North Korean Economy Watch

Andrei Lankov writes in the Korea Times about the state of the North Korean economy.  Excerpt below:

The existing statistics are remarkably untrustworthy, being essentially educated guesses by analysts. Nonetheless, these statistics indicate a moderate growth of the North Korean economy.

But the present author talks to North Koreans quite frequently. So I don’t need statistics to confirm what becomes clear from my talks with refugees, smugglers, migrant workers and those Koreans who have illegal Chinese mobile phones. Throughout the last ten years the economic situation in the country has improved, even though this improvement was very moderate.

What does “improvement” in this context exactly mean? First of all, few if any North Koreans now face the threat of starvation, though malnourishment remains a widespread problem. Many (perhaps, a majority) of North Koreans don’t have enough to eat in spring. This has a seriously negative impact on their health and is especially bad for children. Nonetheless, unlike the 1990s, it seldom leads to death.

The average North Korean meal is a bowl of boiled corn with a few pickles. Meat or fish are eaten only on special occasions or by affluent people.

Indeed the last decade was a time when material inequality increased in leaps and bounds. Some of the new rich are officials who take advantage of their positions while others are successful entrepreneurs running all kinds of private businesses.

A successful North Korean entrepreneur nowadays might even openly own a car. For instance in a relatively small borderland city with a population of some 90,000 people there are officially three private cars. Much more frequently well-to-do North Koreans prefer to register their cars with state agencies. At any rate, ten years ago a private car was almost unthinkable.

The less successful entrepreneurs or craftsmen are still doing quite well as indicated by significant increase in the number of consumer durables owned by North Koreans. Fifteen years ago a fridge was a sign of exceptional luxury, almost as rare as a private jet in the U.S. Now it’s a bit like a luxury car, an item that 10-20 percent of households can afford.

What is also interesting is the spread of computers, including privately owned ones. In most cases these are old, used computers which are imported or smuggled from China. They are quite outdated but they are computers nonetheless. Recently I interviewed a group of school teachers from the countryside, and they said that nowadays every high school, even in remote parts of the country, is likely to have at least one computer (admittedly, this wonderful contraption is seldom switched on).

This does not mean of course that North Korea has become a consumer paradise. In spite of some improvements, the gap between the North and its successful neighbors continues to widen. However in absolute terms the North Korean economy is not shrinking any more.

There have been serious setbacks, the currency reform early last year is a perfect example. For a while, this failure almost paralyzed the economy and created serious food shortages across the country.

But what brought about this moderate growth? It seems that there are three major contributing factors.

First, North Korea has been quite good at begging and blackmailing the outside world into providing aid. The aid was initially provided by South Korea and the U.S., but now it comes almost exclusively from China.

Second, North Korea’s technocrats have learned how to run the country in its new situation. They are not very efficient at this, but, to quote Marcus Noland, “they are muddling through.”

The present author is inclined to believe that it is the third reason which is the most important of all. Over the last decade a relatively powerful private economy has developed in North Korea. North Koreans did not merely learn how to trade privately, they now produce privately as well and this growth of industry invisibly and privately, seems to have contributed to the growth described above.

The growth is moderate, and no breakthrough is likely. Nonetheless, it is real and palpable.

Read the full story here:
Between myths and facts
Korea Times
Andrei Lankov
1/30/2011

UPDATE 3: The JoongAng Daily (2/12/2011) reports on comments made by Robert King:

King explained that in the past, the U.S. had agreed to give North Korea 500,000 tons in food aid, but was only able to give 170,000 tons as North Korea refused the rest and ordered foreigners who had entered North Korea to deliver the aid to leave.

The envoy also said that it has not yet been decided whether the U.S. will grant food aid to the North and that three prerequisites must be fulfilled if it does.

The three conditions, he explained, are whether a real demand for food truly exists in North Korea, whether the North’s need for food is on the same level as other countries in need of aid, and whether monitoring of the aid will be securely guaranteed. Only when these three prerequisites are met can the U.S. grant aid, King said.

