North Korean Economy Watch

From the Daily NK
11/9/2006

On Tuesday, a number of residents in Hoiryeong, North Hamkyong Province mass-protested in front of the Nammun (a south gate) market for “compensation of market refurbishment payment” and against the merger of Hoiryeong markets, according to a North Korean source.

The inside source told the Daily NK through a telephone interview that evening ,“From this morning, more than a hundred shopkeepers, their families and the residents of Nammun district rushed to the market management office to request compensation of market refurbishment fees and repeal of Nammun market closure.”

The informant said that the mass protested against the local government because they were stirred by the authority’s decision. It is extremely exceptional that such a mass protest occurs in North Korean society.

They formed lines to present their opinions and in the meantime, some traders shouted phrases such as “Refund the refurbishment payments!” The primitive type of protest in North Korea, in which any kind of private mass activities are forbidden, means much more than western societies’ demonstrations. “No one particularly led the incident,” the informer testified, “but outraged merchants poured into the management office as a group.”
Security officers forcefully dispersed the protestors and crowd.

He added that Hoiryeong local security officers, fearing a spreading of the protest, forcefully dispersed the protesters and crowd. And it was not clarified whether any of the protestors got arrested.

Nammun market is two kilometers southeast of Hoiryeong city, and a frequent place for shopping of food and other basic supplies by local residents.

The incident occurred when the market management officials started to remove the market.

The officials had been collecting three thousand NK won per trader as “refurbishment fees” since late October.

That morning, however, the market management office ordered all the markets in Hoiryeong to be combined with newly constructed Hoiryeong Market, which is located former Hoiryeong Southern middle school, unilaterally, and started to remove the shops in the Nammun market.

Shopkeepers of Nammun market, having been unaware of such a decision, could not accept the order, the informant told the Daily NK. And none of them was guaranteed with a spot at the new Hoiryeong Market; even if one was, there would be a lot of time and money to be spent before actually having a shop at the new market.

Those shopkeepers of the Nammun Market, waiting for the opening hour, saw the removal of their stands, and sought the management officials. When they found any official unavailable, an angry outburst came.
There was a violent clash among angry residents.

The stand-owners and their families went to the office and asked accountable senior officials for compensation, which they did not receive. One protestor reportedly shouted, “It is ridiculous to walk five kilometers (to the new Hoiryeong Market) to buy a piece of Tofu!”

It was informed that amid the protest there was a violent clash among angry residents. When a man watching the demonstration said it was meaningless to protest, shopkeepers assaulted him for collaborating with the officials.

As soon as an act of violence happened, tens of security officers came to the site and dispersed the protestors and bystanders. Meanwhile, traders vehemently resisted and abused the security guards.

The newly built Hoiryeong Market is constructed at the site of closed Hoiryeong Southern middle school with about 700 sale stands, which are one meter long and a half meter wide. A down payment of 200,000 NK won (US$690) and daily rental fee of 10 to 30 won are required for a stand. Black market exchange rate is over 3000 won per US dollar while official one is 140 per a dollar.

USA Today
Barbara Slavin
10/22/2006

At a kindergarten in Hyangsan, a small city near North Korea’s capital, dozens of colorfully dressed children put on a calisthenics display this month for visitors from the U.N. World Food Program.

The children, full of corn porridge and high-protein biscuits provided daily by the aid agency, jumped, stretched briskly and looked healthy, said Jean-Pierre DeMargerie, the top program official in North Korea. Kids in the front rows looked especially good, he said. “Those 20-30 yards back were not as well groomed or dressed.”

“It’s always difficult to get a clear picture,” DeMargerie said. “The North Koreans don’t like to expose those that might be sick or weak. You build your assumptions on a relatively small sample.”

North Korea, one of the world’s most isolated nations, is a hard society to fathom even for the few foreigners who visit regularly. Whether it is on the verge of economic collapse or resilient in the face of decades of adversity and deprivation remains a matter of conjecture.

Little can be seen clearly

The shroud that keeps North Korea hidden makes it virtually impossible to judge whether the limited sanctions the United Nations imposed in retaliation for an apparent nuclear weapons test Oct. 9 will have any effect on the regime of Kim Jong Il.

The Bush administration hopes the sanctions and international rebuke, particularly from China, North Korea’s main source of trade and investment, will prompt Kim to halt his nuclear program and resume negotiations on a diplomatic solution. “I think (the North Koreans) were surprised by a 15-0” vote on sanctions by the U.N. Security Council, Secretary of State Condoleezza Rice said Saturday. “We’ll see whether or not they are prepared.”

