North Korea virtually ditched its planned economy system and state rationing recently and inaugurated freer management policies under the new regime of Kim Jong-un, a news report said Thursday.
"Lecture meetings have been held since Aug. 6 for each labor group, political cell and factory in regard of the introduction of a new economy management system," Washington-based Radio Free Asia (RFA) quoted from a source based in Ryanggang Province in northern Korea. "During the lectures, details of the new economic management system were released."
The source also said the regime dispatched lecturers to each workers' organization across the country to brief them on the newly-introduced policies, RFA said.
Internally called the "June 28 new economic management system," the set of new policies center on ending the country's previously tight assignment of output and scrapping government rationing to let each production unit support itself, a sharp turnaround from the North's strictly managed production and rationing so far, RFA reported, quoting sources.
Kim Jong-un secretly instructed officials to draw up the new plan on June 28 and ranking officials have been notified of the change since early July, the new outlet said.
"Factories and companies were made to independently produce and set prices and sales methods without state plans," the Ryanggang Province source said in the report. "It means virtually abandoning a planned economy."
Individuals are still not allowed to establish firms on their own and the state will continue to appoint or sack factory or company managers.
RFA also quoted another source who said that according to the new system, the state takes 70 percent of what is produced from farmland while the remaining 30 percent goes to farmers. Currently, the state allocates agricultural output and takes all the harvest.
The radio said the North did not clarify exactly when the new system goes into effect, only indicating it starts "from now on," possibly for fear of unexpected inflation and other side effects the change could bring.
The North's regime continues to widely publicize its retention of other socialistic policies such as free education and free health care, promoting the new economic plan as its own socialistic idea, independent of outside influence, according to RFA.
North Korea could possibly have adopted a experimental trial of economic reform on some parts of the country, Seoul's Unification Ministry said in response to the report.
"(But) We did not think the reform measure is being implemented nationwide," a ministry official said. (Yonhap)
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