Archive for January, 2013

DPRK imports CCTV cameras

Monday, January 14th, 2013

According to the Choson Ilbo:

North Korea is tightening surveillance of the population using tens of thousands of Chinese-made surveillance cameras. According to Chinese customs data, the North imported a total of 16,420 CCTV cameras worth about US$1.66 million from China from January to November last year.

In 2009, the first year China published statistics on bilateral trade, the North imported a whopping 40,465 surveillance cameras from China. In 2010 the figure was 22,987 and in 2011 22,118. Altogether the North has imported over 100,000 cameras worth about $10 million.

Meanwhile, crude oil and oil products were the major products the North imported from China between January and November last year with a total value US$526 million. Next came naphtha products ($101.7 million), cargo trucks ($92.2 million), and flour ($58.8 million).

Read the full story here:
Chinese Cameras Help N.Korean Regime’s Surveillance
Choson Ilbo
2013-1-14

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Kim Jong-un’s new year address (2013)

Friday, January 11th, 2013

Kim Jong-un ditched the new year “Joint Editorial” of the Kim Jong-il era and has personally taken on the role of reading a new year speech (appx .5 hrs)–as was done by his grandfather, Kim Il-sung. Here is a video of the speech (in Korean..no subtitles):

KCNA published the text of the full speech. Here is the English version. Here is the Korean version.

Having read it all, I can understand why Kim Jong-il did not want to give these speeches.  If I had absolute power I would not want to either.  Here is some analysis that others have provided:

The New York Times highlighted Kim jong-un’s softening tone towards South Korea:

“A key to ending the divide of the nation and achieving reunification is to end the situation of confrontation between the North and the South,” Mr. Kim said. “A basic precondition to improving North-South relations and advancing national reunification is to honor and implement North-South joint declarations.”

He was referring to two inter-Korean agreements, signed in 2000 and 2007, when two South Korean presidents, Kim Dae-jung and Roh Moo-hyun, were pursuing a “Sunshine Policy” of reconciliation and economic cooperation with North Korea and met Mr. Kim’s father in the North Korean capital, Pyongyang.

And on economics:

In his speech, Kim Jong-un, echoed themes of previous New Year’s messages, emphasizing that improving the living standards of North Koreans and rejuvenating the agricultural and light industries were among the country’s main priorities.

But he revealed no details of any planned economic policy changes. He mentioned only a need to “improve economic leadership and management” and “spread useful experiences created in various work units.”

The Daily NK issued this commentary:

According to the Ministry of Unification in Seoul, “Overall there was no new policy; they stuck to the existing line.”

In last year’s New Year’s Joint Editorial, the Kim Jong Il era equivalent of this morning’s address, a North Korean regime conscious of the risks of succession emphasized little more than the need to adhere closely to the last instructions of Kim Jong Il as a means of promoting social stability. Kim Jong Il’s name was mentioned a total of 34 times in that editorial.

This year, Kim Jong Eun focused on propagating the accomplishments of his first year, predominantly the December 12th rocket launch success, which he set up as an example for all sectors of the North Korean economy to promote growth. He even put forward a rocket-inspired slogan for 2013, calling for overall economic development based on the “spirit that conquered the universe.”

Cho Bong Hyun, a researcher with IBK’s economic research arm, told Daily NK today, “The core characteristic of this year’s New Year’s Address was emphasizing the Unha-3 launch and linking it to the economy. Kim Jong Eun seems to be planning to use the success of the rocket launch as a tool with which to vitalize the economy.”

However, the list of major achievements mentioned in the address included the military parade that marked the 100th anniversary of Kim Il Sung’s birth, the completion of Huichon Dam and its affiliated power plant, and the construction of athletic facilities around Pyongyang. It is hard not to regard such projects as indicators of North Korea’s fundamental economic weakness rather than strength.

Kim made references to reunification and improving relations with South Korea as well, but did not appear to offer a compromise position that could spur dialogue. Indeed, he appeared also to confirm that Kim Jong Il’s military-first political line is set to continue in 2013 and on into Kim Jong Eun’s rule.

