Action for Korea United Co-chair Seo In-taek speaks during his welcome remarks for the seminar at the National Assembly in Seoul, Friday. Courtesy of Action for Korea United

Scholars and experts in inter-Korea relations and finance assessed the economic situation of the two Koreas and discussed how to prepare for a unified Korea in light of the rapidly evolving international landscape, during a seminar, Friday.

“We are witnessing a Cold War-like division as North Korea has recently sent troops to Russia. Our vision for unification is getting difficult every moment,” Action for Korea United Co-Chair Seo In-taek said during his welcome remarks for the seminar at the National Assembly in Seoul.

“An increasing number of youngsters are not very interested in two Koreas' unification these days. The gap between the two Koreas is getting too wide. Now, it seems almost impossible to fill it, but we still need to prepare for it,” he said during the event hosted by the civic group and supported by the Global Peace Foundation.

Nam Kwang-kyu, a professor at Korea University Asiatic Research Center, presented his study on North Korea's recent economic situation and the cost of possible inter-Korea unification. He said that North Korea's stance toward Seoul has been shifted, a sign that may further deepen the rift between the two Koreas.

“Pyongyang has recently sent troops to support Russia in its invasion on Ukraine. It also scrapped the terms, ‘unification' and ‘one people,' from its constitution while defining inter-Korea ties as relations between ‘two states hostile to each other,'” Nam said.

“The move runs counter to the unification doctrine of his predecessors, his late father Kim Jong-il and grandfather Kim Il-sung. This displays his fear of icy public sentiment and possible popular uprising.”

Nam claimed that an increasing number of Pyongyang residents are starting to demonstrate their discontent with the Kim family's three generations of hereditary leadership and are becoming more receptive to South Korean culture.

“More North Korean people are reportedly watching South Korean movies and TV shows. They are very curious on the culture,” Nam continued.

“Kim might have believed he would get some economic rewards through economic ties with the South. Now, he seems to understand he would rather lose control of the people because of South Korean culture. This is the reason he decided to more alienate his country and people from outside.”

Nam argues that Kim's approach isn't helpful at all to North Korea's economy.

According to recent government data, North Korea's current economic situation could be as bad as the Arduous March in the early 1990s when there was a famine. The country is known to annually need 5.9 million tons of food, but secured only 4.5 million in 2022.

The Bank of Korea said North Korea's gross domestic product has decreased by about 12 percent between 2017 and 2021. During the COVID-19 pandemic, its border trade with China was halted due to border closures.

“(The) economic gap between the two Koreas is getting wider every year. Global think tanks say it requires at least $250 billion to a maximum of $2 trillion for 10 years to build a unified Korea. We need to do something,” Nam said, stressing the urgency of the matter.

“It requires not only government funding but also funding from private sector. I suggest fostering a massive financial hub here to attract financial companies in Japan and Singapore who are interested in (rebuilding North Korea). At the same time, we also need to open their door for capital injection for it.”

Lee Joo-young, senior economist at North Korean Economic Studies of the Bank of Korea Economic Research Institute, called for a more thorough study regarding the average North Korean person's financial situation during his follow-up presentation.

“North Korea's financial institutions have not served their role properly since the Arduous March in the 1990s. Instead, 'jangmadangs,' the country's local farmers' black markets and bazaars, have replaced the role now,” Lee said.

“Near each jangmadang, there are ‘unofficial financial services' provided by some loansharks who operate a cross-border network with China. I surveyed 212 North Korean defectors who fled the country between 2012 and 2018. Of them ... 27.8 percent said they have experienced the unofficial financial services there. Their average wealth was estimated at around $1,761. Almost no one replied to have had a bank account in North Korea.”