The committee tasked with promoting North Korean leader Kim Jong Un’s “20×10 regional development policy” recently issued its first order, calling on North Pyongan Province to establish “joint ventures with foreign entities that focus on production.”
Speaking on condition of anonymity for security reasons, a Daily NK source in North Korea said Friday that the order was issued to the North Pyongan Province People’s Committee. In the directive, the Non-Permanent Central Committee for Promoting Regional Development 20×10 Policy said it would place priority on approving “the establishment of joint ventures with foreign companies or individuals in all processes of shipbuilding, production, repair and parts production at Ryongampo Shipyard and Pukchung Machinery Complex if the province pushes for such ventures.”
Ryongampho Shipyard builds cargo ships, while Pukchung Machinery Complex manufactures diesel engines, refrigeration equipment, and other products. In essence, the committee urged the province to select a few viable companies for joint ventures or investment promotion.
“[The authorities] stipulate that the companies take the form of joint investment companies so that the foreign companies don’t completely control them,” the source said. “The idea must be to achieve ‘targets’ by normalizing production in existing companies through outside investment.
“[The order] also calls for reviving the North Pyongan Province region while developing the nation’s shipbuilding industry and creating high production capacity,” he said. “Both North Pyongan Province and the central government will lend a hand to revitalize the two companies.”
In fact, the committee said it would use the efforts in North Pyongan Province to amend several domestic regulations that restrict the growth of trade or production by joint ventures and foreign-invested enterprises. In particular, the committee even said it was drafting the legal basis and administrative rules to grant 30-year exemptions to the regulations.
Challenges ahead for attracting foreign investment
Despite the central government’s helping hand, officials on the ground are worried. Given that the head of the committee, Jo Yong Won, is the powerful secretary for Organizational Affairs of the Workers’ Party of Korea’s Central Committee, officials could be charged with “negligence” and branded as “reactionary elements” for the slightest slip-up.