Moon expects concrete outcome at North Korea-US summit

South Korean president Moon Jae-in predicted that following Kim Jong Un’s visit to China this week, a second US-North Korea summit is imminent, and he expects more concrete outcomes from that meeting than the first, held in Singapore last June.

Moon, speaking at his annual New Year’s press conference, added that the presence of US troops in South Korea and around the region was not linked to North Korea’s denuclearization, but added that the US needed to come up with corresponding measures to encourage North Korea.

He also discussed his plans and hopes for the national economy, with the focus being on innovation, technology, job growth and social welfare spending.

However, he was in a take-no-prisoners mode on the dire state of relations between Seoul and Tokyo.

Second summit soon

“Chairman Kim Jong Un’s visit to China is, in short, a signal that the second North Korea-US summit is going to happen in the near future,” he said, adding “the very near future.”

Kim has just returned home after a surprisingly short overnight visit to China, which he took by train reportedly accompanied by high-level officials. The trip was businesslike: As well as meeting President Xi Jinping for talks, Kim visited a traditional medicine factory.

Moon said that in the second summit, Pyongyang should come up with “drastic measures” on denuclearization, adding that he thought the second summit should include “clear and specific” agreements.

While nothing has been confirmed, there are indications that Hanoi, Vietnam, may be the setting for the next summit.

The first North Korea-US summit, in Singapore last June, ended with a broadly aspirational, but non-detailed declaration, lacking binding measures or timelines. In the months since, progress has ground to a virtual standstill.

“North Korea knows that for the international sanctions to be lifted, they have to do more on denuclearization, and from the US side, they need to come up with counter-measures that befit North Korea’s endeavors,” he said.

As for the issue of what denuclearization should involve, Moon cited the halting of missile launches and nuclear tests, the closure of the main North Korean nuclear facility at Yongbyon, the admission of international monitors and the dismantlement of ICBMs and missile assembly lines.

Moon said it was his belief that Kim’s understanding of what denuclearization meant was in synch with the understanding of other global leaders. And contrary to a detailed commentary on the issue published in North Korean media late last year, “denuclearization of the Korean peninsula” – the Pyongyang-preferred term that was used in the Singapore summit declaration – did not encompass US troops and assets in South Korea or around the region, Moon said.

“Chairman Kim, when it comes to denuclearization and to an end-of-war treaty as well, thinks these are separate from US forces in Korea, so USFK is not linked to the denuclearization process of the Korean peninsula,” Moon said.

“As two sovereign nations, the US and Korea have an alliance and this is why USFK is residing in [South] Korea. This will not affect future dialog between the US and North Korea … to keep USFK in Korea lies in the hands of Washington and Seoul.”

As for US regional military assets in Guam and elsewhere, Moon said that they “correspond to peace and stability in Northeast Asia as a whole … I don’t think these other issues are related to US-North Korea talks.”

However, Moon was optimistic on the possibility of real progress, given that the current North Korea-US process is being undertaken with a top-down approach, driven by national leaders Kim and US President Donald Trump, unlike the processes of former years, which were led by working- and vice-ministerial-level officials.

On the issue of a widely anticipated visit by Kim to Seoul, expected last December, Moon said the trip presented challenges for North Korea, whose leaders have never visited the South.

Pundits have suggested that with global sanctions in place, the two Korean leaders had little left to discuss in December, having already held three summits in 2018. Moon said he expected another inter-Korean summit to take place after the upcoming North Korea-US summit.

North Korea investment

Calling potential South Korean investment in North Korea “a new wind,” Moon said: “This is a unique opportunity that only we possess … I don’t know when we can utilize this opportunity, but this is definitely a blessing for our economy.”

And while he expressed hopes for the reopening of a South Korean factory zone and tourism complex inside North Korea, he conceded that sanctions make economic exchanges impossible at present.

“There is nothing we can do at this moment, but we are making all preparatory measures, so we will be able to start the moment that sanctions are relieved,” he said.

Meanwhile, Seoul-Tokyo relations are in tatters. One dispute centers on whether, as Tokyo insists, a Korean destroyer “painted” a Japanese aircraft last month with its targeting radar.

Another involves the decision by a South Korean court, this week, to enable asset seizures from Japanese companies in Korea to compensate Korean victims of forced labor during World War II.

Tokyo angrily maintains that related compensation was covered in a 1965 diplomatic relations treaty that was accompanied by an $800 million financial aid package.

Moon said the 1965 treaty “did not suffice” and suggested that Tokyo take a “humble approach” toward historical issues. He acknowledged that Tokyo could “express regrets,” but stated that judicial decisions should be respected by governments.

He also accused Tokyo of stirring tensions over the recent issues. “The leaders of Japan and politicians in Japan, I believe … were trying to produce more provocations and news,” he said. “I don’t think this is the right thing to do.”

Big money, high tech

In his address, Moon noted that South Korea had reached the “US$30,000 per capita income” level, but the approval ratings of the formerly hugely-popular president are now in the late 40% range – a huge fall from the 80% ratings he was enjoying one year prior.

Despite the rosy metrics Moon cited, the falls in his ratings appear to be driven by slowing GDP growth, rising income inequality and, in particular, falling job growth, most especially quality job growth. Small businesses, in particular, have lambasted his raising of the minimum wage.

Moon – who has just undertaken a cabinet reshuffle this year in which he replaced his chief of staff, widely seen as being hard left and even pro-North Korean – acknowledged perennial economic problems.

“Over the long haul, the percentage of corporate income in the GDP has steadily increased more than the economic growth rate, while that of household income has continued to decline,” he admitted.

“The trickle-down effect has long ago ended. Also, increasing exports stopped bringing about a rise in employment long ago.”

He called for greater innovation in an economy that is known for effective metal bashing, but is criticized for being hidebound, citing the importance of innovation in key national industries: automobiles, shipbuilding and petrochemical industries.

He announced investments in “strategic, innovative industries” worth 5.2 trillion won (US$4.6 billion). Key areas are data, artificial intelligence and the hydrogen economy, as well as smart factories, smart cities, self-driving cars and drones.

“The number of smart factories was only about 300 by 2014, but it will be drastically raised to 30,000 by 2022,” he said.

Now there are 57,000 electric vehicles on Korean roads. Moon said the government was planning on increasing the number of electric and hydrogen cars to 430,000 and 67,000, respectively, by 2023, as well as some 2,000 hydrogen buses.

Hyundai Motor Group has announced massive investments in hydrogen fuel cell technologies, and Moon expressed his hopes that the auto giant – which, in recent years has been offshoring to gain better access to overseas markets and to dilute the problems it faces with its militant domestic union, rather than investing at home – would create new plants in South Korea.

On the HR front, Moon pledged to foster 45,000 masters and PhD degree holders in “pace-setting innovative growth areas” as well as 40,000 skilled innovators in science, technology and ICT by the end of his term in 2022.

He also announced major investments in social welfare and pledged to continue supporting cultural industries, noting the success of BTS and Korean dramas internationally.