The Chinese tightrope walk on North Korea

People seem to be pleased about the DPRK decision to re-enter six-party talks. Many commentators are also giving the credit to China for this breakthrough. Michael Moran at cfr.org points out: China?s actions merit most attention. Susan Shirk, an Asian affairs specialist at the University of California, says ?the North Korean nuclear test, by driving China to become part of the solution and averting conflict between China and Japan, shifted strategic ground in Northeast Asia? (YaleGlobal). More than ever, agrees CFR Vice President Gary Samore, China is in the driver?s seat.This leads to an interesting question -- why did North Korea agree to jaw-jaw? I suggested earlier this month that Chinese economic pressure was the source for DPRK moderation. This New York Times report by Joseph Kahn does little to change my mind on this point: China cut off oil exports to North Korea in September during heightened tension over North Korea?s nuclear and missile programs, Chinese trade statistics show. The unusual move ? the figures show China sold no crude oil at all to its neighbor in September ? reduced sales for the year by about 7 percent from the similar period in 2005. China?s oil exports to North Korea, though uneven, had been averaging about 12,300 barrels a day. North Korea depends on China for up to 90 percent of its oil supplies, much of which is sold on credit or for bartered goods, according to Chinese energy experts. Any sustained reduction could cripple its isolated and struggling economy. There is no clear indication that the September figures represent a policy shift by China on providing vital food and fuel supplies to its neighbor and ally in the Korean War. North Korea conducted a nuclear test on Oct. 9, after the period covered by the latest customs data. But North Korea tested ballistic missiles in July, defying sharp warnings from Beijing. China supported a United Nations resolution condemning the missile tests, and urged that North Korea not take any steps that might ?worsen tensions.? ?It is a sharp and sudden reduction at a sensitive time, so political considerations cannot be ruled out,? said He Jun, a Beijing-based energy expert and consultant. ?China could be sending a clear signal.? If that analysis is correct, it suggests that Beijing may seek to punish North Korea in a variety of ways, both open and unspoken, in the aftermath of its nuclear test. Although China has long protected North Korea against outside pressure, analysts said the nuclear test surprised and angered the Chinese leadership. Many here considered North Korea?s nuclear technology primitive and argued that the country was using the threat of developing atomic bombs as an economic bargaining chip.... [L]ast spring Beijing followed Washington?s lead in freezing North Korean assets that the Treasury Department identified as connected to money laundering, according to Bush administration officials. Chinese officials never announced that they had done so, suggesting that they take some tough actions quietly. Chinese experts on North Korea who took part in discussions of the nuclear issue this month said officials had discussed reducing oil shipments if North Korea continued to defy the outside world. Beijing?s response would be especially sharp if North Korea conducted more nuclear tests or declined to resume negotiations about dismantling its nuclear program, these experts said. If Beijing was already using oil to warn North Korea in September, its response to the October test could be more severe. What's really interesting about this is that the Chinese are denying any efforts at economic pressure. I'd deny if I were them too -- because successful Chinese coercion opens up a can of worms Beijing does not want to see open. The moment that Chinese economic pressure against North Korea is perceived as successful, the question becomes, "When will China use its economic lever to put the squeeze on the DPRK regime?" Indeed, this was the point Anne Applebaum made a few weeks ago in Slate. If Chinese pressure turns out to have worked, then it becomes that much tougher for China to take a backseat to the United States on this issue. The thing is, China -- and South Korea -- want the impossible. They want a declawed but intact DPRK to act as a buffer between Beijing and Seoul. If this were possible, then China wouldn't need to worry about the long-term regional threat posed by a unified Korea, and Seoul wouldn't have to worry about the costs of bankrolling North Korea's transition. It's not possible, however, because this regime wants absolute domestic control, and that's incompatible with the kind of reforms that would be necessary to survive. I don't have a great answer to this problem, by the way -- but Beijing doesn't either.