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ECONOMICS Partisan analysis of North Korea’s economic shortcomings

Book review: Unveiling the North Korean Economy by Byung-Yeon Kim

Unveiling The North Korean Economy
by Byung-Yeon Kim
(Cambridge University Press, £28.99)  

NORTH Korea is a hard country to get to know. Most of the media tell of rigid state-control, malnourished people, child labour, shortages of electricity and water and the cult of personality.

A technological, political and military elite seem to live well in the capital, Pyongyang. Military spending on weapons systems and the nuclear programme are the.priorities of the government. Opponents of Kim Jong-un meet a quick end.

There is truth in these reports but not necessarily the whole truth. This book by Byung-Yeon Kim, an economics professor at Seoul University, is only interested in North Korea’s economic failures and its progress towards what he sees as the goal of a full market, capitalist economy.

Since the armistice with the South in 1953 it has imitated the centrally planned Soviet economy but with severely limited resources for investment, especially since the demise of the Soviet Union, its main supplier of oil, and there was a very serious food crisis in the mid 1990s.

Kim describes a rapid increase in the allocation of resources through private enterprise and the market mechanism, allowed by the state though not officially sanctioned, in contrast with South Korea which, with lavish US support, is a developed and fairly prosperous capitalist country.

It’s possible to discern in Kim Jong Un an inferiority complex, disguised by extravagant threats and a megalomania rivalling Donald Trump’s.

The missile tests, with the threat of nuclear bombs are a misjudged warning that North Korea is still a force to be reckoned with as tension rises with US incursions into the South China Sea.

The author explains socialist failure through factors ranging from lack of trained technocrats to the emphasis on moral incentives, especially mass mobilisation, instead of material ones.

Most people, he asserts, take part in the “informal economy” outside official working hours in order to survive.

Comparisons between the per capita GDP rates of the two Korean countries bolster the author’s assumption of the move to capitalism and union with South Korea and he sees Kim Jong Un as the most important factor in the transition.

Health problems or a fall-off in support for the regime could trigger power struggles and military conflicts and South Korean forces might enter the country “to maintain order.”

But Kim makes no allowance for the possibility that anti-capitalist beliefs, which must still exist in North Korea, could materialise as a force for socialism.

He equates China with capitalism but China’s great leap forward has seen a market economy strongly controlled by the Communist Party, which sees it as a means to achieve a socialist future and perhaps the ball is in China’s court.

A Chinese-type economic solution could yet confound the armchair gurus of Seoul.

John Moore


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