UPDATE 2: According to the JoongAng Daily (2/9/2011) the North Koreans have made an official request for food aid to the US government:

North Korean deputy ambassador to the UN, Han Sang-ryol, requested U.S. food aid last month through Robert King, the U.S. special envoy for North Korean human rights, a diplomatic source told the JoongAng Ilbo yesterday.

Local analysts suspect that King, who is currently in Seoul, informed the South Korean government of the request and is discussing a joint response to it.

“Ambassador Han met King in New York on Jan. 14 and requested large-scale U.S. food aid for the North,” said the diplomatic source in Washington.

It is the first time in years that a behind-the-scenes diplomatic discussion between Pyongyang and Washington on aid has come to the surface. U.S. food aid to the North has been suspended since March 2009 after the Kim Jong-il regime rejected a U.S. proposal to increase the number of Korean-speaking food-distribution monitors to make sure aid was getting to the public.

Han told King that the North was willing to enhance international monitoring of food aid “as much as the U.S. wants,” the source said.

King, who came to Seoul on Sunday, started meetings with Seoul officials yesterday, including Wi Sung-lac, the top envoy on North Korean nuclear issues. At a brief media conference after the meeting with Wi, King did not elaborate on the purpose of his visit or his discussion with the South Korean envoy, saying only it was “very good, very serious and a very thoughtful discussion.”

When asked whether food assistance to the North was on the agenda, King said they “talked about a lot of issues.”

“[It is] extremely important for the U.S., as we pursue our policies toward North Korea, to coordinate with the government of South Korea,” King said. “We have a close working relationship, we are able to work together well on issues, we share our analysis, we share our ideas in terms of making progress.”

The official United States stance, as U.S. Assistant Secretary of State Kurt Campbell said earlier this month, is that it does not have a plan to resume food aid to the North for now.

“The U.S. does not think the North has met conditions to get U.S. food aid,” the source said.

And even if Washington decides to resume aid, it will take time because of congressional procedures, the source said. But some analysts see the possibility of change, citing some opinions in the U.S. State Department in favor of engaging the North with aid to sway its attitude on other issues, including denuclearization.

UPDATE 1: According to the Donga Ilbo (2/6/2011):

The U.S.-based Radio Free Asia says the U.S. government and nongovernmental organizations are discussing the resumption of food aid to North Korea.

Quoting diplomatic sources in the U.S., the broadcaster said Washington has not decided to resume food aid to Pyongyang but is having many talks and discussions on the issue.

Voice of America said Friday that the World Food Program and the U.N. Food and Agriculture Organization, both of which are under U.S. influence, also plan an additional survey of the North`s food situation for about a month from Feb. 10.

In an interview, Dr. Kisan Gunjal of the food organization said he will survey the North’s food security and crop situations from Feb. 10 to March 12 at Pyongyang’s official invitation.

In a phone interview with The Dong-A Ilbo, an official at a South Korean aid group said, “The U.S. has asked South Korean non-governmental organizations about North Korea’s crop and food supply situations in 2011 since the North’s artillery provocation on Yeonpyeong Island in November.”

Washington, however, remains officially cautious. U.S. State Department spokesman Philip Crowley told a news briefing Monday that the U.S. government has no immediate plans to provide humanitarian aid to the North.

ORIGINAL POST: According to the Donga Ilbo (1/31/2011) the US and DPRK are talking food aid once more:

The U.S. and North Korea have begun their third round of food diplomacy, with Washington considering resuming food aid to Pyongyang.

The U.S. has halted food aid to the North twice since its first provision in 1996 after blaming Pyongyang for diverting the aid.

The North has always asked for food aid first since North Korean leader Kim Jong Il confronted a series of crises in the early 1990s, when the former Soviet Union and China stopped economic assistance to the Stalinist country.

