Archive for the ‘Railways’ Category

On the de-facto privatization of industry in the DPRK…

Wednesday, August 17th, 2011

Pictured above (Google Earth): A bus depot in Rakrang-guyok, Pyongyang.  See in Google Maps here.

According to the Daily NK:

Growth and improvement is evident in some areas of the private sector in North Korea, Ishimaru Jiro of ASIAPRESS revealed on the 16th, pointing to the growth of bigger, better private transit concerns and relatively productive coal mining operations as evidence of this trend.

In the past, trains were almost the only viable means of long-distance transportation in North Korea. Then, as private business began to grow and the railways fell into a deep malaise, vehicles such as trucks and cars belonging to military bases, state security and state enterprises were pushed into service to earn money for moving people; this, the so-called ‘servi-cha’ industry.

The servi-cha industry has long been fragmented and small scale; but now transportation companies run by rich individuals (‘donju’) which purchase several buses and hire drivers, guides and mechanics, are acting just as a transit company in a capitalist state would do.

With profit-sharing and bribery as the backbone, a large number of North Korean organs and enterprises have decided to lend their name to these individuals, fuelling the growth and development of a network of sorts.

“From the early 2000s, a high-speed bus network mostly between major cities began to emerge,” Ishimaru, revealing the latest research by ASIAPRESS internal North Korean sources, commented. “The companies are packaged as an enterprise affiliated to some state authority outwardly, but they are actually operated by individuals who pay kickbacks to that authority.”

The People’s Safety Ministry affiliated 116 Task Force Team is one such transportation company, Ishimaru says. It operates buses connecting Shinuiju, South Pyongan Province and Pyongyang. Ordinarily, the bus parks at a station or major public location, and then departs when it is full of passengers going to the next destination.

Here are previous posts on the servi-cha industry.

Read the full sotry here:
Green Shoots of Private Enterprise Growth
Daily NK
2011-8-17

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Friday Fun: Kim Jong-il’s Train

Friday, June 10th, 2011


The North Koreans produced a two-part documentary on Kim Jong-il’s recent visit to China which was aired on North Korean television.  In part one of the documentary, we can see some video images of the office aboard Kim Jong-il’s train.  His large wooden desk, which he does not seem to use for friendly/informal meetings, is at the head of the room with comfortable leather chairs along the sides.  There is a door on the back wall which provides access to another room on the train cart — I assume a private office or other personal area.  The floors appear to be made of polished wood.  On the desk, there is a framed photo and maybe an couple of ashtrays?  Most noticeably there is a large flat-screen television mounted on the wall above Kim’s desk.

Part I of the documentary was too long for me up upload to Youtube, but the segment aboard the train is here.

Part II of the documentary is here.

Below is a decent image of what many believe is Kim Jong-il’s train parked outside the Kim family compound in Ryongsong-guyok, Pyongyang (룡성구역, 39.110716°, 125.788507°, Google Maps)

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Hyesan rail incident reported

Friday, May 6th, 2011

Pictured above (Google Earth): Komsan Station in Hyesan

According to Open Radio:

A source in Yanggang province reported May 4th, “A Hyesan – Pyongyang train derailed on May 2nd somewhere in the region of Geomsan station in Hyesan killing at least ten passengers and injuring many others.” The injured are being treated at a nearby hospital but the dead have not been formally identified and are yet to be transferred home.

“The North Korean police and security agencies are both investigating the case,” said the source. “So far they have been unable to establish the incident’s cause.” They are said to be investigating the possibility that a track sleeper became unhinged.

The possibility, however, that this is not merely an accidental occurrence is raised by the fact that the Pyongyang – Hyesan line is known by the population not just to be a route used by citizens travelling between the cities but is also one of national significance.

There are both a security agency detention center and a munitions factory in the Geomsan area of Hyesan. Before he died Kim Il-sung travelled only via station number 1 at Geomsan.

Five of twelve passenger carriages were overturned when they became disconnected from a connecting link. Subsequent repair operations have caused much disruption to regular line service. Stranded passengers are staying in the station’s vicinity as locals take advantage of the situation, catering to them with impromptu vending operations.

Read the full story here:

Ten Die in Pyongyang – Hyesan Rail Incident
Open Radio
2011-5-6

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Gyeongui line to resume normal operations

Wednesday, April 20th, 2011

Institute for Far Eastern Studies (IFES)
NK Brief (11-04-20)

Railroad services to Kaesong Industrial Complex on the Gyeongui Line increased from 21 to 23 times a day from April. Mainly a seasonal change, the last departure service into Kaesong has been pushed back to 5:00 pm from 4:30 pm and the arrival time also changed accordingly from 5:00 pm to 5:40 pm.

