North Korean Economy Watch

Inside North Korea: A Report by Good Friends Chairman Venerable Pomnyun and Seungjoo Baek
SAIS US Korea Institute
September 19, 2007

For audio, click here. 

Chairman of the Good Friends Center for Peace, Human Rights and Refugees, the Venerable Pomnyun, briefed audience members at SAIS on current trends inside North Korea, including issues surrounding the current food crisis caused by the flooding, continuing health crisis, and the breakdown of the education system.

Good Friends, one of the largest Korea-based organizations providing humanitarian aid inside the D.P.R.K. and to refugees in Northern China, contributes some of the most accurate and timely reports on conditions inside North Korea. The Venerable Pomnyun visited Washington D.C. with a team of experts to discuss the on-going food shortage and proliferation of non-government controlled information. While here, they briefed Congress and held a day-long conference at CSIS.

Highlights of his comments (paraphrased, not direct quotes):

• In contrast to the much lower number of famine deaths provided by Stephan Haggard and Marcus Noland Pomnyun maintained the 3 million number claimed by Good Friends in the past.
• He provided a short narrative of coping mechanisms people have adopted to stay afloat (selling and manufacturing in homes). Society is being sustained by activities that are still considered illegal.
• He claims the food situation is getting worse, and he does not think the DPRK can resolve the situation on its own.  Now people buy all their food on the market.
• He claims that people’s lives are not improving.
• TB is on the increase along with other epidemics.  Since there is no electricity, water is not clean. 
• He offered that there are four levels of hospitals: clinics at the town level, hospitals in cities and some towns, hospitals at province level, and specialist offices in the Pyongyang area.
• Hospitals and clinics are not working at the city/province level.  The situation is better in Pyongyang hospitals.  The amount of international medical aid, however, is not enough for even the Pyongyang hospitals.
• Medical aid is the second most needed good (after food).  People do not get medicines from the hospital, but from the markets.  With low salaries, however, medicines are difficult to afford.  [Because the institutional environment is still not supportive of entrepreneurship] there are qulaity problems with pharmaceuticals purchased at the markets.
• The education system, though ‘free’ is not functioning well.  Due to the food shortage problem, students do not go to school.  Teachers also do not come to class.  The cost of education is being pushed back to students directly.  For example, students buy chalk for teachers.  As a result, however, poor students cannot attend school.  The rich students are hiring tutors, so we are seeing a market in private education emerge in the DPRK.
• The DPRK is slowly moving to a private economic system.  Men who cannot get work are now jokingly referring to themselves as “guard dogs,” because they sit at home all day.
• North Koreans do not trust the government or party.  People on their death beds are telling their children to trust their descendents, not the government.  People still spend much of their time trying to subsist, but these complaints will not become a political issue.  The political system is stable and will not collapse any time soon.

Daily NK
Namgung Min
10/23/2007

North Korean civilians’ average life span was disclosed to be approximately 14-years lower than the average life span in South Korea.

The Ministry of Health and Welfare said through inspection documents of the administration on “North Korea’s Health and Medical Situation,” which was recently submitted to the National Assembly.

According to this document, the North Korean civilians’ average life span is 61.4 years for males and 67.3 for females, an average of 64.3 years. For South Korea, the average is 78.1 years, with 74.4 for males and 81.8 for females.

The significant difference in average life span for North and South Korea reflects the fact that the severely worsened medical environment in North Korea.

According to the document, North Korean teenage boys’ smoking rate is supposed to be at an extremely alarming level. In the case of 16-year old males, the smoking rate is around 59.9%. This exceeds by 20.7% the smoking rate of South Korea high school students, provided by the Korean Association of Smoking and Health.

Cigarettes in North Korea, in contrast to South Korean cigarettes, contain a very high level of tar and nicotine content as well as higher toxicity, due to the fact that cigarettes lack filters or are hand-made.

One defector said, “In North Korea, even very young children smoke cigarettes without reservation and easily come in contact with them because they do not have much else to do.”

The document also revealed that 32~40% of North Korea’s 20~34 year olds show signs of malnutrition and approximately 34~36% of them are anemic patients.

