Country Report North Korea February 2011

Economic policy: A revised planning law reimposes central control

In November 2010 South Korea's unification ministry released texts of three new or revised Northern laws: one on economic planning, revised in April, and two orders of the Supreme People's Assembly presidium (a standing committee that acts when the full assembly is not sitting) issued in July, covering labour protection and a law for chambers of commerce. Kyungnam University's Institute for Far Eastern Studies (IFES), one of the least ideologically biased observers of the North in Seoul, suggested that comparison with the legislation to earlier regulations dating from 2001 and 2002 indicated a clear retreat from reform.

The new planning law reasserts state control, stating that the planned economy will be based on prepared figures and that enterprises, organisations and companies will operate on the principle of "ensuring regulated numbers" (presumably this means sticking to prescribed numerical targets laid down from above). It seems to contradict facts on the ground: since the fiasco of the botched currency redenomination in late 2009, markets have largely been left alone. The fear is that this tactic may be temporary, with the state still aiming to reassert control when it can.

As for the labour protection law, on paper this lays out detailed workers' rights. Difficult and strenuous jobs, including mining and fishing, are to be rewarded with additional clothing, food and other rations. The working day is restricted to eight hours, with guaranteed holidays and time off, healthcare and protection of property. As fine as all this sounds, it bears little if any relation to what happens in practice.

The third law is mildly encouraging. North Korea has had a chamber of commerce since 2000. According to IFES, the new order codifies the Chamber of Commerce Regulation issued by the cabinet in 2008. It covers a range of duties and rights concerning commercial operations, including contracts and operations regarding joint ventures with foreign firms; legal letters of confirmation, certificates of country of origin and other paperwork related to trade issues; and exhibitions and conventions held with foreign businesses.

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