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Opinion / Op-Ed Contributors

DPRK on the economic reform path

By Hu Mingyuan (China Daily) Updated: 2013-12-09 07:19

A plenary session of the Workers' Party Central Committee in March had already urged regional governments to create special economic zones that suited their conditions. Later, the SPA Presidium passed a law on establishing, developing and managing EDZs, saying they would provide investors with favorable conditions for economic activities in terms of land use, hiring of labor and taxation. And on Oct 16, the SPA Presidium upgraded the General Bureau for State Economic Development to the State Economic Development Commission, in charge of promoting investment in EDZs.

These new developments show that Pyongyang attaches great importance to economic development, especially to the setting up of EDZs. Pyongyang also encourages private businesses to cooperate with foreign enterprises to attract more foreign investment and plans to set up larger central-level EDZs.

Every DPRK province is preparing to set up an EDZ, with hundreds of foreign-invested enterprises engaged in the industrial sector including machinery, electronics, light industry, aquaculture, pharmaceuticals, construction materials and food processing, as well as the service sector including communications, transportation, banking and catering.

The new initiatives taken by the DPRK in the economic field is the result of the combined effects of various factors. The country has for long been trying to develop its economy. And the results of some of its efforts have been remarkable.

The UN Security Council imposed further sanctions on the DPRK after it conducted its third nuclear test, which dealt a severe blow to its already floundering economy.

Perhaps the Security Council move made the DPRK realize that only economic reform could help it tide over the crisis. It is now trying to modernize its tourism facilities in North Pyongan and Kangwon provinces to attract more foreign tourists in order to earn foreign exchange to help overcome its economic woes.

There are signs that economic reform is quietly unfolding in the DPRK. But whether or not economic reform will become the DPRK's top priority depends on the determination and sincerity of the country's leadership, as well as on how its relations with the Republic of Korea and the US develop. The international community, too, has a role to play in keeping Pyongyang on the right track of economic reform.

A self-sufficient DPRK, moving toward opening up its economy to the outside world will play a crucial role in maintaining peace and stability on the Korean Peninsula. And this is the direction that all countries should help the DPRK take.

The author is an associate researcher at the Center for Northeast Asian Studies, a research institute in Jilin province.

(China Daily 12/09/2013 page9)

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