North Korean Economy Watch

According to the Financial Times:

“The WFP can continue to support around 1.4m children and pregnant women with fortified foods until the end of June. However, new contributions are required now or the operation will come to a standstill in July. We are hopeful that donors will come forward with contributions, given the situation,” he told the Financial Times.

In 2008 the WFP hoped 6.2m people would receive such aid but found it increasingly hard to get donations. Annual aid to North Korea is equivalent to $4.50 (€3.30, £3) per person across the population. The average across other low-income countries is $37 per person.

The WFP has survived such funding crunches in the past, but UN officials fear donors have now become exasperated with North Korea, which expelled US non-governmental organisations last March. Pyongyang has severely restricted aid workers’ access, has demanded they give longer notice periods before rural visits and has barred teams from using their own Korean speakers.

Rocky relations with the US and South Korea after Pyongyang launched a long-range missile last April and tested an atomic warhead in May have further discouraged donations.

The US, once the leading food donor, has said it will not supply cereals until North Korea resumes proper monitoring, allowing aid agencies to track the final recipients.

North Korea’s harvests cannot feed all its people and in recent years the annual food deficit was about 1m tonnes. People are chronically malnourished and as many as 1m are believed to have died during famine in the 1990s.

It is hard to determine the scale of malnutrition but Kim Jong-il, the country’s dictator, made a very rare apology this year for failing to deliver “rice and meat stew” to the people. Food markets were thrown into disarray late last year by a currency redenomination but Mr Due, based in Pyongyang, said these seemed to be returning to normal.

Read the full article below:
Donor fatigue threatens aid for North Korea
Financial Times
Christian Oliver and Anna Fifield
3/3/2010

According to an AFP report that cites Good Friends:

Good Friends, citing its own contacts in the reclusive North, said prices for rice and corn doubled last week at markets in the capital Pyongyang and in the eastern port city of Chongjin.

Rice prices ranged from 120-150 won per kilogramme (2.2 pounds) in Pyongyang and 110 to 140 won in Chongjin last week — up from 40 to 50 won reported on December 30, the group said.

Corn also traded higher at 70-75 won last week — up from 20-25 won on December 30 in the areas, it added. Seoul’s unification ministry, handling cross-border issues, could not confirm the data.

The official exchange rate is 135 won to the dollar but the black market rate is between 2,000 and 3,000 won.

The report came as the World Food Programme struggles to raise relief funds for the food shortage-hit North.

Major donors — including South Korea and the United States — refuse to help in protest at its second nuclear test in May last year.

Statistics available at the WFP website display it raised 89.8 million dollars as of late last month, around only 18 percent of its target of 492 million dollars in relief funds for the communist North.

Read the full article here:
Food prices soaring in N. Korea: group
AFP
1/10/10

Fox News
George Russell
7/27/2009

Is North Korea’s dictatorial regime quietly profiting from U.N. emergency food supplies delivered to its starving people, even as the regime squeezes those deliveries down to a trickle?

Documents produced by the World Food Program, the U.N.’s flagship relief agency, outlining its current emergency operations in the insular communist state, raise a number of touchy questions about the financing and logistics of the effort, which was originally intended to feed some 6.2 million of North Korea’s most vulnerable people, but which is currently providing limited rations only to 1.33 million.

The $500 million program was meant to run from September, 1, 2008 to November 31, 2009, to deliver nearly 630,000 tons of food aid to North Korea at a time when it is suffering from severe flood damage and fertilizer shortages that have led to local food price increases.

Currently, WFP says that only $75.4 million worth of food aid has been delivered under the emergency program, as international donors have recoiled at the Kim Jong Il regime’s recent nuclear detonation and provocative missile launchings toward Japan and Hawaii.

WFP emergency relief program documents obtained by FOX News show that from the outset the food agency planned to pay extraordinarily high transportation costs for sending relief supplies to North Korea from around the world–about a dollar for every two dollar’s worth of food aid shipped into the country under the program.

Moreover, enormous sums were involved: $130,334,172 for “external transport” of 629,938 tons of grain and other food relief supplies for the overall program. (The food supplies themselves are projected to cost $297,396,729.)

For comparative purposes, the “external” shipping costs planned by WFP for the aid program average about $206.90 per metric ton of food aid .

