Pyongyang’s Economic Resolve.docVIP

Pyongyang?s Economic Resolve During his unofficial visit to China January 10-18, North Korean leader Kim Jong Il traveled extensively in the country, touring about a dozen enterprises and institutes in the fields of industry, agriculture, science and technology, and education. While congratulating China on its achievements, Kim sent an encouraging signal: North Korea also attaches great importance to economic expansion and is ready to enhance its exchanges and cooperation with China so as to explore a development path in line with North Korea?s national situation, the official Xinhua News Agency reported. Kim?s vows to focus on economic development have provoked widespread interest in the prospects for the North Korean economy, something that not only affects the stability of the Korean Peninsula but also bears on Northeast Asian economic cooperation. Continued reform Despite the unrelenting security pressure it has faced since the end of the Cold War, Pyongyang keeps cautiously exploring an economic path under the new circumstances. Its efforts in this regard are likely to last well into the future, partly because it has to adapt to the changing international economic landscape and partly because its policy makers have demonstrated the will to do so. In the 1960s, North Korea?s Soviet mode of economic structure and management played a significant role. However, after that, especially since the end of the Cold War, it has been found lacking in the context of the rapid development of the high technology and information industries today and the overwhelming trend toward globalization. Drawbacks, such as an unbalanced economic structure, inefficient resource allocation, limited agricultural production and weak innovation capacity, have become evident. Given these severe bottlenecks, Pyongyang has no choice but to readjust its economic mode toward greater openness. Pyongyang has to adopt some elements of a market economy in order to have economic coop