These results can be attributed to North Korea’s continuous food shortage situation; disease rates due to malnutrition and anemic are high.

North Korea’s birth rate is 1.94, higher than South Korea’s 1.19. However, the infant mortality rate, between `99~`02, was 23.5 per 1,000 persons, but conversely, the `06 mortality rate was 42 persons, 14 times higher than South Korea’s (at 3 persons).
The health span (a period without sickness or handicap) is 52.3 years old (based on 2000 data), a significant decrease from South Korea’s 67.8 years (in 2005).

The reason why North Korea’s health and medical situation is so tenuous as shown above is due to the lack of the state’s investment in this area. The actual situation is that there is an unmistakable gap between North Korea’s single dollar payment for a person’s health and medical fee and South Korea’s $625.

Further, in North Korea, it is extremely difficult to obtain basic medical goods, such as cold medicine or antibiotics.

One defector who escaped in 2005 said, “In North Korea, even if one wants to go to the hospital, he or she cannot receive treatment without any money and there is not even a full equipment of medicine. It is much easier to buy medicine in the jangmadang than in a hospital, because there is more variety and it is more easily obtainable. Only, the price of medicine, compared to other products, transcends the imagination.”

The Ministry of Health and Welfare plans to invest 294 million won (approx. USD316,120) to modernize the People’s Hospital in Gosung and Songdo in Kaesung next year, besides continuing medical support for North Korea.

Yonhap
10/15/2007

*View the UN report here

The number of North Korean women who have died while giving birth rose drastically in 2005 from five years earlier due to worsening health care conditions in the impoverished communist state, a report said Monday.

Maternal mortality rose to 370 per 100,000 births in 2005 from 67 in 2000, according to the report issued jointly by the United Nations Population Fund, UNICEF, the World Health Organization and the World Bank.

Although the rate is lower than the global average of 400 deaths per 100,000, it is 26 times higher than that of South Korea with the rate of 14 deaths per 100,000.

Sub-Saharan African countries have the highest maternal mortality rate of 900 per 100,000, followed by Southeast Asia’s 450 and East Mediterranean countries’ 420.

The comparable figures for the United States, the Western Pacific Ocean and Europe are 99, 82 and 27 respectively.

Blurb from report:

The MMR estimate for 2005 (370) was higher than the 2000 MMR (67). The predicted PMDF in 2005 was higher than in 2000, because the GDP estimate (in purchasing power parity) used in the 2005 model was approximately 75% lower than the estimate of US$ 14 996 used in the 2000 model.

Europen Business Association
October 2007

18 European companies are participating at the European booth organized by the European Business Association (EBA) in Pyongyang. This has been the largest ever participation of European companies at a Trade Fair in Pyongyang. The 18 EBA-member companies come from 6 European countries and are engaged in banking, IT, pharmaceuticals, maritime transportation, railways, courier services, industry, mining, solar driven water pumps, energy saving technology, commodity inspection, cosmetics and other consumer goods and general trading. Some already operate in joint ventures with Korean partners or found other forms of close business cooperation, particularly in the fields of banking, mining, internet services, logistics, software development and pharmaceuticals.

The EBA will continue to make efforts to attract more European companies to invest and do business in the DPRK in the coming years and will share its experience to help make the endeavors of the newcomers and their Korean partners a success. The EBA closely cooperates with the DPRK Chamber of Commerce and the Korea International Exhibition Corporation to facilitate the participation at exhibitions, to intensify trade between European and DPRK-enterprises and to enhance the identification of suitable business and investment opportunities for European companies.

Pictures of the European booth will be published on http://www.eba-pyongyang.org/
Felix Abt, President
Dr. Barbara Unterbeck, PR-manager
European Business Association
President´s Office
Chang Gwang Foreign Residential and Office Building
10th Floor, No. 10-2
Central District
Pyongyang
The Democratic People’s Republic of Korea
http://www.eba-pyongyang.org/

Yonhap
Tony Chang
10/8/2007

South and North Koreas’ top health officials have tentatively agreed to cooperate in modernizing regional hospitals in the communist country, Seoul’s health minister said Monday.

