[Focus] Kim Jong-Il¡¯s Shanghai visit is telling

The sudden visit by North Korean leader Kim Jong-Il to China is observed to be a prelude to the reclusive country¡¯s positive reform and openness in that the destinations of his trip include Shanghai and Shenzhen in Guangdung Province, China¡¯s model regions opened to the outside world.

When Kim, chairman of the National Defense Commission, made a trip to China in May last year, he visited only Zhongguancun area in Beijing, the Silicon Valley of China, but not the developed coastal regions such as Shanghai.

Shanghai, since it was designated as a special development district in 1990, has enjoyed a rapid double-digit annual growth rate and has become the symbol of China¡¯s economic reform and open-door policy.

Over the past 10 years, foreign enterprises invested a total of US$32 billion in 6,400 projects. In particular, about 300 multinational firms, including 45 foreign banks, advanced into the Pudong district. Shenzhen was designated as one of the four special districts in 1980, and it has achieved brilliant growth, transforming into a modern city full of vitality that can rival Hong Kong from a small fishing town in just two decades.

Observers in Beijing speculate that Chairman Kim apparently made up his mind to visit Shanghai to set the course of North Korea¡¯s economic reform and openness.

North Korea legislated a Joint Management Law in September 1984 in an attempt to open to the outside world, but it failed to achieve any remarkable results. Only some enterprises run by pro-Pyongyang, or "Chochongnyon," Korean residents in Japan set up joint companies.

For the economic cooperation with Western countries, the North designated the Rajin-Sunbong region as a free economic and trade district in December 1991, but it ended in a failure, too. The Rajin-Sunbong district was set up after the model of China¡¯s special economic district. It attracted only US$140 million in foreign investment.

At that time, Western investors were reluctant to advance into North Korea due to the suspected nuclear development by the North and lack of related laws such as an investment guarantee law.

As seen in these two attempts, North Korean has been reluctant to import in a full swing the Chinese-style reform and openness. It also has been stingy in evaluating the economic achievement of China.

However, Kim¡¯s China trip in May last year changed the North¡¯s view of China¡¯s reform and openness. Kim had said in his meetings with President Jiang Zemin and Premier Zhu Rongji that he ¡°highly regards China¡¯s achievements of reforms and openness.¡±