North Korea wants foreign investment, despite executions

North Korea says it still wants foreign investment, even though Chang Song-thaek, the uncle of current leader Kim Jong-un, was executed this week, along with two of his right-hand men, an official has said.

Experts both within North Korea, as well as in South Korea, China and Japan say that the country’s fragile economy desperately needs foreign investment.

Chang Song-thaek, who was married to Kim Kyong-hui, the current leader’s aunt, was a key figure in the country’s economic policies and a mentor when the new leader took over from his father. He was considered the second most powerful man in the country.

Mr. Kim’s aunt is said to be safe and not under any threat of being purged like her husband was. She was recently named on a state funeral committee.

Kim Kyong-hui is one of the children of Kim II-sung, the founding leader of the North Korean dynasty, making her virtually unassailable.

Rumors are growing that she may have been involved in getting rid of her husband.

North Korea purge widening

Mr. Kim’s latest purge is a move to consolidate power. When purges occur in North Korea, diplomats, security agencies and politicians around the world wonder how fragile the country has become, not only economically but also politically.

North Koreans on business missions in China have been called back home. Many of them are seen as allies of Chang Song-thaek.

There are growing fears among North Korea’s neighbors that these recent signs of internal instability may lead to threats of military attacks abroad, which from a nuclear-armed state is serious cause for concern.

The Associated Press agency quotes a senior member of the state economic development committee, Yun Yong Sok, who emphasized that recent developments have not affected North Korea’s trade goals.

Yun Yong Sok said “Even though Chang Song-thaek’s group caused great harm to our economy, there will be no change at all in the economic policy of the Democratic People’s Republic of Korea. It’s just the same as before.”

North Korea wants provincial economic zones

In November, North Korea expressed an interest in setting up provincial economic zones with incentives for foreign investors and tourists.

Until the country abandons its nuclear arms program, there is unlikely to be any possibility of attracting international investors or making trade deals.

World reaction

During his trip to Vietnam, US Secretary of State John Kerry said the execution of Mr. Kim’s uncle is “an ominous sign” in an interview with ABC Television.

John Kerry said:

“This is the nature of this ruthless, horrendous dictatorship and of his insecurities. It’s an ominous sign of the instability and of the danger that does exist.”

China, North Korea’s only ally, gave a muted and guarded response. Chinese Foreign Ministry spokesman Hong Lei said2 “As a neighboring country we hope for North Korea to maintain stability, economic development and a happy livelihood for its people.”

South Korea’s Unification Minister, Ryoo Kihl-jae said “Generally in the past we have seen that the efforts to crackdown on internal insecurities then lead to external provocations. We are paying close attention to such a possibility this time as well.”

South Korean President Park Geun-hye said in a Cabinet meeting “North Korea is now engaged in a reign of terror while carrying out a massive purge to consolidate the power of Kim Jong Un.”

British Prime Minister David Cameron’s official spokesman said of the execution4 “It is another example of the extreme brutality of the North Korean regime.” Hugo Swire, British Foreign Office Minister added “We are deeply concerned to learn of the execution. This is another example of the brutality of the North Korean government, and we have consistently raised concerns about severe and systematic human rights abuses.”

How do North and South Korea compare?

Economically, South Korea is lightyears ahead of North Korea. Below are some figures:

North Korea

  • Population – 24.5 million.
  • GDP – $12.4 billion.
  • GDP per capita – $506.

South Korea

  • Population – 50.2 million.
  • GDP – $1.198 trillion.
  • GDP per capita – $26,000.

South Korea’s economy is 96 times greater than that of North Korea. North Korea’s greatest threat is its nuclear capability combined with an unpredictable regime.