In our third-quarter forecast, we said that dialogue between the United States and North Korea would remain open given the costs of a breakdown in talks and U.S. President Donald Trump's personal commitment to a deal, but that a major breakthrough would be difficult to achieve. While the surprise meetup between Trump and North Korea's Kim Jong Un at the Demilitarized Zone indicates continued outreach, there are as yet no clear signs of compromise on either side.
Just over four months since the high-profile breakdown of their summit in Hanoi, Vietnam, U.S. President Donald Trump and North Korean leader Kim Jong Un have met again. On June 30, in what Trump couched as a relatively impromptu event, they held a 50-minute meeting at the inter-Korean border's Panmunjom peace village. In a highly symbolic moment, the two leaders shook hands before Trump became the first sitting U.S. president to cross, however briefly, into North Korea. Kim also stepped over into South Korea.
At a post-meeting news conference, Trump said that U.S. and North Korean representatives will hold working-level nuclear talks in the next two to three weeks between teams chosen by the U.S. special envoy for North Korea, Stephen Biegun, and U.S. Secretary of State Mike Pompeo on the one side and an unnamed North Korean counterpart on the other. The president emphasized the goal of a comprehensive deal, downplaying (as before) speed. He also confirmed that he has invited Kim to visit the White House but there had been no formal agreement. While Trump said sanctions on North Korea would remain, he suggested that talks could change this — a hint of a potential departure from the White House's hard-line position. And he once again downplayed the significance of North Korea's missile launches in May.
Why It Matters
Direct engagement between Trump and Kim will help kickstart the stagnant talks between the two sides. However, much will depend on whether Washington and Pyongyang are willing to be flexible on the hard-line positions that derailed the February summit in Hanoi, which saw North Korea push for near-term sanctions relief and the United States push for the dismantling of key North Korean weapons sites. Such talks will be particularly important given that only six months remain until North Korea's self-imposed end-of-year deadline for progress, with warnings of a return to nuclear testing, and the start of the 2020 U.S. presidential election year that will put Trump's tenure to the test.
For South Korea, this development emphasizes its role as a mediator between the two sides and also lowers tensions — critical for a country caught in the middle and a boost for the administration of Prime Minister Moon Jae In, which faces flagging approval ratings because of economic headwinds. For China, a continuation of the U.S.-North Korea dialogue also reduces the risks of a breakdown that would be costly to Chinese interests. With a new cease-fire in its trade war with the United States, China's support in the nuclear talks on North Korea will give Beijing greater leverage in trade talks going forward.
The U.S.-North Korea outreach has been stalled since February when Trump walked away from the table in Hanoi. The precise genesis of this Demilitarized Zone meeting is unclear, but Trump tweeted on June 29 that he was willing to meet with Kim at the DMZ during Trump's two-day visit to South Korea after the G-20 summit in Japan. A week before, on June 23, North Korea revealed that Trump had sent Kim a personal letter after Kim's landmark summit with Chinese President Xi Jinping in Pyongyang and that Kim would "seriously contemplate the interesting content."