[Congressional Record Volume 143, Number 110 (Wednesday, July 30, 1997)]
[Senate]
[Pages S8375-S8378]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           CHINA TRIP REPORT

 Mr. BAUCUS. Mr. President, over the last Memorial Day recess, 
I visited South Korea, Japan, North Korea, China, and Hong Kong, on an 
official Finance Committee trip.
  Today I am entering into the Record the first half of a trip report I 
recently filed with the Committee, and tomorrow I will include the 
second half, dealing with China and Hong Kong. I hope the Senate will 
find it of use.
  The material follows:

 Asia Trip Report--Covering Visits to South Korea, Japan, North Korea, 
                Beijing, and Hong Kong, May 24-31, 1997


                      I. INTRODUCTION AND SUMMARY

       A. Itinerary--Over the 1997 Memorial Day recess, between 
     May 24th and May 31st, I made a week-long trip to East Asia 
     to host a three-day conference in Beijing entitled ``Working 
     With America: Food Security and International Trade,'' put on 
     by the Mike and Maureen Mansfield Center for Pacific Affairs 
     and the Chinese People's Association for Friendship with 
     Foreign Countries.
       With the authorization of the Senate Committee on Finance, 
     I visited South Korea, Japan, North Korea and Hong Kong as 
     well as Beijing to discuss trade, security, agricultural and 
     humanitarian problems in Asia. This report will inform the 
     Senate on the substance of my discussions, particularly on 
     food and security in Korea; China's application to enter the 
     World Trade Organization; and Hong Kong's transition to 
     China's sovereignty.
       B. Goals--As I see it, our country has three long-term 
     interests in Asia. First, preserving the peace which is 
     critical to our national

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     security and is also the foundation of Asia's current 
     prosperity. Second, opening markets and creating more 
     reciprocity in trade relations with Asian countries. And 
     third, raising the quality of life and promoting long-term 
     political stability by advancing human rights, fighting crime 
     and protecting the environment. My goal on this trip was to 
     understand more fully the immediate issues we must address in 
     order to secure these long-term interests, and to advance if 
     possible our policy goals on these issues.
       In 1997 and 1998, the issues I believe most critical to 
     securing these interests will be: (1) the security and 
     humanitarian problems on the Korean peninsula posed by hunger 
     and economic decline in North Korea; (2) China's application 
     to enter the World Trade Organization; and (3) Hong Kong's 
     transition to Chinese sovereignty. Thus, while I discussed 
     issues ranging from food security to human rights, US-China 
     security relations, environmental protection and agricultural 
     trade with Korea, I concentrated on the first three issues.

       C. Conclusions--I finished the trip feeling that current 
     American policy on these issues is well conceived and well 
     implemented. While I have differences with some of our 
     specific positions and will mention them further on in the 
     report, I believe that in general, we are on the right track.
       In Korea, we are deterring conflict, preventing nuclear 
     proliferation and providing humanitarian assistance as 
     appropriate.
       On China's WTO application, we rightly support China's WTO 
     membership on a commercially appropriate basis, and are 
     working with the other WTO members to make sure that while 
     China understands we are not trying to block membership on 
     political grounds, we also expect them to live up to the 
     fundamental obligations of all WTO members.
       And on Hong Kong's transition, we seem to have secured the 
     direct US interests; we are in close contact with all the 
     political actors and economic interests involved in the 
     transition; and we are appropriately active without being 
     confrontational on political and human rights issues.
       All of these questions are highly complex. The Korean 
     situation, in particular, is dangerous and becoming more so 
     as North Korea's economy declines. All of them will demand a 
     great deal of informed attention from Congress and the 
     American public, as well as from the Executive branch and our 
     diplomats and military leaders in the region. But on the 
     basis of my visits, I am generally pleased with our policies 
     and impressed with the people implementing them.


