Archive for April, 2013

Analysis of Kim Jong Un’s official activities in 2012

Thursday, April 18th, 2013

Institute for Far Eastern Studies (IFES)

After Kim Jong Un came to power about a year ago, his main official activities reportedly were focused on the military.  The young leader is said to be looking to consolidate control over the military to strengthen the monolithic leadership system.

Recently, South Korea’s Ministry of Unification (MOU) released a report on the first anniversary of Kim Jong Un’s appointment as the first secretary of the Workers’ Party.  In the report, Kim Jong Un is reported to have made a total of 192 official activities in which 38 percent (73 activities) were focused on the military while political and economy related activities were 23 percent (45) and 20 percent (37), respectively.

Compared to Kim Jong Il’s record of 145 activities in 2011, in which military related events were 39 while economic and political and entertainment performances were 11 and 29, respectively, Kim Jong Un’s activities were focused more on the military.

In addition, a higher number of military elites were seen accompanying the state leader to these military-related events.

The report also stressed the difficulty in assuming that the North Korean economy drastically improved or deteriorated after Kim Jong Un took power.  According to FAO and WFP reports, 2012 to 2013 grain production reached 4.92 million tons, which is an increase of 10.5 percent against the previous year.

This is the third consecutive year where an increase in grain production has been reported; but North Korea still faces a deficit of 210,000 tons, as 5.43 million tons is estimated to be minimum grain requirement (according to FAO) and only 300,000 tons is expected to come in from overseas.  However, MOU authorities explain that regardless of the food supply, distribution difficulties still remain in North Korea.

The exchange rates are reported to have been continuously on the rise from last year.  As of March of this year, 1 USD exchanged for 8,000 KPW and the price of 1 kg of rice was 5,500 KPW.  Considering the average monthly salary of North Korean workers ranges between 3,000 to 4,000 KPW, the food situation for the ordinary people is suspected to still be poor.

The report also did not see any significant signs of changes in North Korean economic policy.  In North Korean leader Kim Jong Un’s New Year message, building a strong economic nation was named as the top agenda for the year, with agricultural and light industries as key sectors. However, the national budget recently released by North Korea’s Supreme People’s Assembly (SPA) revealed a decrease in the budget for agricultural and light industries while the defense budget has increased.


US cuts subsidies to South Korean groups

Wednesday, April 17th, 2013

According to Yonhap:

The United States has virtually stopped funding anti-North Korean civic groups in South Korea due to its financial downturn, sources here said Wednesday.

Organizations such as the North Korea Intellectuals Solidarity (NKIS) and the North Korea Reform Radio said in a seminar in Seoul that Washington’s financial assistance for groups that support liberty and human rights has all but dried up this year.

“At its peak, the U.S. provided US$5 million in support annually, but the general lack of similar support from the Seoul government may have played a role in the latest cutbacks,” said NKIS executive director Kim Heung-kwang.

He also speculated that current economic troubles in the U.S. and the implementation of across-the-board budget cuts are affecting overseas financial support.

Kim Seung-chul, head of the radio station, said that his organization had relied on assistance from the National Endowment for Democracy, which is controlled by the U.S. State Department.

“With the drying up of subsidies from other U.S. sources, there is a pressing need for the Seoul government to take action,” he said.

Read the full story here:
U.S. cuts off subsidies to anti-N. Korea groups in S. Korea


Chongjin’s Wongang Beer…almost

Sunday, April 14th, 2013

Reuters offers a cautionary tale of investing in the DPRK:

Setting up a brewery in North Korea seemed like a good idea to Harry Kim and his Chinese friends two years ago. Everyone likes beer, even in one of the world’s most closed and least understood countries, they reckoned.

Kim and his partners even got the beer flowing after workers strapped equipment onto a truck in the Chinese border town of Tumen and drove it to the North Korean coastal city of Chongjin. Chinese engineers taught the locals how to brew. City officials loved the taste, he said.

But the small Chinese-North Korean venture ran aground within months after failing to get final approval from authorities in Pyongyang.