His father and the North`s founder Kim Il Sung died in 1994. When the North was devastated by floods and other natural disasters nationwide, Kim Jong Il ordered state cadres to beg the U.S. for help.

The North Korean Foreign Ministry then formed a committee for flood damage and went hat in hand to Washington. The Clinton administration provided 19,500 tons of food through the World Food Program in 1996, expecting the North to implement the 1994 Agreed Framework and be docile in talks for the repatriation of remains of American soldiers killed in action in the Korean War.

Washington increased its food aid from 177,000 tons in 1997 to 695,000 tons in 1999. In 2000, a joint communiqué between the North and the U.S. was signed.

North Korea, however, diverted the food aid in ignoring U.S. and international principles for humanitarian aid.

As public opinion in the U.S. worsened over the assistance, the George W. Bush administration slashed the aid volume from 350,000 tons in 2001 to 40,000 tons in 2003. The U.S. Congress demanded greater transparency in the distribution of the food aid in 2004, when it passed the North Korean Human Rights Act.

Rejecting the demand, Pyongyang expelled World Food Program staff in 2005. Washington opted not to provide food aid to Pyongyang in 2006.

Flexing its muscles in November 2006 by conducting its first nuclear test, North Korea again requested U.S. aid in 2008. The Bush administration, which was nearing the end of its term, chose to sit at the negotiating table with the North and offered 500,000 tons of food aid through the World Food Program.

The North received 169,000 tons of food by expanding the areas where food distribution is monitored and agreeing to allow more Korean-speaking monitoring personnel.

In early 2009, Pyongyang decided to test the newly inaugurated Obama administration by launching a long-range rocket and preparing for a second nuclear test. In March that year, the North expelled humanitarian aid groups, saying it would not be able to keep its promise of distribution transparency.

In fall last year, North Korea unveiled its uranium enrichment program and showed its centrifuges to the U.S. in a virtual threat to conduct its third nuclear test with uranium bombs if Washington failed to provide food.

What the U.S. will eventually do is attracting interest since South Korea is opposed to aid to the North.

Read the full stories below:
Pyongyang asks U.S. to restore food aid: source
JoongAng Daily
Kim Jung-wook, Moon Gwang-lip
2/9/2011

US, N. Korea begin 3rd round of food diplomacy
Donga Ilbo
1/31/2011

Radio Free Asia: US, NGOs discussing food aid to NK
Donga Ilbo
2/6/2011

Three sets of pictures related to the DPRK:

Iron Facebook Curtain: The first image obtained via Aid Watch presents a December 2010 map of Facebook connections.  Notice anyone missing?  (Egypt is there!)

You can see a high resolution version of this image here.

DPRK at night and economic growth: The second image obtained from Aid Watch compares growth in electricity coverage at night between the two Koreas.  This is the first image I have seen like this which makes side-by-side comparisons:

Click image for larger version

I overlaid these images to Google Earth to determine areas of relative growth and decline.  Surprisingly, Pyongyang and Chongjin showed dimmer and smaller electricity signals, indicating lighting was more prolific in 1992 than in 2008.  I would have expected their electricity signals to be just as, if not more, pronounced in 2008.

The areas of growth, where electricity signals are more (modestly) pronounced, include Kaesong (개성), Huichon (희천), Songgan (성간), Thaechon (태천), and Anju (안주).  Most of these are somewhat expected since they have received much publicized foreign (Kaesong) and domestic investment, particularly in power station development.

Also worth noting are the growth of lighting in South Korea and China.

Photoshop Fun: The third set of interesting images come from a Chinese reader who sends along these images from Korea magazine,  the monthly picture magazine published by the DPRK (See e-version here).  The images have been altered to give the impression of plenty.  Below see images of photoshopped goats, swimmers, and bread:

According to the new Noland/Haggard blog:

The two panels below report data on prices for rice and corn. The charts indicate that prices have risen to roughly 35-40 percent of their pre-reform trend line, suggesting that excess growth in the money supply has undone a significant share of the reform. And grain price inflation has accelerated significantly, from an annual rate of 35-40 percent before the reform, to 500-600 percent over the past year.