DeMargerie and a half-dozen others who visited North Korea recently say it is better off than a few years ago and may be able to withstand sanctions.

The sanctions could reduce the amount of hard currency North Korea receives, but market reforms in place since 2002 and stockpiling of excess cash, food aid and fuel may give Kim a cushion to defy the U.N.

In 2005, North Korea “received a surplus of a half-million to 600,000 tons of grain” from China and South Korea, said Kenneth Quinones, a former U.S. intelligence expert on North Korea who teaches at Akita International University in Japan. “It looks like most of that went into storage.” North Korea also had a decent harvest this year after two consecutive bumper crops, he said.

Marcus Noland, a Korea specialist at the Institute for International Economics in Washington, said millions of dollars in Chinese investment went into North Korea during the first half of 2006, more than the country could absorb.

Signs of progress are evident to Steve Linton, 56, who has made more than 50 trips to North Korea in the last 15 years. The son and grandson of Christian missionaries, Linton heads the Eugene Bell Foundation, which has delivered medical equipment to about 70 hospitals throughout the country.

“It used to be that people were visibly thinner in the spring,” when food from the previous year’s harvest had run out and new crops were about to be planted, said Linton, who last visited North Korea in May. Now, he said, “that distinction has pretty much disappeared.”

Linton has noticed that North Koreans are better dressed and that there are more bicycles in a country where a decade ago, nearly everyone traveled on foot. “It’s not lightning speed, but it’s gradual change,” he said.

Emerging markets

Pyongyang, a gloomy capital of bland concrete high-rises and little commerce a decade ago, has a few dozen shops and many sidewalk stalls selling ice cream, cookies, flowers, even videocassettes, said Simon Cockerell, manager for Beijing-based Koryo Tours, which organizes trips to North Korea.

Cockerell said there are four or five billboards for cars, the first commercial advertising in the country. Electricity blackouts, once common, are rare in the capital, he said.

Other indicators of an economic cushion include:

•A resumption of a state-run rationing system that hands out about half a pound of grain daily to city residents, who make up 70% of North Korea’s 22 million people. DeMargerie said North Korean officials told his organization that rationing, which collapsed during a famine in the 1990s, resumed last year. It provides corn or rice to make porridge, a mainstay of the North Korean diet.

•Diversification of oil suppliers. China provides about 80% of North Korean fuel, and Iran and Indonesia supply most of the rest, Quinones said. That gives supply alternatives should China carry out threats to restrict deliveries. Noland said North Korea also may have stockpiled diesel fuel that South Korea provided in 2004.

Noland, who spent several weeks in China last summer along the 880-mile border with North Korea, said economic progress is notable for one group of new entrepreneurs: managers of shuttered state-owned factories who are trading coke, coal and iron ore for cheap Chinese consumer goods and food, which they then sell to fellow North Koreans.

“A lot of small-scale activity in North Korea is done by state-owned enterprises,” Noland said. “They have transformed themselves into retailers. I call it the ‘Wal-Martization’ of the North Korean economy.”

Troubles remain

On the negative side, trade with China, which totaled more than $1.5 billion last year, is down about 30% this year because of the difficulty of transferring funds to North Korean bank accounts, said Nam Sung Wook, head of North Korean Studies at Korea University in Seoul. The problem stems from U.S. action last year to freeze North Korean accounts in a bank in the Chinese enclave of Macau linked to counterfeiting and money laundering.

“There is some confusion among traders in Dandong,” a Chinese city across the Yalu River from North Korea that has become a center of cross-border commerce, Nam said. He forecasts negative growth for the North Korean economy this year after 2.2% growth last year. Even so, new sanctions “will not collapse the North Korean economy,” he said.

Those likely to suffer most are salaried urban professionals, said Nam, who visited Pyongyang in July. He said he heard grumbling from technocrats and professors, whose average monthly pay comes out to about $33 at the official exchange rate but only $5 on the black market.

North Korea also has massive infrastructure needs that make it difficult to sustain economic gains. DeMargerie said only 20%-25% of households have access to clean running water, and the sanitation system is becoming a serious health hazard.

Still, Noland predicted, “They can make it through the winter. They are hunkering down and believe they can survive until the world accepts them as a nuclear power.”

Rice conceded that sanctions are no certain solution. “I think we’ll be at this for a while,” she said. “I can’t tell you how long.”

