North Korea Plans Tourist, Economic Zones to Lure Foreign Cash

A North Korean soldier makes his way across a railway crossing on the Yalu River near a village on the foothills of Mt Baekdu as seen from northeast China's Jilin province, Sept. 23, 2010.

Updated at 11:00 a.m. ET on 2013-09-09

Faced with shortages of much-needed foreign currency, North Korea is moving ahead with a project to build special tourist and economic zones in each of the internationally isolated country’s nine provinces, North Korean sources say.

Provincial leaders are now trying hard to find ways to implement the scheme, believed to have been directly ordered by national leader Kim Jong Un, a former North Korean college professor told RFA’s Korean Service in a recent interview.

“This is a part of Kim Jong Un’s economic revival plan,” the source said, speaking on condition of anonymity during a visit to neighboring China.

“Each senior provincial administrator is trying hard to follow Kim Jong Un’s order,” he said, adding, “the success of the special zone projects is considered to be an important stepping stone to national political advancement.”

The project is expected to see the revival of a long-stalled plan to create a special economic zone at Sinuiju, a North Korean city in North Pyeongan province directly across the Yalu River from the Chinese city of Dandong.

It will be “carried forward again, sooner or later,” RFA’s source said.

“It has even been rumored that a wealthy Hong Kong businessman will invest money in building the industrial complex” in the zone.

Plans for a Sinuiju special economic zone may lack credibility, though, because the project has been publicly promoted many times “and soon blew over,” he said.

Focus on tourism

Other projects under way include the building of a ski resort at Masikryeong in Kangwon province and the construction of “all sorts of tourist facilities” in the southeastern port city of Wonsan, the province's capital city, the source said.

North Korea also plans to develop a “tourist belt” running from Mt. Baekdu, a popular sightseeing destination near the country’s border with China, to Mt. Chilbo in North Hamgyong province in the northeast, he said.

Because of U.N. sanctions against Pyongyang and problems with infrastructure, more hope is now focused on tourism than on industry for the attraction of foreign currency, North Korean sources in China said.

Chinese companies are now avoiding investing in Rason, a special economic zone on North Korea’s northeastern coast, for example, because of limited electricity supply from China, sources said.

Meanwhile, North and South Korea agreed in August to restart their jointly operated Kaesong Industrial Park, which had been shut down by North Korea in April amid heightened political tensions following a third nuclear test by the North two months before.

The test and an earlier rocket launch were in violation of international sanctions that ban North Korea from developing missile or nuclear technology, prompting the U.N. Security Council to adopt tough sanctions against the country in March.

Pyongyang began issuing vitriolic war rhetoric after the measures were imposed, raising prospects of a nuclear conflict on the Korean peninsula, but tensions have diminished  in recent months.

Reported by Joon Ho Kim for RFA’s Korean Service. Translated by Doeun Han. Written in English by Richard Finney.

Correction: An earlier version of this story misstated the location of Wonsan.


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