South Korean President Moon Jae-in answers reporters' questions during his New Year news conference at the Presidential Blue House in Seoul, South Korea, January 10, 2018.  Photo: Reuters / Kim Hong-Ji
South Korean President Moon Jae-in answers reporters' questions during his New Year news conference at the Presidential Blue House in Seoul, South Korea, January 10, 2018. Photo: Reuters / Kim Hong-Ji

South Korean President Moon Jae-in said in a televised press conference on Wednesday that he is ready to sit down with North Korean leader Kim Jong-un “at any time” but warned that “it cannot be a meeting for meeting’s sake.”

Moon was speaking in a new year press conference just a day after his government engaged in its first-ever inter-Korean talks, and also announced that it would not overturn a landmark 2015 deal with Japan on comfort women.

During almost 12-hour-long ministerial-level talks with North Korea, Seoul secured two favorable outcomes. Pyongyang agreed to dispatch a delegation to the Winter Olympics, which take place in Pyeongchang, South Korea this February. Meanwhile the promise of reduced inter-Korean tensions looked close as the sides agreed to hold military talks and reconnect a security hotline in the flashpoint Yellow Sea.

The only reported disharmony yesterday came when the Southern side raised denuclearization, which the Northern delegation refused to discuss. Pyongyang has invested massive resources in strategic weapons, and has even written nuclear weapons possession into its constitution.

North Korea, the US and the Winter Olympics

Calling South Korea “a middle power standing tall in the international community” – a likely reference to the challenges he faces maintaining equilibrium between the USA, China and Japan – Moon said yesterday’s talks were “a good start.” He suggested North Korea’s participation in what he called “an Olympics of peace” could be a springboard for further engagement. “If peace begins in Pyeonchang… I will pursue more dialogue and cooperative projects,” he said, possibly alluding to a re-opening of the inter-Korean industrial complex at Kaesong, shuttered in 2016 due to inter-Korean tensions.

He also addressed a potential summit with North Korean leader Kim Jong-un. “Under the right conditions, I can hold a summit at any time, but it cannot be a meeting for meeting’s sake,” he said. “To hold a summit, the right conditions must be created and certain outcomes must be guaranteed.” He added, however, that “denuclearization of the Korean peninsula… can never be compromised” – a statement which is unlikely to play well in Pyongyang.

Moon has long advocated engagement with North Korea but, since taking power in May, has been largely been ignored by Pyongyang, which has focused on upgrading its strategic weapons and fighting a rhetorical war with Washington. He has backed the US, beefing up military drills and maintaining a controversial US anti-missile system, THAAD, that was deployed under the preceding administration of Park Geun-hye. Yet Moon has continually held out for talks with the North and on New Year’s Day he was rewarded when Kim offered an olive branch to the South, igniting a rapid series of events that led to yesterday’s talks.

Addressing tension reduction, he said: “Every time pressure from the international community goes too high, tensions between South and North only increase.” But with critics suggesting that Pyeongyang is playing the nationalism card – an emotive one on the peninsula – to drive a wedge between Seoul and Washington, Moon made clear that he was in synch with his US ally.

“Under the right conditions, I can hold a summit at any time, but it cannot be a meeting for meeting’s sake”

“We have no difference in opinion with the US”, Moon said. “The United States has shown complete support for inter-Korean talks and expressed hopes to the South that it will help with resolving North Korea’s nuclear issue.” Moon – perhaps in a nod to a belief that the US president is susceptible to personal flattery – also said Donald Trump deserved “big credit” for yesterday’s talks.

Following a phone call with Moon, Trump stated support for the talks and for North Korea’s participation in the Games, and said he would send a US delegation to Pyeongchang, possibly including Trump family members. But US officials, speaking after the talks, were wary about reducing sanctions during the Games.

