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Korean Unification and It’s Impact and Implications Research Paper

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Executive summary

In August 2000, North Korea and South Korea have agreed to work together to serve not only economic but also multidimensional purposes such as political, social, technological as well as overall development. However, inter-Korean unification is likely to be an expensive and troublesome procedure because of the huge political and financial variation between these two countries and many developed countries will not support this reunification. Therefore, this research paper will consider the objectives of the unification, its success, existing dilemma, impact on international politics, and the prospect of reunification.


The aim of this research paper is to analyze the impact and implications of Korean unification, powerful political debate, the current development of reconciliation and financial cooperation and even conflict among interested parties. In order to do so, it will address both economic and multidimensional phenomenon because reunification is a costly and difficult process, which has long-term and short-term effects on the national and international economy, political situation, social and cultural environment. In addition, it will scrutinize the North and South Korean economies, and political differences and barriers of the reunification process, as inter-Korean unification is an expensive and hard process because of the huge political and financial differences. It is also essential to identify the interest of China, Japan, Russia, and the US in these issues as they argued that the unification of these two countries would be harmful to their security and economic purpose. This paper will concentrate on reunification Formulas such as the procedure of democratic reunification and the Process of national reconciliation. Finally, to draw a conclusion, this research paper will also consider recent developments, inter-Korean talks, the strategic objectives of North Korea and South Korea.

Basic Approaches of Political View

National Commonwealth Unification Formula

This formula of unification argues for a confederation style of the two Koreas integration is where member states are independent states and ensured equal official status beneath international law and the member states would enjoy full autonomy with close cooperation with each other intended for any common good or services within the scope arranged by the governing accord. Under this National Commonwealth Unification Formula, both North and South Korea do not transfer their sovereignty and independence to the central government but both of them enjoy remarkable sovereignty.

Democratic Unification

Young added that the principle of democratic pointed out that the unification has to be consummated in the course of a democratic system that majority must be granted based on freedom and rights for all Korean people to be more exact and all the procedures and progression of the unification scheme would be decided upon the democratic principles in the society. However, the democratic rights and freedom of each Korean inhabitant have been entirely appreciated ensuring even after the consciousness of unification. (5)

Dilemmas of Korean Reunification

There are two kinds of dilemmas raised for Korean reunification, the first reality is the Korean peninsula that diverse systems that have developed in the DPRK and ROK,1 and none of them is interested to leave its own system as well practice. In such a circumstance, the most sensible way to accomplish Korean reunification is to be a form of unified state as per the principles of Korean reunification set out by the joint statement. However, both the countries have common necessities and benefits of the nation generated from the principle of peaceful co-existence, as a result, neither side is conquering and influencing each other when no side is overshadowing or else conquering the other.

The other dilemma of reunification is the outsider stakeholders who are the beneficiary of the situation, are not interested to comply with the rising demand of the mass people. People need reunification for meeting their families, seeking the right job, and enjoying a hindrance-free united fatherland but the foreign stakeholders like the United States of America and Japan seriously influence the reunification process from their historical perspectives. Russian and China have also been involved in favor of the DPRK in this process. Thus to understand the external dilemmas of Korean unification it would be wise to study the views of related countries like-

United States of America

Library of Congress mentioned DPRK is not ready to take it easy the US presence in South Korea and thus it suffers from continuous confrontation and mistrust and treats the USA as the biggest imperialist force of the globe that is the reason for unrest throughout the world. The most alarming and disturbing phenomenon is that the American army has not yet left the territory of the Panmunjom South Korea after long decays, which is a threat to regional strategic security. USA is creating threats for Asian countries using South Korea’s land (3) KNS reported Pyongyang to think that the USA has been violating human rights and ought to pray for an apology to the global community for abuses of human rights prior to any further discussion on human rights issues of abroad. The countriesUSA conducts itself that it is the “inspector” and “judge” authorized to look after the human rights condition of the globe but its killing of civilians in Afghanistan and Iraq has not been addressed. (1)

China & Russia

Library of Congress mentioned China and Russia have ideological compatibility with DPRK and have historical cooperation among them with technological and military assistance. China has facilitated to look after the exports of DPRK Russia for its foreign purchase. Russia also has indicated that DPRK that it is interested to revise the 1961-defense treaty between DPRK that was the Soviet Union and the modification would most likely stand for Russia would not be forced to militarily support if North Korea accepts at any event.

