Kim Plans Economic Overhaul in N. Korea

General's ouster paves way for reform: insider
By Matt Cantor,  Newser Staff
Posted Jul 20, 2012 11:11 AM CDT
Kim Plans Economic Overhaul in N. Korea
Kim Jong-Un salutes as he watches a military parade to mark 100 years since the birth of the country's founder and his grandfather, Kim Il-Sung,   (Getty Images)

After North Korea's top military leader was removed from the post, observers wondered why; now an explanation seems to be taking shape. Vice Marshal Ri Yong Ho, seen as a close ally to Kim Jong Il, didn't want to see sweeping changes to the country's economy—but new military boss Kim Jong Un is planning what could be the biggest economic overhaul in decades, an insider tells Reuters. Pyongyang is launching a "political bureau" to run the economy, which until now has been under military control—a system Ri supported.

An "economic reform group" in Kim's party will study potential agricultural and economic changes. It's not known who will run either of the new committees, but their creation follows likely pressure from China, which fears the potential consequences of economic collapse in Pyongyang, including an influx of refugees. Beijing could also provide a model for economic reform. The insider says the shift won't be a political problem for Kim and his powerful uncle, Jang Song Thaek. But the party newspaper "openly criticizes" more economic openness, says an expert. (Read more Kim Jong Un stories.)

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