New economics university opens in Pyongyang. With online courses!

May 12th, 2016

By Benjamin Katzeff Silberstein

This is an interesting piece of news, not least given the almost complete lack of concrete economic policy coming out of the 7th Party Congress (aside from the 5-year plan). Two points to note: First, the university will apparently use “e-teaching” which presumably means online courses. Does North Korea have the technological infrastructure to disseminate online teaching on a broader scale? Second, it seems like the university will focus on business and management training rather than national economics per se. IFES reports:

While currently under the most stringent international sanctions imposed following its fourth nuclear test, North Korea opened a new university in Pyongyang focused on nurturing economic experts.

The Choson Sinbo, a pro-North Korean press in Japan, reported on April 28 that the new university held its opening ceremony on April 1, 2016.

‘Pyongyang Economy and Technology University’ (평양경제기술대학 Pyeongyanggyeongjegisuldaehak) is the new name of the already existing ‘Pyongyang Professional School of Statistics’ (Pyeongyangtonggyejeonmunhakgyo), an institution previously established for the same purpose.

According to the news report, the institution established departments and classes accordingly as it aims to train experts on practical technology in economy for factories and companies. The curriculum is said to be practical, comprehensive, and modern, and to emphasize on-site education and research on the current economic situation.

The news report also mentioned that the university has improved its educational conditions and environment, and that it has commenced initiatives to improve the quality of its staff as well as informatization of the practicum for its major subjects.

The university offers a library for e-books and audio-visual classrooms for foreign languages, and it has informatized and databased teaching methods, administration for academic affairs, etc.

Song Sam-Sung, the president of the institution, stated that the university plans to develop a new initiative to distribute e-teaching plans prepared by the university’s employees to professional technical universities throughout the country.

The university first opened in October 1969 as a vocational high school and was developed to become ‘Pyongyang Professional School of Statistics’, which was equivalent to a technical college. It was restructured into a professional-technical university beginning last year.

Full article here:

New Economics University Opened in Pyongyang to Nurture Economics Experts
Institute for Far Eastern Studies
2016-05-09

 

(Update 2016-05-12)

The original article from Choson Sinbo is available here, though you need to go through a very simple registration process to get login details.

The website Tongil News also writes about the school here.

 

(Update 2016-05-18)

I found another article in Korea Today (no. 5, 2016) about online teaching in North Korea. This one is about online courses taught at Kim Il Sung University.

20160518_105952

Photo credits: Benjamin Katzeff Silberstein.

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New Party Central Auditing Commission inaugurated

May 11th, 2016

New-central-auditing-commission

According to the Pyongyang Times (2016-5-10):

The First Plenary Session of the 7th Central Auditing Commission of the Workers’ Party of Korea was held on May 9.

The event was attended by the members of the Party Central Auditing Commission who have been elected at the Seventh WPK Congress.

There was an election of the chairman and vice-chairman of the Party Central Auditing Commission.

Choe Sung Ho was elected chairman with Pak Myong Sun as his deputy.

According to the Ministry of Unification, the Party Central Auditing Commission, as its name suggests, inspects the party’s financial management.

This is interesting because this story originated in KCNA, though no pictures were released. However, the KCNA story was picked up by the Pyongyang Times, and this second version does contain pictures indicating that Kim Jong-un ran the meeting (See pictures at the top), even though he is not mentioned in the text of the article.

I am not sure of the meeting room location or where the Auditing Commission is physically located, but the meeting did not take place in Conference Hall No. 1 next to the Central Committee Building, Kim Jong-un’s official office.

Kim’s meeting at the Auditing Commission has not been reported in the Rodong Sinmun, the KWP newspaper, to the best of my knowledge.

The cheap and fast analysis suggests that as this is Kim Jong-un’s first committee meeting following the party congress, he is making a priority of understanding/controlling party finances in an effort to be a more assertive party leader (he was just named party chairman after all). Following a thorough party audit, Kim will be in a better position to allocate party financial rents to key supporters as well as to critically engage other cadres over party operations.