Daily NK
Kim Young Jin
9/26/2006

September, once again prices of rice rising in Jangmadang, North Korea.

At Sunam markets in Chungjin, North Hamkyung province:

1Kg rice=1,400 won ($0.46) . This is the highest prices have reached.
1kg of corn is a high 450 won.

The districts within North Hamkyung province such as Onsung, Hoiryeong and Musan are no different.

1kg rice at Onsung and Hoiryeong averages 1,200won ($0.40) and has risen to 1,300won at Musan. On average corn is costing 380~400won per kilo.

Although autumn harvest has begun throughout all of North Korea, the cost of food at Jangmadang continues to rise and the common North Korean experiences greater difficulties as a result of food shortage. Defectors have informed that poverty has become so severe in North Hamkyung province that the nightmares of mass starvation in the mid-90’s is once again tormenting a laborer’s dinner table with the reappearance of ‘grass porridge.’

On 23rd September, defector Choi Soon Nyu (pseudonym, 58, Chungjin, North Hamkyung province) came to China passing through Hoiryeong. She said “At Sunam markets in Chungjin, the price of rice has risen to 1,400won per kilo and corn has even reached 400won per kilo. Poor laborers have resorted to putting pig’s fodder into corn porridge to suffice a meal and the number of people eating grass porridge is growing.”

A tourist Jang Ha Cheol (pseudonym, Dancheon, North Hamkyung province) who entered China on 14th September through China’s Tuman customs said “In the districts of North Hamkyung rice surpassed 1,000won per kilo in July. Since the end of August, rice at Jangmadang in Dancheon and Chungjin averaged 1,300won per kilo.”

The current cost of rice nearing 1,400won per kilo at Chungjin Jangmadang is a record breaking figure. Mr. Han, an activist who has been working for 5 years at an NGO which supports defectors in China said “On the basis of information gathered through consultations with defectors for the past 3 years, it can be said that the current cost of rice at Chungjin is the highest ever in history.”

Mr. Han explained “Even during the ‘Special period’ last October where North Korean authorities strictly controlled selling food at Jangmadang, trade amongst the people did not exceed 1,000won per kilo of rice. Normally when autumn harvest begins in late September, food wholesalers and foreign marketers at Jangmadang release their units of rice kept in storage and so the cost of rice generally tends to have a depreciating effect.”

“Living costs” simultaneously escalate

North Koreans discuss amongst themselves that soon a ‘2,000won ($0.66) rice period’ will come, further raising feelings of anxiety.

Park Sung Cheol (pseudonym, 41, Gilju, North Hamkyung province) who defected to China on 17th September said “There is not a single person who is worried that they will be unable to afford rice as the costs continue to rise. In any case the staple diet for the people is corn. However, if the cost of rice rises then the cost of corn will rise accordingly and general living costs will rise also. As a result, escalating rice prices is not only a basic issue of food costs but a coupling indication that living standards will only get tighter.”

In actual, the general cost of living in North Korea is simultaneously on the rise. Pork in North Hamkyung province which averaged 2,300~2,800won per kilo in the recent spring is now nearing 4,000won (1.33). It appears that within half a year, the cost has risen no less than 60%. Corn oil and spices are averaging similar standards.

In regards to the recent ‘Skyrocketing rice prices at Jangmadang’ in North Korea, NGO’s and defectors in China are conjecturing “This year, as a result of negative farming produce and tightening of regulations by North Korean authorities after the missile launch, it seems that insecurity is lurking within North Korea and hence strategically, food that was kept in storage by food wholesalers, foreign markets and the military is not being sold at Jangmadang.”

Above all, talks coming from within North Korea suggest that compared to last year, this year food output will be regulated on a large scale.

North Korean citizens are forecasting a negative harvest as in the provinces of Pyongnam and Hwanghae, rice harvest failed due to the flood last summer and even in North Hamkyung province where corn farming is prevalent, drought has continuously soiled the area since spring. As a result, it is estimated that the harvest output this year will not even surmount 40% compared to the previous year.

In addition, since the missile launch on July 5th, North Korean authorities have been indicating that “All military families should independently prepare for 90 days of wartime rationing.” “Workers in official departments and transportation business should independently prepare for 30 days of wartime rationing.” As a result, concerns are rising within North Korea as these orders resemble the measures of policy control during the period of nuclear threat in ’93.

For these reasons defectors and NGO’s analyze that the ‘Big Hand’ at Jangmadang maneuvered by food wholesalers, foreign markets and the military are safekeeping rice in storage and watching the price of rice surge even though the harvest season has arrived.

