By JEREMY PAGE
YANJI, China?When North Korea closed its frontier with China to visitors and trade after the death of Kim Jong Il, people here braced for a long wait: Tourists were stranded, business trips canceled, food and oil deliveries frozen.
Within 48 hours, however, many border crossings sprang open again, underlining the reality facing Mr. Kim's son and successor, Kim Jong Eun: The impoverished country can ill afford to close itself off for long from China?which has long been its economic lifeline.
But the swiftness with which the border was reopened highlighted a more recent dynamic: A variety of North Korean agencies and individuals have vested interests in expanding commercial links with China and have become an interest group among the country's elite, analysts say. They point to such ties as the strongest impetus for change within the world's most isolated country.
As the world scrutinizes North Korea for the slightest signal of what lies ahead, the activity along the 885-mile border with China provides some telling clues to the politics playing out in Pyongyang.
China's trade with North Korea has more than doubled since 2006, and Beijing's investment in North Korea and in Chinese border infrastructure has been rising, too, although official statistics on both are somewhat unreliable, analysts say. China exports mainly food and oil to North Korea, and is also the conduit for luxury goods from elsewhere for Pyongyang's elite, while the North sells commodities such as copper, coal and iron ore to China. By some estimates, China now accounts for more than 70% of North Korea's foreign trade, with Russia believed to account for most of the rest.
China has been pouring money into the border area over the past two years in a bid to encourage North Korea to launch Chinese-style market reforms, analysts say.
ReutersArmed North Korean soldiers walk by the border of China and North Korea on the banks of Yalu River near the North Korean town of Sinuiju on Thursday.
The impact of those economic ties are evident in the Chinese border town of Yanji. Older people here remark on the different atmosphere this week compared with after the death of Kim Il Sung in 1994, when North Korea came to a standstill as people there were ordered to show "total grief."
"This time, their slogan is 'Turn grief to strength' and they're paying much more attention to business and the economy," said a veteran official at one of the biggest Chinese cross-border trade companies. "Stores and businesses in North Korea have mostly resumed production," said the official, who is in regular contact with North Korean counterparts.
China's strategy to ramp up commercial links has so far failed to elicit meaningful reform, and analysts say the new regime will be equally wary of introducing economic freedoms that could undermine a state policy of "juche" (self-reliance), and total control over its citizens' lives.
But the expansion of Chinese trade and investment has bound North Korea more closely to China?its only military ally and main aid donor?and unleashed economic forces, at least in border areas, that some experts believe could encourage change over the longer term.
The official at the trading company said the number of North Korean officials living on the Chinese side had increased significantly in recent years and border trade is now being conducted by companies set up by a wider variety of North Korean agencies, including the security forces.
Although these companies still pass most of their revenue to the government, they can keep a commission of 4%-5%, and staff appear to receive generous gifts from the growing number of Chinese companies competing for their business, she said.
She and several other local people also said that many North Korean officials are now living with their families?a significant change from the past, when North Koreans posted abroad usually had to leave families behind to prevent defections.
"That's new," said one long-term foreign resident of the Yanji area, who declined to be identified. "They seem to be living pretty well, too."
A handful of well-dressed North Korean officials were seen by a reporter paying their respects to their deceased leader at the Liujing Hotel in Yanji, a modern high-rise in the city center, outside which several black Audi sedans with tinted windows were parked. They declined to answer questions.
Analysts caution that the benefits of commercial ties are limited to North Korea's border areas, and to its elite officials, and there are no signs yet of them being spread more broadly.
On Friday, North Korea said it would open its border near the South Korean town of Kaesong, clearing the path for a delegation led by the widow of former South Korean President Kim Dae-jung and another by the head of Hyundai Group to visit the North. Kim Dae-jung, who died in 2009, and the Hyundai conglomerate were key players in the so-called Sunshine Policy years from 1998 to 2008, during which South Korea attempted to improve relations with Pyongyang through political engagement and financial support.
Kim Jong Il often appeared to toy with the idea of Chinese-style market reforms?usually after visiting China?and set up several "special economic zones" in the border area, but repeatedly balked at introducing the necessary reforms to allow private enterprise to flourish.
One of the only apparent success stories in the earliest such zone, Rason, which was established in 1992, is a casino that attracts visitors mainly from China, where gambling is forbidden.
"It's OK to go over there to gamble, or to buy and sell things," said one 41-year-old Chinese businessman, who regularly visits Rason. "But if you invest in anything there, you'll lose it. It's like before China began reform and opening up."
Another North Korean economic zone, set up at Sinuiju in 2002, ground to a halt after a Chinese-born Dutch flower tycoon was appointed its governor, then promptly arrested by authorities in China for corruption before he could take up his post.
Nonetheless, Beijing has invested heavily on both sides of the border and has pledged to back a plan to revamp the Rason special economic zone, and to build a new one on an island near Sinuiju.
Whether these trends continue will depend to a large extent on the balance of power in Pyongyang, analysts say.
The younger Mr. Kim is too young, and was anointed heir too recently, to wield the same power as his father. So he is likely to rule as the figurehead of a collective leadership alongside his aunt's husband and several powerful generals, analysts say.
The aunt's husband, Jang Song Thaek, is thought by many experts to be an economic specialist who oversaw the establishment of the special economic zones on the Chinese border and is responsible for the commercial ties with China. An early indicator of Mr. Jang's influence could be whether, or how fast, North Korea resumes talks over that and other ongoing projects.
He accompanied the late North Korean leader on recent trips to China and attended a ground-breaking ceremony in June for the new special economic zone on the island of Hwanggumpyong, analysts say.
North Korea has leased China a pier at a port in Rason, and a Chinese company signed an agreement last year to invest $2 billion in more infrastructure there. China has also started building a $250 million border bridge at Dandong, another frontier city. Analysts say Chinese firms have been negotiating with North Korea on developing its substantial mineral deposits.
"I think the new leadership [in Pyongyang] will continue along this path because North Korea has gained such benefits from it," said Yang Xiyu, a senior fellow at the China Institute of International Studies who has taken part in nuclear talks with North Korea.
"I don't expect any sudden changes, but I think they understand that they key for sustainable economic recovery is making use of external markets and resources."
?Se Young Lee in Seouland Kersten Zhang in Beijing contributed to this article.
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