South Korea proposes tax to help fund unification should North Korea collapse

SAYING THAT “unification will happen,” South Korean president Lee Myung-bak on Sunday proposed a three-step plan to unify the…

SAYING THAT “unification will happen,” South Korean president Lee Myung-bak on Sunday proposed a three-step plan to unify the Korean peninsula and a new tax to help his country absorb the enormous costs of integration.

Unification talk, even hypothetical, is a delicate subject on the Korean peninsula, especially at a time when North Korea is dealing with the poor health of its leader, Kim Jong Il, and a rushed succession process for his son, Kim Jong Eun. Analysts say Mr Lee’s proposal will probably draw a sharp backlash from the north. He is the first South Korean president to propose a tax to help with the costs of unification, and his remarks reflect growing sentiment among South Koreans they must plan for a North Korean collapse.

Though he offered no specifics about his ideas, Lee called preparations a “duty”. If North Korea collapses, South Korea would face a massive burden as refugees flood across the border, requiring the deployment of hundreds of thousands of troops. The cost of unification, according to one study, would exceed $1 trillion.

Since the 1990s, the US and South Korean governments have quietly discussed contingency plans for North Korea’s collapse, but China – the North’s closest ally – has refused to join in, reluctant to anger Mr Kim.

READ MORE

Mr Lee’s plan, similar to proposals from previous South Korean leaders, calls for North Korea’s denuclearisation. If North Korea meets that demand – and years of persuasion have failed – Mr Lee’s plan calls for a “peace community”, improved economic co-operation and then the establishment of a “national community”. “Inter-Korean relations demand a new paradigm,” Mr Lee said, according to South Korea’s Yonhap news agency. “It is imperative that the two sides choose coexistence instead of confrontation, progress instead of stagnation. The two of us need to overcome the current state of division and proceed with the goal of peaceful reunification.”

Relations between the two countries, still technically at war, have deteriorated during Mr Lee’s presidency, hitting a low point with the torpedo sinking of the Cheonan warship in March, in which 46 South Korean sailors died. An international investigation said North Korea was to blame, but Pyongyang has denied responsibility. After the sinking, Mr Lee announced hardline measures against the North, including the cutting off of nearly all trade.

“Overall, I see a major contradiction in . . . proposing a unification tax while having burnt all the bridges with North Korea,” said Moon Chung-in, a professor of political science at Yonsei University. – (Washington Post-Bloomberg)

Military exercise angers Pyongyang

SEOUL – The US and South Korean militaries staged their second joint exercise in less than a month yesterday, fuelling tensions with the North and angering regional power China.

The annual exercise comes a week after Seoul completed its own drills near a disputed maritime border off the west coast that prompted the North to retaliate by firing a barrage of artillery shells in the same area.

Responding with the same rhetoric as it has in the past, the reclusive North said the latest exercise was a “dangerous act to light the fuse of a new war”.

Pyongyang has often turned to sabre-rattling to make a point but analysts say it is unlikely to risk a full-blown war which would pit it against the combined might of the US and South Korean militaries.

But US officials have said further provocations by the North are possible in the coming months, especially as Pyongyang tries to build political momentum for the succession to leader Kim Jong-il, expected to hand power to his youngest son.

Unlike the show-of-force drills in July which involved a US aircraft carrier, this month’s exercises are lower key.

Washington and South Korea say the exercises are defensive and designed to send a message to Pyongyang that its behaviour is aggressive and must stop.

Last week’s tit-for-tat military actions occurred near the Northern Limit Line, the site of several deadly clashes since the 1950-53 Korean war, and the location of the torpedoing of a South Korean warship earlier this year.

Seoul blames Pyongyang for the sinking of the Cheonan corvette, which cost 46 lives. The North denies responsibility.

The exercises have also sparked regional tensions, with the North’s only major ally China calling the US-led drills a threat to both its security and regional stability. – (Reuters)