Since the North Korea’s Equity Joint Venture Law passed in 1984, a great deal of effort, including the enactment of the Foreign Investment Legislation followed by several time revisions, has been made in order to attract foreign investments. Nevertheless, it has not brought out favorable outcomes. North Korea’s inherent political risks, low credit rating and poor investment environments have been often addressed to explain the failure but the absence of arbitration statutes was the core cause of unsuccessful accomplishment to promote economic activities and secure economic profits of foreign investment enterprises. Recognizing the statutory shortage, North Korea legislated the Foreign Economic Arbitration Act in July 1999 (FEAA of 1999) to resolve disputes with foreign investment enterprises efficiently and systematically. Subsequently, the FEAA of 1999 was revised completely in July 2008 (FEAA of 2008) to fix the problems uncovered through enforcement of the FEAA of 1999. The FEAA of 2008 is expected to fuel foreign investments and technology transfer. Most of all, it is noteworthy that the FEAA of 2008, endorsing many aspects of the Model Law on International Commercial Arbitration proposed by the United Nations Commission on International Trade Law (UNICITRAL), attempted to meet the international standards and reflected the features of arbitration procedure grounded upon the freedom of contract. However, the FEAA of 2008 still calls for unceasing efforts to ensure consistency and compatibility with other related statutes and solve a few problems found in the provisions of arbitration procedure as well as enforcement of arbitration awards. Although it will take considerable time to solve all the common issues appearing in socialist laws and to overcome the limits of enforcement of arbitration awards stemming from common ownership of socialism, this article makes a few suggestions to advance the effectiveness of the FEAA of 2008: first, it is needed to legislate promptly the related rules and regulations to efficiently operate the FEAA of 2008; second, it is required to train more qualified arbiters who are equipped with international dispute resolution experiences; third, North Korea should join the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards as well as the Convention on the Settlement of Investment Disputes between States and Nationals of Other States to ensure that approval and enforcement of arbitration awards be effectively rendered under the FEAA of 2008.