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New power plants operational before KWP congress

May 11th, 2016

The Paektusan Hero Youth Power Station No. 3

Paektusan-youth-power-staiton-3-2016-5-11

Pictured above (Yonhap): The Paektusan Hero Youth Power Station No. 3

Paektusan-power-stations-1-3

Pictured Above (Google Earth): The dam is too recent to appear on Google Earth imagery as of publication, but here are the locations of Paektusan Hero Youth Power Stations Nos 1-3

According to KCNA (2016-5-21):

Paektusan Hero Youth Power Stations in Full Operation

The Paektusan Hero Youth Power stations, built in the Democratic People’s Republic of Korea as a symbol of youth power, are now running at full capacity to supply electricity to the area of Mt. Paektu.

Kim Hyong Dok, chairman of the Samjiyon County, Ryanggang Province, People’s Committee, told KCNA:

Now is the dry season, but the stations have generated much electricity for industrial establishments, public cultural establishments and residential quarters in the county.

They are greatly helpful to the county’s economic development and the improvement of its population’s livelihood.

Academician, Prof. and Dr. So Pyong Hwa of Hamhung University of Hydraulic Engineering, said:

Electricity from the stations is also supplied to its neighboring Pochon and Paekam counties and Hyesan City.

It is very gratifying to see the safe conditions of hydraulic structures and generators at the stations. And it is better to read the mentality of their employees resolved to contribute to the province’s economic development and the improvement of its inhabitants’ livelihood with increased electricity production.

According to KCNA (2016-3-31):

Dam Project of Paektusan Hero Youth Power Station No. 3 Completed

Members of the youth shock brigade of the DPRK finished the dam project of the Paektusan Hero Youth Power Station No. 3 on March 31.

Members of the shock brigade and other builders vied with each other to mount the dam to greet the historic moment of the completion of the dam project.
At 10 a.m. they made a report on the completion of the dam project to supreme leader Kim Jong Un, looking up to the sky above Pyongyang.

The project started on January 13.

The completion of the dam project in a matter of less than three months represents a heroic epic which could be created only by the heroes of the youth power who grew up under the care of the peerlessly great men of Mt Paektu and a miracle they worked as young people of heroic Korea by bringing about a great leap forward by doing 10 years’ work just in one year.

Kim Jong-un visited on April 23.

Yonhap reports that its hasty construction meant the dam was not properly constructed, and it is already leaking.

The Paektusan Hero Youth Power Stations 1 & 2 were formally known as the Paektusan Songun Youth Power Stations. The Paektusan Songun Power Station No. 2 was submitted to the UNFCCC program.

It is still too early to tell, but it appears that power from these three plants will be going to Samjiyon and maybe Hyesan.

Wonsan Army-People Power Station

Wonsan-army-people-google-earth-2016-05-01

Above (Google Earth): The wonsan Army-People Power Station Dam, canal, and two hydro power stations.

Wonsan-army-people-Rosong-Sinmun-2016-05-01

Above (Rodong Sinmun)

According to Rodong Sinmun (2016-5-2):

Large-scale Wonsan Army-People Power Station has been built in Kangwon Province.

The power station has provided a foundation for generating the electricity necessary for developing the economy and improving the living standard of the people and solving the issues of household water, industrial water and irrigation water in the province.

An inaugural ceremony of the power station took place on April 29.

Present at the ceremony were Pak Pong Ju, O Su Yong, officials concerned, builders and working people.

A message of thanks from the Central Committee of the Workers’ Party of Korea (WPK) was delivered.

The message appreciated the builders of the power station and supporters for building another monumental edifice representing the era of the Workers’ Party by dint of self-development and self-reliance as a laudable present to the Seventh Congress of the WPK.

Pak Jong Nam, chief secretary of the Kangwon Provincial Committee of the WPK, in a speech called upon the officials, working people and builders of the province to create a fresh Mallima speed in their worksites in the same spirit as was displayed in the construction of the power station.

At the end of the ceremony the participants went round the power station.

This project was submitted to the UNFCCC for consideration.

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Nobel Prize winners visit PUST

May 7th, 2016

According to a press release put out by PUST, Professor Aaron Ciechanover (Chemistry 2004), Professor Finn Kydland (Economics, 2004), and Dr. Sir Richard Robert (Medicine, 1993) visited the campus in Pyongyang.

PUST2016-NLvisit - 7

PUST2016-NLvisit - 6

PUST2016-NLvisit - 2c

You can read the press release for additional information.

