The Federation of Korean Industries, South Korea‘s major business lobby group, proposed Wednesday a new set of principles for inter-Korean business exchange, calling for a paradigm shift toward a mutually beneficial economic relationship.

“A new economy-centered paradigm should be developed in which both Seoul and Pyongyang could gain mutual interests, and it’s time to go beyond the conventional paradigm of ‘support and pressure,’” Park Chan-ho, a senior executive of the FKI said during a seminar on Inter-Korean economic interchange in the Yeouido district of Seoul.

It is the first time for the business lobby group to revise the principles in 20 years, reflecting the current international situation surrounding the two Koreas.

“In the 20 years since the FKI announced the five economic cooperation principles in 1995, China has emerged as a G2 country and development projects are being carried out at the borders of North Korea, China and Russia. And North Korea is showing signs of marketization,” he said.

The new set of five principles includes harmonization of inter-Korean dialogue progress, an economic exchange which benefits both the South and North, self-driven economic development for North Korea, building up an industrial structure that combines the strengths of the two Koreas and securing neighboring countries’ support and participation in forming a northeast Asian economic block.  

During the seminar where some 120 experts gathered, Korea Economic Research Institute analyst Choi Soo-young proposed to set up liaison offices for the economic groups, representing each nation, in the two Koreas.

“Since the Kim Jong-un regime began in 2010, North Korea’s marketization and private economy have been expanded. Pyongyang seeks ways to open the country to foreign intercourse widely,” Choi said.

He also suggested to resume and expand business projects on the border areas, such as the North Korean border city of Gaeseong and Mt. Keumgang, and develop a new inter-Korean industrial park in Pyongyang.

By Park Han-na (hnpark@heraldcorp.com)