N. Korea seeks China ties to balance warmer relations with Soviets. Economic aid seen as top priority in President Kim's Peking visit

When North Korean President Kim Il Sung steps off the train in Peking today, it will mark another swing in his foreign policy back toward an old friend and comrade in arms. After several years of warmer relations with the Soviet Union, with which North Korea shares a common border, President Kim has found it useful to restore the balance by improving his ties with China.

This is his first visit to China since an unpublicized trip in November 1984 and it comes at a time when the Chinese leadership is inclined to give him the welcome he has requested.

East European diplomats said Mr. Kim has asked for the old-fashioned, socialist, red-carpet treatment - cheering crowds, slogans extolling North Korean-Chinese friendship, children with flowers, and thousands of people lining the streets to greet him.

This is the kind of reception the North Koreans orchestrated for Communist Party Secretary Hu Yaobang during an official visit in 1985 and for Chinese President Li Xiannian last year.

Before agreeing to the visit, diplomats also say Kim asked for confirmation that acting Party Secretary Zhao Ziyang would continue in his post as head of the Communist Party after the Party's 13th Congress later this year. The Chinese reportedly assured them he would.

Peking observers say there are many things on the agenda during Kim's one-week stay in Peking, including additional economic assistance and a complex set of political questions.

The economic issues are no less urgent than the political pressures on officials in Pyongyang, the North Korean capital, to ease the country's isolationist attitude toward the outside world and seek less hostile relations with South Korea.

The North Korean economy has been stagnant for several years and the country is no longer able to feed itself.

One frequent visitor to the country said that, by the most optimistic assessment, Pyongyang's last seven-year plan which ended in 1984 fulfilled only 55 percent of its targeted growth.

And the current plan, which began last year, has not gotten off to a good start. North Korea imports rice from Thailand and wheat from Australia, though it has little foreign exchange to pay for such purchases.

North Koreans have claimed that the poor performance in agriculture was the result of bad weather. According to one visitor, however, Soviet experts in Pyongyang have said the problems are in the organization of agriculture which offers no incentives to farmers.

Observers say China has been dissatisfied with Kim's economic policies.

Pyongyang announced some economic reforms several years ago and a joint venture law for foreign investment, but these measures appear to have been abandoned since they did not bring quick results.

China has reportedly refused to include financial grants in aid to its ally and has required more effective use of other types of aid.

China may now be ready to increase its dwindling economic assistance. And China may also be willing to compromise, at least temporarily, on its rapidly growing economic relations with South Korea.

China's indirect trade with South Korea in 1986 is estimated at $1 billion, compared to only $300 to $350 million with North Korea. South Korean investment funds have found their way to China through joint-venture companies, especially in the special economic zone of Shenzhen.

Peking also reportedly has refused to sell advanced fighter aircraft and other military equipment.

This refusal caused the North Koreans to turn to the Soviet Union several years ago for military assistance, a step which provided the Soviet Navy with access to North Korean ports and a closer military relationship.

Kim hosted the head of the Soviet Navy last week and has received other high-level Soviet military leaders in the recent past.

The question of the 1988 Olympic Games, to be held in South Korea, is expected to come up. One source said that Kim will try to persuade China to boycott next year's Olympic Games. However, no one expects China to agree. China's participation in international sports is an important prestige factor for the country and China has openly expressed interest in hosting the games in the year 2000.

Kim may also want to discuss with his hosts minor changes in United States policy on the Korean peninsula, which has included a lifting of a ban on social contacts between US and North Korean diplomats.

The North Korean leader still considers the US to be his most important adversary.

Peking observers say relations between Pyongyang and Peking began to improve after Communist Party Hu Yaobang was dismissed in January.

One source said that North Korea was irritated by Hu's handling of ideological problems and his ``excessive opening to the West.''

North Korea has cracked open its own door to the outside world, however, and is now trying to build up a tourist trade.