Those rates were described as “absolutely ridiculous” by an expert on bulk shipping consulted by FOX News, even for sending goods by international shipping carriers to the remote region that includes North Korea. Another international grain expert consulted by FOX News described them as “way out of line” with past and present international shipping rates for bulk grain and other basic food commodities.

What WFP has not revealed in its documentation until questioned by FOX News, however, is that a substantial, but unspecified, amount of that money is intended to move the emergency aid from China to its final North Korean destination via shipping firms owned by the Kim Jong Il government.

Nowhere in the WFP program documents, which appeared on WFP’s public website only after Fox News began raising questions about them, is there any mention of the North Korean shipping involvement.

Even though WFP has not revealed how much of the $130-plus million in planned “external transport” money Kim Jong Il’s shipping firms are in line to receive, an analysis of the current costs involved in getting such supplies to their second-last destination reveal that the amount slated to pay for the last leg of the journey to North Korea could be huge.

A WFP spokesman blamed the overall high cost on “ the remote geographical location of [North Korea] from place of procurement (normally Black Seas, South Africa and South America).”

All WFP food aid, he added, was first shipped to the northern Chinese port of Dalian, before moving on to the North Korean port of Nampo.

But the spokesman then added that high costs were also due to “the lack of competition of transporters for transshipment” between Dalian and Nampo.

In fact, shipments to and from Dalian, China, one of the major centers of China’s huge export sector, are commonplace and hardly expensive by international standards. Data kept by the U.S. Department of Agriculture, for example, shows that grain shipments from Brazil to China between April and June of this year have varied from $32.50 to $42 per metric ton.

Moreover, those international shipping rates have been on a precipitous downward slide since June, 2008-three months before the WFP aid program began. Even allowing for higher rates from the Black Sea and South Africa, international shipping experts told FOX News that the rates would come nowhere near $206 per ton-especially as there is currently a surplus of international shipping capacity.

The same, however, apparently can’t be said of transport between Dalian and Nampo-a distance of 210 nautical miles.

There, the WFP spokesman said, WFP relies entirely on “feeder vessels belonging to the [North Korean] government.”

Asked late last week by FOX News to provide specifics of the rates charged by North Korean vessels for carrying international food aid home, the WFP spokesman did not provide an answer before this article was published.

However much the Kim Jong Il regime charges for bringing food to its people, it is not the only money that WFP provides to Kim for humanitarian assistance.

The WFP documents show that the government was to receive an additional projected $5,039,504 as a transport fuel subsidy if the relief program gets back into full swing. The “fuel reimbursement levy” amounts to $8 per ton of aid delivered, and according to the WFP spokesman, is normally not provided to countries that receive food aid-they are expected to chip in for this cost on their own–except under a waiver that North Korea has been granted.

So far, the Kim regime’s National Coordinating Committee, a subsidiary of the Ministry of Foreign Affairs, has received $1.16 million under this waiver since September 2008, with the promise of an additional $361,400 to come. The WFP spokesman emphasized that the money was not paid in hard currency.

The same apparently applies to $4,409,566 intended by WFP to enhance a “capacity building strategy of government counterparts” envisaged in the relief plan. According to the WFP spokesman, this means management training and information systems upgrades for the Kim government to handle the new food aid. WFP is also paying for warehouses and equipment to handle the aid. So far, the regime has only $103,200 of the projected total, with another $155,000 committed.

Amid all the fuzzy math of the WFP relief program, there is a final quirk: the inexplicably high transportation costs work to the benefit not only of the Kim regime, but also to the benefit of WFP.

As a matter of standard practice, WFP charges a standard 7% management fee against “direct operational costs” of such relief efforts to support its worldwide operations, over and above the costs it incurs in the specific relief exercise. These, in WFP-speak, are known as the organization’s “indirect support costs.”

Based on direct operational costs in North Korea of $445,033,971-including the $133.3 million in “external transport” costs– WFP expected to reap $32,948,811 as its 7% share of “indirect support costs.”

Its 7% “indirect support” levy on the extraordinary $130.3 million transport bill would amount to about $9.1 million.