A missionary Jung working in China said “According to testimonies of recent defectors, excluding North Korean companies collaborating with foreign movements based in China, merely 20% of locations are distributing rations despite making quotas. It is estimated that more than 70% of workers are being neglected and not receiving any rations.”

He further remarked “As long as half the nation’s distribution and companies and are in possession of a months necessary rations, only 5% of laborers will ever receive it.”

From the Daily NK:
Transportation Chaos in N.K… “1 Train Operating Every 10 Days”
9/6/2006

A dire source from North Korea informed on the 5th that the main railway Pyong-ra line (Pyongyang-Rajin) connecting east North Korea with the inland was suspended leaving people in extreme transportation chaos.

In a phone conversation with a reporter, Kim Min Chul (pseudonym, 47) of Hoiryeong, North Hamkyung province said “It took me more than 1 month to travel from Pyongsung, Pyongan province to Hoiryeong, North Hamkyung province.” Kim who went to Pyongsung and Suncheon in Pyongan province at the end of last July for trade revealed “I returned barely alive and having spent all my money on the road.”

Kim said “The passenger train that connects Pyongan and Chongjin, North Hamkyung province only operates once every 10 days and so the majority of people ride trucks or buses.”

The Shinuiju-Chongjin train service that departs Chongjin, North Hamkyung province for Shinuiju can only operate unto Kowon, North Hamkyung province as restorations for the railroad at Yangduk is not yet complete. The train that arrives at Kowon is then returned back to Chongjin, however this seems to take 10 days.

According to Kim, this past April an accident occurred on the railroad between Yangduk, South Pyongan province and Kowon, North Hamkyung province. A train was overturned and before any restorations could be made, the flood that coincided blocked the tunnel and the rail roadbed was washed away. In some parts of the region, 50m of the rail is warped and in mid-air.

On April 23rd 2006, a 13 carriage train collided with a freight train between the regions of Yangduk-Kowon on its way from Pyongyang to Pyonggang, Gangwon province. It was a large-scale accident where 270 soldiers and 400 civilians were concealed on the train. Kim supposes that at the time, North Korean authorities feared the accident would become public, therefore ceased railway operations for a period of time.

Kim said “At present, traveling long distances is particularly inconvenient as trains are not operating properly. As a result the main services between Yangduk, Pyongyang province, and the east with the inland have become virtually nonexistent.”

Train ticket cost a minimum of 5,000won ($1.67)

As trains are suspended ‘paying to car-pool’ is increasing, as costs rise dramatically.

One North Korean source said “It is becoming a custom that you automatically show a 5,000won($1.67) the moment you board a car. In the case you are carrying luggage, each baggage costs an additional 5,000won.” The cost of traveling from Wonsan, Gangwon province to Kowon, South Hamkyung province is 5,000won, from Wonsan to Pyongyang 20,000won($6.67) and from Wonsan to Hamheung, North Hamkyung province 10,000won($3.33).

The source said “People using trains ride cars between Yangduk to Wonsan and then board trains like ‘a relay race’ only barely returning home.”

The source relayed, unfortunate people travel by walking for over 10 days from Yangduk to Sudonggu, North Hamkyung province through the Bukdaeryeong mountain paths renown for it’s rugged terrain. These people climb over mountains eating stolen potatoes and corn in nearby fields, which has led to a rise in complaints by the people.

Having a bad influence throughout the economy … Skyrocketing prices

As the belt between the east and inland is disconnected, adverse affects are impacting throughout North Korea’s economy and the lives of the people. Even North Hamkyung province which encountered little flood damages is facing restraints as goods cannot be delivered. The people in the majority live off trade are in a situation where they cannot even embezzle goods from each other as trains have been suspended.

The railroad is a critical means of transportation to the point it is called the ‘Economy’s Artery.’ As an important railroad such as this has been suspended, the whole economy has recoiled and signs of shortage in food prevalent.

Accordingly prices at Jangmadang are escalating. In a phone conversation with Kim Sun Mi(pseudonym, 35) of Onsung district, North Korea, confirmed this fact. Kim said “As roads and railways throughout the country are becoming immobilized, prices are skyrocketing.”

Kim said “The cost of rice has risen at Jangmadang at 1,300won ($0.43) per kilo, corn is 300won ($0.1), corn oil is 2,800won ($0.93) a bottle, bean oil is 3,200won ($1.07) and pork 3,300won ($1.1).”