Kim’s experience is an illustration of both the challenge and the potential of doing business in North Korea, which has grabbed global attention in recent weeks with its threats to wage nuclear war on South Korea and the United States.

“It wasn’t rejected. We just waited. The central government didn’t come and say ‘no’, but the documents were just never issued and so we eventually gave up,” said Kim, a Chinese national of Korean descent living in Tumen in China’s northeastern Jilin province.

There is little public information on North Korea’s beer market but one thing seems clear – demand outstrips supply.

Troy Collings, a director at Young Pioneer Tours, a travel operator based in China which takes groups into North Korea and has organised brewery visits, said there were probably less than a dozen locally made beers available in the country.

In Pyongyang, two hotels concoct their own microbrews. The Rakwon department store creates its own eponymous beer, too, he said.

“They can’t produce enough for the domestic market,” said Collings.

The opportunity was clear – and reinforced for Kim when he saw the elite in Chongjin drinking a lot of Heineken and Corona.

So, in mid-2011, Kim and two friends joined up with a North Korean businessman to put the brewery plan in motion.

Approval from Chongjin city came easily, he said. The province, North Hamgyong, gave the green light too. And the first of three investments in equipment and supplies – the initial one worth about 200,000 yuan – was made.

Since North Korea has no system of credit and the risks of investing were high, Kim and his partners tied the beer project to seafood exports.

Before each investment was made, they were allowed to buy a cargo of North Korean seafood to sell in China. The first was about 50 tonnes of squid, he said.

It took about nine hours to drive from Tumen to Chongjin with the brewery equipment, including stops at customs.

The equipment was installed quickly and Chinese engineers showed the North Koreans how to brew. Soon, suds were flowing. The product was dubbed Wongang, or ‘river source’, beer.

On the first day of business the investors invited senior city and provincial leaders to the brewery for a sample. All approved, Kim said.

But the new brewery could not ramp up production without authorisation from Pyongyang, which never came despite months of waiting. There was never a response and the investors never got an explanation.

“If you push too hard it could raise suspicions,” Kim said.

It was a pity, because the North Koreans were good workers, he said, citing how the investors overcame the frequent power cuts which made it hard to use a computer to monitor the brewing process.

Instead, the investors stationed North Korean workers at each of the pressure gauges on the brewing equipment in 12-hour shifts. The workers were told if the dial reached a certain level they should turn a knob to let off pressure.

“They got chairs and sat there looking at the gauges, not sleeping all night, one person at each position,” said Kim.

Thanks to the squid hedge, the Chinese investors basically broke even. Kim now runs his restaurant in the space where the brewing equipment was stored before it was hauled to Chongjin.

Some day Pyongyang may give the green light, Kim says, but he is not holding his breath.

“As I was leaving they said ‘It’s not that we don’t want to do it, and it’s not that our senior leaders or the central government don’t want to do it, but we just don’t have practical experience with this kind of thing’.”

UPDATE: Simon notes in the comments:

There are not about a dozen locally brewed beers in the DPRK, there are literally dozens, if not many more. A great many restaurants and bars brew their own beer. The number quoted in the article isn’t close to the reality that small brewing set-ups are quite widespread in Pyongyang and other cities too.

Read the full story here:
Nuclear threats to squid hedges: it’s hard to get a beer in N.Korea
John Ruwitch


North Korean use of Bittorrent

Friday, April 12th, 2013

A researcher for Torrenfreak has used a database system called Scaneye to track the DPRK’s use of BitTorrent (peer-to-peer file sharing). Here are his results:

One of the titles that jumps out immediately is “Net Monitor for Employees Professional,” which seamlessly fits the country’s profile. Ironically, the downloader in question did very little to cover his or her own tracks.


There are also other needs for which BitTorrent can give a helping hand, on the adult entertainment front for example. The screenshot below shows a selection of the adult clips, including the work of Japanese porn actress Marica Hase and her U.S. colleague Alice Frost.


Aside from spy tools and porn there are plenty of less controversial titles listed as well. “The Complete Home Decorating Idea Book” for example, which may have been out of stock at the local book store.