Regarding the softer tone with South Korea, the Daily NK had this to say:

The message for South Korea in North Korea’s statement for the New Year was considerably more gracious than that of last year. Kim Jong Eun stated in his address, as per the subsequent official translation, “An important issue in putting an end to the division of the country and achieving its reunification is to remove confrontation between the north and the south.”

Despite the fact that the “unity of the Korean people” has been a constant theme of North Korean discourse over several decades now, the reaction to Kim’s words was abnormally enthusiastic. Some experts even believe that the speech revealed Kim Jong Eun’s ardent wish to restore inter-Korean relations, and say that North Korea is sure to put more weight on dialogue with South Korea going forward. The state-run Korea Institute for National Unification (KINU) concluded that North Korea has returned to a gentler South Korea policy.

Yet the reality is that North Korea has been going back and forth between dialogue and provocation over many years. This was even true under the left wing Kim Dae Jung and Roh Moo Hyun administrations. Lest we should forget, at the launch of the Lee Myung Bak administration in 2008, the first conservative administration for ten years, North Korea expressed great anticipation that progress in inter-Korean relations was impending.

At that time, North Korea called for the creation of “a new history of peaceful prosperity” and the promotion of legal and institutional mechanisms to prepare for unification. However, as inter-Korean relations went astray and Kim Jong Eun moved closer to the driving seat, North Korea embarked on a set of extreme provocations. Mind you, even then North and South were still discussing the possibility of a summit behind the scenes.

North Korea has chosen to limit its attacks on the new administration for one major reason; to test it. This happened in the 2003 and 2008 addresses (then known as the New Year’s Joint Editorial); indeed, it happens each time a new administration is launched down in Seoul.

The Daily NK also reports that the new year speech’s treatment of economic issues is nothing new:

[…] Promoting the development of light industry has been a key feature of a number of recent New Year’s Joint Editorials, the keynote editorial carried across North Korea’s three main publications; Rodong Shinmun (for the Chosun Workers’ Party), Chosun People’s Army (for the military) and Minju Chosun (for the Cabinet).

Evan Ramstad at the Wall Street Journal highlights a similar theme.  In his article, “North Korea’s Message: New Style, Similar Script“, he very cleverly compares 2013, 2012, 2011 publications. They are very similar.

Stephan Haggard confesses to being worn down (as am I), but offers some thoughtful comments nonetheless:

The basic economic message seems to be “do everything,” which is really equivalent to not prioritizing anything at all. But it is possibly worse than that. The slogan for the year is “Let us bring about a radical turn in the building of an economic giant with the same spirit and mettle as were displayed in conquering space!” This approach suggests that the regime’s thinking is still locked into the idea of leapfrogging, “100 day battles,” and monumentalism; indeed, the first reference to economics in the speech is to “Juche-oriented and modern factories and enterprises and reconstructed major production bases in key industrial sectors on the basis of advanced science and technology…”

If there is any logic to the speech—a big assumption—it sounds like heavy industry comes first. (“By adopting decisive steps to shore up the vanguard sectors of the national economy and the sectors of basic industries, we should develop coal-mining, electric-power and metallurgical industries and rail transport on a preferential basis and provide a firm springboard for the building of an economic giant.”) This is disheartening to say the least, but who knows? In the next section, the speech says the country should concentrate on people’s livelihoods, agriculture and light industry “too,” and also with the increasing emphasis seen in recent speeches on “science and technology” as a panacea.

Haggard followed up with these comments:

We see three things in the speech, editorials and posters that are discouraging. The first is the ongoing confusion between ends (being a strong and prosperous nation) and the strategy of getting there (heavy industry first, technological leap-frogging, vague injunctions to focus on people’s livelihoods). Second, the emphasis on technology as a form of economic deliverance is everywhere (“Today’s era is an era of science and technology, and we should open up an epoch-making phase in building an economically powerful state with the power of science and technology. The key to crushing the sanctions and blockades by the imperialists and leaping forward into an economically powerful state lies in science and technology.”) A single-minded focus on technology can put a missile in space, and the launch has to be seen as an achievement. But a single-minded focus on technology can’t produce economic growth in the absence of policies that promote ongoing innovation and provide incentives to using technology in an efficient way.In our humble opinion, it is a greater–if more mundane–achievement to grow at 3-4 percent a year than to waste hundreds of millions of dollars on a non-functioning satellite and military posturing.