Basic Approaches of Economical View

After liberation from Japan’s colonial rule, North Korea had mainly maintained trade relations with socialist countries, for example, the Soviet Union but the collapse of the Communist severely affected its economy where it has many hurdles such as lack of foreign exchange reserves, inner-directed economic structure, shortage of arable land, shortages of fertilizer and fuel, deficiency of electricity, aggravated financial hardships. However, Young-Hoon stated that it has successfully recovered by following the strategy of “the construction of a self-supporting national economy” which means human and material resources are secured within the economy itself and they have balanced the production (manufacture products for domestic consumption) and consumption. On the other hand, In 2004, South Korea has joined the trillion-dollar association of world economies through in the 1960s, its gross domestic product (GDP) per capita was inferior to African and Asian countries and in 1997-98 Asian financial crisis has weaken its development model (Library of congress 12). However, the Act on inter-Korean exchanges and cooperation has extended Inter-Korean Trade (exceeded $ 100m to $ 700m) but this Inter-Korean trade has reduced and the reunification formula has failed for this large difference in trade policy and economic environment and for North Korea’s nuclear weapons improvement and its submarine’s intrusion into South Korean waters in 1996. This research paper will present the data of the total exports and imports of these two Korean countries to demonstrate or compare the basic differences of the economic position and the following data shows that South Korea is in a stable position and North Korea runs a trade deficit because the inflow of goods to North Korea is larger than outflow.

Economical View of South Korea

Young argued that the Government of South Korea had countered weakness in their currencies by selling foreign exchange reserves and raising the interest rates that resulted in a downturn in economic growth and prioritized interest-bearing securities over equities. As a result, its economy had seriously affected by the 997-98 financial downturns and these phenomena weakened the banking and financial institutions.

The South Korean Exports

Comparing to the economic condition of North Korea, it can be said that South Korea is in a stable situation in exports sectors as it generates huge national revenue from this sector and a key area of exports are –

  • Semiconductors;
  • Wireless telecommunications product; and
  • Motor vehicles, computers, steel, ships;
  • Petrochemicals and textile (Library of Congress and Indexmundi)
The South Korean Exports
Total Export of South Korea
Figure 2: – Total Export of South Korea
Source: – Indexmundi (2009)
Fiscal Year Total Exports ($ billion)
2003 $162.60
2004 $201.30
2005 $250.60
2006 $288.20
2007 $326.00
2008 $379.00
2009 $433.50

The direction of Exports

Country (exports partners) Percent
China (including Hong Kong) 25.5
United States 20.2
EU 12.8
Japan 15.1
Saudi Arabia 6.1

Table 2: – The main Export collaborates of South Korea
Source: – Self-generated from indexmundi (2009)

Imports to South Korea

However, it has earned enough money from exports but its economic condition is not in stable condition, as it has to expend huge money for imports and major crude oil, food, machinery, electronics and electronic equipment, transport equipment, and chemicals.

Fiscal Year Total Imports ($ billion)
2003 $148.40
2004 $175.60
2005 $214.20
2006 $256.00
2007 $309.30
2008 $349.60
2009 $427.40

Table 3: – Total imports (Year by Year)
Source: – Self-generated from IndexMundi (2009)

The direction of Imports

Country (Imports partners) Percent
China 19.2
United States 8.8
EU 10.6
Japan 15.1
Saudi Arabia 6.1

Table 4: – The major Import collaborates of South Korea
Source: – Self-generated from Library of Congress (2007)

Economical View of North Korea

Library of Congress mentioned that its economy is isolated from the rest of the world so it has maintained a production-based economy with strict government control of trade, wage, fiscal and monetary policies (8). As a result, it has earned very little from exports and other businesses. Moreover, from 1991, its economy has adversely affected due to the collapse of the Soviet Union but for strong decision-making power of the leaders saved the nation from economic crisis such as policymakers has allowed private farmers’ markets to increase sales.