According to Fox News:

A spokesman for the World Food program has confirmed to FOX News that on July 3, the emergency relief organization was ordered to limit food deliveries to 57 of the 131 North Korean counties it previously served. At the same time, the agency was told that it must give seven days’ notice of visits to oversee food deliveries at all of its relief sites — a sharp change from the one-day notice previously required under a deal to retain U.S. support for North Korean relief efforts. As a result, the spokesman said, WFP is “reviewing the current terms and conditions for our work” in North Korea, “to ensure that our work and our accountability is not compromised.”

Additional constraints were also slapped on the child relief organization UNICEF in June, according to a spokesman, Chris de Bono. He told FOX News that the regime banned UNICEF from operating in its northerly Ryanggan province, which borders China, and is one of the impoverished country’s poorest areas. UNICEF still operates in 56 other counties across North Korea.

The restrictions make even more dire the food situation in a country where starvation and malnutrition are widespread, even as the Kim regime continues to set off atomic blasts and fire missiles in the direction of Japan and Hawaii.

Furthermore, they once again raise questions about the U.N.’s ability to monitor whatever relief activities that remain in the country. UNICEF’s spokesman told FOX News that only WFP had won the right to 24-hour notification for inspection visits, and that all other U.N. institutions in North Korea have operated with the one-week request limit as a matter of course.

UNICEF has ten international staff and 20 local staffers in North Korea. None of the international staff speak Korean. The agency is budgeted to spend $13 million a year on North Korean operations, principally on food for infants, children and pregnant women, along with emergency vaccination programs, essential medicines and clean water supplies.

But nowhere near that amount of money from international donors is currently available. According to its Web site, UNICEF has received only 10 percent of the total, or about $1.3 million, undoubtedly a result of the North Korean regime’s aggressive pursuit of nuclear weapons. Unless more money is received soon, the UNICEF spokesman said, “it will be difficult to maintain the current level of operations and this will have serious negative consequences for children and other vulnerable people.”

The same funding shortfall applies to the World Food Program, which told FOX News a month ago that donor nations had provided only $75.4 million toward a 2009 goal of $503 million for North Korea, with more than half of that amount — $38.8 million — food aid that was not delivered in 2008.

The only other U.N. agency that has significant operations in North Korea, the United Nations Population Fund, reports that it has received no curtailment in its activities, but it only operates in 11 North Korean counties. It was slated to spend roughly $8.3 million in North Korea between 2007 and 2009, chiefly for birth control and other forms of “reproductive health” and for helping the regime collect population statistics.

Nonetheless, a big question mark still hangs over the North Korean operations of the United Nations Development Program, the U.N.’s major anti-poverty agency, which suspended operations in North Korea in 2007 in the wake of revelations from an independent inquiry that it had wrongfully provided millions in hard currency to the North Korean regime, ignored U.N. Security Council sanctions in passing on dual-use equipment that could conceivably be used in the country’s nuclear program, and allowed North Korean government employees to fill key positions.

Read the full story below:
North Korea Cuts Off More U.N. Relief as Nation Starves
Fox News
George Russell
7/7/2009

According to Reuters:

Countries appear even less willing to give following North Korea’s second nuclear test in May, Torben Due, the U.N. World Food Programme representative in North Korea, told a news conference in Beijing.

“It’s a very sensitive area. I understand to a certain extent why donors are questioning,” he said. “But my angle is as a humanitarian. Being a humanitarian organisation you should look at the needs of the people. WFP does not engage in the political part of it.”

Due said no new donations had been received following that second test.

An appeal for more than $500 million in food aid has been just 15 percent met, meaning a planned relief operation to reach 6.2 million people has been scaled back to target 2 million.

Due, who lives in Pyongyang and was passing through the Chinese capital, told of the human toll of the state’s struggling economy and international seclusion, with mothers and children stunted by starvation.

“We are now in the middle of the lean season in North Korea, where food supplies are low and it’s a very difficult situation for many people in the country,” he said.

“But more importantly it should be noted that we have a situation where a very large part of the population has been undernourished for 15 or 20 years.”

In some parts of North Korea, some women weigh just 45 kg (99 lb) when they give birth, he added, citing a medical survey.

“The children that survive these conditions will be born with compromised immune systems … and that will contribute to their stunting,” Due said. “It’s a problem which goes from one generation to the next.”

