Putin and Kim’s future dilemma from mercenaries

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Putin and Kim’s future dilemma from mercenaries

Published: 06 Nov. 2024, 19:50 Updated: 07 Nov. 2024, 15:22

Kim Byung-yeon
The author is a chair professor of economics at Seoul National University.

Two desperate men jointly made a risky bet. As North Korean leader Kim Jong-un dispatched his soldiers to Russia after selling shells, Russian President Vladimir Putin warned the West to not intervene in his war against Ukraine. Their choice of timing was also strategic — aiming to affect the results of the U.S. presidential election before Nov. 5 and put pressure on the new U.S. president after the election.

Will Putin’s gamble succeed? If Donald Trump wins the election, he will push for a ceasefire or an end to the war. But if NATO members or a majority of Americans oppose the idea, his plan can be thwarted. At the moment, most security analysts expect a ceasefire or an end to the war in return for more defense costs for NATO members. In this case, the war in Europe will drag on regardless of the election results.

If the war is protracted, Putin will surely want more North Korean youths to be deployed in the battlefields. Since Kim set foot in the war, he wouldn’t refuse Putin’s request. What’s the tradeoff? Kim must secure foreign currencies. As North Korea suffers an annual trade deficit of $2 billion with China, he must supplement at least half of the amount with other sources. But the exchange rate between the North Korean won and U.S. dollar in the market has nearly doubled since early this year, which suggests a critical dearth of the hard currency the Kim regime needs. If he can earn $80 million per month by sending 40,000 soldiers to the battlefields, the North Korean leader will gladly welcome it.

If the war goes on, Kim can revel in the best-possible scenario. Putin would first want to restrict his trade with Kim to economy and conventional weapons technology transfers, because if he transfers cutting-edge military technology to the North, he must pay a huge cost in Russia’s relations with the South, the West and China. But Putin can hardly dismiss Pyongyang’s demand for advanced military technology, given the need to maintain close ties with North Korea during the war. Moreover, Putin will face a limit to his military industry-led growth next year. So far, he has financed the war through Russia’s $50 billion sovereign fund. But the money is expected to be depleted by 2025, as Russia must spend over $180 billion for the war, which accounts for about 40 percent of its total fiscal expenditures. If the Russian government issues national bonds to fill the fiscal gap, interest rates will soar and inflation will prevail. Then, Putin will find it better to provide cutting-edge military technology to North Korea. Kim — now with hard currencies and advanced weapons in his hands — will be convinced that his policy to attain nuclear advancement and economic development at the same time bore fruit.

But the worst-case scenario also can happen to the North Korean leader. If the number of casualties increase in the war, resistance will spread fast in the North. If a number of North Korean soldiers choose to defect to the West, it will pose a serious challenge to the Kim regime. If big money comes in, a conflict of interest among the power elites will also deepen. If Putin uses nuclear weapons, the war cannot but expand, directly linking Kim’s future to Putin’s. As Putin wouldn’t deliver sophisticated technology to the North at once, the two leaders’ relations can turn sour. In that case, Kim will find his destiny resembling that of a tiny ship in the vast ocean.

If the Ukraine war ends soon after the U.S. election, North Korea’s value will plunge fast. Would Putin maintain friendly economic ties with Kim after the war by hiring hundreds of thousands of North Korean workers to rebuild Russia to revive the Russian Empire’s glory days? Or will Putin just abandon North Korea? Experts’ views are split. But clearly, Kim’s future will depend on Putin’s. South Korea, the United States and other allies must deter Russia from employing North Korean workers by inserting “Russia’s obligation to comply with the existing UN resolutions” in the ceasefire agreement. Otherwise, UN sanctions on the recalcitrant state will be effectively neutralized. As the most flexible tectonic plate in the North-China-Russia axis is North Korea, we must prevent the North from going over the top.

All sides are full of landmines. If we can’t see anything due to darkness, we must use our identity as a compass. Is it so dark now to the extent that we must provide combat weapons to Ukraine? If so, we must closely communicate and cooperate with the United States and NATO and act. At the same time, we must systematize our security cooperation with our allies in Asia. But if we can see our surroundings thanks to the light, we must navigate the storm. As night hasn’t fallen yet, we can see the surroundings. We should act prudently, not bravely.

Translation by the Korea JoongAng Daily staff.