Kim said “At present, Kotjebi (street children) are becoming more prevalent in the districts of Chongjin, North Hamkyung and Dancheon, South Hamkyung province. With an obscure thought that ‘You can only live if you go to the borders’ they are drawing to the districts near China and the border areas such as Hoiryeong, Musan and Onsung.”

In the mid-90’s, as the country faced difficulties due to lack of power and old equipment, trains operated once every 10~15 days. In those days, when a train stopped briefly, people would detach windows and chairs putting them to fire.

From the Daily NK:

North Korean Women Responsible for 90% of Family Living…Recent Increase in Divorce 

Recently, it has been found that the divorce rate of North Korean women is rapidly increasing.

According to a newsletter published by a support organization for North Korea ‘Good Friends’ on the 29th, the majority of North Korean women bound to this battle of life are responsible for more than 90% of the family’s living and are caught in a severe lifestyle where they even have to gather bribes to the liking of security officers and protection officers.

It was reported that “The majority of women wake up at 3.30am to make rice and work outside the home all day. On returning home, they are still in charge of domestic housework such as cooking, washing, cleaning. For these reasons divorce has rapidly increased.”

The newsletter also reported “In the case of North Hamkyung province, in spite of divorce proceedings being complicated and approval difficult, of the people married the actual figure of couples living separately or undergoing divorce has reached 20%.”

The major basis of divorce is the burden of women to fulfill duties both in society and traditional female roles within the home.

In addition, it was explained that the reason divorces rates are rising is “During the period of full mobilization to farms like in May and June, not only is it difficult to eat three proper meals a day, but the number of husbands that help in domestic affairs does not even reach 10%.”

It is called the Pyongyang International Technology and Infrastructure Exhibition (PITIE).  I am not sure that is the most productive acronym, and it is not to be confused with the Pyongyang International Trade Fair

Korea Times
EU Promotes Pyongyang Trade Fair
Jan Jettel, Staff Reporter

Despite mounting international tensions surrounding North Korea’s nuclear arms program, preparations for an international trade fair in Pyongyang later this year have shifted into high gear.

The Pyongyang International Technology and Infrastructure Exhibition is scheduled from Oct, 31 to Nov. 3 in the Kimjongilia exhibition hall in Pyongyang. The exhibition is mainly for companies from the manufacturing sector.

The last exhibition in 2002 had 70 participating companies, representing 10 different countries. The project is heavily promoted by the European Union Chamber of Commerce in Korea (EUCCK).

“The objective of the EUCCK in participating in such an exhibition is to demonstrate to the local visitors that there is an alternative to cheap quality Chinese products,’’ said Jean-Jacques Grauhar, chairman of the EUCCK North Korea Committee, in a Korea Times interview.

Grauhar at the same time admitted the political delicacy of the exhibition. “Obviously the current nuclear crisis is not favorable for this exhibition. The U.S. is also exercising pressure on some European companies to limit their contacts with North Korea, in line with their strategy to isolate the country,’’ he said.

Europe, however, will not bend to U.S. pressure, according to Grauhar. “Twenty-three out of 25 EU member states have full-fledged diplomatic relations with North Korea, some of them even have embassies in Pyongyang. The EU’s engagement policy of North Korea still prevails, and this exhibition can be considered an important part of it.’’

Peter Bialas of Messe Munich International, the Germany-based company that organizes the fair, called the U.S. stance on North Korea “completely hypocritical. How can the U.S. demand a change in North Korea and at the same time block all interactions of North Korea with the outside world that might or might not bring about such change?’’ he asked.

Bialas and Grauhar agreed that while head offices of multinational companies have expressed their concerns about the exhibition, their branches in Korea do not feel disturbed by the crisis as they are more familiar with the whole policy environment on the Korean peninsula.

Bialas also said that German companies showed a particular interest in the exhibition because “experience in dealing with East Germany has shown them that companies can successfully do business with one another even if they operate in countries with different political systems. In the end it’s about business, not politics,’’ he added.

However, there will be no American companies taking part in the fair. ‘’There are no legal restrictions prohibiting American companies from visiting North Korea, however, given the current political climate with a missile on the launch pad, I don’t think US firms would be interested in visiting at this time.

“If North Korea were to remove the missile and return to the six-party talks and it appeared there would be some predictability in their actions, I believe there might be some interest. But at the present time, I am afraid I don’t see much hope,’’ said Tami Overby, president of AMCHAM, the American Chamber of Commerce in Korea.

