[Viewpoint] Reform or ‘improvement’?

When North Korean leader Kim Jong-il died on Dec. 17 last year and his power was formally bequeathed to his youngest son Kim Jong-un, observers in South Korea and overseas showed high interest as to whether the reclusive communist state would embark on reforms or not.

Many said the young successor, who spent nine years in Switzerland, would likely start bold reforms, while others said he wouldn’t be able to do so because of the peculiar nature of the North Korean regime and the harsh environment outside the country. Reports are still rattling around that Kim is expected to begin reforms.

One of the first experts who predicted the possibility of reform was Park Jae-kyu, former minister of unification. Shortly after Kim Jong-il died, Park held a press conference and said he had heard from an aid that a study was ongoing in the North, with Kim Jong-un at the center, to adopt a Chinese-style reform policy. At the time, many experts at home and abroad made similar forecasts.

The North also responded positively to such predictions. In an interview with the Associated Press in mid-January in Pyongyang, Yang Hyong-sop, vice president of the Presidium of the Supreme People’s Assembly, said the country’s new leader Kim Jong-un was focusing on knowledge-based economics and paying attention to economic reforms of other countries, including China.

In February, the North Korea Strategic Information Service Center, a well-informed group about the North, quoted a high-ranking source in the communist country about its reform efforts. Since August last year through Kim Jong-il’s death, several manager-level and senior members of the Workers’ Party’s Organizational Department and economic policy and international liaison departments, as well as the cabinet, were selected to implement economic reform projects based on China’s model, the source was quoted saying. Under the reform plan, production facilities of factories and companies would have been rented to groups ? not individuals ? and the state would have collected a part of their profits at the end of a year, the source said.

In mid-April, Japan’s Mainichi Shimbun also reported about Kim Jong-un’s order to party officials made on Jan. 28, 2012. According to the report, Kim ordered officials “not to be afraid of introducing capitalist methods and finding ways to rebuild the North’s economy.” It reported that he urged the officials to speed up the reforms to improve the people’s lives.

The North also said on April 6 that Kim stressed to the workers of the party’s Central Committee to “bring all the problems caused by the economic crisis to the cabinet and create rules and orders to thoroughly resolve them under the direction of the cabinet.”

Time, an American weekly news magazine, also made a report about possible reforms, citing Kim Jong-un’s speech on April 15 at the 100th anniversary of his grandfather Kim Il Sung’s birth. In the address, the young leader said it is the party’s strong determination to make sure that the people don’t have to tighten their belts ever again and that they enjoy the prosperity and wealth of socialism.

Most recently, the Dong-A Ilbo reported Tuesday that small teams to prepare for economic management improvement were created under the cabinet earlier this year at the special order of Kim Jong-un. The newspaper said expectations are high that an economic reform measure will be issued in August or September.

The North has informed the outside that it is preparing a reform, and media from around the world are reporting the high possibility of the communist country’s transformation.

In fact, the North has suffered from a perennial economic crisis for decades, and there was never a time that economic reform was not a topic of interest. And yet, the country insists on the term “improvement” rather than reform. Despite the expectations of the outside world, it has rejected the concept of “reform,” in which the capitalist method would be widely introduced, including the private possession of a production means.

Instead, the country has focused on increasing the efficiency of management by loosening the centrally-focused state-planned economy, while giving more autonomy to each company, factory and farm to produce and distribute with more incentives.

The difference between “reform” and “improvement” is clear in the North. While it accepts the significant role of a market, where the price is decided based on supply and demand, it has never given up the principles of collectivity, the core of a socialist economy.

Will the North adopt the capitalist way this time, like the world expects? Will Kim Jong-un’s remarks that the officials should not be afraid of introducing capitalist methods be interpreted as a sign of a change? Most experts are pessimistic.

It does not mean that the North’s “improvement” is meaningless. The final destination of such improvements will inevitably be reform - and history has proven it. Of course, it is hard to expect that the North will see dramatic change in its political and economic systems, like what happened to the Eastern European countries in the 1990s. It will likely take a step similar to China and Vietnam, where the political system gradually changed in line with economic development.

Then, the North’s “improvements” deserve equal level of international attentions as “reform.” The time has come for us to seriously think about ways to give proper support to both.

The author is an editorial writer of the JoongAng Ilbo.

by Kang Young-jin