Given the DPRK’s prerogatives, however, the US is not inclined to send food aid.  According to the Associated Press:

The United States said Wednesday it is “very concerned” about the North Korean people but cannot send needed food aid without assurances from their Stalinist government that it will reach them.

“We currently have no plans to provide additional food aid to North Korea and any additional food would have to have assurances that it would be appropriately used,” Kelly told reporters.

“We remain very concerned about the well-being of the North Korean people,” the spokesman said.

“But we are very concerned because we need to have an adequate program management in place, monitoring and access provisions and we don’t have that right now,” he added.

He recalled that in March North Korea expelled non-governmental organization (NGO) monitors in line with its decision to reject US food aid.

“At that time we had about 22,000 metric tonnes in storage there. We’ve learned that the DPRK (North Korean) has distributed this food,” Kelly said. 

I have not seen any food prices from North Korean markets in a while.  If anyone has come across any, please send them to me. 

Recent defectors offer a more nuanced account:

The food supply in the North may have improved slightly in the past two years due to better weather, but Jo said food still is hard to come by. “Even last year, we had a campaign in Kangwon province of getting by with two meals a day. Soldiers sometimes would just get three potatoes a day.”

There is a thriving market economy in North Korea at the local level where the average person buys food staples and consumer goods often made in China. Private plots of land are increasingly used for providing food for one’s family, said Cho Myungchul, a researcher who was an economist in the North before defecting to the South 15 years ago. (Reuters)

Read more here:
U.N. says North Korea food aid has dried up
Reuters
Ben Blanchard
7/1/2009

US cannot send food aid to NKorea despites its concerns
AFP
6/1/2009

Life in North Korea: lies, potatoes and cable TV
Reuters
Jack Kim
7/1/2009

Although the UN World Food Program was asked to leave the DPRK in March, along with US relief workers, the UN children’s fund (UNICEF) is still distributing relief supplies.  Additionally, the UNDP is about to resume activities.  According to Yonhap:

The U.N. children’s agency said Wednesday its humanitarian aid operations in North Korea remain steady amid diplomatic tensions, and that Pyongyang will soon sign an agreement to allow a nationwide nutritional survey.

“The situation with regard to access and monitoring is the same as it has been in the past,” Gopalan Balagopal, UNICEF representative in Pyongyang, said in an email interview.

“UNICEF undertakes regular field visits to monitor progress of work and holds periodic review meetings with counterparts,” he said.

…

As part of efforts to improve the health of North Korean children and mothers, the agency will soon sign an agreement with the North Korean government to conduct a nutritional survey across the country, set to start in October, Balagopal said.

“We are finalizing a memorandum of understanding with the government shortly for going ahead with a multiple indicator cluster survey, which will have a nutrition component,” he said.

Another aid agency, the U.N. Development Program, is also preparing to restart its program in North Korea after a two-year hiatus, he said. Four UNDP members came to Pyongyang on May 19, and two of them are staying there, keeping “busy with work for restarting their program,” Balagopal said.

UNDP withdrew from Pyongyang in early 2007 after suspicions arose over North Korea’s misappropriation of development funds.

June is a typically lean period in the North in terms of food security, and UNICEF sees increasing numbers of malnourished children in nurseries and hospitals, according to the official.

North Korea’s harvest this year is expected to fall 1.17 million tons short of food needed to feed its 24 million people, according to the Seoul government. Even if the North’s own imports and Chinese aid are counted in, the net shortage will likely surpass 500,000 tons, it said.

Balagopal said his agency has secured about half of its US$13 million target budget for operations in North Korea this year.

He noted there are “some indications” that access to the provinces in the northeast may be restricted to the U.N. agencies. He did not elaborate and said the U.N. will stop its assistance if the access is not guaranteed.

Read the full article here:
UNICEF aid flowing steady in N. Korea: Pyongyang chief
Yonhap
6/3/2009

Below are excerpts from the Financial Times:

Pyongyang has told Washington that United Nations World Food Programme [WFP] staff will be barred from distributing food aid after March. The Stalinist regime has also told US non-governmental organisations to leave this month, and rescinded permission for other humanitarian groups to visit, the Financial Times has learned.

In an agreement last year, the US agreed to provide North Korea with 500,000 tonnes of food. The WFP was responsible for distributing 400,000 tonnes, with a consortium of NGOs led by MercyCorps in charge of the remainder.