Which brings us to the final problem: what we call the exhortatory approach to economic growth. The endless exhortation in important speeches is not coincidental. In the absence of meaningful incentives, the only way to squeeze more juice out of the workforce is hope that they respond to nationalist appeals by increasing effort. But a country’s workforce can work very hard and remain poor if what it is doing destroys value, as forced-march economic campaigns typically do. As we know from past socialist collapses, a surprising share of the capital stock in the former Soviet Union and Eastern Europe was essentially worthless when the final reckoning came. Effort cannot substitute for fundamentals, if anyone is even paying attention to these campaigns any more.

Evans Revere, writing for Brookings, made some interesting observations:

Kim Jong-un’s choice of venue for the New Year’s speech was important. He delivered his remarks at the Korean Workers’ Party (KWP) Central Committee building, a site selected to reinforce another theme of his year-old leadership: the primacy of the Party over other institutions and the role of the KWP as the main vehicle for his rule. It was no accident that the Party flag was displayed prominently next to Kim as he spoke.

Having sought to convey that he is a leader in his grandfather’s mold, and having reminded the nation (particularly the military) that the Party under his leadership is in the driver’s seat, Kim spent much of the speech holding forth on another central theme of his reign: economic growth. Looking through this section of the speech, one is hard pressed to find details about future economic plans or concrete new ideas aimed at boosting the DPRK’s anemic economy. In fact, its hortatory calls for making new “advances,” “building an economic giant,” and “breaking through the cutting edge” resemble the timeworn, empty exhortations of past New Year’s editorials. Thin gruel indeed.

Andray Abrahamian at Choson Exchange picks up on a similar theme:

For those of you with an interest in empirical measurements, Kim Jong Il’s “Songun” only got six mentions this year. Kim Il Sung’s “Juche” got 13. But as much as the content of Kim’s speech is important, the very fact that he made a speech at all demonstrates his continuing efforts to associate himself with the pre-Songun era of his grandfather. Implicit in Kim’s style is a return to the relative stability and prosperity that Kim Il Sung oversaw.

The Institute for Far Eastern Studies issued two reports on the new year speech:

Kim Jong Un’s New Year’s Address Stresses Continuous Economic Management and Improvement
2013-1-4

In the New Year’s address delivered by Kim Jong Un, emphasis was placed on easing the hostile inter-Korean relations and implementation of the June 15 inter-Korean joint declaration.

An intriguing point of this year’s speech was its format, as Kim Jong Un’s delivery of the New Year’s Address was televised — a rare occurrence, considering the last one to be televised was that given by Kim Il Sung in 1994, some nineteen years ago. The Korean Central News Agency and Korean Central Television broadcasted this year’s speech.

The highlight of the speech was Kim Jong Un’s declaration, “To end the state of division of the country and achieve reunification, we must remove confrontations between North and South.” He added, “Respecting and thoroughly implementing the north-south joint declarations is a basic prerequisite to promoting the inter-Korean relations and hastening the country’s reunification.”

This can be interpreted as an effort by the North as a hopeful message to the newly elected South Korean president Park Geun-hye for improved relations and to urge her administration to depart from her predecessor’s North Korea policy and implement the June 15 and October 4 Joint Declarations.

In the 2008 New Year address, North Korea made a similar statement encouraging the then Lee Myong-bak administration to fulfill the joint declarations.

As for North Korea’s foreign relations, Kim stressed that it will expand and develop relations with those countries that are friendly and cooperative to North Korea and affirmed to “strive actively to realize independence in the world and safeguard peace and stability in the region.” However, there was no mention of North Korea’s position on the nuclear issue or US-DPRK relations.

