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The Rise of North Korea’s Tourism Industry and Policy Directions for South Korea |
| August 13, 2025 |
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Eun-ju ChoiResearch Fellow, Sejong Institute | ej0717@sejong.org
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The recently completed Wonsan Kalma Coastal Tourist Area is a representative tourist district development project that has been strategically promoted since the early period of Kim Jong Un’s rule. North Korea seeks not only to foster tourism in order to secure insufficient foreign currency but also to utilize it to improve its external image. In particular, under the circumstance of prolonged sanctions against North Korea, attention is being paid to the fact that tourism is a sector with low political burden and one that can generate profits legitimately. From this perspective, the completion of the Wonsan Kalma Coastal Tourist Area is understood as the starting point for plans to successively develop large-scale tourist districts in the future.
North Korea’s policy to foster the tourism industry is not merely to use tourism as a means of securing foreign currency, but rather to establish it as a “regional–industry linkage development model” that is connected to the expansion of transportation networks such as ports, airports, and railways, the supply of nearby agricultural and marine products and processed foods, and the development of local service industries. Representative examples include the improvement of port logistics and the formation of construction material and labor supply chains that appeared in the course of developing the Wonsan Kalma Coastal Tourist Area. This policy direction contains a strategic intention to utilize tourism simultaneously for economic profit generation and improvement of diplomatic relations, and it is interpreted as an expectation to achieve both regime stability and foreign currency earnings while adjusting the scope and pace of external opening.
The problem is that the rise of North Korea’s tourism industry has ambivalent aspects for the changing situation on the Korean Peninsula. North Korea’s tourism policy could be utilized as a new opportunity for the improvement of inter-Korean and North Korea–U.S. relations, but if South Korea’s policy response is insufficient, there is also the possibility that the diplomatic and economic space created as North Korea actively pursues the attraction of foreign tourists may be preoccupied by neighboring countries. In fact, North Korea is expected to strengthen tourism cooperation with China and Russia, using it as a means to expand diplomatic exchanges even under sanctions. The United States, as can be seen from the remarks of former President Trump, also has the possibility of conditionally using North Korea’s tourism zone development projects as negotiating leverage in dealing with North Korea.
In this changing phase, the South Korean government must move beyond the perspective of viewing North Korea’s tourism industry merely as an internal phenomenon of North Korea, and preemptively prepare policy plans to utilize it as a strategic resource for the recovery of inter-Korean relations, the advancement of North Korea–U.S. relations, and the establishment of a foundation for multilateral cooperation. Tourism cooperation is a field that is relatively less politically sensitive and can build mutual trust through people-to-people exchanges, but, as seen in the suspension of the Mount Kumgang tourism project, without safeguards for safety and investment protection and the supplementation of related systems, it is difficult to ensure sustainability; therefore, meticulous prior preparation is necessary.
Then, can North Korea’s policy of fostering the tourism industry become a new source of momentum for improving the strained inter-Korean and North Korea–U.S. relations and realizing peace on the Korean Peninsula? This article seeks to analyze the current status and strategy of North Korea’s tourism industry, examine the significance of North Korea–China and North Korea–Russia cooperation and the potential for its utilization in North Korea–U.S. dialogue, and explore the policy conditions and implementation strategies necessary for the South Korean government to pursue substantive cooperation with North Korea in the tourism sector in the future. -
Since the beginning of Kim Jong Un’s rule, North Korea has perceived tourism as a multifunctional industry that can be utilized for acquiring foreign currency, creating employment, revitalizing domestic consumption, and improving the national image. Under this perception, North Korea has been strengthening state-level policies and investments in order to develop the tourism industry in earnest. In particular, it approaches tourism in a market-friendly manner by regarding tourism as an industry, demanding the efficient use of resources based on economic feasibility in the development process, and requiring the enhancement of service quality in the operation process to secure competitiveness.
At the policy level, North Korea is utilizing the fact that tourism can serve as a sustainable external economic sector capable of legally generating foreign currency income under sanctions. Accordingly, it has not only established central-level special tourism zones such as the Wonsan Kalma Coastal Tourist Area, but has also designated tourism development zones at the regional level, while pursuing projects such as the modernization of tourism services and facilities and the establishment of systems for training tourism personnel. In addition, it has pointed out the need to analyze changes and competitive environments in the global tourism industry and to establish development strategies suited to its own conditions, thereby expecting not only economic profit generation but also political and social effects such as improvement of relations with the international community and enhancement of the national image.
