Ex-premier’s return could portend economic reforms


In the middle of an escalating military crisis on the Korean Peninsula, North Korea’s appointment this week of an economic reformer as its new premier struck a discordant, and possibly optimistic note.

The promotion of Pak Pong Ju, 74, is notable not only for the fact that he has served as prime minister before, but also because he was fired from the post in a backlash against the economic reforms he once spearheaded.

His reappointment is therefore being interpreted as a possible indication that North Korea’s young leader, Kim Jong Un, is serious about turning around the North’s moribund economy.

When Kim’s father, Kim Jong Il, died in December 2011 he left a country in dire economic straits — the result of a “military first” policy that fed an ambitious missile and nuclear program at the expense of a starving population.

Some observers initially saw a glimmer of reformist hope in his Swiss-educated heir who, soon after he took over, made several public statements on the need to improve living standards.

Instead, Kim Jong Un has followed his father’s lead, overseeing a long-range rocket launch, a third nuke test and engaging in an intense bout of brinkmanship.

But on Sunday, Kim presided over a meeting of the ruling party’s top leadership that formulated a “new strategic line” of simultaneous economic and nuclear weapons development.

State media touted this as an organic progression from Kim Jong Il’s military-first strategy.

Where, if anywhere, it will lead is still unclear, but Pak’s appointment could be viewed as an attempt to give the economic side of the dual policy some weight and credibility.

A senior South Korean government official Tuesday cited the selection of a premier “with an economic background” as a sign of North Korea’s “willingness to engage” in genuine economic development.

“But whether it’s really a good sign is something we have yet to see,” the official said in a briefing for foreign reporters.

Jeung Young Tae, an analyst at the Korea Institute for National Unification in Seoul, said Pak’s promotion might only be symbolic, “but it’s a symbol that mirrors the need for economic construction” outlined at the party meeting.

“It suggests, albeit to a limited degree, that the North may be wanting to create a more efficient internal economic system,” Jeung said.

Pak, who served as prime minister from 2003-07, is best known as the architect of Chinese-style market reform measures issued a year before he assumed office. The measures envisaged changes in food distribution and price-fixing mechanisms and more autonomy for state enterprises.

As premier, Pak was responsible for pushing these reforms, which prompted the emergence and spread of private markets.

But influential officials in the party and military viewed such reforms as a threat, and a backlash ensued that included a disastrous, inflationary currency reform intended to wipe out the profits of the new private traders.

Pak was suspended from duty in June 2006, fired the following year and, according to some reports, was sent to manage a clothing factory outside Pyongyang.

Jeung suggested that Pak’s experience in the wilderness may well have curbed his reformist zeal. “It certainly won’t be easy for him to advocate the same sort of dramatic economic reforms that may jeopardize his political standing again,” Jeung said.