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Friday, 20 July 2012 - Exclusive: Kim to reform North Korean economy after purge - source |
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See the best of Reuters photography.  See more | Photo caption  Bulgaria bus bombing Several people were killed and more than 20 injured in an explosion on a bus carrying Israeli tourists in Bulgaria.  Slideshow  Best of Tour de France Highlights from the 99th Tour de France.  Slideshow  Exclusive: Kim to reform North Korean economy after purge - source Tweet Share this Email Print Related News North Korean leader cements control over army Wed, Jul 18 2012 Young North Korea leader pushes out father's allies as he tightens grip Tue, Jul 17 2012 Secretive North Korea ditches top military man, purge seen Mon, Jul 16 2012 U.S. to demand disclosures as it eases Myanmar sanctions Wed, Jul 11 2012 South Korean dictator's daughter to launch presidential bid Thu, Jul 5 2012 Analysis & Opinion A rare glimpse into the North Korean soul Military draft exemption for ultra-Orthodox shakes Israeli coalition Related Topics World » North Korea » North Korean leader Kim Jong-Un (C) visits Kyongsang Kindergarten in Pyongyang in this undated picture released by the North's KCNA July 15, 2012. Credit: Reuters/KCNA By Benjamin Kang Lim BEIJING | Fri Jul 20, 2012 4:13am EDT BEIJING (Reuters) - Impoverished North Korea is gearing up to experiment with agricultural and economic reforms after young leader Kim Jong-un and his powerful uncle purged the country's top general for opposing change, a source with ties to both Pyongyang and Beijing said. The source added that the cabinet had created a special bureau to take control of the decaying economy from the military - one of the world's largest - which under Kim's father was given pride of place in running the country. The downfall of Vice Marshal Ri Yong-ho and his allies gives the untested new leader and his uncle Jang Song-thaek, who married into the Kim family dynasty and is widely seen as the real power behind the throne, the mandate to try to save the battered economy and prevent the secretive regime's collapse. The source has correctly predicted events in the past, including North Korea's first nuclear test in 2006 days before it was conducted as well as the ascension of Jang. The changes could herald the most significant reforms by the North in decades. Previous attempts at a more market driven economy have floundered, most recently a drastic currency redenomination in late 2009 which triggered outrage and is widely believed to have resulted in the execution of its chief proponent. "Ri Yong-ho was the most ardent supporter of Kim Jong-il's 'military first' policy," the source told Reuters, referring to Kim Jong-un's late father who plunged the North deeper into isolation over its nuclear ambitions, abject poverty and political repression. The biggest problem was that he opposed the government taking over control of the economy from the military, the source said, requesting anonymity to avoid repercussions. If the reforms do take root, North Korea would be the next Asian pariah state to open up after Myanmar, whose change last year to quasi-civilian government has suddenly started to bring it out from years of seclusion under harsh military rule. North Korea's state news agency KCNA had cited illness for the surprise decision to relieve Ri of all his posts, including the powerful role of vice chairman of the ruling party's Central Military Commission, though in recent video footage he had appeared in good health. Ri was very close to Kim Jong-il and had been a leading figure in the military. Ri's father fought against the Japanese alongside Kim Jong-il's late father Kim Il-sung, who founded North Korea and is still revered as its eternal president. The revelation by the source was an indication of a power struggle in the secretive state in which Kim Jong-un and Jang look to have further consolidated political and military power. Kim Jong-un was named Marshal of the republic this week in a move that adds to his glittering array of titles and cements his position following the death of his father in December. He already heads the Workers' Party of Korea and is first chairman of the National Defence Commission. The North Korean Embassy in Beijing, reached by telephone, declined to comment. REFORMS North Korea's cabinet has created a "political bureau" which will wrest power from the 1.2 million-strong military to run the economy which has been in shambles after a crippling famine in the 1990s, the source said. "In the past, the cabinet was empty with no say in the economy. The military controlled the economy, but that will now change," the source said. Kim Jong-un has set up an "economic reform group" in the ruling Workers' Party to look at agricultural and economic reforms, the source said, adding that North Korea will learn from its giant neighbor and solitary benefactor, China. Beijing leaders are thought to have been pressing Pyongyang to do more to reform the economy, worried that a collapse of the North could send refugees streaming across its border and the loss of a strategic buffer to South Korea and the large contingent of U.S. troops which help protect it. It was unclear who will head the cabinet's "political bureau" and the party's "economic reform group", but change was inevitable, the source said. In sharp contrast to the austere, reclusive image of his father, state media have shown Kim Jong-un visiting fun fairs, speaking in public and applauding at a rock concert at the weekend. Women appear to have been more freedoms, including wearing short skirts, although 200,000 people are in prison camps in the impoverished and isolated country. The source dismissed speculation of any political fallout from the purge, saying: "Kim Jong-un and Jang Song-thaek are in control of the military." Jang has long been seen as a proponent of reform of an economy which through mismanagement has entirely missed out on the fruits of dramatic growth of neighbors like China and South Korea. His push for reform was widely seen as having triggered a period of exile but he was later rehabilitated and given the primary role of supporting Kim Jong-il's son when he was being groomed to eventually take over the leadership. North Korea has yet to name Ri's replacement as head of the army, the source said. It was unclear how many of Ri's men have been sacked, but the source said they have not been jailed. An assessment of the changes by the South Korean government seen by Reuters, said that some 20 top officials had been purged since Kim Jong-un began his ascent to power. (Editing by Jonathan Thatcher) World North Korea Tweet this Link this Share this Digg this Email Reprints   We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.   Edition: U.S. Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom Back to top Reuters.com Business Markets World Politics Technology Opinion Money Pictures Videos Site Index Legal Bankruptcy Law California Legal New York Legal Securities Law Support & Contact Support Corrections Connect with Reuters Twitter   Facebook   LinkedIn   RSS   Podcast   Newsletters   Mobile About Privacy Policy Terms of Use AdChoices Copyright Our Flagship financial information platform incorporating Reuters Insider An ultra-low latency infrastructure for electronic trading and data distribution A connected approach to governance, risk and compliance Our next generation legal research platform Our global tax workstation Thomsonreuters.com About Thomson Reuters Investor Relations Careers Contact Us   Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. 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