Admittedly grain prices are rising worldwide, so the observed increase in grain prices may contain an element of relative price increase, but if food prices are interpreted as a proxy for the overall price level, these data suggest a rapidly growing money supply and accelerating inflation in North Korea.

Pictured above: Nampho Glass Bottle Factory visited by Kim Jong-il

Institute for Far Eastern Studies (IFES)
(NK Brief No. 11-01-26)
1/26/2011

According to North Korean media, Kim Jong Il began this year’s onsite instruction with a visit to the Nampo Glass Bottle Factory. The January 20th issue of the Choson Sinbo also ran an editorial stating that “These days, in our country, improving the lives of the people is especially emphasized.” It also noted that Kim Jong Il’s first onsite visit of the year was to a site important to improving people’s standard of living. The paper boasted that great efforts were being made in the development of light industry — especially factories producing daily-use goods and food products — and revealed that the bottle factory in Nampo will play an important role in meeting the increased countrywide demands for packaging from factories large and small.

Despite this praise, the reality is that the people of North Korea are suffering ever-worsening economic conditions. Just as South Korea is in the middle of a cold spell, the North has suffered chilling conditions ever since the end of December. The Korean Central News Agency reported on January 22, “The cold-weather conditions are expected to continue until the end of January,” and, “this cold spell is causing more than a little damage to the lives of the people and to spring farming preparations.”

As the cold spell drags on, their hardship will continue. North Korea is ill-prepared to deal with such cold weather; freezing pipes make it difficult for the people to access fresh water, while food and firewood are in short supply. Hunger and cold are exacerbated this winter because those without access to firewood or heating oil are also faced with an environment devoid of wild plants or animals.

Power shortages have also grown more severe in the new year. On January 20, Open Radio for North Korea (ORNK) reported that an area of the Yanggang Province has been without electricity since the first of the month. Even Pyongyang has been experiencing power difficulties, with electricity only available to most residents for 1~2 hours each day. ORNK reported that “recently in North Korea, students and parents have been burdened with supplying firewood for school heating, while the prices of coal and wood are skyrocketing in the markets.”

The cost of food has also shot through the roof. Rice, corn, pork, and other staple foods are becoming increasingly more expensive. Young-wha Lee, a spokesperson for the Japanese human rights organization Rescue the North Korean People! Urgent Action Network (RENK), announced on January 17 that a source inside North Korea had reported a 500 Won jump in the price of rice within Pyongyang, from 1,400 Won per kilogram on the January 7 to 1,900 Won within 3~4 days. Corn jumped from 750 to 950 Won, and pork was up from just under 4,000 Won to its current price at around 5,000 Won. Gasoline now costs 3,500 Won.

According to a South Korean online source for news on North Korea, Daily NK, one can see the impact of inflation by taking notice of the price gap of around 200 Won per kilogram of rice in Pyongyang and rice in rural areas (North Pyongan Province’s Sinuiju and Ryanggang Province’s Hyesan, in particular). It is noteworthy that prices are shooting up in January, rather than during the lean season of March and April.

Good Friends, a South Korean-based humanitarian organization, has also relayed reports of inflation from sources within North Korea. It has reported that rice was selling in Pyongyang for as much as 2,100 Won per kilogram on January 7, significantly more than the 1,600 Won per kilogram reported at the end of last year. Prices continued to hover around 2,000 Won until recent rations eased shortages and brought the price back down to around 1,500 Won. As North Korean organizations and social units distribute these overdue holiday rations, there has been a fall in food prices.

