We’ve seen the collapse of the Eastern European socialist countries; China and Vietnam have succeeded in reforming and opening their systems; even Cuba recently stepped up modest reform measures. Libya’s President Colonel Ghadafi has declared that a market economy would operate starting next year. The reason? The socialist economic system which had been maintained since the revolution has not been operating effectively.
Accordingly, as North Korea commemorates the 60th anniversary of the founding of its regime, the possibility of North Korea opening up and reforming has been generating considerable interest. North Korea, while publicly advocating “Socialism in our own way” as the symbol of a self-reliant national economy, has put in place an ongoing reformist policy of limited scope since the establishment of the Rajin-Sonbong Free Economic Trade Zone in 1991, the opening of Mt. Geumgang to tourism in 1998, the promulgation of the Shinuiju Special Economic Zone in 2002, the founding of the Kaesung Industrial Complex and the implementation of the “July 1st Economic Management Reform Measure,” and the agreement for the Haeju special economic zone arrived at during the Inter-Korea Summit talks of October 2007.
Until now, North Korea has been showing interest in the successful economic developments in China and Vietnam. Kim Jong Il visited the Pudong region in Shanghai in January, 2001 and declared it a ‘cataclysm’,’ giving high praise for the results of Chinese reforms and the open door policy.
In October of last year, Kim Young Il, the North Korean Premier, visited Vietnam. Kim Jong Il was attracted to the success of this country, which is relatively small and weak, that grew out of its diplomatic isolation, normalized its relationship with the U.S., started market-based reforms called Doi-Moi and attracted foreign investment.
However, experts generally share the view that there is just a small possibility of North Korea actually opening up even though North Korea has expressed an interest in Chinese or Vietnamese policies.
During the March of Tribulation in the mid-1990s, despite giving economic development the utmost priority in order to resolve a chronic food shortage, the North Korean leadership regarded reforms and openness as the largest threat to the regime.
In particular, it has been pointed out that reform and openness cannot coexist with an absolute dictatorship. This also can be seen through Kim Jong Il’s apparent apprehension at the urging of President Roh Moo Hyun to open and reform during the 2nd Inter-Korean Summit.
Expert analysis is that North Korea, which is trying to catch two rabbits simultaneously—maintaining its regime and economic progress—will eventually fail in reforming and opening up. In order to do so, it is said that a change in the regime must precede it.
Dong Yong Seung, a researcher at the Samsung Economic Research Institute said, “The possibility of reform during Kim’s regime is slim because the Kim regime presumes that preservation of the regime would be difficult once the country opened up. It is highly possible that North Korea will attempt to restrict opening up domestically while maintaining the current Kaesung Industrial Complex and the Raijin-Sonbong Complex.
Park Young Ho, a Senior Researcher at the Korea Institute for National Unification, forecasts, “North Korea must attract foreign investment through political reform, but it has been timid and fearful in doing so. It will not be easy to reform before Kim Jong Il’s regime changes.
If the relations with the U.S. are normalized and subsequently international relationships and surroundings also change, North Korea can open and reform its system. To do that, North Korean denuclearization, certain political reforms, and the reformation of the investment environment must precede it. However, experts pointed out that on a practical level this looks very unlikely, given the attitude of the North Korean authorities so far.
Jung Gwang Min, a researcher at the Institute for National Security Strategy said, “North Korea’s opening depends on denuclearization. This must be carried out in order to resolve the economic sanction issue and the entry of international financial organizations. Most of all, the North Korean leadership must come forward with a clear position on the nuclear issue.”
Park emphasized, “We can create a positive environment for North Korea to open up and reform through changes in international cooperation, but it will not be easy if the leadership does not make a bold policy decision. North Korea needs to decide once and for all to open up and reform.
