Economics, Politics and Public Policy in East Asia and the Pacific
Author: Leonid Petrov, University of Sydney
Last week once again demonstrated to the world the sad truth about the inability of Northeast Asian nations to establish good working relations in political and economic spheres.
The ambitious plan to build a free trade zone across China, South Korea and Japan was pompously declared, only to stumble over old unresolved issues. Read more…
Author: Leonid Petrov, ANU
On the heels of the recent UN Security Council Resolution, which pursued tough new sanctions against the Democratic People’s Republic of Korea (DPRK) for blasting a long-range missile and detonating a second atomic bomb, North Korea has moved aggressively against the last remaining zone of inter-Korean economic cooperation, the Gaesong Industrial Complex (GIP).
On June 11, the North Korean Central News Agency (KCNA) announced the nullification of all contracts on rent, salaries and taxes adopted for industrial park in Gaesong. Pyongyang wanted the minimum monthly wage raised four-fold (from US$75 to $300) and demanded an immediate lump-sum land lease payment of 500 million.
Pyongyang asked Seoul to empty the industrial estate unless the money was paid. This notification came after the two Koreas were wrangling over the release of a South Korean worker who was detained by the North Korean authorities for alleged anti-DPRK statements and inciting and DPRK citizens to defect.
Author: Leonid Petrov
Two American journalists, Euna Lee and Laura Ling, who were arrested on March 17, 2009 on the Sino-North Korean border, appeared before the Democratic People’s Republic of Korea’s (DPRK) Central Court. They were sentenced to 12 years in a labour camp for illegally crossing borders and for espionage activity.
What prompted such a harsh sentence, and what does Pyongyang want the international community to make of all this?
Author: Leonid Petrov
These days North Korea is heading for a major retreat, back to Military Communism. Only those elements of market economy which are necessary to keep the country afloat are being preserved. The economic policy of partial liberalization, which started on 1st July 2002 waned in mid-2005, and is now a history. The old patterns of central economic planning, public distribution system, and strictly controlled market activity are back in place. This might be surprising to those who expected from North Korea to open up and become a transitional economy, but its current economic policy attests to the contrary. We do not know whether this retreat had been planned from the start, but already in 2004 the North Korean authorities were talking openly about this possibility.
Kim Jong-il’s ill health became apparent in October 2007 during the summit with Roh Moo-hyun. In November-December 2007, active anti-market actions were launched in North Korea. This was the time when Chang Sun-taek, Kim’s brother in law, was promoted to the newly created post of first vice-director of the Korean Workers’ Party, with oversight responsibility for the police, judiciary, and other areas of internal security. He was sent to the border area with China to “clean up” smuggling and speculation. Read more…