However, these rations were not seen in all areas of the North, and in those regions where residents were not provided food, prices remain high. Rice in Hamheung jumped from 1,500 Won per kilogram on January 1 to 1,800 Won just one week later. On January 7, similar prices were seen in Chongjin (1,750 Won) and Sinuiju (1,800 Won). Ten days later, rice in Chongjin had climbed to 1,980 Won, and was threatening to break the 2,000 Won barrier. Corn in Pyongyang was selling for 950 Won per kilogram on January 7, while it cost 780 Won in Chongjin and 850 Won in Hamheung, Sinuiju, and Pyongsong. By January 17, corn averaged between 750 and 800 Won. Only in Pyongyang, agricultural regions, and other areas receiving rations had prices fallen to 600 Won per kilogram.

According Good Friends, grain prices in the North have shot up this year because several Party officials in charge of grain imports are behind schedule with incoming shipments, and the rising value of the US dollar and Chinese yuan have driven up the cost of overseas purchases.

According to Choson Ilbo:

North Korean products are being sold in South Korea labeled as Russian after the South stopped all cross-border trade in May last year. The North is desperate to unblock the flow of hard currency and is pushing for resumption of dialogue over the Kaesong Industrial Complex and lucrative package tours to Mt. Kumgang.

The Unification Ministry has released a list of the top 10 North Korean agricultural and fisheries imports, which show that the South brought in around 310,000 tons between 2006 to 2010. Imports totaled US$677 million tons, which worth $135 million a year. Over the last decade, North Korea also earned more than $500 million from the Mt. Kumgang tours, while the Kaesong Industrial Complex brought in $50 million annually.

Shellfish exports made the most money for the North, totaling 171,533 tons worth $268 million, followed by dried fish ($78.76 million), processed fish products ($76.02 million) and other seafood ($67.42 million).

Before the South halted trade following the sinking of the Navy corvette Cheonan, most North Korean shellfish was brought into the port city of Sokcho on the east coast. South Korean importers paid in U.S. dollars in Sokcho after signing contracts in the Chinese border town of Dandong with North Korea’s official economic cooperation agency.

But since trade was halted, North Korean shellfish has been labeled in Dandong as Chinese in origin and apparently sent to the western port city of Incheon. North Korean fisheries products are also apparently loaded on to Chinese vessels in the West Sea and brought into South Korea. As the pressure to bring in more dollars increases, chances have risen that the North’s agricultural and fisheries products are being falsely labeled.

A South Korean businessman who trades with North Korea, said, “Since trade was halted, North Korea has been trying to sell its products to South Korea labeled as Chinese or Russian in origin. This shows just how desperate North Korea is for dollars.”

The alternatives would be to sell the goods to China, the North’s largest trading partner, but prices have to be slashed and it costs more to transport them. Most of the dollars North Korean makes from selling goods to South Korea appear headed straight for leader Kim Jong-il’s coffers and used to prop up his rule. Kim’s funds are divided into local and foreign currencies and the latter, raised by selling farm and fish products, account for a key portion. Products such as shellfish and mushrooms that can bring in the most foreign currency are controlled by the Workers Party or the military, making it hard for the money to be used to boost the welfare of the North Korean people.

“North Korea uses a lot of the money it makes from trade to fund its rule, either buying gifts for government officials or building luxury homes,” said Cho Myung-chul, a professor at the Korea Institute for International Economic Policy, who taught economics at Kim Il-sung University in North Korea. “North Korea desperately needs money to win the hearts and minds of the public and gain support for the hereditary transfer of power. That’s why it’s seeking talks with South Korea, so it can find a way to sell its products.”

South Korea is also prosecuting South Korean firms suspected of trading with the DPRK.

Read the full story here:
N.Korea Sells Products in South Under False Labels
Choson Ilbo
1/22/2011

According to the Daily NK:

North Korean trading companies operated by several organs have been selling steel to China in exchange for food.

One Chinese trader who does business with North Korea reported to The Daily NK on Monday, “China-based North Korean workers in charge of trading with China for Cheongusan Trading Company (under the Escort Command), say that this year Chosun is expanding the volume of its steel sales with China.”