The North Korean Exports

As it has no international business connection so, it has very little opportunity to export products and it can export the following items –

  • fresh and saltwater fish, shellfish, and mollusks;
  • minerals, and metallurgical products;
  • Manufactured goods such as armaments; and
  • Foods and other agricultural products
Total Export of North Korea
Figure 2: – Total Export of North Korea
Source: – Indexmundi (2009)
Fiscal Year Total Exports
2003 $842,000,000
2004 $1,044,000,000
2005 $1,200,000,000
2006 $1,275,000,000
2007 $1,340,000,000
2008 $1,466,000,000
2009 $1,684,000,000

The direction of Exports

Country (exports partners) Percent
China 35
South Korea 45
India 5

Table 2: – The main Export collaborates of North Korea
Source: – Self-generated from Library of Congress (2007)

Imports to North Korea

In 2005, the government has terminated most international humanitarian aid actions and it has to manufacture its own products so it has a serious food crisis, which imposes an extra burden on this country to imports from the international market. Moreover, it has many internal problems such as large-scale military expenditures, limited ability to attract foreign investments, shortage of arable land and weather-related problems, which enhance imports and the main imported products are –

  • heavy petroleum products;
  • As it consumed 25,000 barrels of oil per day, it has to import oil;
  • coking coal; and
  • machinery and equipment;
Fiscal Year Total Imports
2003 $1,314,000,000
2004 $2,042,000,000
2005 $2,100,000,000
2006 $2,819,000,000
2007 $2,720,000,000
2008 $2,879,000,000
2009 $3,055,000,000

Table 3: – Total imports (Year by Year)
Source: – Self generated from IndexMundi (2009)

Direction of Imports

Country (Imports partners) Percent
China 46
South Korea 34
Thailand 6
Russia 4

Table 4: – The major Import collaborates of North Korea
Source: – Self-generated from Library of Congress (2007)

Reunification Formula – Unified North Korea by the Republic of Korea

United Nations (1998) pointed out that permanent representative of the DPRK2 to the General Assembly of UN has addressed that the reunification of south and north Korea has turned complicated by the foreign powers for their own interest for long since World War-II and it would be no longer wise to delay continue the greatest national task for Korean reunification. The reunification talks would be involving only North and South Korea to ensure an absolute and sustainable peace in the Korean peninsula rather than any influence of any foreign power. DPRK would like to drive the mission of the reunification formula for one Korea and working stiff to look for a peaceful resolution of the Korea reunification by the direct involvement and efforts of the people rather than foreign interference.

Procedure of democratic reunification

United Nations (1998) also reported that on 3 May 1972 the DPRK leader Comrade Kim IL Sung put forward the major three doctrines of free, peaceful reunification for the greater national unity of both Koreans. Kim also pointed out the fundamental dilemmas and processes to resolve the national unity by means of national attempts with emphasizing the people’s desire and interests and the three principles of Korean reunification guided as follows:

  • Firstly, the Korean reunification would gain by independent effort without dependence and interference of outsider powers and totally liberated from any intervention.
  • Secondly, the Korean reunification would achieve by means of peaceful resources without conflicting to captivating arms in opposition to the other.
  • Thirdly, the great Korean unity as a single nation would promote through excelling diversities of ideology, morals, ideas, as well as systems.

KNS (2009) mentioned that the three principles provide the most significant reunification program as well as a charter intended for reunification, which is common to both country and as a nation; they call for resolving the issues without any help of others and severely based on these ideologies. Even it would no matter how the state of affairs and surroundings would revolutionize in the near future.

Process of national reconciliation

Young argued for a Three-phase Unification Process that involved the first phase as Reconciliation and Cooperation second phase as Nambuk Yonhap and the third phase as Unified Korea

It may configure that the existing system would replace by establishing a con-federal republic with a unified new Korean government were on condition that the DPRK and ROK would recognize or tolerate any ideological or systematic oppression. The role of government would put into effect the regional autonomy correspondingly by means of equal rights and duties both the counties would be capable to come closer. There is nothing impossible to carry on these objectives for North and South Korea when the present decay has the evidence of Hong Kong reunification with China, the two regimes of a socialist and capitalist economy with the principle of maintaining two systems within a single country.

Howard pointed out that Pyongyang proposed to establishing the ‘Democratic Federal Republic of Koryo’ in the 6th congress of the North Korean Worker’s Party to reunify the two conflicting Korean systems into a harmonized set up for a united federal state through the rigorous efforts of the DPRK and ROK departing from the existing systems that they have now.

