Purpose: This study aims to elucidate the role of South Korea's aid to North Korea as a development resource and to identify its characteristics in comparison to major donor countries. Originality: For North Korea, where exports and foreign investments are limited, foreign aid represents a critical resource for development. Should progress be made on the North Korean nuclear issue, the demand for development in North Korea is expected to surge, and the role of the IKCF is anticipated to expand. This study is significant as a foundational research effort to enhance the utilization of the IKCF as a development resource. Methodology: It categorizes IKCF programs from 1995 to 2022 into development aid projects and projects based on the unique inter-Korean relationship. It reclassifies the programs using the OECD CRS and compares the aid patterns of major donors to highlight the distinctive features of South Korea's aid to North Korea. Result: Initially, the IKCF had a strong character as a development resource, but since the early 2000s, the proportion of projects based on the special inter-Korean relationship has increased, giving the fund a dual character. Since 2008, the significant reduction in aid to North Korea has diminished its development resource role. Comparing sectoral allocation patterns of South Korea and major donors shows these patterns vary depending on key donor countries, reflecting international circumstances and donor characteristics rather than North Korea’s needs. In the mid-2000s, aid through NGOs increased, focusing on ‘productive sectors’ despite criticism for small, fragmented projects. Conclusion and Implication: Given fluctuating international circumstances, diversifying aid to North Korea cooperation with other donors is necessary. To enhance future aid effectiveness, integrating small-scale development projects by private organizations through consortia and addressing sectoral imbalances from a long-term perspective is crucial.
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