With the half of the Mount Kumgang tours, the Donghae Line is running on a more flexible schedule based on demand. Currently both lines are operating. There are 417 South Korean citizens currently residing in North Korea, with the majority (404 people) at the Kaesong Industrial Complex.

According to the Export-Import Bank of Korea, the volume of loans by the businesses operating economic cooperation with North Korea increased over the years, from 10.8 billion KRW in 2008, to 15.4 billion KRW in 2009, and 41.6 billion KRW in 2010. The increase comes as a surprise considering the enforcement of sanctions against the North from the Cheonan incident caused all inter-Korean exchanges and cooperation to discontinue except for the KIC.

The Export-Import Bank (Exim Bank) in coordination with the Ministry of Unification has continued to provide loans to businesses engaged in inter-Korean cooperation through a special loan program called, “Special Economic Exchanges and Cooperation Loan.” Special consideration was given to these small businesses suffering since the imposition of government sanctions.

Last year, a total of 25 businesses (11 economic cooperation-related, 13 exchange-related) received special loans from the Exim Bank. The loans were used mainly for stabilizing the business management to cover various business expenses including tariffs, shipping, material, distribution, manufacturing and labor costs, as well as other additional taxes and interests.

On the other hand, North Korea’s Korean Asia-Pacific Peace Committee informed Hyundai that it would retract the company’s monopoly over the tour of Mt. Kumgang, which was supposed to expire in 2028. Hyundai Asan expressed regret over the North’s decision by saying, “The agreements that were reached on Mt. Kumgang tourism must be honored and cannot be declared void or lose their validity on unilateral notification. The North’s statement should be withdrawn.”

The spokesperson of Hyundai also stated, “The root of this problem is caused by the stalled tourism project. The only solution is to resume the tours to Mt. Kumgang at the earliest time possible.” It further added its intention of working closely with the South Korean government to restart the tours. Since the suspension of Mt. Kumgang tours after a female tourist was shot and killed in July 2008, Hyundai Asan has been hitting dead ends with the project.

Regarding its plan to retract Hyundai, North Korea is pointing the finger at the “South Korean government’s vicious North Korea policy.” According to North’s Uriminzokkiri website, terminating Hyundai’s monopoly rights was an “inevitable decision based on low prospect for resuming the tours of Mount Kumkang.” It further added, “Although the South Korean government is condemning our decision as against international norms, the situation is compelling the DPRK to exercise our rights which is in accordance with domestic and international laws.”

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DPRK owes ROK appx $1billion

Wednesday, April 20th, 2011

According to the Choson Ilbo:

North Korea owes South Korea more than W1 trillion in terms of food and other loans, it emerged Tuesday (US$1=W1,092). The North has to start repaying the debt from June next year, but given its economic difficulties and strained inter-Korean relations it is unlikely that Seoul will see a penny.

According to the Unification Ministry, the Kim Dae-jung and Roh Moo-hyun administrations gave the North 2.4 million tons of rice and 200,000 tons of corn from 2000 to 2007 on condition of repayment over a period of 20 years with a 10-year grace period at a 1 percent annual interest. The loans amount to US$720.04 million, with the interest reaching $155.28 million.

The South Korean government also spent W585.2 billion from the Inter-Korean Cooperation Fund to re-link cross-border railways and roads from 2002 to 2008. Of the total, W149.4 billion worth of materials and equipment for construction on the North Korean side are also loans to be repaid on the same conditions.

Besides, Seoul lent the North $80 million worth of raw materials for production of textile, footwear, and soap in 2007 and 2008. At the time, the North paid back 3 percent of the loan with 1,005 tons of zinc ingots worth $2.4 million, leaving a $77.6 million balance.

All told, the principal on these loans amounts to W1.02 trillion and the total debt including interest to over W1.2 trillion.

The first repayment of $5.83 million for the food loans provided between October 2000 and March 2001 is due on June 7 next year.

A ministry official said, “The amount has already been included in next year’s revenue plan, on the assumption that it will be paid back. If the North fails to pay, it will be deemed outstanding balance.”