While in Pyongyang, the laureates made some [misguided] comments on US sanctions. According to Deutcsh Welle:

Nobel medicine prize winner Richard Roberts, Nobel economics prize winner Finn Kydland and Nobel chemistry prize winner Aaron Ciechanover have described how United Nations sanctions and a lack of internet access are hampering North Korean scientists.

Speaking to reporters following their visit to Pyongyang, the three laureates from Norway, Britain and Israel called for a rollback of many of the international restrictions that have been placed on the Communist state.

“You don’t pressurize via making people sicker,” said Ciechanover: “That’s not the right way to go.”

Roberts described how North Korean academic institutions suffered from a lack of modern scientific equipment. He said restrictions on internet use prevented most scientists from collaborating with colleagues in other countries, or accessing the latest scientific literature.

“So this embargo is really hurting the scientists in some major ways, and I think that’s a great shame,” Roberts added.

He said there was a strong desire for more international exchanges. During the trip, at least two North Korean students were invited to the West.

The Western scientists visited hospitals, universities and research institutes in Pyongyang and met with students and academics. They described clean and modern facilities – a stark contrast to other accounts, which describe the country as brutally impoverished.

The trip, which has been described as an exercise in “silent diplomacy,” was planned more than two years ago with help from the International Peace Foundation (IPF). In turn the Vienna-based organization received an unsolicited email from the Korean National Peace Committee.

Notice that Kydland, the economist, is not quoted in reference to the sanctions. UN Sanctions do not impede economic or social progress so much as North Korea’s actual economic, trade, and investment policies. North Korea has only itself to blame for the state of its economy. Finally, there is no UN embargo on the DPRK, only targeted sanctions on entities that all members of the UNSC agree are involved in the country’s weapons programs. The US, but not UN, has imposed an embargo of “dual use goods” going to the DPRK, but this is aimed at the country’s military, and applies to countries other than the DPRK.

The doctors also demonstrated an ignorance of socialist health economics when they visited the Okryo Children’s Hospital. According to the New York Times:

But the laureates suggested Saturday that the United Nations sanctions imposed on the North because of its nuclear program should be eased. At the Okryu Children’s Hospital in Pyongyang, a showcase medical center that Kim Jong-un visited during its construction in 2013, Mr. Ciechanover said that there were 300 beds and a capacity for 300 outpatients, but that doctors administered only about 60 tests a day, a low figure that he attributed to the sanctions. Doctors faced shortages of medicine and took the view that “you give only what you have to,” he said.

The United Nations sanctions do not apply to medicine, but they restrict the North’s access to foreign currency, and the government is known to channel its limited resources toward the military.

Also, some BBC reporters covering the PUST visit were expelled.

Here is coverage on KCTV.

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Why agricultural reform may appear on the Worker’s Party Congress agenda, and why it might not

May 5th, 2016

By Benjamin Katzeff Silberstein

At this time of writing, the 7th Party Congress of the Korean Worker’s Party is only one day away. In the runup to the congress, as is natural, there has been much speculation about what the congress content will actually be. Most analyses seems to believe that personal and institutional decisions will be at the center, but there have also been speculations that policy proclamations may be made in areas such as agriculture.

This post is not an attempt at forecasting, an often fruitless endeavor.  Rather than predictions, this post offers a few reasons why agricultural reform may be on the agenda for the congress in some shape or form, and a few reasons to believe the opposite.

Why agricultural reform may show up…

The first thing to note is that the North Koreans themselves rarely (or never) use the term “reform” to describe economic policy changes. If such changes are announced, they will probably be called “improvements” or simply “changes”. In any case, the arguably strongest reason to believe that liberalizing policy changes may appear on the congress agenda is that they seem to be working, at least from the perspective of the North Korean government.

Recall that last summer, North Korean press touted the efficiency of the small work-team structures and similar management policy changes in agriculture. Contrary to recent reports about reduced harvests due to the drought, North Korean media claimed that harvests were going up. Earlier, in 2012, journalists were invited to farms to hear farmers themselves speak about the policy changes, a clear indication that the regime was comfortably and formally toying with the rules. At least for some farmers: it is very possible that the reforms were rolled out on a trial-basis, and that they later got stuck in the bureaucratic mills or were deemed too radical. In sum, North Korean media outlets themselves have touted the reforms as successful, and though media reports do not amount to official policy proclamations, they are often good indicators for what’s going on behind the scenes.