American movies and TV-shows are also hard to obtain in North Korea it seems, but the pirated editions are easily accessible online.

“The Following” for example, a TV-show about a psychotic serial killer who leads a cult of serial-killing followers. Or the horror film Death From Above, which features several pro-wrestling stars in the cast.



ROK reports DPRK economy little changed in the last year

Friday, April 12th, 2013

According to Yonhap:

According to the data compiled by the Ministry of Unification and based on information provided by foreign institutions, there were minor improvements in grain production and electricity output, but the difference was minimal and may have actually fueled inequality.

“Personally, I see almost no change from a year earlier,” said a ministry official, who did not want to be identified.

The data was released to the press to coincide with the first anniversary of the North Korean leader having assumed the country’s top job. Kim inherited the communist country after the death of his father in late 2011, but became the first secretary of the Workers’ Party of Korea on April 11 of last year.

North Korea’s food production is estimated to have increased 10.5 percent on-year to 4.92 million tons in the 2012-2013 grain year, the official said, adding that this translates into a shortage of 210,000 tons, down from 300,000 tons from the previous year.

The official, however, said foreign data is based purely on information given by Pyongyang, and is not reliable.

“There may be a need to carefully look at the data on grain,” he said, hinting at the fact that there have been numerous cases over the years where official information was not supported by facts.

On power production, the recent opening of the Huichon power station has increased output by 21.1 billion kilowatts, but the benefits are mostly being felt by the elite in Pyongyang. Outside the capital city, other regions are still affected by power shortages, he claimed.

The official added that while Kim has been calling for the bolstering of its agriculture and light industries, funds earmarked for these sectors grew at a slower pace than the overall growth of the budget.

The 2013 budget grew 5.9 percent from the year before, but funds for the light industry and farming sectors gained 5.1 percent. Defense spending on the other hand gained 16 percent on-year.

The latest data showed that consumer prices have generally been moving up since last year, potentially putting a greater burden on many people whose salaries have not changed in years, the official said.

Read the full story here:
N.K. economy remains unchanged under new leader: data


North Korea Boasts Economic Construction Enabled as a Nuclear State

Thursday, April 11th, 2013

Institute for Far Eastern Studies (IFES)

Rodong Sinmun, the official newspaper of the Workers’ Party declared that North Korea has secured its position as a nuclear state, advancing the nation to concentrate on the economic construction, in an editorial last Friday.

This can be interpreted as North Korea’s intent to place more emphasis on investments towards economic development now that it has “made advancement in nuclear weapons capabilities to respond to any threats from the United States and South Korea.”

The editorial stated, “The tremendous mental and material potentials provided by the great Generalissimos Kim Il Sung and Kim Jong Il, the socialist system of Juche based on collectivism and rich experience made in the effort to build an economic power are precious assets for making a great leaping progress in economic construction.”

This is in line with last month’s plenary meeting of the WPK Central Committee that reiterated the importance of parallel policy of economic construction and nuclear power to compete against the United States.

At the meeting, parallel policy of economy and defense were acclaimed to be superior in its war deterrence and defense capabilities without increasing the defense budget to provide support for economic construction and improve the lives of the people. In addition, agricultural and light industries were named as key sectors and called for improvements in the production of everyday goods for the people and reach the grain production target for this year.

On the other hand, Finance minister Choe Kwang Jin reported at the meeting of the Supreme People’s Assembly on April 1 that 44.8 percent of the national budget was allocated for economic development and improvement of its citizen’s lives.

In addition, the news reported that 38.9 percent of the total expenditures were shifted to social cultural and people policies to implement free compulsory education, healthcare, social insurance and social security systems and secure the development of arts, literature and sports.

The minister added that the rest of the budget was allocated for national defense but no specific amount of defense budget was disclosed.


KCNA: First quarterly plan overfulfilled in Economic fields in DPRK

Wednesday, April 10th, 2013

According to KCNA (2013-4-10):

A production upsurge was witnessed in various fields of the economy in the Democratic People’s Republic of Korea during the first three months this year.