Local businesses were also skeptical about the fair. “In principle, North Korea and particularly the Kaesong Complex would be very interesting for us, but the political climate is just too unstable at the moment for us to consider investment there,’’ said the CEO of a German multinational company in Seoul on condition of anonymity. He added that “the situation would probably be better if the U.S. stopped bullying North Korea and interfering on the Korean peninsula.’’

This comes at a time when the two Koreas are trying to improve relations. Recently, a group of ambassadors visited the Kaesong Industrial Complex in North Korea to attract investment in the project.

Earlier this month, the 12th round of Inter-Korean Economic Cooperation Promotion Committee met on Cheju Island to discuss South Korean economic aid to the North.

From the Daily NK:

North Korean prices are continuing to rise.

At Sunam Jangmadang of Chongjin City, the price of rice is 1,200W/1kg, corn 300W, bottle of oil 2,000W, pork 2,500W and pants made from China 20,000W.

As it is spring, not only is it a time where the overall price of Jangmadang rice rises, but because the country is not distributing rations, the majority of people depend on the rice at Jangmadang. Also, rice sellers are watching this opening and are raising prices.

Lee who entered South Korea in 2003 says she has already sent money to her family by various means. The money sent through earnings from part-time jobs and resettlement money from the South Korean government, is becoming a lifeline for her family. Her families in North Korea depend on her to send money to live and get great relief from their daughters who live in South Korea.

Chinese 100yuan is 34,000won at Jangmadangi

Lee’s family who support their living by selling goods made from China, ceased trade because of soaring prices and control of Jangmadang by authorities.

Lee added, as it became harvest season and authorities restrained Jangmadang operations, there was even an incident last May at Chongjin where a lot of children were hospitalized after eating sweets and medicines made from China, and instruction was made in regards to strengthening the regulation of Chinese goods.

However, Chinese goods are in the majority and controlling Chinese commodities in North Korea is ‘shading the sun with the palm of your hand.’ Lee conveyed that to regulate the problem, police officers confiscate Chinese goods such as alcohol and cigarettes, and that oppression is worsening.

According to Lee, at present in Chongjin, Chinese 100yuan is 34,000 won for North Korean money. If this is converted to dollars, $1 calculates approximately 2,750won.

In March, the exchange rate at Musan Jangmadang was 100yuan to 37,125 won North Korean currency, in dollars $1 for 2,970won. The exchange rate for Yuan has decreased since March from roughly 100yuan to about 3,000won.

Local factory workers, majority mobilized to the village

The local industrial factory Lee’s brother works for in Chongjin, has recently closed factory doors and sends workers to the village. Compared to reports of North Korean publicity and media of central businesses in production at Pyongyang, standards of local industries are extremely inferior.

The reason, local industries could not extricate the aftereffects of acute shortages in equipment and materials following the economic breakdown in the mid-90’s.

According to defector of Chongjin, person ‘A’ laments “Recovery in factories is difficult as electric machines and electric lines are stolen and sold. Factories themselves want restoration but money is required, and isn’t it that there is no where money can appear.”

The most urgent is the problem of electricity. Most recently, as it is the farming season, all the electricity is mobilized for the water meter operations, with electricity servicing the villages approximately 10hours daily. However, as electricity is supplied to the villages, meanwhile the city is locked in darkness.

From the Daily NK:

In June, the highest peak of rice-planting season, North Korean authorities station security guards to be at the crossroads of Jangmadang(a type of black market) and get undercover police officers to wander the streets and regulate people with focused control who are trading. During the rice-planting ‘period of full mobilization’ goods that are sold secretly are all collected.

Also, it has become known that rice in the Onsung region is trading for 1,200won ($0.4).

North Korean citizen, Lee Hyun Sook (32 years, born in Onsung) who to obtain food passed Tumen River revealed while meeting a reporter on the 5th near Yanji City, China that “The people are driving the whole rice-planting battle.”

Lee who came to China bringing a 5 year old child after losing her husband barely ran a business in Jangmadang, and continues her living as a common homemaker. After authorities shutdown Jangmadang in spring, Lee says she was driven to the village, thus crossed the Tumen River as otherwise her child would die of hunger.

Following Is Questions and Answers with Ms. Lee

– It’s said Jangmadang was shutdown?

The security office controlled and did not permit morning Jangmadang. Security guards stationed the road that intersects with Jangmadang, whilst common police officers roamed the street controlling people trading. Goods that are secretly in trade during ‘the period of full mobilization’ are all collected.

