North Korean economist calls for expanding autonomy of enterprises
Workers, technicians and officials celebrate the completion of a construction project at the Hwanghae Iron and Steel Complex on Sept. 30. KCNA-Yonhap
By Jung Da-min
Ri Ki-song in Pyongyang. AP
A Pyongyang economist on Monday called for changes in the regime's economic policies to expand the autonomy of enterprises and ensure the responsibility of workers.
North Korea's party mouthpiece Rodong Sinmun published the call in a column titled “An important demand to carry on the new strategic route of the party” by Ri Ki-song, a professor at North Korea's Academy of Social Sciences' Institute of Economy, who has promoted the North Korean economy in interviews with foreign media.
Ri emphasized the importance of the “socialist system of responsibility management of enterprises,” saying that national economic policies should focus more on improving the achievements of enterprises and workers by giving them more autonomy and responsibility.
“It is important to take strong and practical measures so that the socialist enterprises, the basic units of production and management, can demonstrate their responsibility, initiative and creativity, with the socialist system of responsibility management of enterprises having effects,” Ri wrote.
“Economic and legal conditions should be guaranteed and improved in a reasonable way, so that enterprises, by utilizing the given authority of management, can improve their business management.”
Since North Korean leader Kim Jong-un took power, the country has been focusing on improving its economic management system as a key task in resolving economic problems.
“The North Korean government is seeking various policy changes under the slogan of economic management improvement measures,” said Lee Seog-ki, senior researcher at the Korea Institute for Industrial Economics and Trade (KIET)'s Center for Global Industry and Trade, in a report published in May.
According to the report, which deals with changes in North Korea's enterprise management system and the implications for inter-Korean economic cooperation, the country established and amended detailed regulations for the application of relevant economic laws in 2014 to enforce the socialist system of responsibility management of enterprises.
From the second half of 2014 to the first half of 2015, the country completed the legalization of the new economic management system by amending a series of laws on planning of people's economy, the country's finance and enterprises.
The new economic management system reflects North Korea's changed economic and market conditions to allow private investment and some private economic activities. The new system also strengthened the incentives for enterprises and workers while introducing more market functions. Lastly, it ensured autonomy and decision-making power of the enterprises while allowing their market activities.
“In order to narrow the gap between the official corporate management system and the actual business operation methods and further to improve the performance of the statue-run enterprises by utilizing the market and enlarging the government finances, major revision of the planning system was needed,” the report said.
Meanwhile, Ri also urged the country to strengthen its unique economic structure by implementing comprehensive and equal developments in industries including coal, thermal power, machinery, metal, chemical and light industry.
Ri also called for existing business sectors to be modernized while developing advanced technologies such as information technology, nanotechnology and biotechnology, while creating new high-tech industry sectors.