…

In recent months, however, after North Korea refused to allow sufficient numbers of Korean speakers to join the WFP team, Washington halted food supplies.

Pyongyang has responded by barring food aid workers from operating in the country. So far, the US has supplied 100,000 tonnes to the WFP, and another 70,000 tonnes to the NGOs, which has not been completely distributed.

A US State Department official said that while the US was satisfied with the number of Korean speakers who were allowed to join the NGOs, it was unhappy that the same situation was not true for the WFP, which is responsible for distributing 80 per cent of the food. In addition to MercyCorps, the other NGOs are World Vision, Global Resource Services, Christian Friends of Korea and Samaritan’s Purse.

The official said the US was also responding to North Korea blocking aid workers from conducting a nutritional survey, which was included in the agreement.

“US aid workers have enjoyed tremendous co-operation in the countryside from North Koreans and we hope the DPRK government in Pyongyang will allow them to continue to feed the hungry,” said a Senate aide involved in North Korean issues. “Food aid should be separated from politics.”

Even before the North Korean threat, WFP had been forced to scale back operations because of the break in US funding. The WFP has only received 4.5 per cent of its $504m budget for North Korean operations. A WFP spokesperson said 4.5m of the 6.2m North Koreans targeted under the programme were not receiving assistance as of December.

“WFP hopes that the US will review the humanitarian situation and that food shipments will resume soon,” the spokesperson added.

North Korea recently informed the US that Eugene Bell, World Care and Kirk Humanitarian – three other US NGOs operating in North Korea – would not be allowed to make visits that were already approved. Pyongyang told the US that the planned visits were being cancelled because of “recent developments”.

Nancy Lindborg, president of MercyCorps, said North Korea sometimes temporarily blocked NGOs from visiting. However, she added that she was “hopeful and confident” that the visits would resume. She said her consortium had a “good working relationship” with its North Korean partners.

Read the full article here:
N Korea-US distrust halts food aid
Financial Times
Demetri Sevastopulo
3/17/2009

Below: State Department Briefing, Mercy Corps Press Release
US State Dept press briefing
Robert Wood, Acting Department Spokesman
March 17, 2009

