North Korean Economy Watch

Leonid Petrov writes in the Asia Times:

After two months, an exhibition in Moscow of North Korean graphics, mosaics and embroidery is coming to a close. Oddly entitled “And Water Flows Beneath the Ice”, the exhibition was a major project initiated and hosted by Russian entrepreneurs at the trendy Winzavod Gallery, a revamped wine factory in central-eastern Moscow.

All the pictures came from the Mansudae Art Studio in Pyongyang, a government-run enterprise that employs more than 1,000 artists to create art for export.

The late (and eternal) North Korean president, Kim Il-sung, is known to have once said, “Abstraction in art is death,” leaving no choice for North Korean artists but to embrace socialist realism as their method.

Russians, who still remember when this artistic trend was the only one permitted by the Communist Party, were given a chance to refresh their memory exactly 20 years after the collapse of the Soviet Union. It is no surprise that many felt a sense of familiarity and at times nostalgia for while visiting the unusual exhibition.

During a short trip to Moscow last month, I met with colleagues, Russian scholars and researchers of Korean studies at the exhibition. They came along with their students, and we had a lively discussion about the hidden messages and artistic value of each picture. It was good to share opinions on a contentious topic such as North Korean art, and our feeling converged on many things regarding the commonalities and differences between North Korean and Soviet propaganda art.

First of all, socialist realism in art is a misnomer, since it depicts life as it should be, not as it really is. For instance, in this exhibition, there was an image of chubby children in Pyongyang Zoo feeding monkeys with ice-cream. The abundance of rice, vegetables and rabbits on show in other pictures also seemed a disservice to aid agencies diligently dispatching food and other humanitarian relief to starving North Koreans. In the artwork, life in the Democratic People’s Republic of Korea was consistently depicted as affluent and pleasant.

In fact, North Korea is a revolutionary state, struggling to achieve economic success and advance its military power. This can be viewed and sensed through the canvases dedicated to the heroism of builders working on the Taegyedo Tideland Reclamation Project or soldiers engaged in constructing the Huicheon Dam.

Heroism at war and in peaceful reconstruction is venerated and equated to the revolutionary course of juche (national self-reliance) and songun (military-first) politics. Thus, every picture, embroidery and poster carries a condensed revolutionary message that must convince the viewer that the people of North Korea are determined and invincible. Some may call it propaganda, but in North Korea this genre is known as Chosunhwa (Korean painting).

In fact, there is very little of Korean tradition in Chosunhwa. Although most pictures are created with watercolors and ink, the characters, actions and settings are Stalinist Soviet or Maoist Chinese. Even where the North Korean artists try to be experimental and use such materials as gouache or mosaic, the results resemble the typical posters and murals once omnipresent in the streets of Moscow and Beijing.

Only the embroidery works were genuinely traditional, and most viewers were stunned by their elaborate composition and vibrant range of colors.

After discussing the merit of each exhibit, my expert friends and I agreed that totalitarian societies do produce impressive pieces of art, which inspire awe and overwhelm the target audience.

While the value of such art is transient and more akin to propaganda, the technical side of it is so unquestionably powerful that it deserves recognition and research, if not admiration.

Unfortunately for the North Korean artists and Mansudae Art Studio entrepreneurs, the value of this art is restricted by the willingness of the purchaser to help the juche and songun revolution. Otherwise, mainstream North Korean art, which is dutifully devoid of abstraction, has very limited export value.

That explains the usual commercial difficulties encountered by the North Korean art exhibitions brought overseas by the North Korean Committee for Cultural Relations with Foreign Countries. Among the rare buyers of the socialist kitsch are maverick revolutionary zealots and some rich sympathizers from South Korea.

In Russia and China, former communist patrons of North Korea, the appetite for hackneyed images and themes is dwindling. What leaves the strongest impression from “The Water Flows Beneath the Ice” is not the contrived propaganda on the walls but the artistic installation placed in the middle of the gallery.

Dozens of green combat helmets hanging from the ceiling form perfect lampshades over the scarlet-red carpet hosting a lonely short-legged Korean traditional table. A bowl of white rice on the table symbolizes the prosperity that songun was designed to create and protect. The soft pink light gleaming from each helmet resembles the cherished hope of the Korean people for peace, love and harmony.

The bouquets of colorful firework shots projected on the screen at the end of the gallery hall surmount the composition and instill a sense of triumphant fulfillment. The aim is seemingly to capture the unbending spirit of Koreans (in both the North and South), as well as their hardworking and peace-loving character.

