Despite the deepening international
\nisolation of North Korea, Kim Jong Un is increasingly opening up the country\u2019s
\neconomy and tourism industry in hopes of securing more funds for his
\nleadership. Kim Jong Un\u2019s tacit approval of private business activities has
\nresulted in the expansion of markets. Some suspect that Kim Jong Un is taking
\nadvantage of the budding elements of the market economy such as stall taxes to
\nraise funds for his leadership. Over the past four years of his rule, the lives
\nof average North Koreans are seen as having improved through the North\u2019s
\nvarious economic policies and here to tell us more about is Director Jeon Hyeon
\nJun from the Northeast Asia Peace and Cooperation Institute. <\/i><\/b><\/p>\n
1. Rice prices and the exchange rate in the It seems that more than 90 percent of North Of course, the North Korean economy is not Stable rice prices have always been an 2. So Kim Jong Un\u2019s leadership does not Personally, I think his approach toward the These policies have, to some extent, resolved the problems that 3. Some say that Kim Jong Un is earning an You can say that government funds are being But it\u2019s not that all profits earned from One illustration would be the mobile phone 4. Some believe that this movement of Along with the stabilization of prices 5. But there\u2019s also the belief that the A change in values will inevitably occur. 6. Along with these market-friendly It goes without saying that a boom in Also, modes of transportation such as taxis 7. Though the quality of life for people It is true that with the expansion of the While there are still food shortages, and 8. Lastly, it seems that Kim Jong Un will I think we might see a repeat of Nonetheless, as seen in history, things Despite the deepening international isolation of North Korea, Kim Jong Un is increasingly opening up the country\u2019s economy and tourism industry in hopes of securing more funds for his leadership. Kim Jong Un\u2019s tacit approval of private business activities has resulted in the expansion of markets. Some suspect that Kim Jong Un is taking advantage […]<\/p>\n","protected":false},"author":122,"featured_media":32199,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"wikipediapreview_detectlinks":true,"footnotes":""},"categories":[67],"tags":[],"class_list":["post-32197","post","type-post","status-publish","format-standard","has-post-thumbnail","category-news"],"yoast_head":"\n
\nNorth remained relatively stable in 2015. Some attribute this to the market\u2019s
\nstabilization of supply and demand, and this has also led to a boom in the
\nmarketplace. What is your take on this?<\/i><\/b><\/span> <\/p>\n
\nKoreans maintain their livelihood through the marketplace. Though there are
\ngeneral [official] markets in the North, the majority are unofficial markets through which
\nmany people earn money. As rations under Kim Jong Un\u2019s regime cannot provide for
\nthem sufficiently, it appears market vitalization is being used as a means to
\nresolve this problem.<\/span> <\/p>\n
\nimproving solely due to the pick-up in market activity. Factors such as natural
\nresources and labor exports, tourism, and overseas restaurant operations have
\nhad an effect, but the basis of growth still comes from the markets. <\/span><\/p>\n
\nimportant foundation for growth. In the past, 1 kg of rice has risen up to
\n8,000 KPW, but currently, it is stable, hovering around 5,000. The official
\nexchange rate is believed to be around 108 KPW to the dollar, or 8,400 KPW according to the black market rate. <\/span><\/p>\n
\nactively regulate the marketplace and allows some degree of freedom. If you
\nwere to evaluate his overall policies toward the market? <\/i><\/b><\/span><\/p>\n
\nmarkets is positive. North Korean marketplaces should quickly grow and
\nintroduce the capitalist mode of production, in order for it to receive
\nrecognition in the global community and improve the quality of its people\u2019s
\nlives. So I don\u2019t view this trend of marketization in a negative light. But if
\nthese marketization policies are temporary and short-lived, I think that would
\nbe a problem. <\/span><\/p>\n
\nthe people face in making ends meet. That\u2019s why there would be huge
\nimplications if they start cracking down on markets or if they shut them down
\njust because conditions have improved somewhat for people. There have been many
\ninstances in which the markets were shut down during Kim Jong Il\u2019s time,
\nbecause there were concerns things would get out of control and lead to
\nunwanted rumors. I hope that\u2019s not the case with Kim Jong Un. <\/span><\/p>\n
\nenormous amount of capital through the marketplace. Government funds are
\nsecured through means such as market taxes and mobile phone sales. What do you
\nthink of this?<\/i><\/b><\/span><\/p>\n
\nsecured through the markets. Market fees are collected based on the size of the
\nstall, and the types of items sold. These taxes are no doubt added to the state
\ncoffers and used for state finances, but it is speculated that a portion of it
\ngoes to Kim Jong Un. North Korea is fundamentally a suryong [supreme leader] economy. Since the
\nsuryong has complete control over the nation\u2019s channels of money, you can say
\nthat everything is owned by the state and by extension, the suryong.<\/span> <\/p>\n
