Evaluating North Korea’s Economic Policy in the 2000s—Economic Cooperation with China Is an Inevitable Choice

Abstract

North Korean economic policy in the first decade of the twenty-first century was characterized by experiments with reforms followed by sharp reversals. The “7.1 Improvement Measures” economic recovery plan introduced by Pyongyang for its domestic economy was combined with some efforts by the country to open up its economy to foreign participation. However, as of 2006, these policies had been reversed and the North Korean government had launched a campaign to ban what it now labeled “non-socialist” development. Subsequently, in 2009, a fifth monetary reform was carried out, triggering market depression and further economic atrophy. By early 2010, North Korea had once again relaxed controls on market activity and sought to promote the development of light industry and agriculture. A new “Ten Year Strategic Plan for Economic Development” was formulated, accompanied by a stated goal of “opening the door to a strong and prosperous nation.” Building a strong and prosperous nation will remain the core of North Korean economic policy; gradual reform and opening up is the only way to realize this goal, and continuing to strengthen economic and trade cooperation with China is an inevitable choice in its foreign economic policy.