N.Korea Shuts Down Kim Jong-il's Slush Fund Office

      October 19, 2012 12:03

      The North Korean regime has shut down a department in the Workers Party known as Room 38 that managed late leader Kim Jong-il's private coffers, Japan's Kyodo News reported on Thursday citing informed sources.

      The duties handled by Room 38, which included running hotels and stores to generate foreign currency, have been handed over the newly-created Moranbong Guidance Bureau, which is run by the Cabinet, according to Kyodo.

      The move appears to be part of the North’s efforts to streamline operations to earn hard currency and strengthen the role of the Cabinet ahead of economic reforms.

      The source quoted North Korean leader Kim Jong-un as saying the North must "use the economic policies of other countries as reference" to rebuild its own and ordered agencies concerned to report their policy plans.

      In 2009, the North merged Room 38 with Room 39, another special department handling a network of business operations such as drug smuggling and arms trading, but it separated them again in mid-2010.

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