Sea Monster

TIM LARIMER and STELLA KIMWhen Kim Jong Il speaks, people ... scratch their heads. Divining what goes on inside the nerve centers of Stalinist regimes is always difficult. But in North Korea, Dear Leader Kim's obstinate and cloistered regime is impenetrable. So the world collectively scratched its noggin last week when Pyongyang sent four patrol boats and three torpedo vessels across a maritime demilitarized zone into South Korean waters. Was the North trying to provoke its enemy, with whom it has technically been at war since the 1950s? Was it reminding the world of a readiness to flex its military muscle, just as the two Koreas prepared to meet for a rare round of talks in Beijing? Or could Pyongyang's intention have been more prosaic: Was it simply sending its fleet out to catch the best crabs at the height of the fishing season?

Whatever the motivation, the affair underlines how diplomatic gamesmanship--it's unlikely North Korea wanted the South to sink one of its ships--can quickly evolve into confrontation. The standoff in the Yellow Sea got ugly on June 11, after South Korean patrol boats rammed North Korean vessels that had veered too far south. That itself isn't unusual. North Korean warships for decades have escorted fishing boats in and out of South Korea's waters, especially during crab season. In the beginning, we did not take it as a threat, says South Korean Defense Ministry spokesman Brig. General Cha Young Kook, who says such incidents occur as often as 20 times a year. The spokesman found out himself how sensitive the standoff was; he was fired late last week after comparing the naval row to a marital dispute. But last Tuesday, as Pyongyang's military officers prepared to meet with the United Nations Command at the border village of Panmunjom to discuss the sea dispute, North Korean patrol boats again crossed into the wrong waters. According to Seoul, they tried to ram several South Korean patrol vessels. The South Koreans rammed back. Then, Seoul says, the North Koreans opened fire with 35-mm cannons. South Korea fired back, sinking a 40-ton torpedo boat and damaging five others. U.S. officials in Washington said an estimated 30 North Korean sailors died during the 14-minute fight--the first naval battle between the two Koreas since the war that ended in stalemate in 1953.

With that, the long-feared reignition of war on the Korean Peninsula suddenly seemed possible. The two sides are armed to the teeth and poised to do battle. The U.S. took the threat seriously, dispatching two guided-missile cruisers, the U.S.S. Vincennes and Mobile Bay, from Japan toward the Yellow Sea. It also sent from its west coast four EA-6Bs, aircraft with radar-jamming equipment. Tokyo, which has been wary of Pyongyang ever since North Korea fired a rocket over Japan and into the Pacific Ocean last August, leaked intelligence reports that Pyongyang was preparing launch pads to test-fire medium-range missiles. Those reports were later denied (half-heartedly) by Japan's Defense Ministry, but tension remains high. The North has 1 million men under arms and lots of weapons deployed at the demilitarized zone, frets a U.S. State Department official. Where there is no peace and forces are deployed, someone making a mistake is not good.

By the end of last week, the crisis appeared to have eased. Nobody in Seoul was panicking; unlike earlier flare-ups, this one did not provoke runs on ATM machines or grocery stores. Seoul's stock market dropped but quickly rebounded. North Korea, despite suffering a humiliating naval loss, responded with nothing more than words. Analysts, as ever, were left to figure it all out. This is nothing new, says Nicholas Eberstadt, a visiting scholar at the American Enterprise Institute in Washington. It is the 46-year-old North Korean approach in creating tactical tension. They calculate that making themselves a security problem is important to their survival. In fact, that strategy may be Pyongyang's primary leverage in dealing with the rest of the world. Since North Korea has been crippled by famine and the demise of its industrial base, its military might and reputation for irrationality are its strongest cards in any negotiations.

And as it happens, vice ministers from the two Koreas are scheduled to meet in Beijing this week, in what would be the first such diplomatic encounter in 14 months. No one can prove that North Korea staged the naval skirmish to create tension in advance of the talks, but the circumstantial evidence is strong. Nine minutes into the meeting with the U.N. Command, Pyongyang military officials abruptly announced that South Korean forces had fired at the North's boats. Nobody on the South Korean side knew what they were talking about. But the verbal outburst served a purpose. This is how the North reminds people that the war is not over, says Gordon Flake, executive director of the Mansfield Center for Pacific Affairs in Washington. The incident also helped deflect attention from the subject of this week's discussions: allowing 10 million Koreans who have been separated from family members for more than four decades to reunite. Hard-liners in the North are thought to oppose the reunions. The exchange of people could lead to destabilization of [the North's] political and social structure, says Choi Dai Seok, a North Korean studies professor at Dongkook University in Seoul. Now they can put the high-sea incident on the table and dilute the family reunion issue.

Such speculation reveals the extent to which North Korea's leaders still fear any contact with the outside world. Here's Pyongyang's dilemma: it needs money, food and fertilizer; it doesn't want strings attached. Whenever North Korea has edged toward even the mildest form of engagement with the outside world, it has preceded such moves with a show of force. Last September, for example, Pyongyang launched the missile over Japan when North Korean diplomats were preparing to speak with their U.S. counterparts. Though North Korea said the missile was an innocent misfire of a satellite intended to broadcast revolutionary hymns from space, many analysts believe otherwise. For Koreans, crisis is a fact of life and a method used in negotiations, says Scott Snyder, a fellow at the U.S. Institute of Peace.

That said, the latest timing is particularly befuddling. Desperate for investment, the regime has been opening its doors a crack to capitalism. Pyongyang has allowed South Korean conglomerate Hyundai and other companies to invest directly in the North, and it's permitting tourists from the South to visit on cruise ships. In May, President Bill Clinton's envoy, former Defense Secretary William Perry, became the highest-ranking U.S. official to visit North Korea since the war's end.

North Korea's contradictory moves are severely testing the sunshine policy of South Korean President Kim Dae Jung. Even after the sea battle, boatloads of tourists continued to sail north, and a South Korean ship carrying fertilizer crossed on schedule into North Korean waters. We must continue with the engagement policy with patience and confidence, Lim Dong Won, Seoul's minister of unification, told the national congress last week. On the other hand, the clash also gave Kim the opportunity to appease conservatives who accuse him of being too soft on the North. Kim has declared that his sunshine policy will not tolerate any military provocation, says Donald Gregg, a former U.S. ambassador to South Korea. The South kicked their butts. Kim Dae Jung is not going to put up with this sort of thing.

What Seoul and the rest of the world do next is unclear. You have to look beyond this crisis, says South Korean Foreign Minister Hong Soon-young. In the end, North Korea will be forced to engage by economic and diplomatic necessity, and that will eventually change them. Pain is the agent of change. Further confrontation is risky. But so is a policy of determined engagement, which could provoke a stern response from Pyongyang hard-liners. Some analysts believe a third option, benign neglect, has also provoked North Korea in the past. Last year, when the U.S. fell behind in oil shipments it had agreed to, Pyongyang became aggressive. It's a delicate balance in an unstable region. North Koreans are experts in creating tension that does not spill into catastrophic scale, says Eberstadt. For now, at least, it seems Pyongyang can live with losing one of its gunboats. But as with so much else about the mysterious regime, nobody knows where Pyongyang's ultimate trigger point lies.

With reporting by Jaime A. FlorCruz/Beijing, Barry Hillenbrand/Washington and Donald Macintyre/Tokyo