The trader said, “In November last year, the analysis table of steel quality was delivered to us, and accordingly a contract has also already been signed.” He added, “In Chosun, the company is waiting for a permit to trade from an upper organ after having loaded materials on freight trains.”

He explained further, “For the price of the steel, Chosun has asked for rice, flour, noodles and also construction materials,” adding, “Food in bulk can enter Chosun.”

He explained that since North Korea is facing a serious lack of food, cement and other construction materials due to isolation from the international community, the country is trying to barter steel for food with China, from which the North is able to import.

Another trader in China verified the story, explaining, “Recently in Dandong, workers from Kangsung General Trading Company (under the General Staff) and other companies visited China for the purpose of selling steel.”

He added, “From now on, our company is going to do only steel trade with Chosun. We have decided not to do business in other things because our experiences have shown that there is no credit there.”

He went on, “North Korean trading units may have suffered from limitations put on items by Chinese companies,” going on, “If Chosun does not make a deal with us, they will starve to death this year. Even though they emphasize independent rehabilitation, when have they ever been rehabilitated?”

North Korea’s media frequently emphasizes the glorious production of “Juche” steel at Kim Chaek Steel Mill and Gangsun Steel Mill. Indeed, the Common Editorial issued on the first day of this year stated that, “By the power of the realization of the faith and model of Kim Steel (steel from Kim Chaek Steel Mill) and Juche steel, let’s have waves of victories.”

According to KOTRA, South Korea’s trade statistics agency, from January to October, 2010, North Korea exported steel to China worth $82 million.

One potentially positive aspect to this story is the recognition by the DPRK of the benefits of comparative advantage in trade.  Rather than aiming to produce all of its own food, the DPRK can instead specialize in steel production and trade for Chinese produced food.  Through trade, China and the DPRK could both consume more steel and food than if each country practiced autarchy.  Unfortunately the DPRK’s recent history has demonstrated a callous disregard for comparative advantage and has instead focused on increasing domestic food production and aid while limiting international trade.  Lets hope to see more rational policies prevail in the future.

Read the full story here:
North Korea Bartering Steel for Food
Daily NK
Im Jeong Jin
1/3/2011

Item number one: the DPRK’s domestically produced film camera, Hakmujong-1 (학무정-1):

This picture comes via the Russian blog “Show and Tell Pyongyang”. You can read about this camera in the original Russian here.  You can read about it in English (via Google Translate) here. This is the same blog that informed us about the DPRK’s PDA device and the DPRK’s Linux OS, Red Star.  He also has some fabulous pictures of the Kim Jong-suk Pyongyang Silk Mill here.

Item number two: DPRK’s domestic “Coke”:

This photo comes from the collection of Eric Lafforgue.  If you have not already seen his photos, please do yourself a favor and click over.

The soda is “Crabonated” which is a pretty funny typo.  Also worth noting are the lengths they have gone through to copy the Coca-Cola brand–as if they are trying to win back market-share from the foreign firm.  The colors, red, black, silver and white are the same.  The familiar cursive English “C” at the beginning of the word is a close copy.  They even tried to replicate the Coke “wave” by adding a literal wave in a similar curve along the bottom of the advert.

Item number three: DPRK caviar (Okryu Restaurant)

“Thanks to our leader Kim Jong-il we have managed to breed sturgeons.  People from Pyongyang and other provinces can come here to taste caviar and turtle meat.”

See the full video here. Here is a satellite image of the restaurant.

Item number four: Women’s fashion

Uriminzokkiri has posted a clip on DPRK women’s fashion to their Youtube account.  You can see it here.  I have blogged about women’s fashion before here and here.

Item number five: New Koryolink advert (Koryolink is the DPRK’s new 3-G mobile phone service founded by Orascom)

The video comes from this NK web page.  For South Koreans I posted it to my Youtube account.  You can see it here.

Item number six: DPRK verison of The Diary of Anne Frank

Michael Rank has scanned the introduction and uploaded it here.

