Kim Jong-un's admission of failure shows serious economic situation in North Korea

North Korean leader Kim Jong-un speaks during the eighth congress of the Workers' Party of Korea, Tuesday, according the Korean Central News Agency, Wednesday. Yonhap

By Do Je-hae

North Korean leader Kim Jong-un's opening address at the eighth congress of the Workers' Party of Korea was marked by a rare public acknowledgement of mistakes in the leadership's five-year economic strategy from 2016 through 2020 amid three major disasters that hit the North ― the COVID-19 pandemic, international sanctions, and storm-related flooding and infrastructure damage.

The five-year strategy was established to increase production in agriculture and light industry and normalize core industries such as coal, steel, railways, fisheries and machinery; improve the electricity supply problem through the construction of power plants and the repairing of power distribution networks; expand its trade and cooperation; and build more economic development zones and tourism projects.

"The five-year strategic implementation period for national economic development ended last year, but we fell far short of the goals that were put forward in almost all sectors," Kim was quoted as saying by state media.

A scene from the 6th WPK congress Yonhap

The North Korean leader vowed not to repeat "painful lessons" of the past and stressed the need to further develop the overall economy under a new five-year plan. Kim is expected to seek a turnaround for visible economic achievements ahead of the 10th anniversary of him taking control of the regime later this year.

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It is considered unusual for the North Korean leadership ― particularly for the "supreme leader" himself ― to publicly admit failure in fulfilling state objectives. This shows the gravity of the economic problems North Korea is facing as fallout from the three disasters is expected to continue in 2021, and the incoming Joe Biden administration in the U.S. is expected to take a hard line approach to the North, according to some experts.

"Kim has to admit to the setbacks and promise adjustments as North Korea's economic policy has dramatically failed. Nonetheless, while sanctions, natural disasters and the pandemic challenge the regime, they don't really hold it at risk," Leif-Eric Easley, associate professor of international studies at Ewha Womans University in Seoul, told The Korea Times.

Experts say that Kim's rare acknowledgment of the mistakes mirrors the gravity of the economic woes, particularly for the ordinary people compared to the Kim Jong-il era, due to restrictions on private businesses and trading under the rule of Kim Jong-un.

People walk past a billboard announcing the 8th Congress of the Workers' Party along a main street of the Central District in Pyongyang, North Korea, on Wednesday, Jan., 6, 2021.AP-Yonhap

"This is not the first time for a top North Korean leader to publicly admit economic failure. So the significance of the party congress this year is not the public admission itself, but the magnitude of the economic problems it indicates," a North Korea studies professor told The Korea Times on the condition of anonymity.

"Based on a series of interviews I have conducted with North Korean defectors, what has been particularly traumatic for ordinary people is the shutdown of private trade along the Sino-North Korean border due to COVID-19, as well as the increased restrictions placed on them compared to those of the Kim Jong-il era. To address this situation as COVID-19 continues, the North Korean leadership will likely further devolve responsibility to the local level to reinvigorate the economic situation and extract all internal resources possible to boost domestic production. This strategy will require partial deregulation for local economies, but will be implemented under strict sociocultural controls."

North Korean leader Kim Jong-un, right, and Chinese President Xi Jinping sit down for a conversation during a stroll at a guesthouse in Pyongyang, June 22, 2019, during Xi's visit to North Korea. North Korea is looking to restart economic cooperation with China this year. Korea Times file

Kim did not mention external relations during the opening address, however, it is expected that he will send out messages to the U.S., China and South Korea soon as the congress continues over the coming days. The North Korean leader is expected to seek an economic breakthrough through stronger external cooperation this year. Analysts note that North Korea will place a stronger priority on restarting economic cooperation with China as the new U.S. administration establishes its diplomatic policy and team in the first half of the year.

"When the COVID-19 pandemic is under better control, the first external priority for North Korea is the restoring of cooperation with China, and then inter-Korean and North Korea-U.S. relations," Yang Moo-jin, a professor at the University of North Korean studies, told The Korea Times. "We should keep an eye on when and at what speed the cooperation between North Korea and China will be restored."

The Central Committee of the Communist Party of China (CPC) sent a congratulatory message to the 8th Congress of the Workers' Party of Korea.