* Visit could signal new North Korea interest in economy
* North Korea highly dependent on China but has resisted
changes
* US urges North's leadership to change course
SEOUL, Aug 13 (Reuters) - North Korean leader Kim Jong-un's
uncle -- the man seen as the power behind the young and untested
dictator -- went to Beijing on Monday in the latest signal that
the reclusive state is looking seriously at ways to revive its
broken economy.
The official KCNA news agency said Jang Song-thaek was
visiting China, the North's only major ally, to discuss setting
up joint commercial projects. The news comes after leader Kim
recently told Beijing that his priority is to develop his
impoverished country's decaying economy.
Last month, a source with ties to both Pyongyang and Beijing
told Reuters the North was gearing up to experiment with
agricultural and economic reforms after Kim and his powerful
uncle purged the country's top general for opposing change.
"A delegation of the DPRK-China Joint Guidance Committee
Monday left here for Beijing, China to take part in the third
meeting of the committee," KCNA said.
DPRK is short for the North's official name, the Democratic
People's Republic of Korea.
"It was headed by its DPRK side Chairman Jang Song Thaek who
is a department director of the Central Committee of the
Workers' Party of Korea."
KCNA said the meeting is to discuss the joint economic
projects in Rason on the North's east coast, and in
Hwanggumphyong, an area on the border between the two countries
that is yet to be developed.
The dispatch gave no details about the projects or who else
was in the delegation.
The visit by Jang, who has long advocated economic reforms
in one of Asia's poorest states, follows growing speculation
that Pyongyang and its new leaders want to bring changes to the
way the economy is managed.
The two countries have planned to develop a new industrial
district on the Yalu River that runs along their border, but the
construction of a new bridge that will be part of the project
has been suspended because of disagreements on how to proceed.
China is believed to be wary of pursuing a major new
commercial venture with North Korea amid its own leadership
transition and as Pyongyang continues to defy calls to divert
scarce resources away from arms development program.
South Korea is the only other partner in commercial
development in the North, with an industrial park just north of
their heavily fortified border that is the site of factories
where about 120 South Korean firms use cheap local labor to make
goods.
But South Korea's Hyundai conglomerate has learned the risks
of doing business with the North after assets it built in the
Mount Kumgang resort on the east coast were frozen following
the shooting death of a visitor in 2008 that led to the
suspension of tours there.
CONTRASTING IMAGE
North Korea already relies heavily on China to support its
crumbling economy but its leadership has in the past proven
deeply suspicious of any changes, seeing them as a threat to its
control over the country.
But Kim Jong-un, who took over the state's family
dictatorship when his father died in December, has presented a
sharply contrasting image to his father and is believed to be
planning to carry out economic and agricultural reform.
"There is an element of explaining to China the reforms and
opening that Kim Jong-un has been planning, and of seeking
support by China, which will be crucial" said Yang Moo-jin of
University of North Korean Studies in Seoul.
In Washington, a senior U.S. official said Jang's visit,
which follows a trip to North Korea earlier this month by a
senior Chinese Communist Party official, also contained an
important element of diplomacy.
It could be a prelude to a mission by new leader Kim to
Beijing, said the official, speaking on condition of anonymity.
"It's also part of refurbishing the relationship, which was
a bit dented" by North Korea's decision to go ahead with a
rocket launch despite public warnings from China, the official
said.
The destitute, centrally planned North Korean economy has
been on the decline for years and is unable even in years of
good harvests to feed its 24 million people.
The problems have been compounded by United Nations
sanctions imposed after Pyongyang's missile and nuclear tests in
defiance of international warnings including disapproval by its
ally China.
U.S. State Department spokeswoman Victoria Nuland urged
China to persuade the new North Korean government to take
actions to end the isolation Pyongyang brought upon itself with
those nuclear and missile tests.
"We're hopeful that the new leadership will consider
changing course," she said.
"They can open their country, come back into compliance and
live in a place that respects human rights, respects the needs
of their people, or they can keep doing what they've been doing
and continue to face isolation and continue to face misery," she
told a news briefing.
In another sign that Kim may be looking to end international
isolation, he has sent the country's nominal head of state Kim
Yong-nam this month to Vietnam and Laos, where he was reported
to have discussed economic development.