The government estimates that around 533 trillion won, or some 500 billion dollars, would be needed to rebuild North Korea's economy.
The government said such an amount would be required to raise North Korea’s per capita gross national income (GNI) to around ten-thousand dollars, or half of South Korea’s per capita GNI, within 20 years. The North’s per capita GNI is estimated to stand at one-thousand-216 dollars.
The government made such projections in a report on financial aspects of the Korean unification, set to be released at an international conference next month. The finance and unification ministries and the Financial Services Commission (FSC) have been working on the report for the past five months in cooperation with other related government agencies and research institutes.
In a bid to lower financial burdens that would result from restructuring the North’s economy, the government plans to devise various ways to raise funds, including through the Official Development Assistance and private investment within the South.
Kim Yong-bum, an FSC policy director, said though the economic gap between the two Koreas is extremely wide, the unification will provide the opportunity for the Korean economy to take another leap forward as it would create large-scale domestic demand and resolve problems such as low birthrate. He also said unification would reduce division-related costs, allow the development of underground resources in the North and lessen geopolitical risks.