North Korea’s self-reliance economy

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President Kim Jong-un says, “Let’s reject non-socialist elements.”It is much more relaxed expression than to reject capitalist elements. However, if the expression of ideology comprehensively suppresses the heads of North Korean economic officials, no quality ideas will come out. Although there are differences in degree, the economic model of this era cannot escape capitalism. It is the same even if North Korea maintains a self-reliance economy centered on domestic demand.

 

Although it has been expressed passively, the idea that North Korea will completely give up its nuclear weapons is almost a delusion. The reason for this is an issue accompanied by the historical, geographical, and diplomatic relations of Northeast Asia that cannot be trusted. Rather, based on the principle that the country that causes the economy is bound to be peaceful, creating the economy in a independent way may be the way to lay the foundation for strong national construction in the future.

If the North Korean economy can grow ‘connected’ with the outside world, it will have a strong upward effect on the global economy, which has been stagnant since the Corona crisis. However, concerns over North Korea’s nuclear program will overwhelm optimism.

 

North Korea needs to reduce its conventional military capabilities, including troops, weapons and military production facilities, by 30 percent and divert them as the foundation for civilian economic development. The method of reducing conventional military power would be a good method of first-in-first-out election. The vast conventional military power is a great opportunity cost for economic development. North Korea should calmly analyze the cost benefits of conventional military power and examine its efficiency. Futhermore, the reduction of conventional military forces will give a message that it aims for peace.

As always in the early stages of economic development, North Korea should start with labor-intensive industries. If the foundation for heavy industry by the development of the military industry is already in place, it will be a bonus.

 

After grappling with the problem of unemployment for years since we first took office in 1959, all of us in the cabinet knew that the only way to survive was to industrialize. We had reached the limits of our entrepot trade. The outlook was a further decline. Confrontation from Indonesia was still on and the Malaysians were determined to bypass Singapore. We cast around for solutions and were willing to try any practical idea that could create jobs and enable us to pay our way. One of our soft drink manufacturers suggested to me that we promote tourism; it was labour-intensive, needing cooks, maids, waiters, laundrymen, dry-cleaners, tour guides, drivers and makers of souvenir handicraft. Best of all, it required little capital.

- omission -

 

To my relief it did create many jobs and put coins into many empty pockets. It reduced but did not solve the unemployment problem.

 

For that, we concentrated on getting factories started. Despite our small domestic market of too million, we protected locally assembled cars, refrigerators, air-conditioners, radios, television sets and tape-recorders, in the hope that they would later be partly manufactured locally. We encouraged our own businessmen who set up small factories to manufacture vegetable oils, cosmetics, mosquito coils, hair cream, joss paper and even mothballs! And we were able to attract Hong Kong and Taiwanese investors to build factories for toys, textiles and garments.

 

- [From Third World to First] by Lee Kuan Yew -