…and why it might not.

On the other hand, agriculture has been conspicuously absent from several major publications and proclamations about policy priorities and successes over the past year. For example, agriculture only showed up once in the slogans the regime published earlier this year, while industry received several central shout-outs. Reforms or policy changes in agriculture were not mentioned at all. There are also reasons to doubt that agricultural reforms really did have a strong impact on harvests in 2015 — the increase in harvest output began earlier than state media started mentioning reforms.

Moreover, reports on economic output which the regime published only a few days ago only mentioned agriculture almost in passing. The reports only spoke about how farmers had diligently met their quotas for gathering fertilizer, and did not mention policy changes:

Farming preparations were brisk on the agricultural front, resulting in a 1.7 and 2.8 times growth in the securing of hukposan and microbial fertilizers and an over 1.3 times increase in the acreage of field carpeted with humus soil.

[…]

The production of homemade fertilizers and their transport, tractor overhauling and maintenance and other farming preparations are nearing completion thanks to the devoted drive of agricultural workers across the country.

[…]

Such successes are reported from railway, agricultural and other industrial sectors.

It’s socialist economics as usual, in other words: people work hard according to the planned quotas, and fulfill them because the state told them to do so. Moreover, the Washington Post’s report on Wednesday from a collective farm near Pyongyang did not mention any talk of policy changes in agriculture.

None of this sounds like the propaganda buildup one would expect in the weeks before a grand policy announcement. At least we won’t have to wait too long before we know.

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BBC journalists staying in “Beverly Hills” of Pyongyang (UPDATED)

May 2nd, 2016

UPDATE 1 (2016-5-11): When this blog post was published, I had assumed that the BBC journalists were in the DPRK to cover the seventh party congress, but they were not. These BBC reporters were covering a trip by three nobel prize winners to PUST and other places in North Korea. A second BBC crew was covering the congress. The BBC crew mentioned in this blog post below was expelled. The second BBC crew covering the congress was not affected. This explains why this crew was kept in different residential quarters than other reporters covering the congress who stayed primarily in the Yanggakdo and Koryo Hotels.

ORIGINAL POST (2016-5-2): A BBC reporter took a picture of “Guesthouse No. 24” in the housing compound supposedly under control of the International Department of the KWP:

Guesthouse-24

This area is in Pothonggang District near the new “General Satellite Control Center” (and the Pyongyang City branch of the Ministry of State Security).

Guesthouse-24-google-earth

The article mentions that other journalists are staying here as well, but it is unclear just who all is there at this time.

Presumably Pyongyang’s hotels are filled with people that western journalists would like to interview for their stories on the historic KWP Congress this week, so this would be a nice, comfortable and isolated place to keep foreign journalists under control.

Anna Fifield reports that journalists covering the congress are being spread across town. Some are in the Yanggakdo Hotel and others are in the Koryo Hotel.

It is still unclear where the local delegates to the conference are being kept. Here is what Rodong Sinmun had to say:

Senior Party, State, Army Officials Visit Lodging Quarters of Participants in WPK Congress

Senior party, state and army officials Tuesday visited the lodging quarters of the participants in the Seventh Congress of the Workers’ Party of Korea (WPK).

Senior party, state and army officials Kim Yong Nam, Pak Pong Ju, Choe Ryong Hae, Choe Thae Bok, Pak Yong Sik, Yang Hyong Sop, Kwak Pom Gi, O Su Yong, Kim Phyong Hae and Kim Yong Chol and officials of party and armed forces organs visited the lodging quarters to meet the participants.

They referred to the fact that all service personnel and people of the DPRK have waged a dynamic struggle for the final victory in building a thriving socialist nation, registering special events and achievements by leaps and bounds one after another under the guidance of Marshal Kim Jong Un.

They called on all the participants to play a vanguard role in the drive to implement the idea and line of the Party in the future, too, bearing deep in mind the undying exploits the peerlessly great men of Mt. Paektu performed for the founding and development of the Party.

If I had to guess, I would say 4.25 Hotel in Mirim, but who knows at this point.

