Jeffrey Robertson, "The North Korean Nuclear Crisis – Implications for Australian Trade", Research Note, Parliament of Australia, 3 Feb 2003

Executive Summary

The Democratic People's Republic of Korea (DPRK) remains isolated, economically near collapse and facing yet another potentially devastating humanitarian crisis. Its decision to withdraw from the nuclear Non Proliferation Treaty (NPT) and to restart its graphite moderated reactor have sparked international concern over nuclear proliferation and regional concern about an imminent crisis.

The crisis is based on the potential of the DPRK to develop nuclear weapons within a short time frame after recommencement of the program. These concerns are heightened by the DPRK ballistic missile program and the potential proliferation of both nuclear and ballistic missile knowledge and components. In addition, the historically opaque nature of the DPRK regime is likely to exacerbate the challenge of finding a rapid resolution to the crisis.

The resolution of the current nuclear crisis is affected by factors which distinguish it from previous crises on the Korean peninsula. Reconciliation between North and South Korea, wider US foreign policy interests and growing anti-Americanism in South Korea have made it difficult for the presentation of a united front between South Korea and the US. Further, the attention of the US and the international community is focused on the disarming of Iraq, diverting resources from the resolution of the nuclear crisis on the Korean peninsula.

Scenarios for the resolution of the crisis lie in two diametrically opposed categories of sanctions and engagement. However, the US has had limited success in the application of either approach in dealing with the DPRK. Alternative options include a greater role for China, given it has vital strategic interests at stake, or the use of multilateral negotiations, perhaps including Australia, to resolve the crisis. Both options have been rejected by the DPRK, which seeks a bilateral resolution of the crisis with the US.

The implications for Australia of the crisis include potential adverse economic effects as a result of increasing instability in the Northeast Asian region. Any escalation of the crisis, or the outbreak of conflict, would compound these effects. Australia suffered more than 1500 casualties in the defence of South Korea during the Korean War (1950–53) and was a signatory to the Joint Policy Declaration Concerning the Korean Armistice signed in Washington on 27 July 1953. An Australian contribution to any conflict on the Korean peninsula would be expected given its historical and continuing interest in the security of South Korea as well as its alliance with the United States.

DPRK Nuclear Crisis - Issues Implications.pdf