In terms of institutional arrangements, in 2023 North Korea enacted the Tourism Law, which established a basic law encompassing the entire tourism industry, including obligations and rights for the promotion of tourist convenience, safety guarantees, the formulation of tourism development plans, responsible actors and systems for implementation, and the attraction of foreign investment in the development of tourist zones. In 2025, it adopted the Wonsan Kalma Coastal Tourist Special Zone Law, thereby providing the legal framework for the character of a special economic zone, as well as for the attraction of foreign capital and its operation. Through this, it systematized the development direction and operational processes of the tourism industry more than in the past and enhanced institutional stability.
From the perspective of operational strategy, the admission of foreign tourists is still limited. Until the COVID-19 pandemic, North Korea concentrated on attracting foreign tourists, but after suspending this for more than three years due to the pandemic, it began to permit the entry of foreign tourists again in 2023. Although the full-scale acceptance of foreign tourists has not yet taken place, it is projected that it will gradually expand as the Wonsan Kalma Coastal Tourist Zone has been completed. Kim Jong Un assessed the Wonsan Kalma Coastal Tourist Zone as being at a level capable of hosting international events, and in fact, he held a meeting with Russian Foreign Minister Lavrov in Wonsan in July, releasing related video footage. Furthermore, he declared that at the 9th Congress of the Workers’ Party of Korea, expected in early 2026, plans to develop large-scale tourist zones in several regions will be finalized, signaling an expansion of investment in tourism projects. In this respect, the future performance of the Wonsan Kalma Coastal Tourist Zone is likely to serve as a test bed for setting the direction of North Korea’s tourism policy. -
North Korea’s tourism industry has been utilized as a new arena of diplomatic engagement with China and Russia. Since 2018, North Korea has sought tourism cooperation in the process of
improving relations with China and Russia. As normal trade and investment cooperation became difficult due to international sanctions against North Korea, the country sought to use tourism as a channel to expand economic exchanges with friendly nations within a legal framework. In fact, after Kim Jong Un held a summit with Chinese President Xi Jinping in 2018, the number of Chinese tourists began to increase, and it is estimated that in 2019 alone, as many as 300,000 Chinese visited North Korea. In a situation where the export of North Korean products such as coal and marine products was blocked by UN sanctions, group tourism from China became a major source of foreign currency for North Korea and emerged as a symbol of friendly cooperation between the two countries.
Meanwhile, tourism exchanges that had been suspended due to the COVID-19 pandemic have recently begun to resume through Russia. Since February 2024, North Korea has allowed the entry of Russian tourists, and it has resumed external tourism promotion by participating in the Moscow International Travel & Tourism Exhibition (MITT) for two consecutive years, last year and this year. That North Korea first opened tourism to Russia in this manner is understood as part of the recent closer ties between North Korea and Russia. In July 2025, Russian Foreign Minister Sergei Lavrov personally visited the Wonsan Kalma Coastal Tourist Area and stated that he would provide support by evey available means to enable North Korea to attract Russian tourists. This reflects the trend of expanding exchanges and cooperation in various fields amid the strengthening of North Korea–Russia relations following the Russia–Ukraine war.
From Russia’s perspective, tourism cooperation with North Korea, which has been isolated by sanctions, carries not only economic significance but also diplomatic symbolism. By encouraging Russian tourists to visit North Korea, the two countries can publicly display their friendship both domestically and internationally, and expand into infrastructure cooperation, such as rail and air connections. By attracting Russian tourists, North Korea can externally highlight the image that bilateral relations have been normalized and become closer. At the same time, by first accommodating small groups of Russian tourists, North Korea can utilize the experience as a pilot project to inspect and supplement tourism infrastructure and services such as lodging, dining, transportation, and guides, as well as management systems.
