For years, the conventional wisdom in international diplomacy has been that North Korean leader Kim Jong Un must give up his nuclear weapons and long-range missiles in order to foster his country’s economy. This belief stands in contradiction to Kim’s own “byungjin” policy line, which calls for simultaneous development of arms and the economy.

Indications are now beginning to emerge that outside perceptions may be outdated: Kim is winning on both fronts as a market economy blooms and his strategic arms programs reach maturity.

The sacrifices of the past

Somewhere along the line, the Kim regime, in power since 1948, made a strategic fiscal decision to pursue nuclear weapons and intercontinental ballistic missiles, or ICBMs, at the expense of domestic economic development. This proved disastrous for the people of North Korea.

Catastrophe struck in what has been dubbed the “The Arduous March,” from 1993 to 1998. Then, a combination of the fall of erstwhile European communist allies and natural disasters such as droughts and floods exacerbated a highly inefficient system of food production and a shady system of distribution. As many as half a million people – Pyongyang data is non-existent – may have perished as a result of an inept and uncaring government.

More recently, the so-called byungjin policy proclaimed by Kim Jong Un since 2013 is questionable: ensuring Kim’s and his regime’s security was always the prime goal. The true policy in force was an extension of the songun (military first) line proclaimed by his grandfather in 1962 and later made the central state policy under his father, who passed away in 2011.

However, the costs of the past do not necessarily carry over to the present or future. Research and development expenditures are no longer the bulk of the weapons programs’ expenses. While exact figures are unavailable, it stands to reason that once a prototype nuclear weapon or delivery system has been built and tested, costs are then reduced to production and deployment.

While building bombs and making missiles are not cheap endeavors, they are not as expensive as the R&D that initiates the process. However, there are other reasons why Pyongyang does not have to choose between guns and butter.

Economy develops despite sanctions

Concerns that international sanctions imposed by the UN, as well as those unilaterally enacted by other nations would hurt the common person, have not been borne out in all cases. For example, a recent report on an increasing supply of electricity shows that sanctions can actually benefit the average North Korean.  It seems that coal intended for export is now being diverted to domestic power plants to generate more electricity.

Additionally, Kim has begun taking steps to relinquish control over markets in North Korea and there are indications that this is accelerating economic growth. While North Korea is nowhere near being a capitalistic society, changes noted by observers point toward a market economy being built from the bottom up, taking advantage of relaxed restrictions and a formal go-ahead from Kim himself .

Initially brought about due to the dire straits of the “Arduous March” in the mid-1990s, an unofficial citizen undertaking – a corollary of sorts to the ersatz byungjin policy which would appear a decade later – “marketization” began out of necessity. The markets grew by fits and starts as the regime reacted to them, sometimes negatively.

Now they are blooming nationwide, with Kim’s limited blessing. Donju – literally, “money masters,” or entrepreneurs – are creating businesses to provide the consumer goods and services that the government Public Distribution System cannot. The loosening of controls on private-sector commercial activities has allowed entrepreneurs to develop and manufacture goods to meet booming consumer demand. In some cases, the variety of products is astonishing.

While Kim marshals his nuclear arsenal and delivery systems, the donju are building the economy. While there is a long way to go in improving the lives of everyday North Koreans, the journey has already begun. While the markets are poised for even greater growth, the North’s weapons programs proceed unchecked – despite Kim’s recently stated intentions.

Having his cake – and eating it

Much is being made of Kim Jong Un’s declarations of having destroyed the underground Mount Mantap nuclear testing site near Punggye-ri. But many experts question whether the nuclear test site even remains useful after six detonations, and it is unclear how significantly the site’s tunnels were affected by the surface demolitions carried out in front of the world’s TV cameras.

Kim’s more recent offer to (conditionally) decommission the flagship Yongbyon nuclear complex has also been greeted with cheers in the West, even though that gesture may not be as significant as it appears.

A report based on released intelligence points out the existence of at least one other nuclear materials factory at Kangsong.This follows reports some months ago about the North declaring an entire province to be restricted, intended for military matters.

Parallels could be drawn with US actions when it began the Manhattan Project to develop an atomic weapon during World War II in the mountains and valleys of Tennessee. North Korea’s sparsely-populated, mountainous Chagang Province in the country’s extreme north is perfect for such an undertaking.

Kim’s stated intention to destroy the Sohae missile test facility near Tongchang-ri, is a clear distraction. These days, most of Pyongyang’s long-range missiles are mounted on road-mobile Transporter-Erector-Launchers (TELs). Not only do these eliminate the need for a launch pad, the TELs and their missiles are difficult to track and destroy.

Furthermore, despite repeated denuclearization promises, Pyongyang continues to extract fissile material as well as construct more missiles.

North Korea’s nuclear weapons and long-range delivery systems are not going away. At the same time, there is now a significant grass-roots marketization movement in the North – and this means an improving economy.

Despite the international community’s strategy of squeezing the economy via sanctions to prevent weapons development, it is becoming clear that arms and consumer goods are no longer linked.

No longer a case of guns or butter, now it is guns and butter.