North Korean House of Cards

On the surface, the trip was a success. According to the Chinese Ministry
of Commerce, both sides made progress on setting up developmental guidelines
and systems for the promotion of projects. They also announced the formation
of management committees for the two zones. A deal was signed on forming an
economic, technological, and agricultural alliance; operation and management of
the committees; power supply; and establishment of a company in the Rason zone.
What was not mentioned in the press was the secret reason for Jang’s trip.
Kim Jong-il’s will implies that for a successful transfer of power, Kim Jong-un
would need access to regime funds to build his patronage system. It calls for all Kim
family funds, both domestic and international, to be placed under Kim Kyong-hui’s
control, presumably until Kim Jong-un was ready to take over management himself.
Chinese authorities had reportedly frozen approximately $1.7 billion of the Kim
family’s funds that were allegedly in banks in Hong Kong, Macau, Shanghai, and
Guangzhou. Kim Kyong-hui and Kim Jong-un instructed Jang Song-taek to use his
connections with the Chinese leadership to unfreeze the funds and transfer them to
Kim family accounts inside North Korea.
According to sources inside China, Jang Song-taek failed to secure these
funds. Beyond the reason that his request was denied by China’s leaders, two rumors
for why he was unsuccessful have emerged in defector circles. 131 The first suggests
that Jang had entered into an agreement with Chinese authorities to withhold the
funds, forcing the North Korean regime to embrace Chinese-style economic reforms.
Furthermore, Jang sent a letter to the Chinese leadership in 2013, explaining his
desire to be an agent for change, gradually shifting power away from the KWP to the
Cabinet. The letter was intercepted by the SSD and was included in the investigation
report on Jang as evidence that he had established a confidential liaison with China
outside the purview of the Supreme Leader. Sources point to Jang’s indictment that
accuses him of “anti-Party and anti-revolutionary acts” as a veiled reference to his
attempts to co-opt the political process and set himself up as the de facto Premier. 132
131 Discussion with defector in Seoul who has close ties to Korea-watchers in China, May 2014.
According to one Chinese source close to Hu Jintao, the Chinese leadership’s view was that Jang’s power
in August 2012 was not as profound as it once was. He was seen as a messenger, not a power broker. If
this is true, it lends credence to the theory that his fate had been sealed much earlier in 2011 when Kim
entrusted his will to his sister, Kim Kyong-hui, despite Jang’s dramatic rise in status following Kim
Jong-il’s death.
132 “Exclusive: Jang Song-thaek was executed following his letter to Chinese leadership,” New
Focus International, June 30, 2014. In the letter, Jang reasoned that “Kim Il-sung ruled through a
government overseen by the Premier and Cabinet in order to develop the nation’s light industry and
agriculture, while maintaining the military industry as top priority.” Jang reportedly eschewed the idea
that he wanted to replace Kim Jong-un. On the contrary, he explained that he wanted to develop the
Ken E. Gause
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