Seoul, South Korea (CNN) -- With fingers pointing to North Korea for the March 26 sinking of the South Korean warship Cheonan and the 60th anniversary of the outbreak of the Korean War falling on June 25, the flashpoint peninsula is in the global spotlight once more. Here is a look at the questions looming over the two Koreas.
Is a second Korean War imminent?
Prosperous South Korea simply has too much to lose from war, so military retaliation looks unlikely. Also, most experts believe that an all-out war with South Korea and its U.S. ally would spell the end of Kim Jong-il's government in Pyongyang, so do not expect North Korea to let it escalate that far.
The question is: How far does the North believe it can go without provoking war? The nation has defied the international community by testing ballistic missiles and detonating nuclear devices. While the Cheonan sinking -- North Korea has steadfastly denied involvement -- shocked the world, it is just the latest in a series of bloody attacks.
North Korea dispatched commandos in an unsuccessful attempt to assassinate South Korea's president in 1968; a 1983 bombing linked to North Korea killed 17 high-level South Korean officials while they were on a state visit to Burma (now Myanmar); and agents from the North were accused of bombing a South Korean airliner in 1987. While full-scale war is desired by neither state, tit-for-tat retaliations could happen. That would raise the risk of both sides tumbling into a vortex of escalation that could ignite a war.
Why did the North allegedly sink the Cheonan?
Even as the North denies involvement, there are various theories. Some believe it was revenge for a naval clash last November when a North Korean patrol boat was hit. Others say it could be a move by the North Korean military to increase tensions, thereby ensuring the continued primacy of the state's "Military First" policy. A faction could be attempting to demonstrate loyalty to Kim, or to his son and likely successor, Kim Jong-eun. It could be designed to influence South Korea's June 2 local elections, or even to dissuade world leaders from attending November's G20 summit in Seoul. Most worryingly, Kim is in fragile health, and the sinking, combined with the botched currency revaluation in 2009, indicates even more erratic than usual behavior in Pyongyang.
Why are there two Korean states?
Korea was colonized by Japan in 1910. Following Japan's World War II defeat, Korea was divided along the 38th parallel by the allied powers in a virtual afterthought in 1945. Attempts to hold unified elections failed. In 1948, separate states were established: The capitalist South (Republic of Korea) supported by the U.S., and the communist North (Democratic People's Republic of Korea) supported by the former Soviet Union.
What was the Korean War?
What started as essentially a civil war expanded into the first war in which the United Nations played a military role; escalated into the first (and only) battlefield clash of Cold War superpowers, China and the U.S.; then finally settled down into the first "limited war."
Guerilla fighting roiled the South and border clashes flared between 1948 and 1950. On June 25, 1950, the North launched an outright invasion of the South, aiming to reunify the peninsula under communism. A combined U.N. military effort was launched -- with predominantly American forces -- to resist the North. After desperate summer fighting, North Korea's army was shattered and in October, UN forces raced through the North to finish the war.
China, perennially sensitive to frontier threats, launched a shock counteroffensive to save its communist neighbor. By late December 1950, routed UN troops had been driven from North Korea. The war remained fluid until the summer of 1951, when truce talks began and the front stabilized. Negotiations dragged on; fighting only halted at midnight on July 27, 1953. Though perhaps 2 million lay dead and the peninsula was devastated, the war settled nothing. The war ended in a truce, not a treaty, thus the north and the south are still technically at war.
What happened, post-war?
North Korea, possessor of the peninsula's industrial base and most of its national resources, remained part of the communist bloc. South Korea, though predominantly agricultural, employed guided capitalism under right-wing governments to forge powerful businesses. By 1970, South Korea had economically outpaced the North, and in 1987, achieved democracy. In 1989, communism collapsed across Eastern Europe and China embraced economic reform. North Korea did not and, lacking communist bloc support, fell into destitution.
Kim Il-sung, who had launched the 1950 war, died in 1994, and was succeeded by son Kim Jong-il. In the late 1990s, the isolated state was swept by famine. Perhaps 10 percent of the population died. Yet -- defying predictions -- North Korea neither changed nor collapsed.
Is North Korea the last hardcore communist state?
No. Pyongyang struck communism from its constitution in 2009. Informed observers compare North Korea to the militaristic Japan of the 1930s: It worships its leader like a god; prioritizes its military in all policies; feels threatened by the wider world; is virulently nationalistic; and is accused of abusing human rights.
Why are the two Koreas so hostile?
Neither side signed a peace treaty to end the war, only an armistice. Small-scale military clashes have flared along both land and sea borders over the last six decades. Each state aims to reunify the peninsula under its own system of government, though the South, mindful of the economic costs of reunification, is less vocal.
Is there any inter-Korean cooperation?
Between 1997-2008, two successive Seoul administrations nixed containment and confrontation, promoting instead a "Sunshine Policy" of engagement with North Korea. This bred inter-Korean summits in 2000 and in 2007 and the establishment of two South Korean enclaves inside North Korea: The Mount Kumgang tourism zone and the Kaesong joint industrial park. However, naval clashes occurred in 1999 and 2002, and it was during the "Sunshine" years that Pyongyang tested a nuclear device. In 2008, a conservative administration took office in Seoul and halted most humanitarian aid, pending de-nuclearization. Cross-border relations chilled. Kaesong is the last inter-Korean cooperation project still extant.
What are the Six-Party Talks?
In 1994, under the "Agreed Framework," the international community agreed to supply North Korea with light-water nuclear reactors on condition it mothball its plutonium-based atomic program. In 2002, Washington accused Pyongyang of running a secret uranium-based nuclear program; the 1994 agreement collapsed. In 2003, China chaired the first in a series of talks between itself, Japan, North Korea, South Korea, Russia and the U.S., aimed at denuclearizing the peninsula. Negotiations have been tortuous, progress slow, and North Korea remains a de facto nuclear state. Talks have been in limbo since 2008.
Why does China not pressure North Korea to behave?
China is the North's key trade partner, aid supplier and political supporter; Beijing still views its wartime ally as a critical buffer state on its northeast flank. So although China is increasingly commercially integrated with the Western world, strategic imperative has thus far trumped economic interest.
Why is the Korean peninsula of international importance?
Korea is strategically sited at the heart of Northeast Asia; set between China, Russia and Japan, it has been a frequent historical battleground. Seoul is threatened by North Korea's artillery, Tokyo by its missiles, and Pyongyang is believed to be designing missiles capable of reaching the U.S. Moreover, Northeast Asia is, after the EU and North America, the most prosperous zone of economic activity in the world. Hence, international financial markets, governments and militaries are all sensitive to Korea risk.
What is the likely endgame?
Who knows? North Korea is so opaque, and so often confounds analyses, that it could remain as is for decades, or could implode tomorrow -- perhaps due to power struggles following the death of Kim (born in 1941), who is reportedly in poor health and whose successor is not assured. While pundits hope for eventual reunification under Seoul's leadership, Beijing remains a wild card: South Koreans fear some form of Chinese takeover in the event of a North Korea collapse. Worryingly -- given North Korea's threatening behavior, nuclear arsenal and reluctance to implement significant reform -- few analysts predict a soft landing, whatever form the endgame takes.
Seoul-based reporter Andrew Salmon has been covering the Koreas for seven years. He is the author of the commercial history American Business and the Korean Miracle (2003) and Korean War histories To the Last Round (2009) and the upcoming Scorched Earth, Black Snow (2011).