– How will you live if Jangmadang is shutdown?

From 6 o’clock in the evening Jangmadang doors are open. People like me who earn a daily income and live off their daily income are about to die.

– When is the period of full mobilization until?

Every year when it is farming season, full mobilization is set up. There is no designated date, but is terminated when rice-planting and weeding is complete.

– What type of people are targeted for full mobilization?

After morning, it is quiet and there are no people in the city. Factories, companies, people on the street, students, no differently anyone who holds a spoon all leave. Even the people from far distances (long distance trading) are supervised on the street.

– It’s said that even traveling permission have been reinforced…

The security office does not even issue traveling permissions. People that must go take a citizen warrant, but security guards and police officers come stop their cars on the street regulating people and even collect goods. In particular, people from other provinces are especially made to do a lot of work.

– How much, how long are you made to work?

Supervised people are only sent away when a rice seedbed, 9m long and 1.6m wide is pulled by hand. Those assigned rice-planting pair-up together and only send people away at night, when all the seeds have been planted

According to Lee, when the “Rice-planting full mobilization group” is organized, executive officers go to each farm to manage the people’s Jangmadang and direct the people’s village mobilization. On one hand, she says “When it is morning the broadcasting car roams the streets announcing ‘You have to farm well, to win the fight with Americans’ ‘You have to farm well, to realize the general’s worrying thoughts of the people’s hunger problem.’

Price Increase in the Period of Full Mobilization

It appears that during the period of village mobilization, the price of good rises due to operation restrictions. People wanting to buy rice wander trying to find rice sellers and people that secretly sell and buy in the alleyways are disciplined and carried off to the security office.

The price in Onsung Jangmadang is 1,200won ($0.4) per 1kg of rice and 250won ($0.083) for corn. Fresh pork is 1,800 won ($0.6) per 1kg, as it can spoil easily in the warming weather, but can be bought for 1,600won ($0.53) towards the end of day. It is of course unreasonably expensive compared to a laborer’s monthly income of 5,000won ($1.67).

In a way, on commencement of trade, the people cannot even spread open their goods at Jangmadang but sell to people secretly. Lee said “Food is given, a lunch meal per day for people mobilized to the village.”

After the Resumption of Rationing, There is No News for a Long Time in Onsung

Lee says that it has been a long time since distribution in the Onsung has stopped.

After being questioned “How much rationing have you seen?” Lee said that “No rationing was received since 1994.” Lee comments that last year October, she knew of the truth that rationing had been resumed, but as a non-laborer with no husband, there wasn’t a time she received the classified rations.

Last year October, North Korean authorities instructed the distribution of rations according to districts, but smaller districts were given rice only for a few months before being exhausted. The distributions to the people from factories are 15day rations to last a few days, but Lee and other similar housewives respond to the distributions as completely unfamiliar terms.

People like Lee who earn a daily income and live off their daily income, become suffocated in the reality of their lives when mobilized to the villages. For this reason, there is an actual increase of North Korean people crossing the Tumen River to do suitcase business and earn money.

From the Daily NK:

In North Korea, South Korean dramas are confidentially distributed through VCDs(‘Flat eggs’, as the Cds are known).  Previously, North Koreans were only allowed to watch films from the DPRK, China and USSR.  Posessing VCDs was also illegal.

According to Mr. Lee, a Chinese-North Korean who often visits Shinuiju, “Recently, Kim Jong Il has allowed North Koreans to see films only on the flat eggs(CDs) produced by Hana Electronic [the state-owned production monopoly]”. He added “Hana Electronics VCDs are all North Korean movies, Chinese movies featuring fighting with Japanese soldiers, and the Soviet Union movies”.

However, North Koreans are enthusiastic about South Korean dramas such as Love Song in Winter and Autumn Story and obsolete Western movies Rambo and ‘Bruce Lee’.

Mr. Lee said that “Recently South Korean dramas have been distributed widely, and because North Koreans see religious activities and adult materials through the flat eggs(CDs), the North Korean government dispatched an extensive censors group to crack down them”.

In North Korea, every kind of VCD was prohibited. However, realizing that North Koreans took pleasure in secretly watching the widely distributed VCDs, the North Korean government changed its policy and “partially” allowed its people to watch.

Mr. Lee said that, “These days, the punishment for [watching videos] has lightened, so watching VCDs except religious materials is just fined or orally warned”, adding, “The government does not take violators to political prison camps, but maybe Nodon Danryeondae (Labor facility), or Gyohwaso (long-term labor camp)”. Subsequently, he said that, “Because all officials of the National Security Agency and officials of the People’s Safety Agency see the dramas, the government can not unconditionally prevent from watching like the past”.