Tourism cooperation with China is also an important issue. While China has participated in the UN Security Council sanctions against North Korea, it has continuously expanded tourism. From North Korea’s perspective as well, Chinese tourists account for a high proportion among foreign visitors to North Korea, and their attraction is of great importance in the activation of North Korea’s tourism industry, since economic benefits can be expected without political burden. However, in 2020, when North Korea itself closed its borders, Chinese tourism to North Korea was also suspended, and although there were movements toward resumption after 2023, a full reopening has been delayed. In December 2024, travel agencies such as Koryo Tour officially announced that they had confirmed from North Korea that tourism would be open to visitors of all nationalities from the end of 2024, and simultaneously released travel products scheduled for 2025; nevertheless, throughout the first half of the year, tourism resumption did not materialize. However, North Korea announced plans to resume international events around the 80th anniversary of the Party’s founding scheduled for October this year, and also revealed related tourism programs, thereby raising the possibility that the entry of foreign tourists, including Chinese tourists, will be permitted on this occasion. -
Tourism is both a potential opportunity factor and at the same time a challenge in U.S.-North Korea relations. What drew attention to North Korea’s tourism zone development projects was a remark by U.S. President Trump. Immediately after the U.S.-North Korea summit in Singapore in June 2018, President Trump stated in an interview that North Korea has excellent beaches and that the world’s best hotels and condominiums could be built along such coasts, which became a subject of public attention. On the very first day of his inauguration in 2025 as well, President Trump mentioned in an interview at the White House what is commonly referred to as North Korea’s “coastal condominiums” in relation to U.S.-North Korea relations. Although U.S. investment in North Korea’s development has never been discussed as an official U.S. policy toward North Korea, if U.S.-North Korea contacts are to take place during Trump’s presidency, there is a possibility that the development of tourism zones along North Korea’s coastal areas could be considered as part of an American economic compensation package for North Korea.
However, in order to utilize the field of tourism for the improvement of U.S.-North Korea relations, there are issues that must first be resolved. The first is the lifting of the measure that in effect prohibits U.S. citizens from traveling to North Korea. The ban on tourism to North Korea by U.S. citizens was also imposed during President Trump’s term in 2017. In 2017, the incident occurred in which Otto Warmbier, a U.S. citizen who had visited North Korea for tourism, was detained and later returned to the United States in a comatose state, after which he died. The U.S. Department of State imposed a comprehensive ban on travel to North Korea by its citizens and has extended this measure annually. The second issue is the United Nations Security Council sanctions against North Korea. Although the sanctions do not contain provisions explicitly prohibiting tourism itself, they prohibit joint ventures with North Korea and large-scale cash transactions. Accordingly, not only tourism development projects requiring large-scale investment or remittances, but also cases in which large amounts of tourism payments flow into North Korea may be interpreted as violations of the sanctions. The very reason why tourism to North Korea is, in principle, not subject to sanctions but is nonetheless referred to as being in the gray zone lies in precisely this subtlety.
On the other hand, from North Korea’s perspective, tourism is a highly attractive option in that it constitutes a breakthrough for earning foreign currency legally even under sanctions. The attraction of tourists does not entail illegal risks such as coal smuggling or arms trading, and it is an area that the international community cannot explicitly block. Accordingly, the Kim Jong Un regime, while taking as a given that the sanctions environment will be prolonged, has focused on revitalizing the tourism industry, and this trend is expected to continue. In fact, Kim Jong Un stated at the completion ceremony of the Wonsan Kalma Coastal Tourist Zone that a development plan would be established to rapidly advance the tourist zone development project, and that it would be formalized at the 9th Congress of the Workers’ Party of Korea scheduled for 2026. However, for such plans to be translated into tangible outcomes, an external environment capable of attracting large numbers of foreign tourists must be created.