                          II. KOREAN PENINSULA

       A. Visit--The Korean peninsula was the first stop on my 
     trip. I arrived in Seoul on Sunday, May 25th, spent the next 
     day in discussion with South Korean national security and 
     agricultural officials, representatives of the US business 
     community, and with American diplomats and military 
     personnel. On the morning of May 27th I departed for 
     Pyongyang, where I met with Foreign Ministry and Agriculture 
     Commission officials, departing for Beijing the morning of 
     the 28th. I also had the opportunity to discuss Korea later 
     in the trip with Chinese political and military leaders, and 
     with two senior officers of the Japan Self-Defense Forces 
     during a refueling stop at Misawa Air Force before arrival in 
     Pyongyang.
       My purpose, in addition to discussing bilateral 
     agricultural trade issues with South Korean leaders, was to 
     look into the security and food questions we face on the 
     Korean peninsula. I concluded that American policy with 
     respect to these issues is well-conceived. We have a highly 
     capable military force on the peninsula, which works together 
     with South Korea in the Joint Command. Our political policies 
     are carried out in tandem with South Korea, with the apparent 
     endorsement of the neighboring countries. And we are 
     providing food aid as the World Food Programme identifies the 
     areas of need.
       There is, no doubt, room for improvement. In particular, we 
     could be speeding up our provision of missile defense for 
     Seoul. North Korea's need for food aid may well increase this 
     summer and require a higher-level effort. And while we seem 
     to be in full agreement with neighboring countries on the 
     contingencies we hope to avoid (i.e. war, nuclear 
     proliferation, or sudden collapse into anarchy in the North), 
     we do not appear to have grappled with our long-term positive 
     goals for the Peninsula. But on the whole, I believe that we 
     are confronting a very dangerous situation and doing it well.
       The following sections will evaluate the food situation in 
     North Korea; review the opinions offered by South Korean, 
     Japanese and Chinese officials on policy toward the Korean 
     peninsula; evaluate U.S. policy; and provide a first-hand, if 
     brief and incomplete, look at life today in Pyongyang.
       B. Food Crisis--I discussed reports of food shortages in 
     North Korea with U.S. diplomats and agricultural specialists; 
     South Korean Agriculture Ministry officials; North Korean 
     Foreign Ministry and Agriculture Ministry officials; and 
     Chinese leaders. I had also asked to meet World Food 
     Programme experts in Pyongyang, but was unable to do so.
       My conclusion is that we can think of the food issue as a 
     three-part problem. First, over the next few weeks North 
     Korea will need humanitarian assistance. Second, this need is 
     likely to reach crisis proportions over the summer of 1997. 
     Third, North Korea needs to make some fundamental changes in 
     its agricultural and military if it is to feed itself in the 
     long term. I see little evidence that the government is 
     prepared to do so.
       1. US and South Korean Assessment--Most U.S. and South 
     Korean experts believed the majority of North Koreans 
     continue to receive basic subsistence rations, feeling the 
     North Korean government continued to distribute some basic 
     rations and some more food was available in small farmer 
     markets. In more remote rural areas, however, hunger is 
     probably very severe. This situation is likely to worsen 
     soon, however.
       Over the year as a whole, the U.S. Department of 
     Agriculture forecast a shortfall of about 1.2 million metric 
     tons of rice. To put the figure in context, USDA's estimate 
     of a year's consumption of food in North Korea is 5.4 million 
     metric tons. South Korean estimates were similar.
       US and South Korean experts also agreed on the cause of the 
     food shortages. While floods may be an immediate cause, long-
     term factors--loss of aid from Russia and China at the end of 
     the Cold War, failure to make rural reforms, and spending of 
     25%-30% of GDP on the military--are much more important. A 
     South Korean agricultural official noted very simply that 
     North Korea uses its oil for military exercises rather than 
     to make fertilizer or run tractors, and thus the agricultural 