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North Korea’s food situation: worse, but maybe just back to normal

April 28th, 2016

By Benjamin Katzeff Silberstein

Some days ago, the Food and Agriculture Organization (FAO) sounded the alarm bells on North Korean food production. The drought of last summer, among other factors, has caused North Korea’s food production to drop for the first time since 2010. (Recall that in the past years, both North Korean media outlets and some analysts touted Kim Jong-un’s agricultural reforms — the former claimed that food production was increasing despite the drought. It seems they spoke too soon).

Numbers like this, however, matter little without context. After all, five years is not a very long measurement period. Analysts like Marcus Noland have noted that the years following 2010 were probably exceptionally good. The current downturn might be best contextualized as a return to lower but more normal levels of food production.

How does the latest food production figure look in a larger context? The short answer is: not that bad, even though the downward trend is obviously problematic. Let us take a brief look at North Korean food production figures over the past few years. All following numbers show food production figures in millions of milled cereal equivalent tons:

  • 2008/2009: 3.3
  • 2010/2011: 4.5
  • 2012/2013: 4.9
  • 2013/2014: 5.03
  • 2014/2015: 5.08
  • 2015/2016: 5.06

(Sources for all figures except the 2015/2016 figure can be found here, in a piece I wrote for 38 North late last year. It seems the calculation I made for 2015/2016 was off by 0.01 million tonnes.)

In other words, yes, the latest food production estimate represents a decrease, but it’s not that big. North Korean food production is still far larger than it’s been for most of the 2000s.

It is also interesting to note the striking variation in North Korean government food imports. Marcus Noland and Stephan Haggard wrote in Famine in North Korea that the government downsized food imports as a response to increasing aid flows. Whatever the rationale might be behind the regime’s food import policies, they tend to vary greatly from year to year. In 2012/2013, the country imported almost 400,000 tonnes of cereal. In the mid-2000s, imports were close to one million tonnes, and they dropped to under 300,000 tonnes in 2008/2009.  In 2011/2012, imports climbed to 700,000 tons.

For 2015/2016, FAO projects a gap of need versus production of 694,000 tonnes, but government imports stand at around 300,000 tonnes, a relatively low figure in a historical context. Thus, North Korea is left with an uncovered deficit of 384,000 tonnes. Presumably, this wouldn’t be prohibitively expensive to cover by doubling cereal imports. The economy seems far more healthy today than it was in 2011-2012, and still, it managed to import more than double its planned imports of 2015-2016.

All in all, North Korea’s food production appears to be far from sufficient or stable, but the situation does not appear acute in a historical context. Indeed, one could argue that it’s a matter of policy choices and priorities: the regime could choose to increase imports to offset the decline in production, but its funds are spent elsewhere. And, of course, more efficient agricultural policies overall would make North Korean agriculture and food markets far more resilient to weather variations.

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Taedonggang Beer goes on sale in China

April 28th, 2016

According to the Korea Times:

Taedonggang beer, a state-owned North Korean brand, is available in grocery stores in Dandong and Shenyang, China, according to news reports.

“I noticed billboards promoting Taedonggang beer on a street near Dandong Station, and also newspaper advertisements showing the addresses and phone numbers of retail stores,” a source told Radio Free Asia.

The beer is not yet widely distributed in China. Sources from Shenyang and Dandong said they could find only a few stores selling the beer in Xita Street where many Koreans live and in Korean gift shops.

North Korea’s popular beer costs 20 yuan ($3) a bottle, four times the price of regular brands in Chinese grocery stores.

“The beer has a soft, rich flavor with more alcohol than Chinese beers,” said a Chinese man who tasted Taedonggang beer at a restaurant in Dandong.

“However, the price is too expensive for Chinese citizens to drink regularly.”

Read the full story here:
N. Korean beer sale in China
Korea Times
Lee Jin-a
2015-4-28

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North Korea looking to expand foreign trade, turning to EU and BRICS

April 28th, 2016

Institute for Far Eastern Studies (IFES) 

North Korea is seeking to expand its foreign trade by turning to the EU and BRICS (Brazil, Russia, India, China and South Africa) for cooperation.

In the recently published book Looking at Today’s Choson from 100 Questions and 100 Answers, North Korea emphasized the importance of cooperation with EU and BRICS, saying it will “seek various ways to expand its foreign trade.”

