Publication: Monitor Volume: 7 Issue: 152

Analysts have also examined with a sometimes critical eye another of the agreements contained in this past weekend’s Russian-North Korean joint statement–“one in which the two countries pledged to use all necessary efforts to create a rail transportation system connecting South and North Korea to the Russian Federation and Europe” (Digital Chosun, August 5). In the face of Pyongyang’s demand for a withdrawal of U.S. troops, which ignited a political firestorm in South Korea, President Kim Dae-jung’s government hailed the railroad agreement as an indication that Moscow had in fact managed to nudge the two Koreas back closer to the peace table. That is in part because the inter-Korean railway project was a key component of last year’s watershed summit between the leaders of North and South Korea, and thus a key element of Kim Dae-jung’s “sunshine policy.” But the potential for the railroad talks to jumpstart broader North-South relations was highlighted in reports earlier this week quoting officials from the South as saying that three-way talks between Russia and the two Koreas on the railway project could begin in the near future. Those talks would constitute, moreover, the first official meeting between officials from the North and South since tensions between Washington and Pyongyang led the North Koreans to cut off peace talks. “If the railway project is pushed in earnest, it will contribute greatly to bringing about peace on the Korean Peninsula,” a presidential aide was quoted as saying. The same aide also claimed that Russian President Vladimir Putin might have secretly pledged during his Moscow talks with Kim Jong-il to help North Korea rebuild its outdated rail system. He offered no elaboration (Korea Herald, August 6).

There are obvious economic incentives for both of the Koreas and Russia to push forward with the Korean-Russian rail project, which would create a continuous corridor from the industrially developed South through the North, and then on to European markets via Russia. According to South Korean experts, this so-called “iron silk road” could have a major domestic impact by cutting in half the cost of transporting South Korean manufactured good to Europe. In 2000, about US$32 billion, or 14 percent of South Korea’s total exports, went to Europe and Russia–but only 5 percent via the Trans-Siberian railway (after being transported by ship to various Russian Far Eastern ports). A South Korean transportation expert has estimated that North Korea stands to collect as much as US$51 million per year in transit fees alone if the railroad project ever gets running in earnest, and that total revenue flowing into the North could reach as high as US$100 million annually as trade between the two Koreas increases. In Moscow, meanwhile, Izvestia has estimated that Russia could earn an annual profit of US$2 billion if its Trans-Siberian railroad is successfully linked to the Korean system. According to the Russian railways minister, the number of containers carrying goods between Asia and Europe could gradually increase to 1 million per year. That Moscow and Pyongyang, at least, hope to keep the railway project to themselves is suggested by the fact that Kim and Putin excluded China and Mongolia from inclusion in it. That is despite the fact that a route connecting the Koreas and Russia via Chinese and Mongolian railway lines would actually be the shortest route between the Koreas and Europe.

Unfortunately, formidable obstacles will have to be overcome before the rail project can become a reality. There are, of course, obvious political difficulties. Although South Korea has continued to develop the portion of the rail corridor on its side of the border, work on the two-kilometer section in the demilitarized zone has yet to begin, and the North has reportedly done next to nothing on the link that runs through its territory. And despite the boost that this past weekend’s summit may have given the rail project, some South Korean analysts suggest that continuing tensions between Pyongyang and Washington could ensure that the North continues to drag its feet. A host of technical problems remain as well. They are centered, most obviously, in North Korea, where most of the rail system was constructed either before 1945 by Japanese colonial forces, or in the 1950s by North Korea with Soviet assistance. According to a South Korean study, the North depends on rail lines to carry 90 percent of its transportation. But 80 percent of those lines run on electricity, which is a serious problem, given the country’s extreme power shortfalls. Another South Korean source says that 79 percent of North Korea’s rail network is virtually inoperable due to the electricity problems. The decrepitude of the North’s railway network makes Russia’s reported offer to help with construction work all the more potentially significant (AP, August 5; JoongAng Ilbo, Korea Herald, August 6; AFP, August 7).