Whereas peaceful reunification would greatly enhance Korea’s position, a continuation of the status quo, heightened tension and military clashes are likely to undermine its leadership in the region.

Yet the status quo — where the Korean peninsula remains divided — does not have to entail negative consequences. Although both Koreas might fail to achieve de jure unification, they can avoid military tension and conflict through by promoting mutual exchanges and through cooperation, and so lay the foundation for eventual peaceful unification. Under this rather benign status quo scenario the South Korean economy would continue to grow and North Korea could grasp a new opportunity for opening and reform as well as economic revitalisation. The peninsula, though divided, would be at peace. That would allow both Koreas to play a significant role in shaping the Asian century.

A more disturbing scenario is possible. North Korea maintains its nuclear ambition and international efforts to punish the North through bilateral and multilateral sanctions increase hostility between the two Koreas. The South strengthens its alliance with the United States and seeks further American assurance that it will be protected under the US nuclear umbrella. North Korea  responds by intensifying its nuclear threats. Such a harsh confrontation revives the ‘cold war divide’ in the region and complicating regional security problems. Occasional military clashes deal critical blows to the South Korean economy with the ‘Korea discount’ and ‘sell out Korea’ dominating the response in international markets, while the North Korean economy continues to slide into deep stagnation and paralysis. The Korean peninsula would remain, in this scenario, a dangerous flash point in the Asian century.

Another scenario is that North Korea becomes so dependent on China as to lose aspects of its sovereignty — the ‘Finlandisation’ of North Korea. Mounting external pressures have already made North Korea increasingly dependent on China. As of 2012, China accounted for more than 80 per cent of North Korea’s total trade, and economic ties between the two countries have expanded markedly. If this trend continues, North Korea could be functionally incorporated into China’s northeast economic zone. Inter-Korean economic relations would suffer greatly and the chance of national unification recede. The North Korean economy would, however, be better off than under the second scenario, and South Korea could also sustain its economic growth at a moderate pace. But China’s growing influence would overshadow the role and visibility of both Koreas.

National division might not be the inevitable destiny of Koreans. They could achieve national unification. Koreans could take Germany as a successful example of unification by absorption; a total merger of the two Koreas into a unified nation, through South Korea’s takeover of the North, is possible. The complete internal collapse of North Korea is also plausible. If unification occurred under these circumstances, it would represent the ultimate triumph of South Korea’s market economy and liberal democracy over North Korea’s juche ideology.

Three factors could impede unification through collapse and takeover.

First, North Koreans, regardless of what the post-Kim regime looks like, are not likely to give up their sovereignty, through fear of losing material and positional values. Second, South Korea lacks both the economic and social resources to absorb the North. Given the fragile foundation of the South Korean economy, absorption could result in the collective destruction of both Koreas. South Korean youths are openly reluctant to bear the high costs of German-type unification. Finally, for strategic reasons, China is not likely to let North Korea collapse internally and South Korea absorb the North.

Unification by mutual consent could also be possible. Peaceful co-existence through confidence-building measures, arms control and reduction, as well as promoting exchanges and cooperation, could lead to de facto, if not de jure, unification in the form of a union between the North and South. This is the most desirable scenario because it would be cheaper, relatively free from trauma and far more manageable than anything else. It would not be possible unless North Korea adopted a market economy and gave up its nuclear armaments. A Korea unified in this way would emerge as a major middle power in the region regardless of how it overcame division. Its population would number almost 80 million and it would have enormous economic and military capabilities.

Military clashes and even war cannot be ruled out. North Korea might unexpectedly engage in pre-emptive military move on the South, or brinkmanship diplomacy could trigger a surgical strike on nuclear and missile facilities in the North by the United States and its allied forces. In either case, the end result would probably be the takeover of the North by South Korea and its allies. The human and material costs of war cannot be calculated and, devastated by war, Korea will play no significant role in Asia’s future.

Chung-in Moon is Professor of Political Science at Yonsei University and advisor to late President Roh Moo-hyun.

This article appeared in the most recent edition of the East Asia Forum Quarterly, ‘Coming to terms with Asia’.