     sector has been short of energy throughout this decade. 
     Chinese officials from Manchuria tell him, he said, that 
     since 1991 North Korea has conducted a propaganda campaign 
     calling for ``two meals a day for the glorious unification of 
     the peninsula.''
       2. North Korean Views--The North Korean officials appeared 
     to realize they face an emergency. Foreign Ministry Officials 
     spoke in general terms about food problems and North Korea's 
     appreciation of foreign assistance. Agriculture Commission 
     officials, led by Vice Chair Madame Kim Yong-suk, provided a 
     highly detailed statistical review of recent flood damage, 
     reclamation work in paddy fields, and overall food shortages.
       According to Mme. Kim, the most pressing need for food aid 
     will be quite soon. Spring planting had gone well, and in the 
     absence of new flooding the fall harvest would be good. 
     However, she said, ``in July and August we will face a very 
     tense situation,'' and in the interim North Korea ``would 
     accept with pleasure 1 million tons of assistance.''
       This recognition of an immediate crisis was not matched by 
     any realistic appraisal of the causes of the present food 
     crisis or of North Korea's long-term policy needs. Both the 
     Foreign Ministry and Agriculture officials attributed the 
     food crisis solely to flood damage in the last two years. The 
     only long-term effort they said was necessary was a 
     reforestation program to reduce erosion.
       3. Policy Conclusions--North Korea is clearly in dire 
     straits. While I did not travel outside the capital (because 
     of time constraints rather than North Korean unwillingness), 
     US and South Korean experts provided accounts of severe food 
     shortages which I consider credible. Their views were 
     generally in accord with the accounts of North Korean 
     officials, international food experts, and recent travellers 
     outside Pyongyang including Rep. Tony Hall and several 
     journalists.
       Up to now we have provided $25 million in humanitarian food 
     aid. South Korea, China and Japan have also made 
     contributions. Our diplomats believe the WFP is capable of 
     providing assistance without significant diversion to the 
     North Korean military, and I see no reason to question that 
     assessment.
       My own strong opinion is that, as a humanitarian matter we 
     should provide short-term food aid to people proven to need 
     it. This will be most urgent this July and August. However, 
     longer-term aid or large-scale involvement in the North 
     Korean agricultural and industrial economy should only be 
     done in concert with South Korea, and should not proceed 
     without willingness on the part of the North to address the 
     basic economic and military issues that have caused this 
     crisis.
       C. Security on the Korean Peninsula--Despite North Korea's 
     economic and food difficulties, US military officers and 
     diplomats along with South Korean officials stress that it 
     continues to pose a severe military threat to South Korea and 
     Americans stationed in the South. It maintains a million-man 
     army in a population of 23 million; spends 25-30% of its GDP 
     on the military; and stations about 65% of its troops, and 
     most of its artillery and rocket launchers in offensive 
     positions very close to the Demilitarized Zone. Our response 
     has come in two main forms.
       1. Deterrence--The foundation of all US policy toward the 
     North is strategic alliance with South Korea to deter North 
     Korean military aggression. We have done this through 
     permanent stationing of 37,000 American troops in South 
     Korea, and complete cooperation in a Joint Command with South 
     Korea.
       Up to now, deterrence has succeeded. US military officers, 
     including Supreme Commander Gen. John Tilelli, said that 
     relations with the South Korean military are very good. South 
     Korean officials agreed. Both sides emphasized the importance 
     of continuing to work very closely together on military 
     preparation, and also in any negotiations with North Korea. 
     All agreed that if the North Korean industrial and 
     agricultural economy continued to decline--as it seems very 
     likely to do in the absence of any reform--the North Korean 
     government would become more desperate and the military 
     situation would become more dangerous.
       Finally, I should mention that military officers had some 
     concerns about quality-of-

