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N.K. needs technical help before joining int'l financial institutions: U.S. expert
WASHINGTON, Oct. 19 (Yonhap) -- North Korea must first receive technical assistance from international financial institutions before it can join them and begin receiving monetary aid, a U.S. expert said Friday.
Pyongyang, viewed as one of the most secretive regimes in the world, has to provide certain economic data and follow standardized practices and procedures in order to be able to join financial institutions, Marcus Noland, a senior fellow at the Institute for International Economics, told Yonhap in an e-mail interview.
Noland proposed first inviting North Korea in as an observer "to begin the process of education and technical assistance to support their economic transition" into full membership.
North Korea had said it wanted to join such institutions in 1996, but lost all interest after finding out it would not immediately begin receiving money, according to Noland.
Since then, it has not indicated willingness to adopt the transparency and openness required for membership into the institutions, he said.
Outside aid to the North is heavily constrained by various sanctions, notably by the U.S., which brands Pyongyang as a state sponsor of terrorism. The designation requires Washington to vote against monetary loans and assistance programs to North Korea through international organizations, such as the World Bank and the International Monetary Fund (IMF).
In an annual IMF meeting here next week, South Korean Finance Minister Kwon O-kyu is expected to call on the global community to increase support for North Korea's economic development, and to allow Pyongyang to become a member of global financial institutions.
His recommendations follow an inter-Korean summit earlier this month that highlighted economic cooperation and progress in six-nation efforts to denuclearize the Korean Peninsula.
Noland questioned whether Pyongyang would be willing to be subjected to the scrutiny required for a membership into the international financial system.
"Frankly speaking, the most important thing that the international financial institutions could immediately provide to the North Koreans is technical assistance," he said.
"But again, it is not at all clear that they are particularly interested in becoming members of these organizations or reforming their internal practices in ways that would allow them to make full use of membership."
Such assistance could involve setting up processes, procedures and regulations to reform North Korea's laws and practices, he said.
North Korea also has to provide the necessary data, a process which international institutions could assist by providing basic standards, such as data collection standards.
North Korea and financial institutions also need to come up with a strategic plan, said Noland. If, for example, Pyongyang wanted to set up a stock exchange, the institutions would assist in starting it and revising relevant laws in the North, he said.
ldm@yna.co.kr
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