As for the economy, Kim stressed that “the entire Party, the whole country and all the people should wage an all-out struggle this year to effect a turnaround in building an economic giant and improving the people’s standard of living.” The importance of economy and the improvement of the lives of its people were reiterated and agriculture and light industry was named as frontline industries.

Similarly, last year’s New Year joint editorial called for revolution in light industry and agriculture. This year’s message stressed that economic guidance and management must be improved to reflect the realities of development. It also stressed that the North “hold fast to the socialist economic system of our own style, steadily improve and perfect the methods of economic management on the principle of encouraging the working masses to fulfill their responsibility and role befitting the masters of production, and generalize on an extensive scale the good experiences gained at several units.”

In 2012, North Korea announced its ‘June 28 policy’. There is speculation that changes are taking place in various parts of the country to pilot changes in its economic system.

The New Year address also emphasizes the military. “The military might of a country represents its national strength; only when it builds up its military might in every way can it develop into a thriving country and defend the security and happiness of its people.” Kim Jong Un also emphasized that “The sector of defense industry should develop in larger numbers sophisticated military hardware of our own style that can contribute to implementing the Party’s military strategy.”

South Korean government showed a lukewarm response to North Korea’s New Year address. While the format of the address was relatively novel in that it was televised, most North Korea watchers see the content and format of the joint editorial as similar to past addresses. Kim Jong Un placed heavy emphasis on the economic sector, but the method of improvement revealed no major changes from the current policy. Likewise, no concrete measures were suggested for the improvement of inter-Korean relations except for a general suggestion to open the doors for dialogue.

and…

North Korea’s National Science and Technology Council calls the New Year’s Address, “A Shortcut Measure to Become an Economic Powerhouse”
2013-1-11

In the 2013 New Year speech by Kim Jong Un, plans to strengthen the National Science and Technology Council can be noticed to serve as a driving force for the future economic construction of North Korea.

According to the Chosun Shinbo, a pro-North Korean newspaper in Japan, the National Science and Technology Council assessed the New Year speech to substantiate, “The teachings of our leader Kim Jong Un, to stipulate the power of science and technology in order to provide a shortcut in constructing a strong economic nation.”

The news evaluated 2012 as a year of revolutionary achievement for succeeding in the satellite launch as it was the last year of the “Third Five-Year Plan” of scientific and technological development.

According to the newspaper, the National Science and Technology Council was acclaimed as an esteemed mechanism in conducting scientific research contributing to the nation’s economic development and in creating a new foundation for various scientific research sectors to carry out its projects.

As a result, the news claimed noteworthy achievements were made in state-of-the-art scientific research, with over hundreds of studies conducted in reconstruction and modernization projects in factories and enterprises across the country.

The 2013 marks the first year of the “Fourth Five-Year Plan of Scientific and Technological Development” and the National Science and Technology Council outlined its major goals and tasks of this year: “Our scientists and technicians will carry out the tasks put forth by the New Year speech to realize the modernization of our economy and build a strong nation from advancement in science and technology.”

The Presidium of the Supreme People’s Assembly decided last month to award the Medal of Kim Jong Il to the Korean Committee of Space Technology (KCST) for the successful launch of the Kwangmyongsong 3-2 satellite and commended it as the “paramount event and celebration in our national history of 5,000 years and of our people.”

The successful launch of the long-range rocket was lauded as a major national achievement to North Koreans, with the opportunity to embark on the building of a new satellite named “Kim Jong Un.”

In addition, Rodong Sinmun, the official newspaper of Workers’ Party of Korea, declared that the era of President Kim Il Sung and Kim Jong-il should be known as the “100 Years of Juche,” while the newspaper referred to Kim Jong Un’s era as the “new 100 Years of Juche.”

For Kim Jong Un, it is critical that his regime improve the North Korean economy in order for him to fully consolidate his power and win the hearts of the North Korean people. Kim is likely to continue to push forward with economic development efforts in 2013, through promoting political stability.