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     life issues for American soldiers, but felt that construction 
     of new barracks under the last two Military Construction 
     appropriation bills would help a great deal.
       2. Nuclear Proliferation and the Agreed Framework--A 
     corollary to our broader defense strategy in Korea is 
     opposition to proliferation of nuclear weapons. These would 
     not change the ultimate outcome of any conflict, but would 
     raise its cost in human life, physical destruction and 
     environmental damage enormously.
       Since 1994, we have attempted to prevent nuclear 
     proliferation through the ``Agreed Framework.'' Under this 
     agreement, North Korea agreed to freeze its nuclear program 
     while we supply 500,000 barrels of oil and over a longer term 
     replace the heavy-water nuclear reactor at Yongbyon, north of 
     Pyongyang, with light-water reactors whose products cannot be 
     used for weapons. Our military people and diplomats feel that 
     North Korea is complying with this part of the agreement. I 
     have no reason to disagree, and believe we should continue 
     with the Agreed Framework.
       While I will address political issues and negotiating 
     proposals later on, I should note here that the Agreed 
     Framework also calls for progress toward political and 
     economic normalization of relations between the US and North 
     Korea. North Korean officials, including the Foreign 
     Minister, complained repeatedly about the slow pace of 
     normalization with the US and our failure to lift sanctions, 
     saying this had increased North Korean ``suspicions'' about 
     US intentions and reliability. However, the Agreed Framework 
     also includes a commitment to North-South dialogue aimed at 
     reducing political and military tension between the two 
     Korean governments. North Korea has not done this. American 
     action on the political side of the Agreed Framework must 
     depend on North Korean willingness to begin North-South 
     dialogue.
       3. Conclusions--I was extremely impressed by our military 
     officers and enlisted people. I believe our strategy is 
     appropriate and our coordination with South Korea is close. I 
     would add only one point. I heard many times about the 
     vulnerability of Seoul to North Korean missile, rocket and 
     artillery fire. If we can ease that by providing some missile 
     defenses to Seoul, we should do it as soon as possible.
       D. Political Issues and Negotiations--Progress toward 
     normal political relations, relaxed trade sanctions or 
     assistance beyond short-term humanitarian aid, must result 
     from talks leading to reduced military and political tension 
     on the peninsula. These must address first and foremost the 
     basic issue of North Korea's threats and aggressive military 
     posture vis-a-vis South Korea, but can include North Korean 
     concerns as well. And they must not lead to any separation of 
     the US from South Korea, nor any unnecessary political 
     conflicts with China, Japan or Russia.
       1. Four-Party Talks--Last year, President Clinton proposed 
     ``four-party talks'' on Korean issues including South Korea 
     and North Korea along with the US and China as the two 
     principal belligerent powers in the Korean War. These could 
     address North Korean concerns about trade, economics and 
     other issues as well as the concerns we and South Korea have 
     about security. Based on my discussions in Seoul, Pyongyang 
     and Beijing, I remain convinced this is the best approach to 
     Korean security issues. Recent progress toward these talks 
     bears out this conclusion.
       2. North Korean Views--I repeatedly urged the North Korean 
     Foreign Ministry officials to open a North/South dialogue as 
     the Agreed Framework requires, and to begin four-party talks 
     with South Korea, China and the US.
       Foreign Minister Kim Yongnam and Vice Foreign Minister Kim 
     Gye Gwan were my main interlocutors on this issue. The Vice 
     Foreign Minister gave a peculiarly weak and unconvincing 
     reason for North Korea's failure to engage in a North-South 
     dialogue, saying North Korean public opinion had been 
     offended when President Kim Young-sam of South Korea failed 
     to offer condolences on the death of former President Kim Il-
     sung in 1994. He did, however, state support in principle for 
     North-South dialogue, and neither he nor the Foreign 
     Minister, however, ruled it out after the election of 
     South Korea's new President this December.
       Both the Foreign Minister and the Vice Foreign Minister 
     raised concerns about the four-party talks proposal, mostly 
     questioning the reason why China should be involved. They 
     also insisted that the US was following a hostile policy by 
     continuing to impose sanctions and an overall trade embargo 
     on North Korea. They did not, however, insist on large-scale 
     food or economic aid as a precondition for entering the four-
     party talks.
       3. The Chinese Role--As the largest local military power 
     bordering on North Korea, and as a government with 
     traditional ties to North Korea, China has very large 
     interests in the Korean issue and will play a key role in any 
     solution to it.
       American officials in Seoul and Beijing generally felt that 
     China is acting responsibly and helpfully. South Korean 
     officials agreed. In a more general sense, they said they 
     were satisfied with the state of South Korean-Chinese 
     relations, and hoped US-China relations would remain 
     ``harmonious.''
       North Koreans, by contrast, seemed indifferent to China. 
     They did not encourage Chinese participation in four-party 
     talks--to the contrary, in fact, they called for a ``3+1'' 
     formula with China playing an unspecified but clearly minor 
     role. One official, commenting on the overall political 
     situation of the Korean peninsula, said ``the directly 
     involved parties are the DPRK and the US, and we acknowledge 
     that the South has some indirect concerns. China is not 
     concerned.''
       E. Japanese and Chinese Views--During my trip, I met with 
     senior policymakers in Beijing about Korean issues, and 
     discussed Korean policy with two senior officers of the Japan 
     Self-Defense Forces. A brief summary of these conversations 
     follows.
       1. Japanese Views--At Misawa Air Force Base I met with Gen. 
     Akihiko Hayashi and General Minoru Hoso, of the Northern 
     Command of the Japan Self-Defense Forces. These discussions 