The book noted that with the upcoming Pyongyang International Trade Fair (PITF) in May and September, North Korea is looking for grounds to engage in foreign trade to “further the cooperation with many countries around the world.”

The book also stated that North Korea is engaging in a wide range of international trade such as economic cooperation and looking into cooperative business models with Europe, Southeast Asia, Latin America, the Middle East and Africa as well as with international and regional economic organizations such as the EU and BRICS.

However, seeing as the book does not specify detailed ways in which North Korea will take to cooperate with the EU and BRICS, the plan appears as a mere hope.

While the book admitted the difficulty in building an economically strong country while facing the sanctions imposed by the international community, it emphasized that “it [North Korea] is putting its effort in expanding international trade to directly penetrate the sanctions to build a strong socialist state.”

The book also noted that the diversification of active foreign trade will enable “the expansion of width and depth of distribution through dealing with more countries on various industries on many accounts.” The diversification in this context refers to the people in charge of trade and the methods of trade.

Continuing on the idea of diversification, the book mentioned that “not only does the diversification of foreign trade not contradict itself with the independence of national economic stability, but it actually is an important asset in developing the ability of economic independence and its capability,” meaning that diversification should be a key foundation in building an independent economy.

The book explained that the independence of economy is the enhancement of people’s identity and independence that is linked to the domestication of materials. Therefore, beginning with coke (coal) gasification, Juche-iron, Juche-refractory material production line, Juche-fertilizer, and Juche-textile production line will be completed, for instance.

According to the book, this will be the core foundation in speeding up economic development in association with the domestic materials parring with international market prices to stay in market competition. It also stated that this is “not only a matter of economic efficiency, but also a fierce fight against enemy states in the war of defending socialism.”

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Food prices in North Korea: vegetable prices up, rice prices stable

April 28th, 2016

By Benjamin Katzeff Silberstein

Daily NK reports that vegetable prices have gone up in North Korea’s border regions, due to cold weather and forced mobilization efforts (the 70-day battle). But rice prices remain stable (my emphasis):

The price of vegetables including cabbage and radish has surged around the border regions in North Korea and to a lesser degree, further inland. The sudden spike is believed to be driven by sanctions jitters, unseasonably cold temperatures, and excessive mobilization for the upcoming Party Congress, but is being viewed by some as a temporary upswing, given the continual stability in rice prices and foreign exchange rates. 

“Back in February, cabbage was selling for around 2,500 KPW (per kilogram), but prices have suddenly jumped to 7,000 KPW. That’s more expensive than rice,” a Daily NK source in Ryanggang Province reported on April 25. “Now is usually the time when food supplies are short (because of the barley hump), but it looks like the hike was triggered by more people mixing in dried greens with their rice to conserve their rice supplies, in the belief that the food situation may worsen due to [implications stemming from] the sanctions.”

[…]

“In some areas of Taehongdan County, people are eating so-called ‘radish noodles,’ which are made by coating radish leaves with potato starch,” the source explained.

On a nerdy note, I wonder if the connection between potato starch and Taehongdan is merely accidental. Remember, Taehongdan is the birthplace of Kim Jong-il’s 1998 “Potato Revolution.”

Food prices also seem to be impacted by the blitz-mobilization campaign leading up to the 7th Party Congress (my emphasis):

Conditions in the central inland areas are not much different. Individuals who would normally grow their own vegetables have seen their schedules disrupted by ongoing “70-Day Battle” mobilizations. “Thanks to the continual mobilizations, said by many to be ‘turning their hearts into black lumps of coal’, ahead of the Party Congress, business at the markets has lost its vibrancy and the residents are miserable,” a source in Pyongyang told Daily NK.

Rice prices, meanwhile, remain notably stabile:

Despite these high prices, movements on the rice and foreign currency front have remained relatively stable, leading people to believe the spike in vegetables will be short lived.

“Vegetables are not export items and therefore their prices are determined by domestic supply and demand,” the Pyongyang-based source noted. “However strong the sanctions may be, rice prices have nonetheless remained the same and, under these conditions, not many will choose to eat expensive cabbages over rice,” the source added, suggesting that prices are likely to return to normal as the markets readjust for supply and demand.

Full article here:
Vegetable prices spikes, rice remains stabile 
Daily NK
Kang Mi Jin
2016-04-28

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