ced countries of the world" in terms of per capita output of key industrial goods. By the mid-1970s, Pyongyang had concluded it was losing out to Seoul in the economic race. Since the mid-1980s, it has begun to modify its rigid self-sufficiency policy, emphasizing foreign trade and readiness to accept foreign investment and tourism, and, by the late 1980s, even some economic cooperation with South Korea. Pyongyang is now faced with the challenge of how to realign its foreign economic relations without losing its tight grip on controls over the population. Along with political control and economic development, military preparedness remains vital to North Korean survival. Since the end of the Korean War, Pyongyang has invested heavily in a military buildup to counter has appealed to South Korean leaders for mutual reconciliation, while covertly seeking to destabilize what it calls the "military fascist clique." But Pyongyang also has resorted to assassination, dispatching killers to Seoul in 1968 and 1974, both an attempt on President Park Chung Hee; to Rangoon, in 1983, to kill visiting President Chun Doo Hwan; and terrorists to the Middle East, in 1987, to blow up a South Korean airliner en route to Seoul. In dealing with Seoul and others, North Korea is widely seen to have behaved unpredictably. Even as it prides itself on being unfailingly consistent and "principled" on Korean nationalism or unification, Pyongyang has clearly made tactical changes in its South Korea policy, reversing itself in a number of important instances including the following: Pyongyang unilaterally suspended the historic dialogue with the South in 1973, saying it was a waste of time, but in 1985 resumed the dialogue, concluding that circumstances now favored engaging the South. In 1979, Pyongyang rejected a South Korean-U.S. proposal for a tripartite conference as a scheme to promote "a two-Koreas" policy, but had a change of heart in January 1984. In September...
