Engaging North Korea

China’s orchestration approach to economic statecraft is evident across this chapter’s three cases. First, central-level officials delegated authority to economic-minded government agencies and financial institutions. They established supportive policies and financial resources that successfully enticed Chinese enterprises to “go out” into North Korea’s uncertain economic environment. Regional officials seized this opportunity, eagerly promoting cross-border trade and investment ties in the expectation that local economies would benefit. China’s foreign aid, the second case, operated along similar lines, mobilizing an array of enterprises and regional officials to implement central-level policy at modest cost. The final case, Beijing’s sanctions aimed at Pyongyang’s nuclear weapons program, demonstrates China’s capacity to restrain commercial ties, even though sanctions failed to deter Pyongyang’s efforts. However, policymakers’ successful mobilization of commercial actors and regional officials contributed to modest economic improvements and spurred market-based dynamics, bolstering North Korea’s regime stability while shoring up bilateral ties.

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