On US-North Korea talks, China may hold the cards

China's President Xi Jinping (right) walking with North Korean leader Kim Jong Un in the Chinese city of Dalian, on May 8, 2018.
China's President Xi Jinping (right) walking with North Korean leader Kim Jong Un in the Chinese city of Dalian, on May 8, 2018. PHOTO: AFP

DANDONG, China (NYTIMES) - Along the Chinese border with North Korea, the evidence of Beijing's leverage in the coming talks between US President Donald Trump and the North Korean leader, Kim Jong Un, is everywhere.

Footage of China's president, Xi Jinping, hosting Kim this week plays in a loop on a big outdoor screen here in the city of Dandong, and residents are eager for cross-border trade to resume as sanctions on North Korea are eased.

Traders say they are putting in advance orders for coal from North Korean suppliers. Some exporters are already smuggling goods across the border.

"If you bribe the customs officials twice as much as before," said one businessman who sells machinery for mining, "some of the smaller equipment goes through."

At a new apartment complex where four 15-storey towers are going up, sales have taken off and prices have doubled as buyers - including North Koreans carrying stacks of Chinese currency - snap up studios overlooking the Yalu River, a saleswoman said.

The Trump administration insists it will maintain its campaign of "maximum pressure" on the North until Kim has shown "substantial dismantlement" of his nuclear arsenal.

But the buoyant mood in Dandong is a reminder that China, as North Korea's main trade partner, can decide how strictly to enforce the international sanctions against it.

Beijing has already positioned itself as a critical player that can shape the outcome of the talks, which Trump said will take place June 12 in Singapore.

The reclusive Kim has travelled twice in the past two months to China to consult with Xi, notably in each case just before hosting a visit by Mike Pompeo, the new US secretary of state.

The message both times was clear: Kim wants China's support for his approach to nuclear disarmament - a gradual, action-for-action process in which the North is rewarded for each move it takes toward denuclearisation.

Trump's national security team has urged a faster approach, with a timetable as quick as six months to a year, and economic benefits coming only at the end.

In his meeting with Kim this week, though, Xi endorsed "phased and synchronous measures" that would "eventually achieve denuclearisation and lasting peace on the peninsula."

Even as Trump is celebrating North Korea's release of three US prisoners, China has many reasons to believe it will come out ahead in the coming talks.

For one thing, its leverage over sanctions enforcement means its view on the main issues - the method and pace of denuclearization - will carry weight with both North Korea and the United States. Beyond that, it sees the prospect of progress towards a long-standing security goal: the withdrawal of US troops from the Korean Peninsula.

While he has emphasised the importance of moving quickly, President Moon Jae In of South Korea has also endorsed an "action-for-action" approach to denuclearisation, putting his position closer to that of China and North Korea than of the United States. The joint declaration issued after his summit meeting with Kim last month set no deadline for denuclearisation, suggesting the diplomatic momentum is already shifting towards a phased approach.

This could make it easier for the North to reject demands to discard its weapons quickly, forcing Trump to choose between accepting a more gradual process or going home empty-handed despite the expectations he has built before the meeting.

"The obvious risk that America faces in the summit is that Trump makes a big concession to Kim, without getting anything close to full denuclearization in return," said Hugh White, a professor of international strategic studies at the Australian National University.

If Trump cannot get the big breakthrough he wants in denuclearization, he may try instead to negotiate a treaty to establish diplomatic relations with the North and formally end the 1950-53 Korean War, which was halted by an armistice.

Trump has shown great enthusiasm for signing an official peace treaty with North Korea, a gesture that he has said would be good for everyone.

However, such an outcome might also play into China's hands by calling into question the need for the nearly 30,000 U.S. troops now stationed in South Korea and the annual joint military exercises that involve even more U.S. forces, which are intended to serve as a deterrent against the heavily armed North.

"An agreement with North Korea which reduced tension, while clearly welcome in itself, could well mark the beginning of the end for America's long-standing preponderance in Asia," White said. "And that would be a big win for China."

Now that North Korea is in play in a larger strategic contest of wills between Beijing and Washington, China is no longer so interested in squeezing the North.

"China has no incentive to punish North Korea anymore," said Cheng Xiaohe, a professor at Renmin University in Beijing.

"Its relations with South Korea have soured. A few months ago, China had a good relationship with President Trump, but now there is a trade war with the United States."

For its part, South Korea is also keen to prevent the North from slipping too far under Chinese control, even while its current support of a gradualist approach to denuclearization is in line with China's view. In the joint communiqué released after Kim's meeting with Moon last month, the South pledged to help the North modernize its railroads and highways.

The recent diplomatic developments have given both China and South Korea "every reason to oppose and disregard new sanctions if the US tries to impose them," said veteran diplomat Bilahari Kausikan, former permanent secretary at Singapore's Ministry of Foreign Affairs.