Overall, the “And Water Flows Beneath the Ice” was a bright and memorable phenomenon for the cultural life of the Russian capital. Neither the awkwardness of the premises (conditions in the old liquor factory demanded that all visitors wore clumsy overshoes) nor the overpriced pamphlet (more than US$30) spoiled the positive and inspiring atmosphere.

Although it is commercially and morally questionable as well as kitsch, the unusual initiative has awakened in hardened Russian art-lovers a long-lost belief in fairness and altruism: ideals that are highly valued by Koreans.

Read the full story here:
North Korean art stirs Muscovites
Asia Times
Leonid Petrov
2/2/2011

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

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 Daily NK:

High level North Korean cadres are visiting a casino in the far northeast of the country, disguising their identities so as to avoid government regulations which forbid them from entering, a defector-led NGO has revealed.

Reporting the news, an NK Intellectuals Solidarity inside source explained yesterday, “Recently, cases of high level North Korean cadres disguising their identities to enter Orakjang Casino, which is in the Emperor Hotel in Rasun City, have been occurring frequently.”

The Emperor Hotel was established in 2000 by Emperor Group, a Hong Kong-based property developer. With around 100 rooms, bars, cafes, an indoor swimming pool, sauna, night club, sports center and a fine sea view, the hotel, which cost $64 million to build, employs around 500 people, including a number of North Korean women.

According to the source, while the hotel was regularly frequented by Chinese tourists and officials when it opened, it closed down at the end of 2004 after one official, acting independently, squandered a fortune in public funds there.

However, seizing the opportunity presented by Kim Jong Il’s visits to China last year, the hotel reopened and, according to the source, has recently been doing well off Russian traders, among others.

On this, the source explained, “One of the conditions placed on the opening of the hotel was that North Koreans would not be allowed to enter, and at the beginning their entry seemed to have been thoroughly prohibited,” adding that therefore, “However, as the number of Chinese traders going to the casino increased, so high North Korean cadres doing business with the Chinese and wealthy North Koreans disguising their identities also entered.

The North Koreans apparently pretend to be Korean-Chinese when they enter the casino, where some reportedly gamble away as much as $10,000 per day.

Because North Korean enterprises and factories are unable to operate properly due to a lack of raw materials and capital, average cadres and staff go to gamble mostly to relieve their boredom, the source explained.

Read the full story here:
Casino Luring in Bored North Koreans
Daily NK
Cho Jong-ik
1/27/2011

According to Daily NK:

The North Korean media has released a poster emphasizing the value of the June 15th North-South Joint Declaration. Of particular interest is the appearance on it of three intellectuals carrying a blue flag bearing the words “North-South Joint Declaration”.

The appearance of blue on a North Korean poster, as opposed to red, is very unusual. In North Korea, blue is reserved in propaganda circles as a symbol of autonomy and peace. Therefore, the poster can be said to represent North Korea’s most recent calls for dialogue, independent reunification and the establishment of a peace system on the Korean Peninsula.

Uriminzokkiri, the propaganda website run by North Korea’s Committee for the Peaceful Reunification of the Fatherland released the poster today under the title, “The North-South Joint Declaration is an unchangeable milestone for national prosperity and a banner of independent unification that must be implemented by the whole nation!”

Looking in more detail, each of the three intellectuals on the poster is bearing a book with the title of one of reunification principles (from top): the July 7th 1972 “Three Grand Principles for the Unification of the Fatherland”; July 4th 1993 “Ten Basic Principles of People’s Unity for the Unification of the Fatherland”; and October 1980 “Founding Plan for the Democratic Federal Republic of Korea”,

The three lie at the core of past “plans for unification” put forward by North Korea. Pyongyang is currently pressing for a dialogue with the South both at home and abroad by emphasizing its past efforts to achieve unification. Ultimately, therefore, the poster represents part of North Korea’s basic effort to present itself as the man of peace on the Korean Peninsula.

In a phone interview with The Daily NK, Cheong Seong Chang of Sejong Research Institute agreed, “It is rare for North Korea to use blue in posters and suchlike,” adding, “It was written to water down concerns by saying, ‘this is not to achieve a Communist takeover’.”

Cheong added, “It could have been deliberately written from the perspective of efforts to undermine our sense of vigilance.”

Kim Sun Cheol, who arrived in South Korea in 2009 after a long spell working in propaganda and agitation for the Chosun Workers’ Party said, “In North Korea, blue is called a symbol of autonomy and peace. However, this is the first time it has appeared on an official poster.”

“The appearance of a blue flag on this poster is not just for South Korea’s benefit, it seems to be to present the ‘man of peace’ image to international society as well,” Kim added.

