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Since 1989, economic relation between two Koreas has been rapidly increased in term of trade and investment as well, mainly drived by government of South Korea. As a result, South Korea is the 2th largest trade partner for North Korea, next to China and economic dependency on South Korea is also getting higher. Trade with South Korea is one of important sources of earning foreign currency for North Korea. However, lack of marketable products of north korea to export to south korea makes it difficult for both sides to expand economic exchange and cooperation. Development of economic relation between two Koreaa relys substantially on non-commercial transaction in form of economic aids by South Korea. For enhancement of economic relation with north korea, efforts are needed to promote exchange of products. As for investment in North Korea, business climate is underdeveloped so that privite companies invest hardly with firm expectation of gaining profits. Under abnormal situation facing North Korea, it is desirable to put first priority on promoting transaction of products by privite companies. In parallel with it, efforts should be concentrated on making investment climate more sound, for example the development of Gaesung Industrial Complex. Besides to promoting the bilateral relation, cooperation with neighboring countries will make great contribution to promotion of economic relations between two Koreas. However, confrontation between North Korea and the U.S is main obstacle to pave the way for multilateral cooperation, which makes North Korea more isolated from the rest world. If current issues like nuclear problem would not find solution, North Korea's isolation would be hardly overcome, which would also make difficult further development of economic cooperation between two Koreas It is remarkble that trade between North Korea and China is expanding with galoping tempo. Trade between two countries in 2005 increased by 40% comparing previous year, which is faster than that between two Koreas. China is the 1st trade partner for North Korea. Political leaders of China who visited Pungyang last year gave words to cooperate with North Korea for economic development. Nowdays China is first largest trade partner for both North- and South Korea. Interdependency of three countries will be more deepening. China has grand plan to establish the economic zone in the Northeast Asia including North Korea. Tripartite relation among China, ROK, DPRK will play favourable role in developing economic relation of two Koreas.