CAMBRIDGE, England — For several years now North Korea has been carrying out a process of economic reform and opening up. Sound familiar? That is what the Chinese did 25 years ago when they, too, realized that their economic system was out-of-date and unable to meet the aspirations of its people.

As the North Korean news agency put it in a press release recently: “We are now taking bold measures to improve the overall economic management system with a view to re-energizing the economy to suit the changed actual conditions in the new century.” I can vouch for this, as I was one of the economists they called on for advice last year.

After the historic trip to Pyongyang by U.S. Secretary of State Madeleine Albright in October 2000, several countries normalized their relations with the Democratic People’s Republic of Korea and others signaled their intention to do so. Leader after leader visited Pyongyang and offered their support for the reforms. And not only the usual leaders of small countries: Presidents Vladimir Putin of Russia and Jiang Zemin of China went and even Japan sent its prime minister, Junichiro Koizumi.

In all of these high-level meetings, the North Korean leaders reiterated the offer to give up their nuclear ambitions and to stop producing, testing, deploying and selling long- and medium-range missiles in return for security guarantees and assistance with their economic reform program.

Despite the crisis manufactured by the Bush administration following the visit to Pyongyang of Assistant Secretary of State for East Asia and Pacific Affairs James Kelly in October last year, these reforms have continued.

The South Koreans are continuing to work with the North Koreans in cooperative economic ventures. Roads and a railroad through the demilitarized zone have been opened up recently despite U.S. opposition. South Korean entrepreneurs have gone north to investigate investment opportunities.

Former President Bill Clinton began the process of removing the embargo on trade, and had promised to go further, making it possible, for example, for North Korea to join the World Bank and the Asian Development Bank.

The Bush administration later stopped these supportive activities and moved into reverse gear, starting from when it stopped Israel from making a deal — negotiated twice — with North Korea. Israel wanted to improve its security by paying North Korea $3 billion over three years to stop exporting missiles to Arab nations.

The Agreed Framework put in place in 1994 by Nobel laureate and former President Jimmy Carter included clauses calling for a freeze on known nuclear installations in North Korea and compensation for that in the form of new, more acceptable, nuclear plants (and supplies of fuel oil until they are operational).

The clauses in the Agreed Framework relating to energy were multilaterized by the establishment of the Korean Peninsula Energy Development Organization (KEDO) and although the U.S. slowed down the building of the new power stations, it was going ahead. The first would have become operational possibly by 2005, only two years late, until work was recently stopped.

U.S. Republican Congresses stopped the implementation of the bilateral clauses that would have supported North Korea’s development effort.

With deals like the Israel initiative prevented and with the continued trade embargo, there is little Pyongyang can do to earn the foreign exchange its needs to feed its people except through missile sales and other questionable activities.

Selling out-of-date missiles and missile technology is one thing, developing nuclear weapon capability is another. It needs to be repeated that the Bush administration has offered no new evidence that the North Koreans are in breach of any international obligation. By stopping progress on the building of the new reactors they have also put off the date by which the North Koreans would be obliged to open up their territory to inspection to prove full compliance.

By refusing to sit down with the North Koreans and discuss the situation the Bush administration is pushing them into a corner. By stopping their fuel oil supplies and reducing and threatening to stop food aid, and by blocking their attempts to join the world community, they are making them desperate.

They have reopened the only reactor they have, small though it is, it is the only source of new energy they have. By forcing them to reopen it the Bush administration has ensured that they now have more potential nuclear weapons capability than they had before this crisis.

Moving warships and long-range bombers into East Asia serves no purpose. They cannot achieve what could be achieved by bilateral negotiation. This is a crisis manufactured by the Bush administration. Only they can solve it.

President George W. Bush is letting his personal loathing for North Korean leader Kim Jong Il affect his judgment. Kim is guilty of nothing that Jiang of China is not guilty of, writ large. Yet Jiang goes to barbecues at the Crawford, Texas, ranch home of Bush and gets bear hugs too. Why?

If Bush really wanted to secure a regime change in North Korea as well as reduce any real or imagined nuclear threat, he has choices. He can start bilateral negotiations to achieve the second and bomb Zurich to achieve the first.

Dictators like Kim depend on Swiss banks to stash away and protect, for a fee of course — this is Switzerland — their ill-gotten billions. Without them they would not survive in power long. Recent confessions among politicians and their bagmen in South Korea suggest that up to $1 billion has been paid to Kim in the last four years alone.

There is one good thing coming out of this crisis. Although the leaders of South Korea, China, Japan and Russia are willing to jump up and say they are in favor of a nuclear-free Korean Peninsula whenever Bush tells them to, they are adamant that his methods of reaching that goal are unacceptable. We are witnessing a tectonic shift in international relations. The development of this new Asia-focused coalition will change the balance of world power.

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