Date
24 September 2018
People in Pyongyang take part in celebrations marking the 70th anniversary of the founding of North Korea. In contrast to previous events, there were no displays of long-range missiles during the military parade last weekend. Photo: KCNA via Reuters.
People in Pyongyang take part in celebrations marking the 70th anniversary of the founding of North Korea. In contrast to previous events, there were no displays of long-range missiles during the military parade last weekend. Photo: KCNA via Reuters.

Why N Korea’s Kim may be really serious about economic reforms

On Sept. 9, North Korea celebrated the 70th anniversary of the nation’s founding with much aplomb and fervor.

Yet this time the routine military parade held in Pyongyang only featured conventional weapons and the elite goose-stepping formations, while the intimidating ICBMs were totally left out of the picture.

Apparently, Pyongyang avoided saber-rattling this time because it didn’t want to provoke the international community.

Instead, a highlight of the celebration was a visit by Li Zhanshu, chairman of the National People’s Congress Standing Committee of China and special envoy of President Xi Jinping, to meet Kim Jong-un.

There is a view that the reason why Xi didn’t go to Pyongyang himself as widely expected is that he didn’t want to provoke the United States either.

Some commentators viewed the developments as signs that Pyongyang wants to focus its energy overwhelmingly on economic development in the days ahead, rather than on nuclear programs.

Now, we come to this question: should we really take the North’s friendly posture over the past weekend seriously?

There were substantial grounds to harbor doubts. It is because after the historic Trump-Kim summit held in Singapore in June this year, North Korea is yet to take any solid action on denuclearization.

Dismayed at North Korea’s foot-dragging over giving up its nukes, Trump recently cancelled a scheduled visit of Secretary of State Mike Pompeo to Pyongyang.

Again, we come to the question: is North Korea’s seemingly serious commitment to developing its economy, instead of its nukes, really genuine?

In our opinion, the recent completion of the Ryugyong Hotel can serve as a clue.

For years, this pyramid-shaped structure has remained the undisputed landmark of Pyongyang city.

The building project was first launched in 1987. If it had been completed in 1989 according to schedule, the hotel would have become the tallest skyscraper in the world at that time.

Unfortunately, the ambitious hotel project had been plagued by serious delays, underfunding, power outages and cost-overruns since its early days of construction. As a consequence, the entire project soon ground to an indefinite halt.

The unfinished hotel, which was rated by a travel and lifestyle website under CNN as Number 1 of the world’s top 10 ugliest buildings back in 2012, became such a huge embarrassment for the North Korean government at one point that it simply wiped it off from the map of the Pyongyang city.

Nevertheless, after almost 30 years of delays, the Ryugyong Hotel was finally completed and open for business on July 27, 2017, in a rather low-profile fashion.

Yet news of the hotel’s opening received very little coverage from the global media, mainly because Pyongyang test-fired another ballistic missile on the following day into the exclusive economic zone of Japan.

As a matter of fact, even if Pyongyang had managed to complete the Ryugyong Hotel in 1989, it would probably have become just another “haunted house”, given the fact that back in those days, the annual number of foreign tourists visiting North Korea only stood at a thousand or so.

Nonetheless, 30 years on, today North Korea is receiving some 100,000 foreign holidaymakers every year, which means the 105-storey Ryugyong Hotel that provides more than 3,000 rooms can finally have the opportunity to fulfill its full economic potential.

As Kim Jong-un managed to complete the Ryugyong Hotel, something that both his father and his grandfather failed to achieve, it may serve as a strong indication of his determination to embark on full-scale economic reforms.

Besides, the fact that Kim has been frequently visiting manufacturing plants and farms across his country in recent months and reprimanding local officials for having failed to meet official economic targets may well be another indication that he is really serious about improving the quality of life of his people.

After all, North Korea is itself like an unfinished building, and there is certainly a lot of work to do.

This article appeared in the Hong Kong Economic Journal on Sept 10

Translation by Alan Lee with additional reporting

[Chinese version 中文版]

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JC/RC

Hong Kong Economic Journal

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