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Korean Unification in a New Era NOVEMBER 2014 A Conference Report of the CSIS Korea Chair 1616 Rhode Island Avenue NW | Washington, DC 20036 t. 202.887.0200 | f. 202.775.3199 | www.csis.org ROWMAN & LITTLEFIELD Lanham • Boulder • New York • Toronto • Plymouth, UK Korean 4501 Forbes Boulevard, Lanham, MD 20706 t. 800.462.6420 | f. 301.429.5749 | www.rowman.com Unification Cover photo: http://www.shutterstock.com/gallery-401596p1.html?cr=00&pl=edit-00”>Attila JANDI</a> / <a href=”http://www.shutterstock.com/editorial?cr=00&pl=edit-00”>Shutterstock.com</a> ISBN 978-1-4422-4049-0 in a New Era Ë|xHSLEOCy240490z v*:+:!:+:! EDITOR Victor Cha Blank Korean Unification in a New Era EDITOR Victor Cha A Conference Report of the CSIS Korea Chair November 2014 ROWMAN & LITTLEFIELD Lanham • Boulder • New York • Toronto • Plymouth, UK About CSIS For over 50 years, the Center for Strategic and International Studies (CSIS) has worked to develop solutions to the world’s greatest policy challenges. Today, CSIS scholars are providing strategic insights and bipartisan policy solutions to help decisionmakers chart a course toward a better world. CSIS is a nonprofi t orga ni za tion headquartered in Washington, D.C. The Center’s 220 full-time staff and large network of affi liated scholars conduct research and analysis and develop policy initiatives that look into the future and anticipate change. Founded at the height of the Cold War by David M. Abshire and Admiral Arleigh Burke, CSIS was dedicated to fi nding ways to sustain American prominence and prosperity as a force for good in the world. Since 1962, CSIS has become one of the world’s preeminent international institutions focused on defense and security; regional stability; and transnational challenges ranging from energy and climate to global health and economic integration. Former U.S. senator Sam Nunn has chaired the CSIS Board of Trustees since 1999. Former deputy secretary of defense John J. Hamre became the Center’s president and chief executive offi cer in 2000. CSIS does not take specifi c policy positions; accordingly, all views expressed herein should be understood to be solely those of the author(s). © 2014 by the Center for Strategic and International Studies, the Korea Institute for International Economic Policy, the Korea Institute for National Unifi cation, and the Korea Institute for Industrial Economics and Trade. All rights reserved. ISBN: 978-1-4422-4049-0 (pb); 978-1-4422-4050-6 (eBook) Acknowledgments This volume is a report of the results and fi ndings from the international conference “Korean Unifi cation in a New Era” held on September 4, 2014, at CSIS in Washington, D.C. The conference was cohosted by the National Research Council for Economics, Humani- ties, and Social Sciences (NRCS) and the Center for Strategic and International Studies (CSIS) and was organized by the Korea Institute for International Economic Policy (KIEP), the Korea Institute for National Unifi cation (KINU), and the Korea Institute for Industrial Economics and Trade (KIET). Center for Strategic & International Studies Rowman & Littlefi eld 1616 Rhode Island Avenue, NW 4501 Forbes Boulevard Washington, DC 20036 Lanham, MD 20706 202-887-0200 | www.csis.org 301-459-3366 | www.rowman.com Contents Executive Summary v Dr. Victor Cha, Center for Strategic and International Studies Introductory and Welcoming Remarks 1 Dr. Kang Eun Bong, National Research Council for Economics, Humanities, and Social Sciences Congratulatory Remarks 3 His Excellency Ambassador Ahn Ho- Young, Republic of Korea Ambassador to the United States SESSION ONE: ECONOMICS OF KOREAN UNIFICATION 5 Panel A: The Economic Synergy Effect of Unifi cation of the Korean Peninsula 6 Dr. Marcus Noland, Peterson Institute for International Economics Dr. Kim Dongsoo, Korean Institute for Industrial Economics and Trade Dr. Jeong Hyung- Gon, Korea Institute for International Economic Policy Mr. Matthew Goodman, Center for Strategic and International Studies Panel B: Opening for Business: Foreign Investment after Unifi cation 18 Mr. Thomas Byrne, Moody’s Investors Service Mr. William Brown, Offi ce of the Director of National Intelligence Dr. Sue Mi Terry, East Asian Institute, Columbia University Dr. Park Hyeong- Jung, Korea Institute for National Unifi cation LUNCHEON ADDRESS 31 Mr. Sydney Seiler, Special Envoy for Six-Party Talks, U.S. Department of State SESSION TWO: KOREAN UNIFICATION AND THE SECURITY ENVIRONMENT 37 Panel C: The Northeast Asian Perspective 38 Dr. Michael Green, Center for Strategic and International Studies Dr. Park Ihn- hwi, Ewha Womans University Mr. Christopher Johnson, Center for Strategic and International Studies Mr. Bruce Klingner, Heritage Foundation | III Panel D: Global Perspectives 50 Dr. Kurt Campbell, The Asia Group Dr. Kim Jaechun, Sogang University Ambassador Stapleton Roy, Wilson Center Dr. Kim Yung Ho, Sungshin Women’s University CLOSING REMARKS 62 Dr. Victor