In this year’s New Year’s message, the year 2012 was named as the “year of the people” while agriculture and light industry were said to be major fronts for economic construction of a kangsong taeguk, or strong and prosperous nation. Food shortage and livelihood of the people were also named as major challenges to be resolved to realize kangsong taeguk.

From this year, “June 28 Policy” is likely to continue and already, pilot measures were implemented in selected rural areas to improve economic management and expand autonomy of factories and work sites. Depending on the outcomes of the pilot measure, changes in economic policy is likely to occur this year.

Some new measures likely to take place are as follows: in the agricultural sector, the expansion of farmers’ right to dispose of grain yield; in the industrial sector, the increase of incentives via increasing the autonomy of each company.

Alexandre Mansourov wrote extensive comments on the DPRK’s 2012 in 38 North.

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Kaesong Industrial Zone production continues to rise

Thursday, January 10th, 2013

According to Yonhap:

Production at the Kaesong Industrial Complex grew 17.5 percent last year from a year earlier as South Korean firms employed more North Korean workers, which raised output, Seoul’s Unification Ministry said Thursday.

The total output by the 123 South Korean firms operating in the inter-Korean economic project zone is estimated to have reached US$470 million during the one year period, according to data released by the ministry handling inter-Korean affairs.

The total number of North Korean workers employed at the industrial park in the North Korean border city of Kaesong, rose to 53,507 as of the end of 2012, up from 49,866 a year earlier, according to the data.

You can read the full story here:
Output from Kaesong complex jumps 17.5 pct on-year in 2012
Yonhap
2013-1-10

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DPRK marks Kim Jong-un’s birthday

Tuesday, January 8th, 2013

The level of celebration is no up to that of Kim Il-sung or Kim Jong-il, but the Daily NK provides interesting details of the new “holiday”:

Inside sources have revealed that North Korea marked January 8th, Kim Jong Eun’s birthday, with a nationwide program of commemorative lectures and meetings, along with the delivery of gifts to children.

A source from Hyesan in Yangkang Province told Daily NK on the 8th, “On the 7th at 5PM, everyone had to attend a commemorative lecture to celebrate the birth of comrade Kim Jong Eun. They congratulated comrade Kim Jong Eun on his 33rd birthday and first year working in the Central Party Committee, and made us declare that we would comprehensively implement the New Year’s Address.”

The source added, “People then had to gather in their units by 7AM this morning to pledge allegiance to him. The main point was to say that we will serve Marshal Kim Jong Eun loyally and only follow the Marshal.”

A second source from Hoiryeong added, “At 7AM today the authorities started distributing gifts to elementary, kindergarten and middle schools to mark comrade Kim Jong Eun’s birthday. In the past gifts were delivered to individual schools, but this time a team was formed to deliver them one by one. This was done so that every child would be sure to receive his or her gift.”

The source explained, “Children had to show their birth certificates to the team to receive their gift bag. The gift bag included five things; a 100g bag of candy, a bag of cookies, candy made of beans, gum and rice crackers. However, the quality of the snacks was no better than in the past, and a lot of the kids didn’t much want to eat them.”

Despite the birthday events, January 8th 2013 still paled in comparison to the events held annually on February 16th and April 15th, the anniversaries of the births of Kim Jong Il and Kim Il Sung respectively. This is because it has only been a year since Kim Jong Eun became supreme leader upon the death of his father. As such, this year the authorities did not hold any public celebration events, a trend that is expected to continue for the first three years of Kim Jong Eun’s rule.

Read the full story here:
January 8th Marked by Lectures and Loyalty
Daily NK
Kim Kwang Jin
2013-01-08

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Number of DPRK defectors drops in 2012

Wednesday, January 2nd, 2013

According to the BBC:

There has been a significant decrease in the number of refugees from North Korea to South Korea in 2012 compared with 2011, data from South Korea shows.

Just over [1,508] North Koreans arrived in the South in 2012 compared to more than 2,700 the previous year, according to the South’s Unification Ministry.