Item number seven: Happy new year!

According to the Daily NK:

Even though the price of rice is over 1,300 won per kilogram in North Korean markets, cadres and the upper class are hoarding rice and grain. This is because a rumor is spreading saying that the international community may suspend food aid to North Korea next year due to the Yeonpyeong attack so the price of rice may not drop next year.

A source from Hoiryeong, North Hamkyung Province, said that, “In the Hoiryeong Jangmadang, rice sells over for 1,300 won per kilogram. Even though it is an unreasonably higher price than in previous years, the wealthy are hoarding the rice they will consume for the next year.”

Immediately after the Yeonpyeong attack, the price of rice soared to over 1,300 won and has stayed at that level. This is because the value of the Yuan has gone up since the currency redenomination last year.

The source explained, “Despite the high price of rice, people purchase it in bulk because they believe that next year the price may not decline considering the current trend.” He added, “A rumor that we won’t receive food aid next year due to being internationally isolated has been circulated by those who get international and domestic information via foreign radio or those who have visited China for private reasons.”

The source reported that, “Based on the experiences of the last decade, people know very well that there will be no food aid from the outside world when the situation is tense like it is this year.”

“Not only those who support themselves through commerce, but also family members of officials of the National Security Agency and People’s Safety Ministry, who primarily live off the national distribution system, are spending all the money they’ve saved to buy up food. They buy reserve provisions in order not to worry about a possible suspension of the distribution system.”

According to the explanation of the source, at the time of the November 30 currency redenomination last year, those who had goods to trade did not get hit hard. Therefore, wealthy people try to obtain more food despite the high price.

Read the full story here:
The Rich Hoarding Rice
Daily NK
Yoo Gwan Hee
12/29/2010

According to Yonhap:

Skinny jeans, blue crabs, pig-intestine rolls and even human manure were some of the hottest items among North Korean consumers this year, according to a South Korean professor who has interviewed recent defectors from the communist country.

Kim Young-soo, a political science professor at Seoul’s Sogang University, said in a conference on Tuesday that adult movies, television dramas and instant noodle “ramen” made in South Korea are also selling “like hot cakes” in North Korea.

Skinny jeans refer to slim-fit pants that have gained popularity around the world, said Kim who interviewed about 2,000 defectors this year as part of a research project for the government.

He said that skinny jeans are so popular in the North’s capital, Pyongyang, that people there sometimes mistakenly believe Chinese wearing the stylish clothes are roaming their capital.

“These are signs that North Korea is easing its isolation,” Kim said in a telephone interview, noting that such lifestyle changes are conspicuous in Pyongyang and areas near the border with China.

The professor said many of the defectors he has interviewed had stayed in China no longer than a month before they came to South Korea, allowing him to have a relatively up-to-date glimpse of the latest culture in the communist country.

Kim said defectors told him pine mushrooms were also a “hit” among North Koreans this year because exports to South Korea had been diverted into the domestic market since cross-border tensions soared over the deadly March sinking of a South Korean warship.

After a multinational investigation in May found North Korea responsible for the sinking that killed 46 sailors, Seoul banned cross-border trade as part of its punitive measures.

Kim said blue crabs have met the same fate as pine mushrooms, allowing North Koreans to enjoy what was once a rarity for them. The professor even told of a shop in which human manure could be traded to be used as an alternative to chemical fertilizer, an item on which the North had heavily depended from the South for years.

“Soondae,” or sausage rolls stuffed with ingredients such as noodles and vegetables and wrapped in pig intestine films, has also made inroads into the market as a staple after the military stopped collecting pork and other food items from civilians, Kim said.

“These changes may not necessarily lead to greater ones in society, but they do bear a meaning,” he said.

Read the full sotry here:
Skinny jeans, pig-intestine rolls among “hit items” in North Korea this year: survey
Yonhap
Sam Kim
12/28/2010