QUESTION: Do you have anything to say or to confirm about North Korea cutting off or saying it does not want U.S. food aid –
MR. WOOD: Yeah.
QUESTION: — and kicking out U.S. NGOs over an accelerated timeline?
MR. WOOD: Yeah, yeah. North Korea has informed the United States that it does not wish to receive additional U.S. food assistance at this time. And we will work with U.S. NGOs and their North Korean counterparts to ensure that food that’s already been delivered – excuse me, food that’s already in North Korea is distributed to the intended recipients. And one of the things I also want to mention is that we have aimed to implement the U.S.-DPRK food aid program according to the terms agreed to by the United States and the North Korean Government in May 2008.
And I will give you just a breakdown in terms of the amount of food aid that we have provided. The U.S. has delivered 169,000 metric tons of U.S. food to North Korea in 2008 and 2009. The last shipment of U.S. food aid, which was nearly 5,000 metric tons of vegetable oil and soy blend, arrived in North Korea in late January and is being distributed by U.S. NGOs.
QUESTION: (Inaudible) of that?
MR. WOOD: Of which one, the 5,000 metric tons? Yeah, I am sorry. I don’t have any – any value here. We can try and get that to you in the Press Office.
QUESTION: Could you say when you were notified of this and how you were notified?
MR. WOOD: I don’t know, but it was obviously communicated to us by the North Koreans. I don’t know how that was done, whether it was done through the New York channel or some –
QUESTION: (Inaudible)?
MR. WOOD: Yeah, I just – I don’t know.
QUESTION: Last week maybe?
QUESTION: Just a clarification?
MR. WOOD: Yeah.
QUESTION: You said it’s being distributed by U.S. NGOs or UN NGOs?
MR. WOOD: U.S.
QUESTION: U.S.
QUESTION: Of the (inaudible) metric tons, what is it of? Is it grain? Is it – what is it?
MR. WOOD: Well, I’ll have to get the specifics on it, but I refer to our last shipment of U.S. food, which was, you know –
QUESTION: Oil and soy blend.
MR. WOOD: That’s right. I don’t have that breakdown. We can certainly try and get that for you, Sue.
QUESTION: Okay. .
QUESTION: (Inaudible), are you disappointed in this?
MR. WOOD: Of course. Absolutely. I mean, this was a program intended to try to help get food to needy North Koreans, and we’re obviously disappointed in that. This, you know, does not help us implement this agreement that we reached with the North back in 2008, so –
QUESTION: Well, not only does it not help you implement it, it kind of – I mean, are they abrogating the agreement?
MR. WOOD: Well, I don’t have the actual text of the agreement, so I can’t say with absolute specificity that they’re in violation of it. But we have an agreement to try to deliver, you know, this food assistance, and now the North is saying they do not want to receive any more assistance. So you know, we’re concerned about it.
But the food that is there right now in North Korea, we’re going to work with U.S. NGOs, with their North Korean counterparts, to make sure that this assistance gets to the people who –
QUESTION: Can you be a little bit more explicit about why you’re concerned about it, why you’re disappointed?
MR. WOOD: Well, I mean, clearly this is food assistance that the North Korean people need. That’s why we’re concerned. You know, this humanitarian assistance that we provide to the North has nothing to do with the Six-Party Talks. This is about our true humanitarian concern for these people. And as you know, the food situation in North Korea is not a good one, and so we’re very concerned about it.
QUESTION: Did they give you any explanation why they won’t – they didn’t want any more?
MR. WOOD: They have just said that they do not want to receive any additional food assistance at this time. That’s about as far as they went.
QUESTION: But no reason was provided at all? Just a one-sentence note you got?
MR. WOOD: I mean, it’s – I don’t know if it was one sentence that was given to us, but you know, that was the bottom line. And that’s the most important part of this.
QUESTION: And when did they inform you?
MR. WOOD: It was, I think, over the last couple of days, I believe.
QUESTION: Robert, do you know what the accelerated timeline for the withdrawal of the NGOs will be?
MR. WOOD: I don’t know.
QUESTION: It was supposed to be the end of May.
MR. WOOD: Yeah, I don’t know. Again, probably the best folks to address that are the North Koreans.

Press Release by relief organizations:
FOR IMMEDIATE RELEASE

March 19, 2008                                                                     

STATEMENT OF NGO PARTNERS ON CESSATION OF FOOD AID PROGRAM IN THE DEMOCRATIC PEOPLE’S REPUBLIC OF KOREA (DPRK)

Contacts:  Joy Portella, +1.206.437.7885, jportella@sea.mercycorps.org

March 19, 2009—The following is a statement issued by the NGO Partners that have been distributing food aid in the DPRK through a program supported by the U.S. Agency fro International Development (USAID). The NGO Partnership is led by Mercy Corps, co-led by World Vision, and includes Christian Friends of Korea, Global Resource Services and Samaritan’s Purse:

This week, North Korean authorities have asked us to close the USAID-supported food assistance program that we have been operating since June 2008. Our joint team, dedicated to this program, will leave the DPRK by the end of March.
 
We are saddened by this decision, but are very proud of what the program has accomplished.  Working closely with our North Korean partner, we have ensured that food reached almost one million vulnerable children, pregnant and nursing mothers and the elderly.
 
Each of our organizations has worked in the DPRK for more than a decade. We remain committed to assistance in that country, and our individual, on-going programs focused on health, water, sanitation and agriculture will continue as before.
 
The NGO Food Assistance program is part of a larger 500,000 metric ton initiative supported by USAID in which the World Food Program was to distribute 400,000 metric tons of food and the NGO Partners were to distribute 100,000 metric tons.  In the ten months of this program, 169,000 metric tons of food has been delivered to the DPRK, of which the U.S. NGOs have brought in 71,000 metric tons of food.  This food from NGOs has benefitted more than 900,000 people in the two north west provinces of Chagang and North Pyongan.
 
This has been a model program with unparalleled monitoring cooperation to ensure that food gets to those most in need. Our in-country staff of 16 people has worked closely with our North Korean partners.
 
The NGO food assistance program was scheduled to run until the end of May 2009. Until the end of the month, we will work with our North Korean partners to ensure a proper close-out.
 
