William Pesek is an award-winning Tokyo-based journalist and author of "Japanization: What the World Can Learn from Japan's Lost Decades."
As Asia investors make a mental list of major threats in 2021, Kim Jong Un is making a play for a place at the very top.
Between COVID-19 and the Donald Trump show in Washington, North Korea has not had many headlines of late. Earlier this week, we learned the Dear Leader's economy is set to shrink the most since 1997, a reminder that the pandemic is slamming the remotest of political systems.
That, coupled with floods devastating large swathes of crops, has Kim doing something unprecedented: effectively admitting failure. Back in 2016, Kim hosted Pyongyang's first Workers' Party's Congress in three decades, detailing ambitious designs for creating a "great socialist country" with a thriving economy within five years.
Things quickly went awry. First, crushing United Nations sanctions over nuclear weapons and missile tests. Then came torrential rains on a near-biblical scale, and now a pandemic reducing demand for North Korean goods, illicit and otherwise.
That has Kim devising yet another five-year plan. This week, he announced an "80-day battle" to jump-start an economy that both his father and grandfather failed to modernize. The hope is to complete some big stimulus projects before the next Party Congress in January.
But let's face it: these stimulus efforts usually center on defense-related infrastructure, efforts that sure to put Kim's nation in the U.N. Security Council's crosshairs all over again. Kim's rather public mea culpa, meantime, seemed aimed at reminding Asia that Pyongyang foresees a rough 2021.
Written between the lines in bold font is Kim's realization of how little his economy got for all those chummy photo opportunities with Trump.
The Kim Dynasty scored hugely from President Trump's mix of neediness and naivete. In Washington, a meeting with a U.S. leader had always been seen as the prize reward for a long and transparent North Korean effort to denuclearize. But Trump gave Kim the payoff upfront, legitimizing a murderous tyrant on the world stage for zero in return.
It is a wonder that so many smart people thought Trump's Singapore summit with Kim in June 2018 might succeed. Or two meetings after that. All they did was buy Kim time to accelerate his nuclear program, while Trump -- desperate for a win on the global stage -- covered for Pyongyang.
This outcome is wildly at odds with what Shinzo Abe envisioned when he returned to the premiership in 2012. Abe had big plans to curb Kim's missile capabilities and resolve the issue of Pyongyang's abduction of Japanese decades ago. Then along came Trump to bigfoot Tokyo's ambitions.
New Prime Minister Yoshihide Suga faces quite a geopolitical paradox: a Kim regime more economically enfeebled, but militarily more dangerous than in 2017 when Trump blundered onto the scene. In many ways, Suga's hands are tied between now and the Nov. 3 U.S. election. Who knows, Trump might just invite Kim to his Mar-a-Lago lair in Florida for a round of golf.
But might Kim return to business as usual, threatening neighbors to extract aid and sanctions relief, in 2021? On Tuesday, Fitch Ratings said "geopolitical risks around relations with North Korea weigh on" the South's credit grade. As Fitch points out, "diplomatic efforts have stalled and prospects for deeper integration of inter-Korean relations have deteriorated in the past six months."
Pyongyang again conducting short-range missile tests and destroying the joint liaison office in Kaesong, Fitch notes, are not promising as far as these things go. Nor are prospects for restarting denuclearization negotiations, which Fitch says, "appear dim prior to the U.S. election and are quite uncertain thereafter."
Trump's weird bromance with Kim would put a Joe Biden White House in a near-impossible situation. Biden certainly would not share love letters with Kim. A return to the brinkmanship of old might have Kim lashing out in ways that blow out credit spreads in debt markets, slam stock bourses and send the Japanese yen, the South Korean won and other currencies reeling.
The COVID-19 effect is its own wild-card. Even before the pandemic, Kim was a dismal economic manager. Back in December, Seoul National University's Kim Byung-yeon warned Kim's regime was on track to lose at least $1 billion in foreign reserves annually, bankrupting Pyongyang within a few years.
Since the pandemic began, weak medical capacity forced Kim to lock down borders hard. "While those methods may be successful in limiting infections, they have done serious damage to an already anemic economy," says Sue Mi Terry at Washington-based Center for Strategic and International Studies.
Earlier this year, Kim reportedly delegated some economic retooling duties to his younger sister, Kim Yo Jong. It is unclear whether this power-sharing arrangement is real or symbolic. At the same time, there is every reason to think COVID-19 fallout will limit Pyongyang's tolerance for radical change, including freeing up markets or making it easier to start businesses. That could mean hitting up China for increased aid.
How might Kim's desperation bubble over into Asia's 2021? Odds are we will see a fresh cycle of fire-and-fury provocations -- both rhetorical and physical by way of nuclear tests and missile launches over Japan. Either way, the Hermit Kingdom seems ready to reclaim the spotlight at the worst possible moment.