Read the full story here:
North Korea Embraces Blue of Peace
Daily NK
Yoo Gwan Hee
1/17/2011

Pictured above: Paek Son Haeng Memorial Hall, Pyongyang (Google Earth)

According to the Daily NK:

North Korea has apparently agreed to accept foreign funding to produce a movie which shows Christians in a positive light. It will be the first movie made in North Korea to show the life story of a Christian.

An activist working in New Zealand for “Team and Team International”, a South Korean NGO working on international disaster relief, reported today, “A North Korean movie import-export company (Chosun Movie Company) has decided to produce a movie, ‘Paek Sun Haeng’, with the support of an organization from New Zealand,” and added, “They are at the last stage of working on the scenario and plan to start filming this coming September.” A budget production, it will cost a reported $1.5 million.

The activist said that the two sides have agreed to show the movie in movie theaters across the country and on Chosun Central TV. The purpose behind the investment is apparently to depict the positive side of Christianity and Christians to the North Korean people.

He explained, “Based on the idea that the figure, Baek Sun Haeng, has been defined as a good capitalist in North Korea, the organization has been negotiating production of a movie about her with North Korea since 2008.” Additionally, he said “They will describe fully the image of Baek as a philanthropist as well as a Christian in the movie.”

The scenario was reportedly written by the head of Chosun Movie Company, Choi Hyuk Woo, but there has been conflict over the degree of Christian content.

The source explained, “Problems when the North Koreans tried to change one line or scene have not been small.” However, “They were able to persuade the North Korean staff by sticking stubbornly to the fact that it would have been impossible to invest in the movie without Christian content.”

North Korea’s bad situation vis a vis foreign currency may have influenced the North’s decision-making, the source agreed, saying, “I am aware that North Korea’s internal capital situation is rather difficult. That economic difficulty may have influenced this contract somewhat.”

Chosun Movie Company oversees the export and import of movies under the Culture and Art Department of the Propaganda and Agitation Department, which is within the Central Committee of the Party.

The activist emphasized, “Aid activities for North Korea should give dreams and hope for new things to the North Korean people through diverse cultural approaches beyond food or essential aid.”

The movie’s main character, Baek Sun Haeng (1848-1933) is a well-known philanthropist in North Korea who has been mentioned in North Korean textbooks, in Kim Il Sung’s memoirs and elsewhere.

After her husband died when she was 16 years old, she is said to have accumulated wealth relentlessly. After that, she built both “Baek Sun Bridge” across the Daedong River and a three-story public meeting hall in Pyongyang. She also donated real-estate for Pyongyang Gwangsun School and Changdeok School.

Baek, as the deaconess of a church, also contributed to the education of Korean Christians by donating capital and land for Pyongyang Presbyterian Church School, which was built by Rev. Samuel Austin Moffett, the then-reverend at the First Church of Pyongyang, and Soongsil School, the forerunner to Soongsil University in Seoul, which was established by Dr. W. M. Baird, an American missionary, in Pyongyang on October 10th, 1887.

Additionally, she dedicated all of her property to an organization dedicated to the relief of poverty in 1925, so the Japanese government general tried to present her with a commendation, but she refused it. Therefore, she has been praised highly as a “people’s capitalist” in North Korea.

In 2006, the North Korea media reported that an existing monument to Baek had been restored and moved into “Baek Sun Haeng Memorial Hall” in Pyongyang on the instructions of Kim Jong Il.

Read the full story here:
Christian Movie Being Shot inside North Korea
Daily NK
1/17/2011

UPDATE 2: Apparently female graduates of the DPRK’s most prestigious university can look forward to careers as….Golf Caddies.  According to the Choson Ilbo:

He said there are about 30 female caddies at the complex in their 20s or 30s, many of them graduates of the prestigious Kim Il-sung University. “Caddies were beautiful and considerate,” he said. “After I finished playing golf, I came out of the shower at the club house, and there was a woman dressed in traditional Korean costume holding a towel. I instantly wondered whether there was another service waiting for me, but there was no 19th hole.”

UPDATE 1: Simon adds some interesting information in the comments section below.  Also, here are two additional stories about a golf tournament held back in 2004: story one, story two.

ORIGINAL POST:

Click image to visit the official web page

According to the Choson Ilbo:

North Korea will host its first ever amateur golf tournament for foreign visitors. London-based Lupine Travel on Thursday announced that together with China Youth Travel Service of Dandong, it is organizing the North Korean Amateur Open for golfers from around the world in Pyongyang from April 26 to 30.

Lupine Travel, which specializes in tour packages to unique destinations, is currently offering a five-day tour to the North through the website www.northkoreanopen.com.

