Understanding Kim Jong Un’s Economic Policymaking: Key Findings and Implications
All good things must come to an end, they say, and this is a chance, at the end of the project “Understanding Kim Jong Un’s Economic Policymaking,” to review what we tried to do, what we may have accomplished and the tremendous amount of work that remains to be done.
By reading and analyzing North Korea’s two premier economic journals—Kyo’ngje Yo’ngu and the Journal of Kim Il Sung University, also known as Hakpo—in depth, the project set out with the goal of shedding some light on how Pyongyang’s economic policy decisions are made and rolled out under Kim Jong Un from 2012-2020.
The breadth of this study was extensive, including Kim’s initiatives across the farming, enterprise and banking sectors, as well as tourism, economic development zones (EDZs) and foreign trade. It examined how these various reform-related initiatives were introduced and how sensitivities (and sometimes pushback) connected to reform initiatives were revealed. Across the board, a careful reading of the journals revealed the following: tensions between the traditional views of socialist principles and the more flexible, pro-reform interpretations; the challenges facing the regime as it pushes its reformist agenda; and both the extent to which the regime has been willing to go and its persistence over time to try to implement new ideas.
To wrap up this project, we are providing a summary below of five key findings from our research.
First, judging by articles in the journals, the Democratic People’s Republic of Korea (DPRK or North Korea) follows a particular pattern in rolling out new economic policies. New ideas do not simply appear out of the blue. The journals start by introducing the topics, signaling that Kim has issued some broad policy guidance that necessitated research on them. After studies have been conducted, new ideas have been tested in some units, viable plans have been identified and policy guidelines have been issued, the journals then go beyond general discussions and start explaining the new initiatives in more detail and advocating them with a range of arguments—some of which are highly abstruse, others more detailed and plainly stated—and, most importantly, how the new ideas can or should be operationalized.
Second, contrary to the widely accepted notion that all North Korean publications speak with one voice and toe the party line, the country’s two economic journals, particularly Kyo’ngje Yo’ngu, have served as a platform for internal discussions and often for differing views on new ideas and initiatives. It is inconceivable that dueling narratives on sensitive topics, such as economic reform, could be conducted without the concurrence, and more likely the backing, of various elements within the country’s leadership. Contending views may be more likely when a policy is still under discussion within the leadership, but there are times when these appear even after a top-level decision has clearly been made.
Third, the fundamental question of “economic management,” which is used in DPRK media as code for “reformist economic policies,” seems to boil down to finding the right balance between centralization (state and/or party control) and decentralization (greater decision-making for individual units). We continued to see contending narratives on this issue through the end of 2020, after which Kyo’ngje Yo’ngu was discontinued, thereby indicating that the Kim regime was still struggling at that time to find the right answer. Hakpo, since 2019, has published formal scholarly articles, a departure from the shorter essay-style writings it published through the end of 2018 that made this journal one of the two major platforms of economic policy discussions. Unless North Korea resumes the publication of Kyo’ngje Yo’ngu or changes the focus and format of Hakpo articles, it will be difficult to decipher the country’s intentions regarding the various economic policy issues. We will continue to have access to the North Korean party’s official economic policy through the dailies, but the dailies do not provide the behind-the-scenes discussions that inform decision-making or otherwise reflect Pyongyang’s dilemmas and challenges.
Fourth, North Korea’s push for tourism, EDZs, and foreign trade was not new when Kim Jong Un took power. What was different was how they became integrated into Kim’s broader push for new economic policies. It is hardly a coincidence that Kim called for promoting tourism and EDZs in the same speech where he formalized the concept of “economic management methods of our style.” In many ways, the North’s external economic measures were shaped by and built on the North’s domestic reform initiatives that explored new boundaries, even to the extent of supporting ideas that traditionally were thought “risky” or “too capitalist.” For example, some journal articles on tourism and EDZs presented a variety of steps to rejuvenate the North Korean tourism industry and attract foreign investors, ranging from removing or easing legal barriers to allowing the principle of supply and demand to take its course in lieu of central planning. In addition, multiple academic journals supported the diversification of trade, even with capitalist countries.