     were brief given our limited time, and concentrated on 
     Japan's security role rather than on Japan's particular 
     political concerns about its kidnapped citizens and the 
     recent apprehension of a North Korean ship loaded with 
     amphetamines at a Japanese port, or its broader political 
     views on Korean issues. Japan is deeply concerned about North 
     Korea's deployment of a new generation of medium-range 
     missiles capable of targeting Japan, and working closely with 
     us on attempts to deter conflict on the peninsula.
       2. Chinese Views--The senior political leaders, Foreign 
     Ministry officials and military officers I met in Beijing 
     were quite interested in my visit to Pyongyang, and asked 
     about my physical impressions of Pyongyang and the 
     discussions I had with North Korean officials. None raised 
     any basic objections to US policy toward North Korea.
       On the political issues, their general view was that Kim 
     Jong-il is a rational person who understands that, in the 
     words of one Chinese officer, ``to attack the South would be 
     the act of a madman,'' and is unlikely to engage in any 
     serious provocation. Further, they believe he is in firm 
     control of the North, and that no political upheaval is 
     likely in the short-term despite the food and economic 
     problems.
       With respect to economics and the food situation, Chinese 
     said they were unsure whether North Korea's problems resulted 
     from floods or from ``poor economic organization.'' They said 
     they would help with food needs ``within China's capacity.''
       Finally, all the Chinese with whom I raised the Korean 
     issue said that China's influence over North Korea is 
     limited; that China would act with the goal of maintaining 
     peace and stability on the Korean peninsula; and that China 
     viewed the four-party talks proposal favorably. US diplomats 
     generally agreed that China is acting very constructively on 
     these issues. I believe it is essential that we continue to 
     work with China on the four-party talks proposal.
       F. Long-Term Issues--Opinions were divided as to North 
     Korea's long-term prospects.
       Americans and South Koreans tended to believe that the 
     North was fairly resilient, that Kim Jong-il is in firm 
     control of the government, and that could probably continue 
     along its present path for several years. However, objective 
     indicators pointed to a situation which is not sustainable 
     indefinitely, and many felt that some abrupt collapse or 
     desperate military assault on South Korea was possible. 
     Chinese agreed that Kim Jong-il was firmly in control of the 
     country, but felt more certain than US or South Korean 
     sources that North Korea would remain politically stable.
       Many people commented that South Koreans did not feel the 
     German model of unification was ideal--it had been very 
     expensive and difficult for the German economy to absorb, and 
     they preferred a ``soft landing'' for the North followed by a 
     longer transition. However, few seemed to have a vision of 
     how to make this possible, and a number of Americans 
     commented that a ``soft landing'' did not seem very likely.
       North Korean officials gave essentially ideological 
     explanations of why their country would emerge from the 
     present ``arduous march'' and recover economically. The Vice 
     Foreign Minister, for example, said that while many 
     foreigners spoke of North Korea as ``a broken airplane and 
     some say it will soon collapse . . . my country is not going 
     to collapse at all. We have the wise leadership of the Great 
     Leader Comrade Kim Jong-il, and the entire people rally 
     around in general and single hearted unity. We have a guiding 
     ideal which is different from the USSR or Eastern Europe, and 
     that is the juche [self-reliance] idea.''
       G. Personal Assessment of Pyongyang.--Finally, a visit to 
     Pyongyang is unusual, and apart from the policy issues, my 
     personal impressions of the city may be of some interest.
       I arrived in North Korea on a specially arranged U.S. Air 
     Force flight, which entered North Korean airspace at the 
     Russian border on North Korea's far northeast, proceeded 
     along the coast and then crossed over a mountainous area to 
     Pyongyang. From the air, as far as I could tell, the fields 
     and rice paddies look in bad shape and rivers show severe 
     siltation.
       We proceeded from the airport (we landed at 12:20 p.m.; at 
     least one radar was turned off, and no other planes appeared 
     to be active) by car to Pyongyang. We were able to drive 
     around the center of the city on the way to several meetings, 
     and took an unaccompanied 15-minute walk from the hotel to 
     the city railway station and back. This relatively short 
     experience revealed a city which resembles a ghost town--I 
     can only compare it to my visit to Phnom Penh in 1979, just 
     after the Vietnamese Army had expelled the Khmer Rouges.

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       We saw very few cars, few trucks or buses, and no sense of 
     normal business or economic activity at all. Streets were 
     almost empty, and no economic activity was apparent--I saw no 
     people engaged even in waiting in lines at stores. The people 
     we did see appeared in reasonably good physical health, 
     although listless and low on energy. This applied to the many 
     (but not well-armed) military people I saw on the street as 
     well as to the civilians. And the physical plant of the city 
     is clearly deteriorating. Electricity was spotty in our 
     hotel, in surrounding buildings and on the streets. A number 
     of trucks and buses appeared to be rusting and out of use, 
     and a trolley car was essentially abandoned near the hotel 
     with its back wheels off.
       In preparing for this stop, I anticipated a highly 
     repressive state. I expected poverty and perhaps visible 
     signs of hunger, although I had been told this was less 
     likely in the capital than in rural regions. And I expected 
     constant surveillance. What I did not expect was the almost 
     empty, eerie quality of Pyongyang. Clearly, the country is in 
     dire straits. While I cannot speculate on North Korea's long-
     term prospects with any authority, it is hard to imagine that 
     they can sustain their current domestic and military policies 
     indefinitely.

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