The country’s top economic policymaker is stressing the need to slow the pace of economic cooperation with North Korea, pointing to a number of prerequisites such as lifting of the international sanctions and the summit between North Korea and the United States.
“I was glad economic issues were included in the Panmunjeon Declaration,” Strategy and Finance Minister Kim Dong-yeon said in a radio interview with TBS, Wednesday. President Moon Jae-in and North Korean leader Kim Jong-un made a joint announcement following the historic inter-Korean summit held at Panmunjeom on April 27, including plans for economic cooperation for balanced development and joint prosperity.
The finance minister, however, said there are priorities.
“The World Bank, International Monetary Fund (IMF), Asia Development Bank (ADB) and European Bank for Reconstruction and Development (EBRD) contacted us to show their will to participate in North Korea’s economic development if it opens or reforms,” the minister said, adding that these international organizations have much experience in helping countries that went through similar transformations, such as Russia.
However, he said diverse discussions and consensus in the international community should preclude inter-Korean economic cooperation, going beyond North Korea’s nuclear problem.
“North Korea should join the IMF first to receive such development funding from international organizations. All international organizations demand IMF membership as the priority,” he said.
He added that it usually takes around three years for a country to be admitted to the IMF since the organization should analyze economic conditions and diverse statistics of prospective member countries.
“We are considering diverse ways of working with North Korea since there have been cases of technical assistance offered for non-member countries,” he said.
“Haste makes waste. The government will calmly prepare for diverse scenarios, taking into account international factors.”
The minister also pressured the National Assembly to approve a 3.9 trillion won supplementary budget plan that aims at creating jobs for young people.
“The job market has structural problems, but since it is in seriously poor condition we should take measures that can be done in the short term. The extra budget is part of it,” he said.
He added while there could be criticism that the current administration’s job market policy is falling short of expectations, all of society should tackle structural problems together.
Regarding GM Korea, he said measures have already been prepared to make the carmaker contribute to the economy for at least 10 years. There has been concern that GM may eventually desert Korea as it did from a number of other countries after getting government support. The state-run Korea Development Bank (KDB), which is the troubled carmaker’s second-largest shareholder, had agreed to further invest 800 billion won on condition that GM headquarters turns its 3 trillion won loan for GM Korea into an equity and provides an additional 4 trillion won in loans. The government is scheduled to sign an MOU with GM Thursday to cooperate on developing the car industry here.