Moody: “Little Possibility of North Korean Economic Reformation”

[imText1]Although North Korea has seemed to make efforts at economic reformation through the Gaesung Industrial Complex and the Shinuiju Special region, Moody’s Investor Service estimated that North Korea’s actions were not in earnest, and no internal economic changes have been made.

On May 22, an official of Moody’s Investor Service, a Credit Rating Agency, announced that despite Kim Jong Il’s visit to China early this year, North Korea did not show any indication of internal economic restructuring.

Vice-president of Moody’s, Thomas Byrne, gauged that it was unlikely that North Korea was moving towards economic reformation at the North Korean Economic Outlook Symposium held by the Institute for Corean-American Studies(ICAS) at the Rusell Senate Building.

Vice-president Byrne estimated that North Korea failed to adjust its currency and exchange rate, and its trade environment had not improved, so that the economic situation had worsened. Plus, he emphasized that North Korea did not display any sign of internal economic reformation.

About the Gaesung Industrial Complex, he said that, “If 5 more complexes like Gaesung Industrial Complex develop, it will be evident that North Korea is in the process of economic reformation, but at this point, the Complex is no more than a symbol”. He emphasized that if North Korea is committed to economic reformation, “it should follow the economic model of South Korea”.

Vice-president Byrne warned that if South Korea continued to support North Korea economically, it would soon face economic crisis.

He also stated that, “The difference between the approaches of South Korea and the U.S. is not extensive enough to make an impact on the credit rating of South Korea. South Korea always gets a lower credit rating than it otherwise would because of North Korea”.

Meanwhile, a special correspondent explained that North Korean-Chinese trader Lee Dae Kil (pseudonym, 49), who recently came back from North Korea, expressed a negative opinion about the North Korean economy.

Mr. Lee said that, “There has been little profit in spite of a fewe years of trade with North Korea. North Koreans trade only for living, not for profit. The North Korean government does not even make such efforts”.

Mr. Lee said that, “After it was discovered that the U.S. had blocked banks working with North Korea, dollar transactions sharply decreased. There were people who asked me what happened outside”.