Aside from the food and economic loans, the South also lent the North W1.37 trillion through the Korean Peninsula Energy Development Organization from 1998 to 2006 for the construction of a light-water nuclear reactor. The money was raised by issuing government bonds. The total amount of all loans adds up to W2.25 trillion, if the accrued interest of W877.2 billion is counted.

But since the KEDO project was scrapped in 2006, there is no way for the South to get the money back. It seems likely that the total amount will be handled as “irredeemable government bonds” that have to be made up for with tax money.

Read the full story here:
Pyongyang Owes Seoul Huge Amounts of Money
Choson Ilbo
2011-4-20

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North Korea increasing coal production – seeking to ease power shortages and boost exports

Wednesday, February 2nd, 2011

Pictured Above: Pongchon Coal Mine (Google Earth)

Institute for Far Eastern Studies (IFES)
NK Brief No. 11-01-18
1/28/2011

The DPRK Workers’ Party’s newspaper, the Rodong Sinmun, recently featured a front-page editorial urging the North Korean people to increase coal production. On January 26, the KCNA reiterated the call, reporting that the newspaper editorial highlighted fertilizer, cotton, electricity, and steel as products suffering from a lack of coal, and that “coal production must be quickly increased in the Jik-dong Youth Mine, the Chongsong Youth Mine, the Ryongdeung Mine, the Jaenam Mine, Bongchon Mine [Pongchon Mine] and other mines with good conditions and large deposits.”

The editorial also emphasized that “priority must be placed on the equipment and materials necessary for coal production,” and, “the Cabinet, national planning committee, government ministries and central organizations need to draft plans for guaranteeing equipment and materials and must unconditionally and strongly push to provide,” ensuring that the mines have everything they need. It also called on all people of North Korea to assist in mining endeavors and to support the miners, adding that those responsible for providing safety equipment for the mines and miners step up efforts to ensure that all necessary safety gear is available.

In the recent New Year’s Joint Editorial, coal, power, steel and railways were named as the four ‘vanguard industries’ of the people’s economy. Of the four, coal took the top spot, and all of North Korea’s other media outlets followed up the editorial with articles focusing on the coal industry. On January 15, Voice of America radio quoted some recent Chinese customs statistics, revealing that “North Korea exported almost 41 million tons of coal to China between January and November of last year, surpassing the 36 million tons exported [to China] in 2009.” It was notable that only 15.1 tons were exported between January and August, but that 25.5 tons were sent across the border between August and November.

North Korea’s coal exports to China earned it 340 million USD last year, making the coal industry a favorite of Pyongyang’s economic and political elites. Increasing coal production is boosting output from some of the North’s electrical power plants, while exports to China provide much-needed foreign capital. However, even in Pyongyang, where the electrical supply is relatively good, many houses lack heating and experience long black-outs. Open North Korea Radio, a shortwave radio station based in the South, reported on January 24, “As electrical conditions in Pyongyang worsen, now no heating is available.” Farming villages can find nearby timber to use as firewood, but because prices are so high in Pyongyang, even heating has become difficult. Some in the city even wish for rural lifestyles, just for the access to food and heat.

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ROK goods saturate DPRK

Thursday, January 6th, 2011

According to the Hankyorey:

A report on major North Korean indicators released by Statistics Korea on Wednesday revealed that South Korean products are becoming increasingly popular in North Korea, and that there are hardly any North Korean urban youth who do not watch South Korean TV dramas or movies.

In the report, Statistics Korea said it is becoming a fad for young people in major North Korean cities like Pyongyang and along the border with China to watch South Korean television dramas and films using MP3 players or laptop computers. Statistics Korea said MP3 players with 1G of memory cost 60,000 North Korean Won (estimated $419), while a used laptop costs about 2 million North Korean Won. A memory chip with two or three movies costs 10,000 North Korean Won if it is an original, and 5,000 North Korean Won if its a copy.

The report also said many South Korean products are in circulation in North Korea, including blenders, portable heaters, gas ranges, butane cans, lunch trays, gas heaters, rice cookers, dishrags and gloves. According to the report, South Korean shampoo and conditioner is popular with the wives of high-ranking North Korean officials in Pyongyang. Some 470g bottles of South Korean shampoo and rinse go for 40-50 yuan (8,000-10,000 South Korean Won) in Pyongyang. The report said the popularity of South Korean products was also reflected in other goods. South Korean necklaces are sold for about $500 and earrings for about $70-80, while South Korean products like perfume, deodorant, car air fresheners, refrigerator deodorizer and bathroom air fresheners are also selling well.