It has been assessed that if the countries reunified in the course of the anticipated confederation formula, the existing temperament of arms race connecting the DPRK and ROK would put an end to the Korean peninsula, and positively the region would be transformed into a land of peace and safeguard and remove the leading threats of war in rest of the world.

Recent developments

AFP mentioned that the ROC minister of reunification has stated to include the North Korean nuclear issue with the highest priority at inter-Korean ministerial talks in 1995 with the hope that it would progress the inter-Korean dialogue and lead to the progress for the six-party talks.

In the same meeting, the ROC pressurized DPRK to be of the same mind to an early recommencement of the six-party consultation including DPRK, ROK, China, Russia, Japan, and the USA. DPRK has agreed theoretically that, they would seat in the fourth round of six-party talks in Beijing regarding its nuclear weapons issues and it would decrease nuclear program in exchange for diplomatic, financial benefits as well as security guarantees.

The Gale Group reported that ROK proposed inter-Korean Railway links in the ministerial talks in August 2002 and put forward the inter-Korean military talks to initiate the discussion on the cross-border railway as well as road links.

The Korean times argued that North and South Korea has scheduled to start again the working-level talks in North Korean territory at the Gaeseong Industrial Complex in mid-July 2009 to talk on terms of contracts on rent, wages and taxes, cheap labor, free land use and other incentives at the joint ventured industrial park. People think that it would ease growing tensions within the Korean Peninsula

KNS reported that the Inter-Korean talks which were aimed to look for share more family reunions has broken devoid of accomplishment of any agreement on October 16, 2009. The North and South Korea has become unsuccessful to minimize the diversities on their posture with high opinion to further reunions even though the meeting finished with no any tangible agreements but just the two Korea give your word to consult one another for the coming Red Cross talks. Throughout the meeting, South Korea anticipated to postponed the fresh rounds of reunions for the month of January 2010 and start again just about Lunar New Year’s in February 2010. Hyun the South Korean Minister of Unification added that that the meeting would deal with a variety of issues associated with cross-border exchanges and alleviate inter-Korean policy deportment. (5)

Inter-Korean talks

Kyung argued that after long historical evidence of the inter-Korean Summit, the inter-Korean relations experienced a period of elation evidenced by an assortment of irreconcilability and exchanging programs and schemes, those instigate exceptional eagerness as well as interest in new enlargements (10). Obviously, the inter-Korean talks are essential to humanizing the rapport involving the South and North Korea even so, the inter-Korean conversation may be illustrated by irregular progress and slow down through the internal motivation of the people has increased for reunification.

Until September 2001 the 5th Inter-Korean Ministerial, there was a total of 16 meetings through different means that consist of 4 ministerial meetings, 5 military working-level, 3 Red Cross channels, 2 economic working and a single defense ministerial conference. By this time, the remarkable outcome is that 3100 families reunited, 6000 families are in the queues, and 600 mails have exchanged that proves poor efforts and time-consuming trend (12).

Strategic objectives

The main objective is the same that is peaceful unification but due to large economic differences between South Korea and North Korea, the strategic objectives are different from each other and these are described as follows-

South Korea

South Korea would like to scrutinize the hidden strategic intentions of North Korea,

  • Burgess argued that South Korea would bear a serious financial burden for reunification (total cost of unification $25 billion to $3.5 trillion,) but it has agreed for people sentiment;
  • The South Korean government believed that the hypothesis of democracy means that unification has to be achieved by democratic means founded on independence and civil rights for all Korean citizens;
  • It wants to be free from any external intervention;
  • South Korea seeks mutual co-operation, co-existence as well as co-prosperity;
  • South Korea believed that North Korea would keep its promise by curtailing its nuclear program because its primary strategic goal is North Korea’s denuclearization;
  • Kwon argued that it wants to develop the nation by continuing economic growth;
  • South Korea is interested to increase tourism business and recovery of the Kaesong Industrial Complex actions;
  • But it requires strategic wit not to step the complicated traps fixed by North Korea as it has experienced the Yeonan-Ho fishing boat crew (Kwon);