“During unofficial talks with North Korean Health Minister Choi Chang-sik, we’ve agreed to seek joint projects to modernize provincial hospitals in the North,” Byun Jae-jin, South Korea’s health minister, told reporters.

Byun was part of a Seoul delegation that accompanied President Roh Moo-hyun during his summit with North Korean leader Kim Jong-il last week, where both sides also agreed to end military hostility and significantly expand inter-Korean cooperation in various fields.

The minister said last week that the two Koreas agreed to cooperate in welfare and medicine, possibly forming an inter-Korean medical body to deal with future peninsula-wide epidemics, Seoul’s top health official said Thursday.

Choi, along with other top North Korean officials, reportedly requested South Korea to construct a pharmaceutical factory in Nampo, near the North Korean capital of Pyongyang, according to Byun.

Seoul’s on-and-off aid to the communist state has mostly focused on food and other necessities, while medical supplies to North Korea have been largely organized by non-governmental organizations and other private agencies.

North Korea’s lack of basic medical supplies has often been cited in local and foreign media, with the country often requesting health-related supplies to combat diseases such as malaria and scarlet fever from the South.

Version 5: Download it here (on Google Earth) 

This map covers North Korea’s agriculture, aviation, cultural locations, manufacturing facilities, railroad, energy infrastructure, politics, sports venues, military establishments, religious facilities, leisure destinations, and national parks. It is continually expanding and undergoing revisions. This is the fifth version.

Additions to the latest version of “North Korea Uncovered” include updates to new Google Earth overlays of Sinchon, UNESCO sites, Railroads, canals, and the DMZ, in addition to Kim Jong Suk college of eduation (Hyesan), a huge expansion of the electricity grid (with a little help from Martyn Williams) plus a few more parks, antiaircraft sites, dams, mines, canals, etc.

Disclaimer: I cannot vouch for the authenticity of many locations since I have not seen or been to them, but great efforts have been made to check for authenticity. These efforts include pouring over books, maps, conducting interviews, and keeping up with other peoples’ discoveries. In many cases, I have posted sources, though not for all. This is a thorough compilation of lots of material, but I will leave it up to the reader to make up their own minds as to what they see. I cannot catch everything and I welcome contributions.

I hope this map will increase interest in North Korea. There is still plenty more to learn, and I look forward to receiving your additions to this project.

Yonhap
9/24/2007

North Korea is becoming more transparent and effective in dealing with disasters, spurred by both internal and external factors, an Asia-Pacific regional specialist said in his latest paper.

Dr. Alexandre Mansourov, a securities studies professor at the Asia-Pacific Center for Security Studies (APCSS) in Hawaii, noted five trends in the North Korean government’s responses over the past decade to nationwide shocks, including floods, typhoons, drought and avian influenza outbreaks.

Increasing transparency is one of the trends, with Pyongyang more quickly admitting to disasters that have struck the nation, he said in a paper (download here) released last week through the Korea Economic Institute in Washington.

It took North Korea several years to admit the impact of natural disasters in the mid-1990s that led to massive starvation and chronic food shortages. But in August 2000, when it was hit by Typhoon Prapiroon, North Korea released the news three weeks after it occurred, and in the two following years, when other typhoons struck, North Korea reported it within three to six days, Mansourov said.

Pyongyang immediately acknowledged flooding in August 2007, he said.

“Observers agree that the timeliness, details, and amount of coverage of flood damage and rehabilitation work in August 2007 is unprecedented.”

North Korea is also showing institutional knowledge and a capacity for disaster management, with new organizations growing out of a decade of learning and experience, such as various provincial centers, the professor said.

The North Korean Red Cross Society has been exceptional, he said, working with the International Federation of Red Cross and Red Crescent Societies, and has made itself the leading agency in disaster preparedness and response.

Inter-agency coordination has also increased, with deputy prime minister-level working groups working closely together in each disaster since the flood of 2001, as there are preventive programs through which basic relief supplies are stored in town and villages.

For example, the 10-year strategy against avian influenza, worked out by the emergency commission in 2005, would have been unthinkable a decade ago, Mansourov wrote.

