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Introduction and Overview

Can the economic system of the Democratic People’s Republic of Korea (DPRK, or North Korea) be successfully reformed? That is to say: Is it possible for contemporary North Korea, with its autarkic, hypermilitarized, and ostensibly centrally planned economic structure (institutions and arrangements, one must note, whose post–Cold War performance has been so woe- ful that the nation suffered peacetime famine in the middle and late 1990s), to move toward and eventually embody an economic regimen akin to the ones that have permitted so much material progress in East Asia’s two exemplars of “reform socialism”—China and Vietnam—over the past generation?

Could the rulers of the North Korean state maintain control if the economy under their command evolved from the current variant of “socialism with Korean characteristics” into something with a more peaceable, pragmatic, market-friendly, and internationally open orientation? Can North Korea’s highest authorities seriously entertain the notion of inculcating a comprehensive, far-reaching refashioning of what they formally and officially extol as “our own way of socialism” [urisik sahoejuii]? Do they entertain such notions today?

If North Korean authorities did determine to undertake such a transformation, would they be expected to possess the know-how necessary for such a venture? Are there resources—intellectual, institutional, financial—that outside parties could provide that might improve the odds of success for an incipient North Korean economic reform? And, if so, under what conditions — and conditionalities—might those resources most prudently be offered?

This volume attempts to examine these questions in a detailed, rigorous, and systematic manner. The following chapters address the status and outlook for the North Korean political economy; the likelihood of an official DPRK shift toward economic pragmatism, and the practical pitfalls any such move would encounter; the record and lessons of economic liberalization in socialist and post-socialist economies and development assistance initiatives in such locales; the identification and analysis of key sectors of the North Korean economy, whose revitalization might be abetted through outside efforts; the prospects for an international mobilization of private and public capital in the service of North Korean economic reconstruction; and the role that particular external stakeholders might be expected to play in such a venture. Each of the chapters in this book addresses one aspect or another of the North Korea economic reform problematik; taken together, they present an in-depth perspective on the issues that would have to be faced if the international community were to resolve to support the economic reform process in North Korea through comprehensive—but also selective—commitments and investments.

As readers will quickly see, the specialists we have assembled—all authorities in their respective fields and areas—do not speak with a single voice about the prospects for North Korean economic reform or the odds that such re- form could be bolstered through an external framework for international cooperation. On many critical points, our authors take issue with each other; at more than a few points, the reader will encounter powerfully argued but strikingly discrepant judgments about the questions we pose at the outset of our introduction.

We do not believe this well-informed controversy is a bad thing. Quite the contrary: In our view, it is precisely on such an elevated and varying intellectual terrain that the quest to understand the possibilities and pitfalls of encouraging North Korean economic reform may be more fruitfully pursued.

While it may be the case that none of the basic questions we pose about North Korean economic reform can as yet be said to have a clear and definitive answer, it is also clearly the case that attempting to get the answers to each of these questions right—or close to right—is more than an abstract academic exercise. These days, in fact, the actual, real-world answers to those several questions qualify as high-stakes propositions for a great many inter- ested parties, including the people of the Korean peninsula, the neighboring regions of Northeast Asia, and a number of peoples and places more geographically removed from the locus of such inquires but nevertheless still directly affected by the dramas these inquiries reflect. Indeed, the reformabil- ity of the North Korean economic system is now an issue absolutely central to the future security and prosperity of Northeast Asia.

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