North Korea

  • Its strategy is based on peaceful unification;
  • Its initial strategic objective was to form the Confederal Republic of Koryo to represent the Korean people in the United Nation;
  • It would like to change the strategic relationships with Northeast Asia as it is isolated from the world;
  • It has placed main concern on co-existing structures rather than on the Pyongyang-led unification strategy;
  • Its aim is to decrease the US and Japanese influence and to boost Russia’s pressure in North-East Asia;
  • It pursues “co-existence” with South Korea and it believes that the Korean peninsula issue should be dealt with solely by the two Koreas;
  • One of the most important aims to increase inter-Korean trade, to enlarge investment from neighboring countries such as China, Japan and South Korea and it would like to develop the free-market economy for a stable and prosperous future;
  • Its aim is to increase the inflow as the outflow is much larger than inflow create an economic deficit;
  • It should open its door to foreign investment and technology which are crucial to overcoming the present financial sufferings;
  • It would like to convince the international community and intended to release from the international sanctions.


Circumstances prove that the people of both Korea but the governments are somehow influenced by the foreign powers from the historical inheritance of World War II. The end of the cold war era failed to bring world peace but created more unrest in Asia and the reunification of Korea would be an irreconcilable concern until the six parties DPRK, ROK, China, Russia, Japan and the USA would be honest and come to the table for solving the dilemmas. The entire research paper has addressed how the unification of Korea will set the view and changes the long-term strategic relations in Northeast Asia, how these two countries would manage the high cost of reunification, and to reunification, how the foremost powers in the region organize and respond. From the above discussion, it could conclude that North Korea would be largely benefited from this decision but there will always exist a dilemma that whether the US-based alliance will possibly continue or not. Coghlan argued that South Korea would set up their long and short-term strategic plan by considering the national political environment and sentiment because Korean people now more concentrate on their own feelings instead of US interests (20). However, Russia views the unification of Korea as an opportunity to regain its strategic significance, so it has taken a more active diplomatic approach and it has no interest in the war on the peninsula and has economic benefit from oil and gas sectors (Young 19). In addition, this paper also mentioned that though all the stakeholders want democratic unification it has many difficulties such as China may deprive of South Korean investment, for geographical location Japan has security problems, and the USA initially supported the unification process but it has imposed many burdens. Therefore, though theoretically, these two countries have agreed to reunify but practically it never is possible for them to unify for the severe pressure and unwillingness of the activities of these countries.

Works Cited

AFP, , 2005. Web.

Burgess, L. Michelle. Development Strategies for North Korea, The Project on International Peace and Security (PIPS). 2009. Web.

Coghlan, David. Prospects from Korean Reunification. 2008. Web.

Howard, Bill. . 2000. Web.

. Exports, Import& GDP of North Korea. 2009. Web.

. Exports, Import& GDP of South Korea. 2009. Web.

Library of Congress. Country profile of North Korea. 2007. Web.

Library of Congress. Country profile of South Korea. 2007. Web.

Library of Congress. . 2008. Web.

KNS. Adherence to Three Principles of Reunification Called for. 2009. Web.

KNS. U.S. Termed Heinous Human Rights Abuser. Korea News Service. 2009. Web.

Kwon, Goohoon. Experiences with Monetary Integration and Lessons for Korean Unification. IMF Working Paper No. 97/65. 2001. Web.

Kyung-woong, Kim. Changes in Inter-Korean Relations: The Vicissitudes of Politics. East Asian Revie. Vol. 13, No 4, 2001. Web.

KNS. Inter-Korean talks fail to reach an agreement on more family reunions. 2009. Web.

Steinberg, David I. South Korea: Preparation Awaiting Unification- The Political Components, Asian Foundatio. 2007. Web.

The Korean times. , 2009. Web.

The Gale Group. Korea proposes inter-Korean talks over railway link. 2002. Web.

United Nations. National reunification policy of the Government of the Democratic People’s Republic of Korea. 1998, Web.

Young, Namkoong. Similarities and Dissimilarities: The Inter-Korean Summit and Unification Formulae. East Asian Review Vol. 13, No 3, Autumn 2001, pp. 59-80. 2001. Web.


  1. Republic of Korea (South Korea)
  2. Democratic People’s Republic of Korea
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