We remain committed to helping the people of the DPRK to overcome hunger and improve their lives. The food program resulted from the tremendous humanitarian need in the DPRK. We will continue to work—as individual agencies and in cooperative partnerships—to address these needs. We hope the success of this program will serve as a model for the future.

Stephan Haggard and Marcus Noland
Asia Pacific Bulletin
No. 27, February 5, 2009

Abstract
North Korea has suffered chronic hunger problems for two decades. A famine in the 1990s killed up to one million people and shortages have remained endemic. Most observers believe that the recent harvest is the best in years, but even under optimistic scenarios, food-related distress is likely to continue. Stephan Haggard and Marcus Noland discuss North Korea’s current food situation and the prospects for the future.

Download the full paper in PDF here. 

On May 12, 2008, The DPRK formally asked the UN World Food Program for emergency food assistance.  In June 2008, the UN WFP/FAO launched the “Rapid Food Security Assessment”.  They confirmed…

…a significant deterioration in food security in most parts of the country.3 Close to three quarters of respondents have reduced their food intake, over half are reportedly eating only two meals per day (down from three) and dietary diversity is extremely poor among two thirds of the surveyed population. Most families have daily consumption consisting of only of maize, vegetables and wild foods, a diet lacking protein, fats and micronutrients.

and

FAO forecasts that the October/November 2008 harvest will be 70-75 percent of an average year’s output due to inadequate fertilizer supplies, meaning the current food shortages will extend into the next agricultural year. The risk that the country will again suffer summer flooding remains, which could lead to further crop destruction and/or require general food distributions of emergency food aid. In such an event, WFP will have contingency stocks available in the country to rapidly respond. (UN Operations Report)

The UN launched a coordinated response lasting from September 2008-November 2009 which targets over 6 million people with 600,000 metric tons of food assistance.

But according to the Daily NK (Jan 13, 2009):

According to North Korean authorities, the total agricultural yield including rice, corn, potatoes and others reached its highest point since the food shortages of the 1990s this year, at 4.7 million tons.

According to the Joongang Ilbo, a South Korean newspaper, a Chinese official involved in the agricultural business who had just gotten back from North Korea quoted a North Korean official as saying that they “had presumed the failure of last year’s harvest due to low temperatures in the Spring and Fall, but in fact recorded the highest level in recent years, 4.7 million tons.”

Regarding this, a researcher from the Korea Rural Economic Institute, Kwon Tae Jin said in a telephone conversation with the Daily NK that, “When I visited Pyongyang in December of last year, Ri Il Sok, Director of the Foreign Cooperation Team in the North Korean Ministry of Agriculture said to me that grain output last year was 4.67 million tons, up by 17 percent over a year ago.” (Daily NK)

Andrei Lankov, writing in tomorrow’s Asia Times (Jan 16), confirms the Daily NK story:

These worries seemed well-founded and the journalists who penned them were often among the most knowledgeable on North Korean issues. Furthermore, most of these stories were based on reports produced by reputable international organizations. By early September, North Korean watchers agreed almost unanimously that a great disaster was set to strike North Korea this coming winter.

Now it has become clear, however, that these were false alarms. The predicted famine has not materialized and does not appear likely to do so in the near future. North Korea has had its best harvest in years, and until next summer no North Korean is likely to starve to death – although some may remain severely malnourished.

This is good news. However, the contrast between the reality and recent predictions is remarkably stark. In recent years, we have come to believe that there are at least a few things about secretive North Korea which are known for sure. Yet the recent turnaround of events has again shed light on the severe limits of outside information about the Hermit Kingdom.

Lankov offers a couple of scenarios that could explain how this happened:

For example, why did reputable international organizations make such a serious mistake in estimating the North’s food shortage? It cannot be ruled out that international observers were deliberately misled by their North Korean minders. Perhaps foreign observers were shown the worst fields because the North wanted more food aid then would otherwise be available?

It also seems that some basic assumptions about North Korean agriculture are wrong. Unless the 2008 harvest was the result of incredible luck, it seems to indicate that fertilizer is far less important than previously believed. It is possible that North Korean farmers have devised strategies to deal with fertilizer shortages.

The false alarms of a disastrous famine in North Korea are a sober reminder that when dealing with the world’s most secretive society, predictions should be treated with the greatest caution.

