SEOUL — Sanctions-hit North Korea on Wednesday formally launched a development bank aimed at attracting foreign funds to revive its economy, state media reported.
Directors of the State Development Bank held their first meeting to elect officers and decide on a management structure and annual budget, the Korean Central News Agency said.
The bank, set up on the orders of leader Kim Jong-Il, will have "advanced banking rules and system for transactions with international monetary organisations and commercial banks," the agency said.
It would invest in major projects and act as a commercial bank.
The bank is the latest move by the North to revive its ailing economy and rebuild crumbling infrastructure. In January it upgraded the status of Rason, a free trade zone near the border with China and Russia, to boost foreign trade.
Tougher United Nations sanctions imposed after missile and nuclear tests last year restrict access by the impoverished communist state to international credit, and ban its lucrative weapons exports.
A UN resolution instructs member states and international bodies not to make new grants or loans except for humanitarian and developmental purposes "directly addressing civilian needs."
The UN could ease or roll back the sanctions if the North decides to rejoin six-party nuclear disarmament talks and makes substantial progress towards scrapping its nuclear programmes.
The North is under diplomatic pressure to return to the nuclear dialogue which it quit last April. It says the United States should first commit to holding talks on a peace treaty to formally end the 1950-1953 Korean War.
Analysts have said the decision to found the development bank shows leader Kim is confident the six-party talks will eventually produce a settlement.
The board is made up of members of the National Defence Commission (NDC), the nation's top ruling body; the Korea Asia-Pacific Peace Committee, a state agency in charge of exchanges with South Korea; the finance ministry; the Korea Taepung International Investment Group and two independent directors.
NDC representative Jon Il-Chun was elected director-general and Pak Chol-Su, described as a Korean resident in China, as his deputy.
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