In this study we consider five scenarios for Korean unification: 1) military unification, 2) regime collapse, 3) maintaining the status quo, 4) reconciliation and cooperation, and 5) the optimal scenario of inter-Korean relations, peaceful unification. Comparing these five scenarios with the existing unification scenarios, we can observe shortcomings of past reunification scenarios. First, unification would be achieved under the guidance of South Korea on the basis of the market economy and liberal democracy as the political system. Second, they ignore the positions and interests held by North Korea. Third, they put excessive emphases on economic benefits of Korean unification to neighboring countries. Lastly, they predicted that unification would actually be achieved in near future. This study attempts to correct the shortcomings of previous reunification scenarios and to reflect current realities. Cost-Benefits of each of the five unification scenarios are as follows.
A military unification scenario could be initiated only by the U.S.A or with their approval and support by the ROK. NK does not have the armaments, logistical and human resources to resist after a recent chain of natural disasters, on top of economic problems and being subject to severe international sanctions. The costs of this scenario to Russia would be possible damage to the Russian Far East territory and citizens; tighter security and border control leading to a slowdown in the implementation of development projects in the Russian Far East; possible sanctions from the West; suspension of multilateral projects in Northeast Asia; and the decline in trade and other forms of economic cooperation between Russia and both Koreas. Russia also stands to lose 0.5-1.5 billion USD in transit earnings annually from delays in the railroad project, and additional 3.0 billion USD related to the interruption of the gas project. There will be no benefits for Russia in a military unification scenario.
Regime collapse scenario is unlikely because of the firmness of the NK leadership on key domestic and foreign policy issues, and support from China, which provides food and other necessities to maintain social stability in NK. Russia’s costs under this scenario will be the same as in the case of military unification minus the direct damage to the Russian Far East territory and population. Possible benefits to Russia will be in the indefinite future, mostly from possible elimination of obstacles for implementation of rail, gas and other projects.
The status quo scenario is one of the more probable options. The main danger of the scenario is the unpredictability of NK’s response to the US and its allies’ disregard for Pyongyang’s security concerns. Russia’s costs would include simple continuation of the existing economic relations with both Koreas; postponement of benefits from the geographical location of the peninsula as a “bridge of integration” in East Asia; delays in implementation of the railway, gas and other projects (the same as in previous two scenarios). Russia’s benefits will include maintenance of some stability on the peninsula; savings in defense spending; gradual increase in trade volume and economic cooperation with the two Koreas. By 2020, Russia’s bilateral trade with SK is expected to reach 30 billion USD, with the NK – 1 billion USD.
Reconciliation and cooperation represents a far more profitable scenario since it significantly reduces the risk of large-scale armed conflict on Russia’s borders and increases chances for the realization of multilateral economic projects. Russia’s costs will be related to funds needed for the implementation of those projects, establishment of effective mechanism of trilateral cooperation (Russian Far East-SK-NK) and for assistance to modernize the NK economy. Russia’s benefits may include revenues from the realization of railway and gas projects (up to 5.0 billion USD annually): acquiring a key position in facilitating trade flows from Europe to the Korean Peninsula and back; increases in her trade with SK and NK; more active participation of the two Korean states in economic projects in the Russian Far East region.
The optimal scenario of peaceful inter-Korean relations is a prerequisite for the start of the reunification process, which would meet the interests of both the Korean nation and the international community. Russia’s benefits will stem from creation of a larger market for the export of her energy resources; connection of TSR with TKR; exploitation of gas and electricity transmission lines; increased investment in the Russian Far East, including the development of advanced growth zones; transformation of the peninsula into a transit bridge for Russia’s integration into the APR economy. In general, the implementation of this scenario would bring additional 2-3% increase in the Russian GDP annually. Since this scenario is unlikely to be realized, the most profitable and realistic prospect for Russia remains the development of peaceful relations between SK and NK according to the “Reconciliation and Cooperation” scenario.
Any real progress towards a ultimate goal of Korean reunification can be achieved only when the NK elite will be convinced that the SK, along with the international community, engage in an honest attempt to integrate the North into the existing world.