“Anything that lowers tensions on the Korean Peninsula is a positive development,” said Under Secretary for Public Diplomacy and Public Affairs Steve Goldstein in a press briefing on January 9. “We’re in close consultation with the Republic of Korea to ensure North Korea’s participation in the Olympics does not violate UN Security Council sanctions.”

Seoul had offered, yesterday, to relax some sanctions in order to ensure successful North Korean participation in Pyeongchang.

Other external responses to the inter-Korean talks have also been positive. IOC President Thomas Bach called North Korean participation “a great step forward in the Olympic spirit,” but which athletes will compete remains unclear: only two North Korean figure skaters have qualified. South Korea has offered to pay transport and accommodation costs for the North Korean delegation, which could number in the hundreds, including art performers, a cheering squad, and a taekwondo demonstration team.

Troubled relations with Tokyo

Moon’s delicate diplomatic foot-stepping between North Korea and the United States was reflected in moves to balance domestic opinion and relations with Tokyo. Yesterday, his foreign minister, Kang Kyung-wha, announced Seoul would not overturn a landmark 2015 deal reached between Tokyo and the preceding Park administration on comfort women. The step surprised some, as an investigative task force mandated by Moon had slammed the deal as flawed, while Moon himself met surviving comfort women and activists last week.

In his press conference, Moon indicated that, while Seoul would not overturn the 2015 agreement – which called for the respective administrations to abandon comfort women as an inter-government issue – it would continue to engage in the issue and coordinate with activists. He said that the Korean government would invest its own funds to assist surviving comfort women, rather than using compensation already paid by Japan.

South Korean President Moon Jae-in greets a South Korean woman who was forced to work in Japanese wartime brothels as a ‘comfort woman,’ at the Presidential Blue House in Seoul, South Korea, January 4, 2018. Photo: The Presidential Blue House / Yonhap via Reuters

“The money received from the Japanese government will be frozen; what we do with the money we need to discuss with Japan, with victims and civil society,” he said. “If the money from Japan can be used to heal the wounds of the victims, and civil society agrees on the use of this money, that will be a good alternative.”

It was not clear what will happen to Japanese compensation already handed out. At the end of 2016, 34 out of 46 then-living comfort women had agreed to accept Japanese payments. Bolstered by civic activists, the minority of comfort women who did not receive the compensation have fought a high-profile campaign against the 2015 deal, winning widespread support in South Korea.

Domestic affairs

Speaking of local affairs, Moon said that reform of chaebol, the giant, family-controlled conglomerates that dominate the Korean economy, “is important from the perspective of returning economic benefits to small and medium businesses,” and also that “unfair business practices… will be rooted out.” He added that “shareholders’ rights will be increased and a stewardship code will be introduced.”

The latter moves would pave the way for shareholder interventionism by state-run funds which hold chaebol shares. He added that financial sector innovation would be promoted to ensure fair lending practices rather than “abuses of power and illegitimate lending” – possibly a critique of long-standing cosy relations between banks and chaebol.

“[Chaebol reform] is important from the perspective of returning economic benefits to small and medium businesses”

Successive Korean administrations have failed to overcome chaebol reform resistance and re-balance the Korean economy, which is characterized by the chaebol at the top, millions of struggling mom ‘n pop businesses at the bottom, and very little in the middle.

Moon said that Koreans’ per capita income this year would surpass US$30,000, but added his government would focus on upgrading health insurance and supporting medical care, housing, education and childcare. It would also cap lending rates, he said.

Since a credit crisis in 2002 sparked by easy access to mortgages and credit cards, Koreans have suffered massive household debt burdens, partly driven by ultra-high private educational expenses. However, the Moon administration’s move to raise the basic wage has caused concerns among small business owners.

Moon also proposed a referendum on constitutional revision, to be held alongside local elections in June, a move that looks set to inflame the conservative opposition. However, since the impeachment of ex-President Park last March, the right wing has been in political disarray, offering Moon a window of opportunity to pursue left-leaning initiatives.

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