From the perspective of the United States, a proposal for investment cooperation in the development of tourist zones can serve as a negotiating tool that provides North Korea with economic opportunities while simultaneously imposing certain constraints. If such a plan were to be implemented, North Korea would gain tangible benefits in the form of foreign currency income and infrastructure modernization; however, if cooperation were to be suspended or conditions were not met, it would lose the anticipated tourism revenues and developmental effects. This structure may function as a factor that compels North Korea to take a more active approach in implementing agreements with the international community, while at the same time playing a role in limiting North Korea’s range of options under the maintenance of the sanctions regime. As a result, North Korean tourism can be said to constitute both a loophole in international sanctions against North Korea and a potential card in negotiations between North Korea and the United States. If “tourism authorization and investment cooperation projects” are to be discussed in future North Korea–United States contacts, it is possible that this would take the form of a small deal, in which North Korea accepts part of the U.S. demands and, in return, the United States permits tourism projects or tacitly allows investment support. Ultimately, tourism may be treated not only as an economic matter but also as a strategic domain in the political and diplomatic context between North Korea and the United States. -
If tourism cooperation with North Korea is to be pursued in practice in the future, it is first necessary to identify North Korea’s demand for investment in tourism. In addition to the development of the Mount Kumgang tourism district and the tourism district in Samjiyon already mentioned by Kim Jong Un, the tourism district development plan scheduled to be announced at the 9th Congress of the Workers’ Party of Korea in 2026 suggests that the required scale of funds will grow even larger. When North Korea disclosed the details of the “Wonsan–Mount Kumgang District Plan” in 2014, it estimated the projected development cost at 7.8 billion USD. At the current point, more than a decade later, it is difficult for the further expanded development plan to be realized without the accompanying mobilization of funds.
North Korea is in urgent need not only of funds but also of technology and know-how for the establishment of modern tourism infrastructure. In terms of software aspects such as hotel management systems, online reservation platforms, international payment systems, tourism safety management, and multilingual services, North Korea’s demand for external technological support is expected to be high. These areas of technological cooperation demonstrate the possibility of forming technological partnerships independently of economic investment.
At present, due to sanctions and the stalemate, it is difficult for South Korea or the United States to directly invest in North Korea’s tourism zones; however, depending on changes in the situation, tourism may become the field through which cooperation can first be initiated. In particular, in the case of South Korea, tourism toward North Korea is a relatively less politically sensitive area and, in the past, has been a practical field of cooperation that brought benefits to both North and South. Tourism, in itself, can serve as a starting point for cooperation and dialogue, but if the situation on the Korean Peninsula improves in the future and sanctions are eased, joint investment between North and South could be discussed not only in Mount Kumgang but also in other tourism zone development projects that North Korea is planning, utilizing South Korea’s capital and experience. Furthermore, it is necessary to consider the possibility of investment participation by the United States and neighboring countries. As introduced in President Trump’s first administration, if North Korea–United States relations improve, participation by the United States even in private-sector tourism development projects may also become possible.
Nevertheless, in practical terms, the United Nations sanctions on North Korea constitute a major obstacle. As stated above, under the UN sanctions, if a large inflow of cash enters North Korea, there can arise controversies over violations of sanctions, and thus, for North Korea tourism to be activated, this issue must be clarified. Accordingly, investment participation by South Korea and the United States in North Korean tourism zones can be realized only if it is discussed together with other agenda items in dialogue with North Korea. However, it is necessary to note the positive role that cooperation in the tourism sector does not conflict with the easing of military tensions but rather contributes to enhancing mutual understanding through people-to-people exchanges. The UN Sanctions Committee on North Korea also has precedents of granting exceptions to sports exchanges such as the Olympics and the Asian Games, and if tourism is accepted as one means of peacebuilding, there also exists the possibility of receiving an exception from sanctions. -
For substantive exchange and cooperation in the field of tourism to be realized, above all, political and security stability must precede. In order to prevent foreign tourists visiting North Korea from perceiving the situation on the Korean Peninsula as a potential risk factor, peace and stability on the Korean Peninsula need to be firmly maintained. In particular, the psychological sense of security of foreigners is directly connected to international tourism demand, and this is influenced by complex factors including not only inter-Korean relations but also the diplomatic environment of surrounding countries and the UN sanctions.
For South and North Korea to shift toward a relationship of reconciliation and cooperation, the resumption of dialogue must be a prerequisite, and for this to occur, a process of building trust through concrete actions, beyond merely urging North Korea to engage in dialogue, is necessary. The suspension of loudspeaker broadcasts toward North Korea undertaken by the South Korean government after the inauguration of the Lee Jae-myung administration can be regarded as an example of such an action. What is noteworthy is that North Korea, rather than immediately responding to South Korea’s dialogue proposals as in the past, has shown a pattern of responding proportionally to the counterpart’s concrete measures. This implies that when determining whether to accept a policy, North Korea is more likely to react sensitively to sustained and predictable patterns of behavior than to a single gesture.
