Why Is Kim Jong-il Touring Chinese Boomtowns?

From left, the pier in Binhai New Area, where North Korean leader Kim Jong-il stopped to inspect industrial facilities; Diaoyutai's No. 18 Villa, where Kim rested after arriving in Beijing; and the Great Hall of the People in Beijing, where he met with senior officials

North Korean leader Kim Jong-il made a surprise stopover in the Chinese boomtown of Tianjin, sometimes called the "Shanghai of northern China," on Wednesday. It was the second showcase for China's booming economy Kim visited during his trip to China after a stay in the eastern port city and financial center of Dalian on Monday and Tuesday.

The pace of Kim's visit appears to be oddly relaxed considering the dire economic situation in North Korea due to a botched currency reform and rising tension on the Korean peninsula after the sinking of the South Korean Navy corvette Cheonan.



Since 2005, the Chinese government has been developing Tianjin's Binhai New Area into a northern economic hub like the Pudong economic zone in Shanghai down south. Binhai covers 2,270 sq. km with factories by 4,000 multinational corporations such as Motorola, Airbus and Yamaha. Around 100 South Korean businesses have invested in the region, including LG Electronics, Hyundai Mobis and Kumho Tire. The Samsung conglomerate operates no fewer than 13 factories there.

Kim also visited Tianjin during his trip to China in 2004 when the special economic zone was in an early stage of development.

Experts speculate that Kim is visiting the boomtowns to publicize his willingness to reform North Korea's moribund economy. Kim is trying to draw Chinese investment to North Korea's Rajin-Sonbong special economic zone as hard currency supplies have dried up. "North Korea's foreign currency supply is steadily drying up after joint economic projects with South Korea were halted and there is also a shortage of goods, a North Korea expert in Beijing said. Kim's visits to Dalian and Tianjin "appear aimed at sending a message that he is strongly interested in economic reforms."

On three of his four previous trips to China, Kim toured major showcases for China's economic reforms. In 2000, Kim toured an IT complex in Beijing and inspected a Lenovo computer factory there. In 2001, he visited a GM car plant and an NEC factory in Shanghai, as well as the city's thriving stock market. "Shanghai has made incredible changes," Kim said afterwards.

On his fourth visit in 2006, Kim toured the boomtowns of Guangzhou, Shenzen and Zhuhai in southern China and Xiamen in Fujian Province. But that failed to result in more open markets in North Korea. While Kim in 2002 announced a set of opening measures and plans to develop Sinuiju into a special economic zone, he sacked the proponents of economic reform within North Korea a few years later.

The Chinese leadership is said to have been angered by Kim in 2006 when, after touring the Chinese boomtowns as if he meant to emulate their success, he conducted his first nuclear test instead.

"North Korea earlier this year announced plans to set up an international cooperation agency called the Taepung International Investment Group and a state development bank to take charge of attracting foreign investments, but there is little sign there that the market will be opened," a source in Beijing with close knowledge of North Korean affairs said. "Kim's visits to the two economic centers appear to be aimed more at overcoming his country's economic crisis."

Meanwhile, sources in China say Kim's son and heir apparent Kim Jong-un accompanied his father from Dandong to Dalian and is in Beijing as well. But one diplomatic source in Beijing said, "There are rampant rumors that Kim Jong-un is accompanying his father on this trip, but there is no concrete evidence supporting such claims."