To learn more, read the following documents/stories:
Emergency Operation Democratic People’s Republic of Korea
Title: 10757.0 – Emergency Assistance to Population Groups Affected by Floods and Rising Food and Fuel Prices
UN World Food Program

2008 Agricultural Yield of North Korea
Daily NK
Kim So Yeol
1/13/2009

North Korea reaps a rich harvest
Asia Times
Andrei Lankov
1/16/2009

North Korean Economy Watch topic archives:
Food, Agriculture, Foreign Aid Statistics

(UPDATE BELOW)
Press Statement by Sean McCormack
December 30, 2008
US Department of State web site

Question:  Will you please provide an update on the deliveries of food aid to North Korea?

Answer:   To date, over 143,000 metric tons of U.S. food (wheat, corn, and soybeans) has been delivered to North Korea. Of that amount, the latest shipment of 25,000 metric tons of corn and soybeans arrived in North Korea on November 23 and has completed unloading for distribution by the U.S. NGOs. The latest shipment of food aid (totaling 21,000 metric tons), which was expected to arrive by the end of December, is now expected to arrive in the DPRK on January 2, due to recent rough seas.

The United States has not stopped food aid to North Korea. Under the terms of our agreement with the DPRK, there is to be no limit imposed on the Korean language capabilities of the World Food Program (WFP) and U.S. NGO staff implementing the food aid program. The lack of sufficient Korean speakers on the WFP program is one of the key issues in ongoing discussions. The issuance of visas for Korean-speaking monitors for the WFP program is another issue currently being discussed, along with other technical issues. A delegation that recently visited North Korea, identified problems in the implementation of the world food program portion of the food aid program. Those problems are not yet resolved.

Under the most recent agreement reached at the six party talks, the US has committed to sending 500,000 tons of food assistance to North Korea within the 12 months beginning in June 2008.  So far the US has shipped 143,000 tons. 

South Korean civil society is also contributing:

Two South Korean charities say they’ve shipped food and fuel to impoverished North Korean families suffering in the cold.

A shipment of food for babies and their mothers worth about $302,300 is to be distributed in Hoeryong by the Seoul-based Jungto Society, a Buddhist group, Yonhap News Agency reported Tuesday.

Families in Hoeryong are particularly vulnerable because the town sits on the remote northeastern tip of North Korea and and receives less assistance from other regions, said Kim Ae-Kyung, a Jungto spokesman.

The shipment includes dried seaweed powder, flour, milk powder, sugar and salt for 2,500 mothers and 6,300 infants and children.

Another South Korean charity, Briquet Sharing Movement, said it has delivered 50,000 charcoal fuel briquets to North Korean border towns Kaesong and Kosong.

In all, the two towns have received 800,000 briquets from the charity this year, enough to help heat 3,200 homes, Yonhap reported.

(UPDATE) From the Korea Times:

[T]he “Easter Star” was en route to the reclusive country with 21,000 metric tons of corn and will soon arrive at the port of Nampo.

American NGOs, such as Mercy Corps, World Vision and Global Resource Service will distribute the aid in Jagang and North Pyeongan Provinces, the official added. The State Department originally expected the aid to reach the port by the end of this month.

It will be the sixth shipment of the 500,000 metric tons of promised food aid. In May, the U.S. agreed to resume the aid in June for 12 months. The United States given 143,000 metric tons of food assistance so far, State Department spokesman Sean McCormack told reporters in Washington last week.

The NGO official also said 4,940 metric tons of a corn-soya blend and corn oil will be separately shipped to North Korea in mid-January as the seventh shipment, and NGOs will distribute them in the same regions.

NGOs have been a regular channel for Washington to distribute its promised assistance. The World Food Program under the United Nations has also distributed food assistance on the U.S. government’s behalf.

The shipment will be the first aid package reaching North Korea after talks on dismantling the North Korean nuclear program came to an abrupt end without substantial agreement in early December.

In spite of the stalemate on the nuclear issue, McCormack said, “Our humanitarian program will continue.” U.S. attention is now shifting to stationing Korean-speaking staff working with the WFP and NGO programs at the point of distribution.

Read the full articles here:
Charities send food, fuel to North Korea
UPI News
12/30/2008

US Corn Aid to Arrive in North Korea Jan. 3
Korea Times
Kim Se-jeong
12/28/2008