ABSTRACT
A unified Korean Peninsula economy by the next decade would likely have a population of nearly 80 million, larger than any European country except Germany. This chapter begins with economic overviews of the North and the South. It compares the outward-orientation in the South with the Juche policy in the North and discusses the potential for intra-Korean trade and special economic zones to overcome the North’s international isolation. The chapter analyzes the marketization of the North’s economy, followed by an overview of the forces driving a unified Korean Peninsula economy. The South Korean economy faces challenges to sustain its convergence to the income levels in the most advanced economies. South Korea’s strategies to revive economic growth have not reversed the slowing trend. Low income in the North is accompanied by food shortages and malnutrition. The biggest contrast between the North and South is their openness to the global economy.
