The rumored reformation of North Korea – Part 1

While Kim Jong-un is often presented in the Western media as a comical, menacing, and an erratic person, this description is misleading. The young North Korean ruler might have a penchant for bizarre clothes and haircuts, and he may also be prone to outbursts of anger, but his economic policies have been remarkably consistent – until recently.

Soon after his ascent to power, he began to slowly steer his country towards something akin to a market-oriented reformist policy, not unlike the policies of Deng Xiaoping in the early days of the Chinese reformation. Recently, however, the line has changed, and the tempo of reforms has dropped significantly.

The reforms began in 2012 when the country’s agriculture was partially switched to a household-based model. Since 2013, North Korean farmers, who for many decades have worked for fixed rations, received 30 percent of the total harvest. In 2015, that figure is expected to double to 60 percent. The new system has made farmers work harder and take greater responsibility, and the results have been quickly visible: both 2013 and 2014 were marked by bumper harvests. Even a grave drought in the spring of 2014 failed to negatively impact the recovery of North Korean agriculture.

Simultaneously, the North Korean government took measures to attract foreign investments. Some 20-odd special economic zones were created.

The next step was expected to happen this year. State-appointed managers would acquire a level of freedom very similar to that of private entrepreneurs in regular market economies. The new management system was supposed to be implemented across the entire country starting in 2015, with nearly all industrial enterprises switching to the new model. But it did not happen.    Continued

This entry was posted in China, DPRK Government, Humanitarian Aid and Relief, Kim Jong Un by Grant Montgomery.