China to press Kim Jong-il on economy, nuclear talks

By Royston Chan

DALIAN, China (Reuters) - North Korean leader Kim Jong-il headed to Beijing by train on Tuesday to talk to Chinese leaders about economic reforms and a return to nuclear disarmament negotiations, but any bold move is unlikely.

North Korean leader Kim Jong-il steps into a car at a hotel in Dalian, China May 3, 2010.

Reclusive Kim's last visit to China in 2006 brought effusive promises of economic cooperation between the two neighbors, as well as broad vows from the North Korean leader to seek progress toward "denuclearization." There have been few signs of either.

Neither Beijing nor Pyongyang has confirmed Kim's latest trip abroad, but there was little doubt the short, frizzy-haired leader entered China on Monday, staying in Dalian, a northeastern port promoted as a showcase of market reforms.

A train that resembled plane-shy Kim's chosen transportation then left a city station early on Tuesday evening and a source with ties to China's leadership said he was going to Beijing for talks with President Hu Jintao and other officials.

North Korea is keen to learn from China's success but any changes would be "gradual," said the source, who declined to be named because the visit is politically sensitive.

China will also urge a return to six-party talks on nuclear disarmament that Pyongyang has boycotted for over a year.

But Zhang Liangui, an expert on North Korea at the Central Party School in Beijing, said that the economy is the key.

"I think the North Korean leader will be most concerned about economic relations, because the domestic economy there is in trouble," Zhang said.

Chinese Foreign Ministry spokeswoman Jiang Yu refused to confirm or comment on the trip, saying only that "China and North Korea have a tradition of high-level mutual visits."

The choice of Dalian, with its foreign companies and industrial parks, showed that Beijing wants to nudge Kim to grapple with his feeble economy, said Zhang.

A South Korean official, speaking on condition of anonymity, said that Kim, who left his a Dalian hotel in a motorcade of limousines, mini-buses and security escorts, visited a dock facility near Dalian.

A mismanaged currency re-denomination last year paralyzed much of North Korea's nascent private business and sent shivers of unrest through the brittle economy.

"China hopes that Kim will learn from it, but North Korea doesn't think that way," said Zhang, citing Pyongyang's adherence to a doctrine of "juche," or self-reliance.

"It would be childish to expect that Kim Jong-il will change his mind because he has visited a few projects."

China is a crucial economic and political backer of its smaller neighbor, which it fears could become a dire burden if 68-year-old Kim's regime falls apart and spills refugees into northeast China.

In 2009, trade between China and North Korea -- which has an estimated GDP of $17 billion -- was worth $2.7 billion.

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Kim's trip, his first abroad since a suspected stroke in 2008, comes while his government also faces pressure on two security fronts -- stalled nuclear disarmament talks and the sinking of a South Korean warship, the Cheonan, apparently hit by a North Korean torpedo on March 26.

On Tuesday, South Korean President Lee Myung-bak came close to openly blaming North Korea for the sinking, which killed 46 sailors, but also made clear he was not about to order a retaliatory strike.

"The pressure (on North Korea) is heavy and it seems that Kim would want to choose this time to visit to play the China card, to show that he has China's support," said Zhang.

Kim's visit could kindle hopes of restarting the dormant international nuclear disarmament talks hosted byBeijing.

"If he is really in China, then there'll certainly be discussion of the six-party talks and the nuclear issue," said Cai Jian, a Korea expert at Fudan University in Shanghai.

The six-party talks bring together North and South Korea, China, the United States, Japan and Russia.

"Kim may for tactical reasons say that he is willing to return to the nuclear disarmament talks," said Zhang. "But the chances of substantive nuclear disarmament by North Korea are close to zero."