hankyoreh

By Han Seung-dong, senior staff writer

The Seoul-Pyongyang megacity: a practical idea for integrating, and unifying South and North Korea by linking their capitals together into a supranational economic zone. It is based on the basic assumption that economic integration has to come before political integration. Indeed, postponing political integration, it argues, could actually help the megacity function better and ease integration between North and South while generating maximum synergy. It represents a genuinely feasible form of integration, and one that can achieve unification faster and more cheaply without treading the same path of trial and error as East and West Germany. South and North would each have to give up their obsession with integrating political systems first, only then could the Seoul-Pyongyang megacity take shape as a major economic hub not just for the Korean Peninsula, but for all of East Asia. It would, in short, be the best path to reunification, offering a way out for a crisis-stricken South Korean capitalist economy as well as a way to rebuild a moribund North Korea, and all while avoiding the chaos of a scenario where the North is absorbed by the South and interference by neighboring countries.

This is the basic premise of “The Seoul-Pyongyang Megacity,” a book by architectural engineering and North Korean studies graduate Min Kyung-tae. The idea itself may not be entirely new, but the degree to which the author - a specialist in new technology, venture investment, and external cooperation at Samsung Electronics - has worked the scenario out certainly warrants attention. The South Korean economy, Min repeatedly notes, is “constantly worrying about everyone but a few corporations losing steam in growth once the high-speed development period passes.” Many South Koreans, he writes, feel “pressured to choose between China and US as China’s rise marks the transition toward a ‘G2 era,’” and have begun to worry the country may self-destruct if it doesn’t handle the situation wisely. These concerns are not something out of the distant future - they’re the reality today. The solution, and the way out of crisis, Min says, is through a Seoul-Pyongyang megacity. His idea is a sign that mainstream South Korean economists, and the corporations in particular, have started taking an economy-first integration plan seriously as a realistic vision for the future of the national economy.

The economic integration idea is different from the so-called “flock of geese” catch-up development model in which a late starter gradually bridges the gap by acquiring technology and know-how from an already industrialized country. Min’s claim is that the rise of a massive rival like China makes the catch-up model obsolete, and that South and North need to achieve a more accelerated pattern of growth by linking the North’s labor- and resource-based economy (the first domain) immediately with the South’s technology- and capital-based economy (second) so it can skip ahead to a knowledge- and network-based economy (third).

This approach would offer South Korea a way past its own growth barriers by providing access to the North’s abundant labor force and larger territory, dozens of times more resources, and a vast, connected market of at least 100 million people. While North Korea may look beyond recovery at the moment, support in technology and capital from the South can help to rapidly improve infrastructure and income levels, quickly laying the groundwork for reconstruction and positioning it better for growth than other developing countries.

Min describes this form of economic integration - turning North Korea from basket case to treasure chest - as “the best sort of merger and acquisition for the 21st century.” The Seoul-Pyongyang megacity could find itself the most promising and competitive network region in the world, he says. While his idea carries more than a whiff of the “unification-as-jackpot” notion presented by, among others, President Park Geun-hye, it also offers clear solutions to the issues presented by the two sides’ vast militaries, the military economy, youth unemployment, and changes in industry structure.

The chief assumption, Min says, is that a short-term absorption-style reunification following a North Korean collapse is a scenario to be avoided at all costs. He identifies four possible scenarios for North Korea’s future: cooperation without any upheavals in Pyongyang, an upheaval while cooperation is occurring, continued antagonism without any upheaval, and an upheaval under conditions of antagonism. The first he identifies as the best-case scenario, the last as the worst. He also predicts that the first scenario would allow each side to make up for each other’s weaknesses and make the most of each other’s strengths, generating a synergy effect and achieving faster, cheaper integration without having to contend with any major difficulties. The politically focused approach favoring absorption of a post-collapse North Korea, he warns, could actually prolong the division indefinitely by inviting intervention by neighboring countries, or lead to the worst-case scenario of the North ending up as another Tibet for Beijing.

Min’s book is noteworthy for the way it recognizes the focus on political integration as unrealistic, for the clear path it sets with its focus on economic integration, and for the way it signals that South Korean businesses are now on the front lines of the debate.

Please direct questions or comments to [english@hani.co.kr]