In this context, the South Korean government must devise a strategy to create conditions that enable North Korea to participate more actively in tension reduction and peace-building efforts. To this end, it is necessary to maintain a consistent message while emphasizing that the resumption of tourism can serve not merely as an economic achievement but as a crucial foundation for expanding cultural and human exchanges and building mutual trust, thereby persuasively demonstrating the importance and legitimacy of the initiative.
Furthermore, to increase the possibility of North Korea's acceptance, the internal and external environment that North Korea currently faces must be considered. While North Korea recognizes the potential for earning foreign currency from the tourism industry, it places more emphasis on cooperation with China and Russia than on a full-scale expansion. Consequently, the resumption of inter-Korean tourism is likely to be pushed down in priority in the short term. Furthermore, structural constraints exist for North Korea to fully open its tourism sector as long as international sanctions against it are not eased. Therefore, the South Korean government must prepare specific and highly feasible measures in advance. There is a need to first promote possible tourism cooperation models that do not violate sanctions against North Korea—for example, third-country-linked tourism or special visit programs with a strong humanitarian and cultural focus. -
Tourism exchanges should not be pursued as a one-time event, but rather as part of a process in which both North and South Korea build trust over the medium to long term. To this end, the South Korean government must prioritize the securing of political and security stability, while simultaneously providing both incentives and safeguards to enable North Korea to gradually engage in various exchanges, including in the tourism sector. Only when such a strategic approach is in place can exchanges and cooperation in the tourism sector serve as a tangible driving force for peace and prosperity on the Korean Peninsula.
First, a roadmap should be prepared that includes tourism exchange projects that can be implemented immediately if inter-Korean relations improve. At present, the most realistic option is to utilize the Wonsan Kalma Coastal Tourist Area. Given that Kim Jong Un has announced plans to hold various international events in the Wonsan Kalma Coastal Tourist Area, it is necessary to design theme-based programs in advance and to prepare solutions for potential issues that may arise during implementation.
Second, for tourism cooperation to be sustained, certain preconditions must be met. Specifically, these include the reduction of political and military tensions and the building of inter-Korean trust to lower deterrents for foreign tourists; the establishment of political and institutional trust regarding tourism as a whole; and the arrangement of prior consultations and approval procedures with the international community to ensure that tourism with North Korea does not fall into controversy over sanctions violations. In particular, as experienced in the case of the suspension of tourism in Mount Kumgang, issues related to tourist safety must be concretely negotiated and institutionalized, and in the long term, the legal protection framework for overseas investors, including those from South Korea, should be strengthened.
Finally, it is necessary to require responsible preparation from North Korea as well. First, North Korea should be persuaded to improve tourist safety and convenience in accordance with international standards, and made aware that securing global trust is essential for the growth of the tourism industry. To this end, North Korean authorities should discuss measures such as enhancing the level of tourism services, gradually expanding the permissible scope of contact between foreigners and North Korean residents, and ensuring transparency in the use of business revenues.
Tourism is an effective means to promote mutual exchange and understanding. With the completion of the Wonsan Kalma Coastal Tourist Area as a starting point, the South Korean government should, in the short term, use it as a foothold to improve inter-Korean relations, and in the long term, develop it into a platform for multilateral cooperation. This requires supporting policy and institutional preparations. Attention to North Korea’s tourism industry carries significance beyond the economic realm, as it can provide opportunities for easing tensions on the Korean Peninsula and fostering exchange and cooperation. To translate this potential into tangible outcomes, it is necessary to establish concrete cooperation measures and implementation strategies involving neighboring countries and the international community. If inter-Korean tourism exchanges are carried out in a stable manner, they can serve as a long-term driving force for peace and prosperity on the Korean Peninsula.
| Changes in North Korea’s Tourism Policy and Institutional Basis: Strategy and Practice
| Current Status of North Korea-China and North Korea-Russia Tourism Cooperation and Diplomatic Implications
| Tourism Industry and North Korea-U.S. Dialogue: Opportunities and Challenges
| Practical Opportunities and Constraints of Tourism Cooperation
| Peace on the Korean Peninsula and Prerequisites for Tourism Exchanges
| Conditions and Implementation Measures for the Stable Promotion of Inter-Korean Tourism Cooperation
※ The contents published on 'Sejong Focus' are personal opinions of the author and do not represent the official views of Sejong Institue