South Korea’s nominal GNI in 2009 was $837.2 billion, 37.4 times that of North Korea’s $22.4 billion. North Korea’s economic power, all told, is no more than the level of the South Korean city of Gwangju (about 22 trillion Won). South Korea’s per capita income of $18,175 was 17.9 times that of North Korea’s $960. South Korea also conducted $686.6 billion in total trade, 201.9 times that of North Korea, which conducted only $3.4 billion. The only sectors in which North Korea topped South Korea were production of iron ore and coal and length of railroads. North Korea’s iron ore production was 4.955 million tons, ten times that of South Korea (455,000 tons), and its coal production was 25.5 million tons, 10 times that of South Korea (2.519 million tons). North Korea also had 5,242km of railroads, 1.4 times that of South Korea’s 3,378km. North Korea is also believed to have 7 quadrillion Won in underground mineral wealth.

I have been unable to locate the original on the Statistics Korea page.  If any readers can find it, please let me know.

Read the full story here:
In limited N.Korean market, furor for S.Korean products
Hankyoreh
Hwangbo Yon
1/6/2011

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Rumored $3.5b Chinese investment deal

Thursday, December 30th, 2010

The Choson Ilbo begins this story with “Rumor has it”….

Rumor has it that China is getting directly involved in the development of North Korea’s Rajin-Sonbong Port, once the center of the UN Development Programme’s Duman (or Tumen) River project in 1991. A source in Beijing said Wednesday, “As far as I’m aware, North Korea and China’s Commerce Ministry recently signed a memorandum of understanding outlining Beijing’s investment of US$3.5 billion over five years beginning next year” in the special economic zone there. The source said China is investing in roads, ports and gas facilities in the region.

The Rajin-Sonbong area, at the mouth of the Duman River, is a strategic point of economic cooperation between the two countries, but neither bank is Chinese territory. One side is in North Korea and the other in Russia, so to get to the East Sea China had to borrow a port from either side. China did nothing about the UNDP initiative in the 1990s, but since the mid-2000s, it has set its eyes on the area.

North Korea for some reason rented out the best equipped dock there to Russia in 2008 but since last year it has been seeking investment from China to overcome dried-up aid from South Korea amid international sanctions. North Korean leader Kim Jong-il urged Chinese President Hu Jintao when he visited China in May this year to invest in the region.

But the rumor of direct investment from the Chinese government has not been confirmed. One diplomatic source in Beijing said, “I’ve heard nothing about the Chinese Commerce Ministry’s direct involvement in negotiations. It’s just one of many rumors since North Korea became active in developing the Rajin-Sonbong area.”

UPDATE from the Choson Ilbo:

Chinese officials with close ties with North Korea say the North has used to demand hard cash for business deals but is now taking a more flexible approach. The Global Times, a sister publication of the People’s Daily, published a series of reports Saturday about the Rajin-Sonbong special economic zone of North Korea.

It said street lights and neon signs powered by windmills have appeared in the region, which had earlier been pitch dark at night, while the previously ubiquitous soldiers have vanished.

North Korea allowed 4,000 Chinese residents in the area to rent commercial property and agreed to designate an area in the Rajin-Sonbong special economic zone to be jointly administered by the two countries.

North Korea had offered China to develop one or two islands in the estuary of the Apnok River on a 50-year lease, but when China demurred it apparently offered a 100-year lease and even allowed construction of golf courses and other recreational facilities.

Many private Chinese companies are reticent about investing in North Korea. Not only is there a lack of business laws to protect their investment, there are also too many political uncertainties. As a result, the Chinese government is not playing a very active role. In the case of the bridge across the Apnok River, North Korea apparently wanted Chinese state-run companies to take part in construction, but Beijing declined.

One source in Beijing said some Chinese companies are showing great interest in developing the Rajin-Sonbong area, but most are biding their time. “Chinese businesses still don’t seem to trust the sincerity of North Korea’s desire to open up its economy,” the source added.

Additional Information:
1. The Chinese and Russians currently lease docks at Rajin. You can see a satellite image of them here.

2. Here is more information on China’s 10-year lease of Rajin.

3. Here is information on the Yalu Islands China is reportedly leasing.

4. The Russians are also building Russian gauge railway line from the Russian border to the port in Rajin.

5. Here are all previous Rajin (Rason)posts

Read the full stories here:
Beijing ‘Pouring Money into N.Korea’s Special Economic Zone’
Choson Ilbo
12/30/2010

N.Korea’s Cross-Border Business with China Picking Up
Choson Ilbo
12/30/2010

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Leadership compound reconstruction continues

Tuesday, October 26th, 2010

The Daily NK reports that construction is afoot at numerous DPRK leadership compounds.