The quarterly coal output quota was hit at 101 percent nationwide. Coal production increased sharply at the Kaechon, Tokchon and Kangdong area coal-mining complexes.

The Kim Chaek Iron and Steel Complex, a giant steel maker, finished the quarterly pig production plan at 105 percent.

The Taean Heavy Machine Complex, a major generator producer, topped the plan for March by 30 percent.

The same is true for other machinery makers, including Rakwon and Ryongsong Machine complexes.

A production upswing was also seen in the timber industry, with its quarterly plan topped at 100.5 percent.

In particular, forestry stations under the Jagang Provincial Forestry Management Bureau made fresh innovations in logging.


Some new Google Earth items

Tuesday, April 9th, 2013

I am way behind on blog posts. Actually, I am way behind on everything at the moment. However, I wanted to take a second to point out a couple of new items that appeared on Google Earth imagery today.

We can now see the new location of the USS Pueblo:

Pueblo-2013-Google Earth

Learn more about the Pueblo being moved here.

We can also see construction work has begun on the new shopping center and/or skate park in central Pyongyang:


Learn more about the shopping center and/or skate park construction here.


Concern (Irish NGO) suspends DPRK operations

Monday, April 8th, 2013

According to the Irish Times:

Irish NGO Concern has temporarily suspended its aid work in North Korea due to the increasing threat of war. The suspension takes place with immediate effect due to fears over staff safety.

The non-governmental organisation has 14 workers in the area. Eleven of them are from North Korea, while there are also three international workers from Nepal, India and Sweden. The only Irish Concern employee in the area left a number of months ago.

Concern’s overseas director of aid Paul O’Brien said the organisation had a meeting with the Department of Foreign Affairs last week, where the decision was made.“Two of our international staff are outside the area now and we can’t really function without them. We will return to work once it settles down there,” he said.

Mr O’Brien said he hopes things will settle in the country by the time former leader Kim Il-Sung’s birthday takes place on April 15th. The birthday is celebrated as a public holiday where North Koreans celebrate the life of their “Eternal President”, who died in 1994.

Read the full story here:
Concern suspends North Korea operations
Jason Kennedy


Market expansion: Sinuiju

Wednesday, April 3rd, 2013

For years the center of commercial life in Sinuiju has been the Chaeha-dong Market (채하시장). It has seen consistent growth since 2002:


Google Earth image date: 2002-4-29


Google Earth image date: 2004-1-27 (note the street trading around the market)


Google Earth image date: 2005-1-29


Google Earth image date: 2009-10-11

The market pretty much remained this size until 2011-4-19, the last day that satellite imagery records this structure.

On the next available image, dated 2012-10-30, we can see the market has been destroyed. It appears that the space is being transformed into a new park, much like we have seen being built in different parts of Pyongyang over the last year.


However, the story is not as sad as the story of the Phyongsong Market (formerly the country’s largest). A new market has been built on the outskirts of the city to replace the Chaeha Market:




This new market is over twice the size of the old Chaeha Market. Its dimensions are approximately 183m x 60m. We only have one satellite image of this market, and it is closed.  It is unclear how busy it is on market day (approximately every ten days) or how much of the area around the market and road leading to the market is filled with additional vendors.

The DPRK has a mixed relationship with these markets.  On the one hand they are a clear rebuke of the state’s old socialist ideology and the official socialist retail distribution system.  To date no North Korean leader has ever publicly visited a market as part of an inspection or guidance tour.  The closest we have seen was when Choe Yong-rim visited the Pyongyang Underground Shop (under Kim Il-sung Square) on 2011-11-17.

On the other hand, however, many state-owned and August 3 factories and companies now sell directly through these markets rather than official shops and distribution channels (which allows them to stockpile cash rather than relying on account transfers with the central bank). Additionally these markets are integrated into the public finance system.  The state charges a fee for vending slots in these markets and party inspectors regularly patrol them to enforce (imperfectly) various dictates.

It would be interesting to know if this market was built before or after Kim Jong il died (2011-12-17). This would be a powerful signal of the intentions of Kim Jong-un’s economic team. From the available public imagery, however, it is not possible to say at this point.