only modest trade growth, especially as China’s imports from North Korea decreased last year, in large part due to moderation in demand and a stiff drop in unit prices for coal and other natural resources.