Residence 15 in the Central District (중앙구역):

The residence is located at 39° 0’56.39″N, 125°44’45.45″E.  The first photo is dated March 23, 2009.  The second is dated December 20, 2009.  The third image is from the Daily NK story overlaid onto Google Earth.

Onpho Spa in Kyongsong County (경성군):
The Daily NK also provides a new image of the elite compound at the Onpho Spa.  Here is the original low resolution image from Google Earth and the new high resolution image:

This compound is located at 41°39’26.91″N, 129°30’29.57″E.  Even though the “before” image is in low resolution, we can see that the compound has been drastically rebuilt.  It bears resemblance to the Sinchon Elite Compound (satellite image here) which also is built on a spa.    Barbara Demick mentioned this facility in her recent Nothing to Envy.

The Daily NK also mentions that here is construction taking place at the leadership compound in Songdowon, north of Wonsan. Satellite image here.

The reconstruction of leadership compounds has been underway for some time.  I blogged about some other projects in February 2009. Read about them here.

Here is the text from the Daily NK story:

An unusual level of remodeling and reconstruction of official buildings and special villas is going on across North Korea, according to sources.

One such source inside North Korea reported today that after demolishing the No. 15 Official Residence, located in vicinity of Kim Jong Il’s current office in Pyongyang, the authorities began construction of a new building in July, a claim which has been confirmed by satellite images.

The No. 15 Official Residence was where Ko Young Hee, Kim Jong Eun’s mother, used to live. The location is linked to Kim Jong Il’s office and other official buildings by underground tunnels fitted with an electronic train. When Kim Jong Eun was a child, he also lived there.

However, the source said he believes that the prime real estate may be undergoing a change of use.

The source also reported that in December, 2009, Kim Jong Eun ordered the destruction of another special villa in Kyungsung, North Hamkyung Province, a place famous for hot springs, and the building of a new conference hall and villa with imported construction materials in its place.

Approximately ten kilometers of road and rail construction has also been going on so that the area can be reached more conveniently, the source added.

According to the source, around 1,200 soldiers have been mobilized alongside residents of Chongjin and Hoiryeong for the work. In addition, each household in the area has had to provide ten buckets of rocks for construction and pay 500 won for their delivery.

Regarding this work, North Korea Reform Radio reported in July, “During construction of Kim Jong Eun’s special villa in Kyungsung, the authorities diverted the flow of a stream flowing through Haonpo-ri in Kyungsung, burying farms and angering residents.”

Reconstruction of another villa and conference hall at the coastal Songdowon Resort in Wonsan, Kangwon Province is also ongoing. This construction is reportedly a gift for Kim Jong Il on the orders of Kim Jong Eun.

The construction consists of two large, circular buildings. One of them has a lot of separate rooms, while the other has just one big hall, according to rumors.

Therefore, the source assumed that the finished building might be a similar to Kim Jong Il’s Seoho Villa, the No. 72 Villa in Nakwon, South Hamkyung, which is rumored to have one room extending 100m below the ground.

A South Korean architect estimates that the construction of the three facilities and railroad will cost a total of around $180 million dollars, an amount which, according to the current international market price of corn, $300/ton, is enough to buy 600,000 tons of corn, enough to feed 2.3 million North Koreans for two months.

According to documents the South Korean military and intelligence authorities provided for submission to a hearing of the Diplomacy, Commerce and Unification Committee of the National Assembly by lawmaker Yoon Sang Hyun, there are 33 luxurious villas in beautiful mountainous areas and along the coasts of North Korea. Since 2008, 13 out of 33 sites have been under maintenance work, according to intelligence.

There are also 28 stations for the exclusive use of Kim Jong Il across North Korea.

In North Korea, in general, around two or three facilities are remodeled per year, but the current degree of widespread construction and remodeling suggests that Kim Jong Eun may be set to use the villas in the future.

On this, an anonymous expert with a national policy institute suggested that it does not portend a scaling back of the Kim family ruling style. “Seeing Kim Jong Eun’s luxurious life pattern,” he said, “he seems set to follow his father’s conventional method of dictatorship.”

You can see satellite imagery of 19 leadership  train stations here.

