“Rich Merchants” Increasing in North Korea

[imText1]There is an increase of varieties in the items they sell and in how much capital they have among the North Korean merchants. After the late 1990s when the “noodle business in (black) markets” started, the businesses varied from running restaurants to karaoke, lodging and to others. Recently, there has been an increase in the individual (North Korean) merchants investing in North Korean “giupso” (state run business) for the purpose of starting a trade business with China.

Although this business process has not been legalized, the North Korean government protects investors who pay the government the right of enterprise as well as their personal earnings. Furthermore, if an investor does some “patriotic business” (donating money or goods to the government) then he can expand his business much more easily.

Kim Chul Hong, (pseudoname, from South Hamkyung province) we met in Hunchoon, China, is known as the “big hand” in city A of South Hamkyung province. He is an owner of a restaurant with 8 waiters, which also includes karaoke and lodging services. Kim was originally a manager in OOO giupso. Through the workers at Foreign Economic Committee, whom he had kept good relations with for long, he bought forty used tires from China and bribed the government with them so he can run a restaurant.

“Ever since the “walk of suffer” period, everyone started a business of their own. The government stopped the food distribution, and except for the workers of the state run farms, nobody could farm on their own. They had to at least sell noodles to survive. Those who could save a little bit of money from noodle selling, they would buy clothes or goods from China and bring them back to Noth Korea to sell. That is how they maintained their household. I too started selling clothes with the help of my relatives in China once the giupso stopped running.”

Kim further said that in North Korea, you can do everything with money.

“There are many lodging places nearby markets or train stations where you can have your children baby-sit or leave your personal belongings for a while. Furthermore, you can do anything you are capable of, from selling food and goods to trading fisheries. At first, selling and buying was prohibited, but recently, the government even offers a part of the state run factories to be used when the individuals wish to run a business with personal fund. Once he makes profit, he donates a part of his profit to the government, so in some regions, the government recommends it.”

Sung Nam Jin (pseudoname, North Hankyung province) we met in Yenji explained how North Korea transformed.

“There are people who are doing good business in North Korea. They are the ones who can get money from their relatives in Japan or China. In Chungjin, there is a restaurant called, “Naktabong Restaurant,” which is run by a Korean Japanese, ( Korean descendent born in Japan who moved to North Korea). Before, those from Japan were not treated well, but since the money from Cho-chung-ryeon stopping coming in, Korean Japanese people now receive a relatively good treatment. It is said that the owner of Naktabong Restaurant collected money from his relatives to bribe the government.”

Apparently Naktabong Restaurant is a pretty famous restaurant in Chungjin, where Chinese and Japanese foods as well as North Korean ostrich dish are served. You can use not only North Korean money but dollars and yens as well in the restaurant.

Choi Se Hoon (pseduname, from Jagang Province) argued that the phenomenon of which individual businesses are increasing must be observed with close attention.

“The common people are still having extreme difficulties to survive. Although some are running business, most of them are food related businesses. Those who do not have much starve to death and now there may be less people dying, but things did not change much from before. However, there is a constant change among the people who have money. They save money and expand their businesses. For this reason, those working for the party (government) are becoming less privileged. However, they still hold some power. If those people running business were on their knees kissing the feet of the government officials before, now there are many cases the government officials pay visits to the businessmen first.”

Although they are only special cases, the “business” which was only a mere solution for the survival is now more and more believed to be the leeway to power and riches. It is something to be watched patiently, the kind of response the wave of economic reform blowing from the bottom will bring of the North Korean government.

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