Cha, Center for Strategic and International Studies Appendix 1. Conference Agenda 64 Appendix 2. Media Participants 66 Appendix 3. Participant Biographies 68 IV | VICTOR CHA Executive Summary: Analyzing the Concept of “Jackpot” Unifi cation Dr. Victor Cha, Center for Strategic and International Studies As a result of a speech delivered by Republic of Korea (ROK) president Park Geun- hye in Dresden, Germany, on March 28, 2014, the topic of unifi cation of the Korean peninsula has been on the minds of many. This is, of course, not the fi rst time that unifi cation has been in the news. During the Cold War era, unifi cation was defi ned as the absolute mili- tary victory of one side over the other. In Korean, this was known as “songgong t’ongil” or “p’ukch’in t’ongil” (“march north” or “unifi cation by force”). In po liti cal science litera- ture infl uenced by the Euro pean experience, it was defi ned as the perfect integration of the two countries. After the reunifi cation of Germany on October 3, 1990, unifi cation was seen as the economic and po liti cal absorption of one side by the other. And yet at other times, it was defi ned, by both North and South Korea, as the imperfect operation of one country, two systems. For a de cade during the period of “sunshine” policy, 1997–2007, unifi cation was defi ned as something to be avoided for generations. It was framed as an outcome that was too diffi cult to contemplate, too dangerous to suggest, and too expensive to afford. What is different about the current iteration of the unifi cation dialectic is Park Geun- hye’s view of unifi cation as an opportunity or jackpot ఝ෢. What does this mean? How is this formulation different from previous conceptions? And what are the opportunities as well as the challenges inherent in unifi cation for Korea, the United States, and the world? To try to answer these questions, CSIS with the National Research Council for Econom- ics, Humanities, and Social Sciences (NRCS), Korea Institute for International Economic Policy (KIEP), Korea Institute for National Unifi cation (KINU), and Korea Institute for Indus- trial Economics and Trade (KIET) orga nized a two- day international conference on Septem- ber 4, 2014, at CSIS headquarters in Washington, D.C. The title of the conference was “Korean Unifi cation in a New Era.” The conference panels were designed to analyze specifi cally the proposition that unifi - cation is a “jackpot” as described by President Park. Two panels in the morning were | V devoted to in-depth analysis of the economic aspects of unifi cation. The fi rst panel addressed the question of the economic opportunities that might be associated with unifi cation. The second panel looked specifi cally at the business and investment opportunities/potential with unifi cation. Participants in both panels were world experts, including economists and sovereign ratings analysts, in addition to trade policy specialists. The afternoon panels were devoted to the po liti cal and security opportunities with unifi cation. The key question addressed in these sessions related to the so-called peace dividend that might be associated with unifi cation and in partic u lar the reactions of regional players to a unifi ed Korea. Would they support such an outcome? And how could they be helpful? The afternoon sessions were also populated with high-pro fi le specialists, including former White House offi cials in both the Bush and Obama admin- istrations. There are a lot of unknowns about unifi cation that make forecasting diffi cult. There are also known challenges that make unifi cation daunting. There are no two bordering countries today with a larger income gap than that between the two Koreas, which poses obvious integration challenges. This conference did not deny the many known diffi culties associated with unifi cation. It did, however, seek to identify the positive elements amid many of the unknown variables at play. Thus, it did not take on faith that unifi cation would be “easy.” Conference Proceedings and Agenda The day started with some congratulatory remarks by the H. E. Ahn Ho-Young, South Korea’s ambassador to the United States. In his remarks, Ambassador Ahn congratulated the organizers for pulling together a so-called dream team of specialists on Korean unifi ca- tion. The ambassador also hosted a dinner at his private residence in the evening to allow speakers and discussants to continue the conversation from the morning and afternoon in an off- the- record format. The conference took place in the main conference hall of CSIS with an attendance of 162, including national and international print and televi sion journalists (see Appendix 2 for a full list of media participants). The event was live streamed to audiences around the world via the CSIS live Ustream channel, and throughout the day observers could follow the conference through social media and tweet questions @CSISKoreaChair #CSISLive.
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