He said that, “Recently, the numbers of religious people have increased, and because of it, some people were caught watching religious films”, and “It is hard to survive in the religious cases”.

Meanwhile, shortwave radios are illegally traded at around 2,000 won($0.67) at Jangmadangs. Until 3 or 4 years ago, the government had carried out the reporting system about the illegal trades, but after the news that South Korea and the U.S sent radios, the trades at Jangmadangs were officially inhibited.

Now it was known that the small radios sold in secret are carried in through smuggling vessels generally in Jagangdo province, North Korea.  financial problems are resolved, a broker is introduced and guidance to an exile route is given.

Daily NK
Kim Young Jin
5/28/2006

North Korea is facing the hardest “yellow spring” right now. ‘Yellow Spring’ means the hardest time of the year in North Korea. “Yellow spring” originates from how the sky looks yellow because of starvation.

Mr. Lee Hyun Soo (46) who crossed the Tumen River on 15 May said, “It is hard to endure day by day”.

Mr. Lee, head of a household of four said, “Rumors of people going to China and South Korea go around. I tried not to cross the border, but I did because of my family members who are starving”. He complained, “The government have been acting like they would give us food for a long time, but they deceived us”.

Recently, North Koreans who cannot make their ends meet like Mr. Lee started to cross the Tumen River again. The reporter met 5 North Koreans including Mr. Lee. They met with the reporter at a secret place in Yanji, and expressed strong discontents about the situation of food shortage in North Korea and the policy regarding food distribution system.

Mr. Choi Young Nam (37) said, “I have been waiting since the 1st of April. I know that there are even less rice in spring, so where would the rice come from? They cannot deceive us like this”. Mr. Choi said. “In January and February, rice for 2~3 days were given to the old and supporting families. After that, we bought the rice at Jangmadang price at the distribution center”.

The official price of rice is 45won($0.015) for rice and 25won($0.0083) for corn. After North Korea resumed its food distribution system, the government regulated the rice transaction at Jangmadang while selling rice at 950 won($0.32) and corn at 350 won($0.12), which is same as Jangmadang price. Recently, price at Jangmadang went over 1300 won($0.433) and the price at distribution center went up accordingly.
“Similar To The Situation At The End Of Food Shortage In 1998”

They say, “Family of those who work at the government, police and national security agency store up food for one year. People who work at powerful organizations such as Office #5 (foreign currency earning office under office #39 under the Party, loocated at each city and province) receive food, but other workplaces do not distribute food anymore”.

After the 7.1 Economic Management Improvement Measure in 2002, policy which orders each organization to provide for their workers has been adopted; workplaces with power can feed the workers, while poor factories cannot. People generally have an attitude that does not care if others can eat or not.

Mr. Park who was involved in ‘suitcase business’ with Chinese said, “Everyone is involved in trade, and I could not even break even because I could not sell the goods at fair price”.

Mr. Park who is employed at a steel factory in Hoeryong has three family members to support. Mr. Park crossed theTumen River to earn money by farming in China, because it seemed hopeless and difficult to live in North Korea. Following is what Mr. Park said.

“The situation is similar to the situation at the end of food shortage in 1998. The number of people who come to China will increase soon. People at the border area know that why they are so poor because they are involved in trade with Chineses. All they have in their heart is anger”.

“Living By Grassroots and Porridge, The Old and The Sick Are Dying Of Starvation”

Mr. Hyun Joo Hoon (50) who sold goods in Pyongan and Hwanghae Province says, “People in Pyongan Province are worse off than those in border area”.

People in Pyongan Province and at border area both do not receive food from distribution system, but people in provinces without the capital to start business began to eat grassroots and porridge for meals. Mr. Hyun said, “I ate corn porridge because I only received five day worth of food”. Mr. Hyun said, he had seen the sick and the old dying of starvation at Soonchun and Dukchun in South Pyongan Province.

Mr. Hyun said, “It is because the government regulated the outflow of food to other provinces as the government ordered the regional governments to distribute food on their own”. In the fall of last year, North Korean government has regulated the outflow of food by placing posts at highways connecting different cities and districts.

Mr. Lee added, “People in the inner provinces believe the propaganda of the North Korean government that the reason for the poverty is the economic sanction by imperialists, even when they are dying. Unless their thoughts change, they cannot even resist”.