\nthe markets go to the leadership. This is because part of it is owned by
\nindividuals. This is why in the North, we now have people called donju [new affluent middle class] who have
\nin essence become capitalists. These are the people who get to own some of the
\nprofits.<\/span> <\/p>\n
\nmarket, where it costs about 50 USD to import a handset from China, which is
\nthen sold for roughly 200-300 USD. The profits from this are pocketed by the
\nNorth Korean government, but it is said to be split roughly by a 3:7 ratio: 30%
\ngoes to the vendor, and 70% goes to Office No. 39 under the Central Party,
\nwhere it is used for leadership funds. Most is spent on the various projects
\nthat Kim Jong Un puts forward. <\/span><\/p>\n
\nmarketization will help stabilize Kim Jong Un\u2019s regime. What do you make of
\nthis?<\/i><\/b><\/span><\/p>\n
\nthanks to the boom in market activity, living standards have improved, so it
\nseems this has helped quell some of the disgruntlement people had. North Korea
\npromotes this improvement as an achievement of Kim Jong Un, so public support
\nfor the leader has remained somewhat steady. If you look at surveys on
\n defectors, you\u2019ll see that Kim Jong Un has about a 60% support rate. Of
\ncourse, this figure is lower than that of Kim Il Sung or Kim Jong Il, but it\u2019s
\nstill a very high approval rating, and it can be attributed to the policies
\nthat have helped stimulate market activity. <\/span><\/p>\n
\nproliferation of markets will trigger a change in values among people. They say
\nthe \u2018jangmadang [marketplace] generation\u2019 value the markets more than the
\nstate, so their loyalty is getting weaker. What would you say to this?<\/b><\/i><\/span><\/p>\n
\nDuring Kim Il Sung\u2019s rule, people strongly believed that their livelihoods
\nwould be taken care of by the leader through state rations. As a result, they
\nhad strong loyalty towards the leader. On the other hand, after experiencing
\nthe Arduous March [famine] of the mid-1990s, as neither the Party nor the leader could
\nprovide for them, doubt began to spread. So recently, love and passion towards
\nthe family and self are becoming stronger than their devotion towards the
\nleader, state and Party. <\/span><\/p>\n
\npolicies, people are also saying consumption is improving. Particularly in
\nPyongyang, the increase of things such as apartments and cars has led many to
\nbelieve that this is the effect of marketization. Could you please tell us
\nabout some of the changes that we\u2019re seeing in people\u2019s everyday lives? <\/i><\/b><\/span><\/p>\n
\nmarket activities will lead to a change in public perception. Individualism rather than collectivism and nationalism develops, and this also
\nleads to a change in actions. According to existing rules, the sale of
\napartments or homes is not allowed since the property belongs to the state.
\nInstead, the type of exchange in North Korea is essentially not for the right
\nof ownership, but the right of usage. Yet the exchange for the right of usage
\nitself is still in conflict with the practice and rules of socialism. While it
\nused to be that one would be punished for this if caught, it has now become so
\ncommonplace that the state security and people\u2019s safety officials just turn a
\nblind eye to it. <\/span><\/p>\n
\nin Pyongyang have increased. This shows that the movement of Pyongyang
\nresidents has become more active, and the need for long distance transportation
\nhas increased. As the markets become more active, jobs normally found in
\ncapitalist societies are emerging, and bureaucrats related to these changes are
\naccepting more bribes as corruption becomes worse. <\/span><\/p>\n
\nhas improved to some degree, unwanted side effects cannot go unnoticed. As the
\nreach of the private economy expands, the planned economy has collapsed, the
\ngap between the rich and the poor has grown, and other factors of instability
\nhave increased. <\/i><\/b><\/span><\/p>\n
\nprivate economy, there has been a collapse of the planned economy and the
\nwealth disparity has increased. The top one percent\u2019s earnings are 18 times
\nmore than the majority of the lower classes. The rate of factory operations has
\nstarted to increase, and this is because wealthy donju are finding ways to cut
\ncorners and pay money to reopen those factories to pocket the profits. <\/span><\/p>\n
\nmany are stuck in absolute poverty, we can say that the very fact that the
\nabove events have become prominent indicates that the elements of production
\nfrom capitalism are being introduced, making it not entirely a bad thing. <\/span><\/p>\n
\ncontinuously look for ways to manage this marketization trend, given the side
\neffects it can produce. What kind of measures do you think we might see in the
\nfuture? <\/i><\/b><\/span><\/p>\n
\nmarketplace regulation and tolerance. In other words, on one hand he will
\noverlook market activities so that it will improve people\u2019s livelihoods, but if
\nit swells to the point that it threatens the regime, he will likely immediately
\nand ruthlessly control it. I think we\u2019ll see a repetition of that. <\/span><\/p>\n
\ncontinue to move forward. Ultimately I believe that North Korea will inevitably
\nreach a point where it will have to officially introduce a market economy. <\/span> <\/p>\n","protected":false},"excerpt":{"rendered":"