DPRK government continues to prove price controls ineffective

According to Radio Free Asia:

Government price controls are now being imposed on non-food items in the markets, with frequent spot checks by state security police to monitor sales of sought-after household goods such as spoons, toothbrushes, and candles.

Price tags for more than 35 items were posted at farmers’ markets in Hweryong , Onsung, and Moosan cities in northern Hamgyong province, where North Korea’s poorest people go to buy the hard-to-find necessities of life.

“Market administrators and security agents take turns asking repeatedly about the price of various items,” a North Korean who recently defected to the South said in an interview.

“According to the government-imposed price tags, a toothbrush costs 200 won, a spoon 150 won, and 10 candles 1,000 won.”

This compares with unregulated prices of 250 won for a toothbrush, 200 won for a spoon, and 1,300-1500 won for a bundle of 10 candles.

An average monthly salary for a worker in North Korea is about 2,500 won.

“If someone asks the price, the vendors will be sure to give you the price dictated by the authorities, but they will not actually sell anything for that price,” the defector said.

Another South Korean-based defector agreed.

“When the inspectors come by, they see the official price on the tag, but when buyers come by, the vendors never sell for that price, but for a higher one,” the defector said.

“If buyers ask the vendor to sell for the government-imposed price, the vendors simply tell them to try to purchase for that price from somebody else.”

To avoid the watchful eye of the authorities, some vendors simply avoid going to farmers’ markets, and instead set up small bazaars elsewhere to sell manufactured goods.

The North Korean government has attempted to regulate the markets in numerous ways in the last few years (More history and commentary here).  So far the implementation of new rules has proven haphazard, unpredictable, and largely ineffective since the black market is well developed and the levels of bureaucracy involved in the operations are numerous and subject to local manipulation. 

The non-uniformity of these market regulations can be seen in the following IFES report:

North Koreans subject to harsher market controls
Institute for Far Eastern Studies (IFES)
NK Brief No. 09-5-6-1

Good Friends, a non-profit organization working for human rights in North Korea, reported recently that North Korean residents are becoming increasingly discontent due to the government’s strengthening of restrictions on markets.

The group’s online newsletter, “North Korea Today,” reported in its most recent issue (no. 275) that a new list of banned items, presented as the “February 17th policy”, was issued by authorities to women selling goods in the market in Chungjin, North Hamgyong Province on April 10th.

According to a Good Friends source, Party propaganda officials were dispatched to markets in broadcasting trucks in order to announce the new measure, blaring that the selling of goods on the list of banned items would be considered “anti-socialist” activity, and would be punished accordingly.

Other sources report that the ban has resulted in an increase of door-to-door sales, and that those in the market are still willing to take individual orders for goods on the banned list, and then meet outside of the market to complete the deal.

In Hyeryong, North Hamgyong Province and Hyesan, Ryanggang Province, the “February 17 policy” was posted around markets, but the details of the policy were not explained. In the city of Hamheung, market hours were also restricted, with sellers only allowed to operate from 1~6 pm.

The goods restricted were mostly imported wares, with as much as 90 percent of foreign goods banned, and absolutely all South Korean products blocked. Those caught selling restricted items can expect to have their goods confiscated, with additional punishment not unheard of.

So the good news is that these rules make little difference to the actual distribution of goods and services in the DPRK.  Of course the bad news is that the North Korean government keeps trying.

The whole story can be obtained here:
Radio Free Asia
Jung Young


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