Another notable trend is the increasing cooperation between the North Korean government and international humanitarian community, gradually allowing joint needs assessments and monitoring, he noted.

Mansourov argued that external factors helped bring about the changes.

“International factors did make a difference in what happened in (North Korea), especially through the introduction of innovative ideas and dissemination of best humanitarian practices,” in addition to foreign aid, he said.

The scholar also argued that while the country’s top leader, Kim Jong-il, does control any institutional changes, there is also adaptation driven by needs.

“There has been some degree of autonomous institutional learning and adaptation; it is incremental in nature and caused by both positive and negative feedback from the environment regarding institutional performance in crisis situations,” he said.

Yonhap
9/21/2007

North Korea is at serious risk from contagious diseases following damage from recent floods, an official from North Korea’s Red Cross told a newspaper in Japan on Friday.

In an interview with the Chosun Sinbo, a pro-North Korean newspaper in Japan, Kim Eun-chul, a vice secretary-general at the Red Cross Society of North Korea, said, “What we are most concerned with now is the spread of infectious diseases in the severely damaged areas.”

“The destruction of the water supply facilities could result in various diseases including skin diseases and diarrhea, as well as flue.”

Kim showed his anxiety, saying that the communist country would not be able to cope with the diseases when they broke out, as many of the North’s public health centers are also destroyed from floods.

“More than 560 hospitals were destroyed and 2,100 medical offices were damaged. The medical supplies were wet and useless. We can’t even read charts as they were soaked,” he said.

“New patients with diarrhea are reported one after another. We are now relying solely on the emergency medicines provided by the International Federation of the Red Cross and Red Crescent (IFRC).”

The IFRC shipped US$1,69 million worth of medical aid to North Korea earlier this month, which can be used for three months, according to Kim.

Yonhap
8/31/2007

North Korea’s foreign minister Friday met with a U.S. delegation bringing emergency medical supplies to help North Korean victims of recent floods, the North’s official news outlet said.

The reclusive country has appealed to the international community for assistance to cope with massive flooding caused by heavy downpours that left at least 600 people dead or missing and about 100,000 people homeless in early August. The United Nations is seeking US$14 million to provide North Korea with food, medicine, drinking water and other emergency goods.

“Foreign Minister Pak Ui-chun met with guests from the United States who visited with emergency medical aid equipment donated by the U.S. administration and the non-governmental organization Samaritan’s Purse with regard to flood damage at the Mansudae Assembly hall,” said the one-sentence report carried by the Korean Central News Agency. It did not identify the U.S. guests.

Washington has so far pledged US$100,000 for the U.N. initiative, equally distributing the funds to two non-governmental relief organizations, Mercy Corps and Samaritan’s Purse, to deliver emergency aid to North Korea.

The heaviest rain in 40 years swept North Korea, which is poorly equipped to cope amid wide-spread deforestation. The severe damage caused the second inter-Korean summit to be postponed from late August to early October.

The most authoritative, publicly available map of North Korea
Version 4: August 29, 2007

Download it here 

This map covers North Korea’s agriculture, aviation, cultural locations, manufacturing facilities, railroad, energy infrastructure, politics, sports venues, military establishments, religious facilities, leisure destinations, and national parks. It is continually expanding and undergoing revisions. This is the fourth version.

Additions to the latest version of “North Korea Uncovered” include the city of Manpo along the Chinese border, KEDO, Kumgang Resort expansion, Kaesong Industrial Zone, as well as a few more parks, antiaircraft sites, dams, mines, canals, etc. I have also added more links in the menu which will tell the viewer a bit about the locations themselves. I have also changed the color scheme to make the collage easier to view.

Disclaimer: I cannot vouch for the authenticity of many locations since I have not seen or been to them, but great efforts have been made to check for authenticity. These efforts include pouring over books, maps, conducting interviews, and keeping up with other peoples’ discoveries. In many cases, I have posted sources, though not for all. This is a thorough compilation of lots of material, but I will leave it up to the reader to make up their own minds as to what they see. I cannot catch everything and I welcome contributions.

I hope this map will increase interest in North Korea. There is still plenty more to learn, and I look forward to receiving your additions to this project.