Fifth, there is no indication that Pyongyang is completely retreating on Kim’s earlier push for reform. North Korean media continue to mention “improv[ing] economic management” and “steadily perfect[ing] the optimized methods of economic management” at the highest levels. Nevertheless, there has clearly been a shift toward greater centralization in the past few years, and this shift has taken a toll on the North’s external economic policies as well. This was exemplified most recently by Kim Jong Un’s report to a party plenary meeting in December 2022, which essentially repudiated the import of foreign technology, something that in the past was accepted and even endorsed. Whether the renewed emphasis on economic centralization is temporary or represents a strategic decision with long-range consequences, only time will tell.
North Korea’s stance on economic reform is significant, not just for its domestic repercussions, but also for how it links with the country’s foreign policy. This is a critical area that needs closer study. Some of the questions to ask include: How were Kim Jong Il’s July 2002 economic policy reforms connected to the North’s diplomatic initiatives starting in the early 2000s? Are there links between Kim Jong Un’s diplomatic initiatives in 2014 and 2015 and the introduction of his measures in agriculture, enterprise management, and banking during that period? Were there diplomatic opportunities missed that could have been exploited with a better understanding of the North’s economic policy developments?
Perhaps the most obvious area that should be researched more thoroughly would be the connection between Kim’s pivot to diplomacy in January 2018 and Pyongyang’s declaration of the “new strategic line” of “concentrating all efforts on socialist economic construction” three months later, in April. One overall hypothesis to test might be whether Pyongyang has tried to improve its external security environment, which usually means improving relations with Washington, to provide better conditions for introducing new, reformist economic ideas. Should this particular situation present itself again, the question of whether there are specific diplomatic steps to take that go beyond the stale discussions of “carrots” or “incentives” that would be congruent with Pyongyang’s reform-oriented measures and utilize the momentum of North Korea’s own domestic economic policies should be more closely examined. If anything, our review of the journal articles on Pyongyang’s domestic reform measures and their impact on tourism, EDZs, and trade policy has reinforced the impression that there needs to be much closer consideration of the linkages between the North’s economic policy initiatives and its diplomacy. Identifying these domestic economic initiatives may help US policymakers to craft future policies that can both encourage and build on the momentum of these trends.
“경애하는 김정은동지께서 조선로동당 중앙위원회 2013년 3월전원회의에서 하신 보고,” Rodong Sinmun, April 2, 2013.
For more, see Robert Carlin and Rachel Minyoung Lee, “Understanding Kim Jong Un’s Economic Policymaking: Tourism as an Industry,” 38 North, July 26, 2022, https://www.38north.org/2022/07/understanding-kim-jong-uns-economic-policymaking-tourism-as-an-industry/; and Robert Carlin and Rachel Minyoung Lee, “Understanding Kim Jong Un’s Economic Policymaking: Rolling Out Economic Development Zones,” 38 North, December 21, 2022, https://www.stimson.org/2022/understanding-kim-jong-uns-economic-policymaking-rolling-out-economic-development-zones/.
For more, see Robert Carlin and Rachel Minyoung Lee, “Understanding Kim Jong Un’s Economic Policymaking: Foreign Trade Narrative,” 38 North, February 6, 2023, https://www.38north.org/2023/02/understanding-kim-jong-uns-economic-policymaking-foreign-trade-narrative/.
Political News Team, “Report on 6th Enlarged Plenary Meeting of 8th WPK Central Committee,” Rodong Sinmun, January 1, 2023; and “On DPRK Cabinet’s Work for Last Year and Tasks for This Year,” Rodong Sinmun, January 19, 2023.
“3rd Plenary Meeting of 7th C.C., WPK Held in Presence of Kim Jong Un,” KCNA, April 21, 2018.