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North Korea’s Economic Zone, Rason, Yet to Flourish

in International Business

North Korea’s Economic Zone, Rason, Yet to Flourish

Over the past two years, North Korea’s leadership has made attempts to transform Rason into an international hub and attract foreign investment into the region.

Jang Song Thaek, a senior official and uncle of leader Kim Jong Un, led a visit to China to discuss joint cooperation on developing economic zones along the border in an indication that the project has the attention of top officials.

A diorama of how Rason International Commercial Trade Center would look like in years to come has been produced—consisting of modern buildings sparkled with lights and streets garnished with trees.

Whether that vision turns out to be real depends in large part on whether China comes through with the electricity, supplies and money needed to bring Rason into the 21st century.

North Korea’s government has made the bid to move the country away from insularity by taking steps that invite investors to the country.

Yun Yong Sok, vice department director of North Korea’s Committee for Investment and Joint Venture said that the government calls for policies needed to strengthen economic cooperation with other countries while still maintaining North Korea’s “juche” policy of self-reliance.

Rason lies in a strategic geographic location with Russia on one side and China on the other.

The zone is referred to as “golden triangle” because it has three ports with waters that never freeze, even in winter,  offering potential routes into all three countries.

“Right now, the most important thing is to improve the infrastructure, including electricity supply, transport and harbor construction as soon as possible,” said Kim Young Nam, vice director of the Economic Cooperation Bureau of the Rason City People’s Committee.

It was earmarked in 1991 as a special economic zone, with officials seeing promise in building factories for manufacturing and expanding the Rajin port for shipping. However, little was done to develop Rason until North Korean authorities in recent years gave the area some autonomy from Pyongyang and amended or wrote new laws that make it easier for foreign businesses to set up shop, particularly regarding visas and entry.

It also signed a pact with China two years ago to jointly develop the zone.

Rason is getting all the attention it needs to help it move forward and compete with the booming market economies of its neighbors in Northeast Asia.

Kim Yong Ho, the president of the Kumyong Co., which provides services to restaurants in Rason, said business in the area is booming and he has seen more customers, both North Korean and foreign.

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