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NK Briefs

공지사항
Title Kim Jong Un Stresses the Principles of Market Economy through ‘May 30th Measures’ Date 2015.01.15
Attach 150107_NK Brief_(KJU New Year Speech Prospects for 2015 Economic Policy)(1).pdf
In a January 8, 2015 article publish by the Choson Sinbo (a pro-North Korean newspaper in Japan), the North Korean economy was described as a “flexible collectivist system,” adding that “Choson’s (North Korea’s) socialist economy promotes the establishment of a collectivist system that can flexibly respond to the current development.”

The news article explicated that this system is “under the plan and unified guidance of the state which guarantees the socialist enterprises to achieve economic development through ensuring active and evolutionary actions.” This hints at North Korean leader Kim Jong Un’s plans to continually promote a somewhat relaxed socialist planned economy in the future.

Since Kim Jong Un came to power, his regime has taken action to change the management structure and expand the autonomy (and incentives) of enterprises and farms, inter alia. Such changes can be interpreted as North Korea’s moves to highlight the flexibility of the system and the independent actions of economic agents.

The Choson Sinbo article continued: “By adhering to socialist ownership and strictly following objective economic laws in economic guidance and management, rational and just economic space will be created.” It added that “the ultimate conclusion in the establishment of our-style of economic management system is the improvement of people's living standards.”

According to the article, “Kim Jong Un announced a historic measure regarding the establishment of ‘our-style economic management method’ in May 2014.” This seems to confirm that the recent economic policy announced in North Korea was headed by Kim Jong Un. (Note that in his 2015 New Year Address, Kim Jong Un also emphasized the need for the Cabinet, state, and Party organizations to “make proactive efforts to establish the economic management method of our style,” suggesting it as an important task of 2015.)

Until now, there was only speculation that North Korea had plans to expand elements of the market economy and widen the scope of the policy target. The speculation was based on last year’s announced ‘May 30th Measures’, the details of which were vaguely known. However, this recent article by Choson Sinbo seems to support the certainty of this policy.

The newspaper further elaborated the importance of North Korea’s ‘parallel policy of nuclear and economic development’, but also emphasized the regime’s focus on improving people's living standards through the “defense industry’s lead to develop the science and technology sector and introduce its achievements to the economic sector associated with people’s livelihoods.”

In regards to the recent US sanctions against the DPRK following the Sony Pictures hacking incident, the news article explained that North Korea was embarking on a variety of strategies -- such as seeking multifarious development of foreign economic relations, realizing various trade transactions, increasing the ratio of domestic goods (versus imported goods) of raw materials and equipment -- in order to minimize the impact of the US sanctions against the DPRK economy.

The news article concluded that North Korea is not likely to give up its current ‘parallel policy’, despite the foreign threats. Rather, in response to the threats, the DPRK is developing existing foundations of the self-supporting economy in order to be self-sufficient in raw materials and equipment and improve the ratio of domestic goods to imported goods.
 
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