Read the full sotry here:
Luxury Villa Construction Booming
Daily NK
Kim Tae Hong
10/26/2010

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DPRK cracks down on informal transportation market

Monday, October 25th, 2010

According to the Daily NK:

The People’s Safety Ministry has declared war on the use of vehicles for private gain, according to a source, raising fears that another period of social upheaval is on the cards.

Vans, buses and trucks have been in use as so-called “servi-cha” (service cars) in North Korea since the late 1990s, after the authorities became unable to provide regular electricity to the railroads. Since then, this alternative transportation system has become a core means of distribution and domestic movement.

However, a source from North Hamkyung Province reported on Sunday, “A crackdown on sedans, vans, and 1.5 to 2-ton trucks belonging to individuals has begun under a decree handed down by the People’s Safety Ministry on the 18th. Now, all traffic safety agents are checking car registration documents, vehicle licenses, car permits and driver’s licenses on the streets.”

The source explained, “The PSM intends to confiscate all kinds of vehicles apart from those registered for cadres and businesses in the Traffic Office database in each province. Even those vehicles belonging to military-owned foreign currency-making enterprises have been targeted for inspection, but the military police will deal with them.”

According to the source, the North Korean authorities have divided the crackdown on the servi-cha system into two steps: the first is to be carried out until the end of this year, and the second by late April, 2011. First, for the next six months, the PSM will investigate vehicle ownership in government organs, companies and factories, inspecting all vehicles on the streets and confiscating those found guilty of illegality. In the second phase, the PSM will move on owners of private vehicles.

Vehicle management in North Korea is the work of the Traffic Department of the People’s Safety Ministry. The Traffic Department has a Traffic Office under each municipal or provincial People’s Safety Ministry which is in charge of monitoring vehicles within that region. Vehicles belonging to the military are managed and monitored by the rear guard unit of each corps, division or regiment; punishment, monitoring and crackdowns are military police duties.

The operation of a “servi-cha” requires the collusion of three parties; the car’s real owner, a driver and a cadre from an organ or enterprise.

A used car arrives from China or Japan, whereupon the cadre, who has close relations with the smuggler of the car, registers it in the name of his organ or enterprise, since all vehicles must belong to a group, not an individual.

Then, the car owner hires a driver and operates the vehicle as a bus or delivery truck.

Gains are divided between the cadre and the owner, who also pays the driver’s salary. The cadre extracts some of the profits for himself and records the rest as company income.

Under this mechanism, almost every organ, company, factory and even collective farm has at least one “servi-cha” in its name; profits are used to cover other losses, since there is no support coming from Pyongyang anymore.

This system is probably the most decisive influence on the growth of the jangmadang in North Korea. Thanks to the “servi-cha”, volumes of commercial traffic and personnel migration have increased and products smuggled in across the Tumen and Yalu Rivers from China are able to reach remote southern provinces such as Kangwon and Hwanghae.

Since the late 1990s, when the operating ratio of the railroad dropped to as low as 40%, the servi-cha system spread as an alternative to the collapsing public transit network. As permanent markets emerged in 2004, demand from people for migration and the distribution of goods increased drastically, and thereafter the system became the core transportation tool.

Considering the dominant influence of the “servi-cha” in the daily lives of the North Korean people today, if the crackdown is long and/or successful over a long period, other serious effects may be felt in North Korean society, where the aftershocks of the currency redenomination have only just dispersed.

This measure is being interpreted as part of a series of struggles for the eradication of what the North Korean authorities see as “anti-socialist elements”. Additionally, it seems to be an attempt not to ignore the abuse of loopholes in the system by cadres.

From the authorities’ perspective, the wide-spread usage of the servi-cha represents a loss of control over the society, because the movement of goods and people naturally incorporates the circulation of information.

The obvious problem is that any crackdown on the servi-cha industry will cause instability in the markets.

The source said, “Getting rid of ‘servi-cha’ is the same as letting us starve to death,” adding, “If they eliminate ‘servi-cha’, it won’t just be a problem for companies; any life tied up in markets including wholesaling and retailing will hit a brick wall.”

He explained further, “The measure will be a blow to cadres in the middle and lower levels, who are in collusion with traders. Therefore, lower cadres are likely to resist the measure first.”

Therefore, it is very much open to question whether the measure will be a success or a failure, just like previous crackdowns over markets and the currency redenomination.

Read the full story here:
War Declared on the Servi-Cha
Daily NK
Im Jeong Jin
10/25/2010

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