Activists say that the North, under Kim Jong-un, is taking stronger measures to prevent people from trying to leave.

The figure for 2012 is the first time that numbers have fallen below 2,000 since 2006, says Yonhap news agency.

There are about 24,613 North Koreans who have arrived in South Korea since 1998, according to the Unification Ministry.

Additional Information

Andrei Lankov offers additional numbers and context here.

RFA reports that border guard rotations have been increased.

Read the full story here:
Drop in North Korean refugees to South Korea
BBC
2013-1-2

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DPRK – China trade in 2011

Wednesday, January 2nd, 2013

According to Bloomberg:

North Korea’s trade with China expanded more than 60 percent to $5.63 billion in 2011 […]

Commerce with China accounted for 70.1 percent of the North’s total $8 billion trade in 2011, up from 57 percent in the previous year, South Korea’s national statistics office, Statistics Korea, said in its annual report today in Seoul. North Korea does not report economic data. Inter-Korean trade amounted to about $1.71 billion in the same year.

Excluding a dip in 2009, trade between the two countries has increased every year since the start of 2000, when the statistics bureau started releasing estimates. Data for 2012 will be released around the end of next year.

North Korea’s economy expanded 0.8 percent in 2011 and gross national income per capita was 1.33 million won ($1,239), nearly one nineteenth that of South Korea’s 25 million won, according to the Bank of Korea. South Korea’s total nominal gross national income was 38.2 times that of the North’s 32.44 trillion won.

The regime imported 3.8 million barrels of crude oil for 2011. Power generation capacity was 6.9 million kilowatts, less than one-10th that of South Korea. Steel production was 1.23 million tons and production of chemical fertilizer production was 471,000 tons.

North Korea’s population rose to 24.3 million in 2011 from 24.2 million the previous year — about half of South Korea’s. Population estimates were based on North Korea’s 1993 and 2008 censuses.

The Los Angeles Times also reported on these findings.

Here is coverage in Business Insider.

The Statistics Korea page for North Korea can be found here.

Read the full story here:
N. Korea’s 2011 China Trade Grew More Than 60 Percent
Bloomberg
Sangwon Yoon
2013-1-2

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Won continues to fall in value

Tuesday, January 1st, 2013

According to the Daily NK:

A source from Pyongyang told Daily NK about the current situation on the 4th, explaining, “The price of rice is 6,700 won now, 300 won more than it was two weeks ago. The markets weren’t able to operate properly while the people were being made to attend events for the mourning [of Kim Jong-il’s death], and that lasted until the 18th. But even now there are people who are still hoarding food, so the situation is not getting any better.”

According to the source, there was word that rice would arrive in bulk from China after the Kim Jong Il mourning period, but supplies to markets barely changed despite evidence that some rice did arrive. Not only that, “Even though prices went on rising, the upper (the authorities) still tried to control areas of market operation during the mourning period, so there were traders selling rice secretly, and some alley traders (those operating beyond the market walls) asking for more than 8,000 won a kilo.”

“Municipal Party cadres kept telling us to try and wait because the Marshal (Kim Jong Eun) had issued an order to ‘ensure rice for the people,’” she mused. “But nobody believes that kind of talk anymore. Rice will be in short supply during January, and this is likely to go on into February given study sessions for the New Year’s Address and then preparation for Kim Jong Il’s birthday.”

“The U.S. Dollar exchange rate here is out of control, and has reached 9,100 won per dollar. Speculation has it that they will try yet again to control exchange rates this month, and this is making the exchange rate problem even worse,” she concluded. “In just Pyongyang’s markets, about 50% of the money in circulation is U.S. Dollars, 25% is Yuan and 25% is from here. I guess people want to have foreign currency more and more because they cannot foresee what will happen next.”

“People from this city can easily distinguish a real dollar from a counterfeit one, and people soon learn about traders who dare to deal in fakes,” she added.

Read the full story here:
Markets Mired in Mournful Turmoil
Daily NK
Lee Sang Yong
2012-1-4

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