The Puppet Masters

It seems odd to go on writing about my life in Korea without mentioning current events. Last Thursday the results of an international investigation found that four weeks ago North Korea attacked and sank the South Korean Navy corvette Cheonan, with the loss of 46 lives.

North Korea has, over the years, previously attacked South Korean military vessels, launched a 31-man commando raid on the President's residence in Seoul, attacked a Presidential delegation in Burma killing the South Korean Foreign Minister amongst others, blown up a South Korean passenger plane, launched a disasterous spying mission in 1996, kidnapped Japanese citizens from the Japanese mainland - although at least they eventually got an apology - and generally made a mockery of international agreements and the international community at every available opportunity. These are merely the edited highlights of North Korean provocations. Which is why most people in Korea have reacted to the latest incident with a certain stoicism. One must be careful of reading too much into the South Korean media in these times, but I would concur that there has been little panic buying in the shops either in Busan or – I understand from my social network – in Seoul. This is not to say people are unaffected. A friend in Seoul who has a young baby said that at the moment she has no enthusiasm for her job – all she wants to do is be at home with her child now. There are more police on the subways, possibly due to the recent capture of a North Korean spy and the information she obtained about the Seoul Metro, and the underlying tension is just that little bit higher. Despite this, bizarrely, North Korea has still demanded that South Korea's SBS network give it a free World Cup television feed and pay for Northern journalists to attend the football tournament this summer.

It's said that the road to Hell is paved with good intentions. We paid a high price once in my country for appeasing a ruthless dictator. In retrospect, South Korea may have repeated that mistake with its 'Sunshine Policy'. It's tempting to have hoped that North Korea would have gone down the Chinese road of economic development, but this perhaps ignores the reality that the Chinese Communist Party is somewhat meritocratic and these days, pragmatic. North Korea is more akin to a feudal dictatorship, with hereditary succession where the leader is often raised to the status of a God. Our mistake has been to believe that Kim Jong-Il would do the logical thing, but ego and internal politics in dictatorships is rarely about logic.

I've been part of that mistake too. Back in the naive 'Sunshine' days I invested in a company called Aminex which had done a deal to explore for oil in Northern territory. That saga still goes on, with a deal on the Eastern sea – the place where North Korean submarines disappear - being signed despite the latest crisis. Needless to say, I've come to see that move as a mistake, and now don't believe in supporting a dictatorship in any way when it will spend the foreign currency it receives on weapons which might eventually kill me and my family. I've also considered not buying Chinese-made goods or investing in China any more on the principle that North Korea is increasingly a puppet state of China and protectorate at the UN Security Council. But it's a problematic position, because if South Koreans rose up as a whole and boycotted China in protest, it may push China into nationalist outrage. But if we all continue to do business with them, are we once again travelling down the road of appeasement with another dictatorship?

And how much do South Koreans care anyway? Believe it or not despite all this, a recent Gallup Korea survey revealed that if North Korea invades the South, apparently 25.7% of respondents are against the Government immediately exercising its right to self-defence. You read that correctly - allegedly one-quarter of South Koreans don't want to fight back. This might be because they don't want to be conscripted or because they want to just talk to the attackers. The allegation that many young people have no idea who started the Korean War may be a contributory factor. Still, I find it inexplicable.

Right now, I've done nothing about the situation, which is surprising for a financial trader. We tend to think in terms of offsetting risk – hedging our positions for worst case scenarios – and that makes us financial survivalists. That sense of survivalism often extends into the real world, where it seems we are the first to buy masks during viral outbreaks, store emergency food, water and equipment. It's not always the direct problem we fear so much as the collapse in infrastructure that leaves people short of basic essentials. And gone down that road too in the past, but despite the vague risk that conflict could break out at any minute, this time I've done nothing to prepare for it. Yes, Busan's distance from the border puts it in a much more fortunate position than Seoul, but since any war is likely to be fought asymmetrically by the North, it would be a mistake to believe that we are safe here. And a widespread infrastructural collapse will carry its own implications.

Another reason why I really haven't addressed this is that I've been extremely busy of late for various reasons, and life goes on. Preparing for a war is some way down my list of things to do, which is my judgement on the probabilities involved. If conflict breaks out that will prove to be a bad trade. This is the slightly surreal nature of life in Korea right now – it feels like the Cold War all over again. Will the sirens one day sound in anger?