August 14, 2012
China, North Korea Seek Better Economic Ties
Jang Song Taek, North Korean leader Kim Jong Un's influential uncle, is in China this week to discuss economic and trade ties. At a meeting on Tuesday, the two countries agreed to take further steps toward the opening of industrial economic zones along their shared borders.
Analysts say the trip, which will include stops in China’s northeastern border provinces of Jilin and Liaoning, is a sign the impoverished country is looking to open up its economy.
Xie Tao, a political scientist at Beijing Foreign Studies University, says that while Kim Jong Un’s father was hesitant to follow in China’s footsteps toward economic reform, North Korea’s new leader is taking a different approach.
“I think that Kim Jong Un's feeling is that his father's sort of rule, that put the military first, is something that can only make North Korea isolated. So he thinks that he wants to maintain on the political side a dictatorship or authoritarian rule, but on the economic side he wants to do reforms and opening up,” Xie said.
“This is similar to what Deng Xiaoping did in China, [creating] a kind of economic performance legitimacy to maintain the legitimacy of its regime,“ he added.
China’s state run Xinhua news agency says the two sides signed agreements Tuesday that cover the establishment and operation of management committees to help with the development of the economic zones - one in Rason (a warm water port on North Korea’s northeastern coast) and another on islands in the Yalu River along their shared border.
The agreements covered details such as electrical supply, and technical economic and agricultural cooperation.
A statement from China’s commerce ministry said that development on the islands on the Yalu River will focus on sectors that include information and tourism. At the Rason Special Economic Zone the focus will be on raw materials, equipment manufacturing, and high-tech goods.
In a report earlier Tuesday, China’s vice commerce minister, Chen Jian, said Beijing would lend its support to big Chinese companies looking to invest in North Korea.
Pyongyang relies heavily on China for economic support. Analysts estimate that trade between China and North Korea has boomed from roughly $300 million in 1999 to more than $3 billion in recent years.
China’s support for North Korea is believed to be partly based on a concerns that a severe collapse of the country’s economy could trigger a flood of North Korean immigrants across its border.
But helping North Korea open its economy also has its risks, Xie Tao says. China, he says, prefers an authoritarian and economically open North Korea that has cool relations with the United States and countries in the region. If North Korea takes major steps to open up its economy that dynamic could change.
“Once you develop the economy there is a much higher likelihood to dialogue with the U.S.,” Xie Tao said. “U.S. capital, technology, South Korea, Japan these are all things that relate to the U.S. China can provide a certain amount of technology, China now has a surplus capital looking for profits, but if you want to integrate in the international community you cannot play without the United States.”