By Benjamin Katzeff Silberstein
Curtis Melvin and Andray Abrahamian have published a new report on the progress (and lack thereof) of North Korea’s Special Economic Zones. Overall, the message seems to be that things aren’t exactly proceeding smoothly. One of the main impediments is still that North Korea’s institutional environment isn’t showing signs of improving much. But not all hope is lost. Particularly on the local level, there seem to be a strong ambition to make the zones work:
Overall, although the Kim regime may be promoting special economic zones as a key piece of its economic development strategy, there is still a long way to go to make these zones successful. Certainly, the North’s strained political relations bring about serious financial and reputational challenges to attracting foreign investment; however, it is not the only impediment to success.
Inconsistent and unreliable communication about plans for the zones and a lack of strategic planning for attracting either domestic or international investment reflect limitations of the North’s domestic economic policymaking capacity. Despite these structural challenges, localized efforts are underway to try to make individual zones work. For instance, teams from Wonsan and Unjong have begun experimenting with outreach and marketing. They are also trying to create more comprehensive development plans and organizations. Around Sinuiju, there are at least two significant construction projects well underway, reflecting a desire for cross-border cooperation in that region.
The unfinished new Yalu Bridge, however, stands as a reminder that the success of most of these zones depends heavily on the DPRK’s relations with its neighbors. In particular, Wonsan and Rason eagerly await better days. Until they arrive, Rason will continue to putter along; domestic capital and visitors may have only a small impact on the Wonsan area; and smaller projects, like the newly announced Kyongwon Economic Zone, will likely remain largely undeveloped for the foreseeable future.
Read the full report here:
North Korea’s Special Economic Zones: Plans vs. Progress
11-24-2015
Andray Abrahamian and Curtis Melvin
38North
