[Viewpoint] How to give rice to the North

It is good to hear that the ruling party is considering resuming rice aid to North Korea, where an impoverished economy has been hard hit by flooding. The time is right. At home, we are overflowing with rice. Farmers are actually struggling with the excess while North Koreans just can’t get enough to eat. The recent flood damage will likely exacerbate its food shortage. Medical supplies will also be wanting. The scene is truly tragic; one side of the border line is battling with surplus and the other is utterly deprived. We must act upon humanitarian grounds.

But the process is not simple. Opposition to resuming aid to North Korea remains strong. Worsened inter-Korean ties are another stumbling block. We should reach an agreement as a nation on rice aid to North Korea. The issue should be isolated from the broader conservative policy on North Korea that opposes blind support to a communist state that remains recalcitrant to international demands to denuclearize.

The discussion over resuming humanitarian rice aid should not spark another divisive controversy among ourselves. In order to avoid such a dispute, we can employ a business perspective on the matter by suggesting a mutually beneficial quid pro quo instead of free aid.

One method is to create a “unification fund” financed by rice revenue. We can supply rice to North Korea on long-term contracts and use the revenue to fund any future unification costs.

According to the agreement from the inter-Korean summit in 2000, South Korea has been supplying rice to North Korea payable in installments over 20 years with 10-year grace period.

According to this arrangement, North Korea should have started paying for the rice this year. But there has been no such talk because there has not been any form of inter-Korean dialogue. If the two were still on speaking terms, they may have discussed the matter.

We should seize momentum to come up with a repayment program that has the blessing of the public. We can refer to international models for benchmarks. The best example is the U.S. federal law on overseas food assistance, dubbed the Public Law 480, which uses agricultural surpluses to supply countries in need at favorable terms.

The program helps kill two birds with one stone. South Korea benefited from the 1954 law to fight starvation amid devastation after the war. How we paid for the American foodstuffs is interesting. Under a bilateral agreement, 10 to 20 percent went to run American outlets in Korea and the rest was paid by the government via purchase of American weaponry.

We could apply our own experience with the aid program to North Korea. We can maintain the long-term payment structure while requiring payment in different goods. The first can be mineral resources. A few years ago, we were paid in mineral goods for light-industry raw materials supplied to North Korea. North Korea is rich in mineral resources, including zinc, magnesite and iron ore, that are commercially valuable. We cannot let Chinese companies enjoy exclusive access to North Korean resources.

The second form of payment can be the replacement of leases on land and properties in use by South Korean outlets in the North or helping finance stays in North Korea by humanitarian aid groups. The third can be the creation of a unification fund upon agreement by both parties.

In short, North Korea can pay for the rice in labor, resources or land.

There is always the chance that North Korea may not honor these terms. We can hedge against that risk by discussing specific uses of the unification fund every year and flexibly appropriating supplies according to North Korea’s record of payments. If the payment is deposited in a unification fund, it could be put to use later in various ways.

There are some voices calling for rice aid to be donated with no strings attached, instead of loans, while strengthening surveillance of the distribution. We must enforce transparency in the distribution. But instead of stressing that at the start, we could strengthen enforcement through supply procedures.

What is more important is to economize rice aid. Overseas assistance usually seeks long-term benefits rather than immediate gains. We must have a farsighted perspective on aid programs in preparation for unification. Through rice supplies, we can help our farmers as well as North Korean residents. It can also provide a long-awaited breakthrough in inter-Korean relations.

In November, the G-20 Summit will be held in Seoul. We must show the world a land of peace, not tension. We must pitch our country as an attractive market for investment and use the momentum gained for a leap in economic progress. But we first need to put inter-Korean ties on stable grounds - and rice aid can be the stepping stone to do just that.

*Translation by the JoongAng Daily staff.
The writer is a professor of North Korean studies at Inje University.

By Kim Yeon-chul