North Korea is recording extremely poor rates of economic growth and refusing to reform, while placing its planning emphasis on munitions and heavy industries which will only make the situation worse, says Hong Yang Ho, South Korea’s Vice Minister of Unification.

Hong was speaking at the 2009 Fall Seminar sponsored by the North Korea Economic Forum on the 3rd. He explained, “Under the banner of self-revival, North Korea has passively resisted outside reforms and gone forward with Military-first politics, emphasizing munitions and heavy chemical industries. This has resulted in significant deterioration in areas directly related to industrial production and the lives of civilians.”

Vice Minister Hong also noted, “North Korea, in response to domestic and external crisis situations, launched the 100-Day Battle straight after the 150-Day Battle, but skepticism is high as to the effectiveness of these campaigns.”

He elaborated on North Korea’s economic situation, “After recording negative growth in the 1990s, North Korea’s production base collapsed and its capacity for economic self-revival was almost lost. In the 2000s, it recorded a low domestic and external annual growth rate of just 2 percent.”

“First and foremost, the North should expand its external trade and ability to attract foreign capital by selecting an export-led industrialization strategy with a focus on labor-intensive manufacturing industries; against this backdrop, an economic development strategy which intensively pursues high-tech industries is needed,” he claimed.

He then emphasized, “The most important factor in North Korea engaging in serious cooperation with the South while achieving incremental progress and overcoming its difficult economic situation is a decision to swiftly abandon nuclear weapons.”

He added, “If the North abandons its nuclear weapons and takes the path of genuine reform and opening, then it will be able to receive economic support from the international community and improve relations with countries such as the U.S., Japan and South Korea. The Lee Myung Bak administration has also stated that it is ready to cooperate with the North in areas such as economic, educational, financial and infrastructure improvements if it decides to abandon its nuclear weapons once and for all.”

“Our government is prepared to help the North and can only hope that it swiftly comes to a reformed position.”