Economic issues are one of the focuses of the 20th inter-Korean
ministerial meeting, which opened on Wednesday in Pyongyang,
capital of North Korea.
Experts say that improved relations between the two Koreas and
better cooperation herald an opportune chance for the peninsula's
economic development, according to an article published in the
daily newspaper Shanghai Securities News on Wednesday.
"The enhanced inter-Korean economic cooperation will prove to be
a win-win one, with both sides benefiting from different areas,"
said Shen Jiru, a research fellow at the Institute of World
Economics and Political Studies, Chinese Academy of Social
Sciences.
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North Korea to gain more economic benefits
The enhanced cooperation will bring more conspicuous economic
benefits to North Korea, which had long received humanitarian aid,
including grains and fertilizers, from South Korea until July 5,
2006, when it test-fired missiles. "Although North Korea's economy
is lagging behind its Asian peers, it still has its advantages,"
said Shen.
"North Korea has a modern industrial basis. If properly
oriented, the economy will enjoy a promising future," he added.
First, North Korea is rich in natural resources, such as
minerals, which are the country's chief export.
Second, labor costs in the country stands low while national
education enjoys a quite high level. These factors are expected to
contribute a lot against the backdrop of North Korea's economic
construction drive.
The grains, seeds, fertilizers and pesticides provided in aid
from South Korea will continue to play a significant role in North
Korea's efforts to overcome its economic difficulties and improve
people's living standards.
South Korea to profit politically
South Korea, with its more advanced economy, will gain fewer
economic advantages. Instead, it "will benefit more in politics,"
Shen said.
South Korea's economy, which maintained two-digit growth for two
decades after its economic rise in 1960s, has been haunted by the
inter-Korean relations and the Korean Peninsula nuclear issue.
In its latest rating report on South Korea published at the end
of 2006, Standard Poor's Ratings Service said that geopolitical
risk remained the single and most unfavorable factor in South
Korea's sovereign credit rating.
The latest statistics show that South Korea's economy grew by 5
percent in 2006, the fastest pace since President Roh Moo-hyun took
office in February 2003. But the figure was still lower than the
average growth rate of 7 percent for the last half century.
Experts say that with the denuclearization of the Korean
Peninsula and the resumption of the inter-Korean ministerial
meeting, the political environment is sure to improve, allowing
South Korea's economy to grow. Meanwhile, the rich resources and
low-cost labors from North Korea could also contribute to economic
development in South Korea.
Cooperation on the exploitation of mineral deposits is among the
first items on the agenda of the ministerial meeting. This will
help South Korea, which suffers from a shortage of raw
materials.
(Xinhua News Agency March 1, 2007)