According to the website, any amateur golfer who hits an average of 90 can take part. The package costs 999 euros, and includes visas, tournament entry, return train travel from China into North Korea, meals and accommodation.

Pyongyang Golf Complex, located near Taicheng Lake some 27 km from the capital, is the only golf course in the country for North Koreans. The Korea LPGA Pyongyang Open was held there in August 2005.

“The 18-hole, par 72 course covers 120 hectares with 45 hectares of green and is 7 km long. The course can service up to 100 competitors at a time and includes a service area covering 2700 square meters; including shops, restaurants, conference facilities and a sauna,” the website said. “When Kim Jong-Il opened the course in 1991, he shot a world record 38 under par on his first ever round of golf (including 11 holes in one).”

The Wall Street Journal’s Korea Real Time also covered the announcement.

North Korea has four golf facilities and one driving range.  Only three golf facilities are in operation and only two open to “the public”. Here are satellite images of all four (the last image was taken when the golf course was under construction): Pyongyang Country Club, Yangak Golf Course, Sosan Driving Range, elite three-hole range, and Kumgangsan (under construction in the image).

According to the Associated Press:

The Asian Football Confederation has fined North Korea $2,000 for failing to bring a player to an Asian Cup news conference.

The fine, announced Sunday, is the latest to be imposed on teams at the tournament in Doha, Qatar for violating the AFC’s media policy. Qatar has also been fined $2,000 for the same offence while complaints against Iraq and Saudi Arabia for failing to bring players to a news conference have been sent to the AFC’s disciplinary committee.

Read the full story here:
North Korea fined $2,000 for failing to send player to Asian Cup news conference
Associated Press
1/15/2011

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

On January 7, the Korean Workers’ Party newspaper Rodong Sinmun ran an article introducing the Huichon Ryonha Machine Complex, which manufactures Computer Numerical Control (CNC) systems. The article appeared just before Kim Jong Un’s birthday, and the CNC system appears to be attributed to the youngest son of Kim Jong Il.

The newspaper introduced the machine complex by calling for advancements in the coming year, stating that the CNC system manufacturer “saved our country” and that it was the envy of everyone, catching eyes around the world. The article also proclaimed that “the fatherland” was “growing younger and stronger” with the implementation of vanguard-technology CNC, and that equipment filling a space the size of seven soccer stadiums was set to further the push for industrialization. The reference to ‘growing younger and stronger’ is thought to refer to Kim Jong Un.

In particular, the article stated that North Korea “is not a country that only answers the hardline talk of aggressors with a more hardline response,” and that the North “is not a country that answers the nuclear cudgel of the aggressors as a satellite-launching country or a nuclear country by name alone.” Rather, “the citizens living on this land will answer with vanguard technological breakthroughs” in the face of the economic and technologically dominant aggressors.

North Korea’s satellite launch and nuclear programs were credited to Kim Jong Il in both domestic and international propaganda. The article emphasizing ‘vanguard technological breakthroughs’ is part of a campaign in which the succession system and Kim Jong Un’s reputation are being built on economic and technological development. Increasing propaganda touting CNC technology, in particular, is reflective of the realization of Kim Jong Un’s leadership role.

On one hand, there were no special ceremonies on January 8, the first birthday of Kim Jong Un’s to pass since his official emergence into DPRK politics. In fact, according to the Daily NK, Kim Jong Un’s birthday is not acknowledged in the official calendars issued by Pyongyang at the end of last year.

Last year, North Korea recognized Kim Jong Un’s birthday as a special holiday, with laborers and farm workers all having a day off. Within the Party, the day is known as “the people’s holiday,” and there were internal celebrations attended by Party members. A source within North Korea explained to Daily NK, “with no official promulgation of a successor, it doesn’t make sense to make the Young General’s birthday a holiday.”

While it’s clear that Kim Jong Un will move up through the ranks to take his father’s leadership position, he has to first be officially established within the Party before his birthday can be celebrated on a national level. Furthermore, since the currency reform measures at the end of November, 2009, prices skyrocketed and the lives of the people grew more difficult. With the current atmosphere within North Korea, it would not benefit Kim Jong Un to be cast into the spotlight by politicizing his birthday.

In addition, North Korean authorities have been emphasizing the ‘battle’ for light industrial development and the improvement of the lives of the people through the New Year’s Joint Resolution and other articles in state-run newspapers and media, while the people of North Korea have been gathering in groups to have the joint resolution explained and the key points emphasized. In this situation, it appears authorities decided that public celebration of Kim Jong Un’s birthday would be distracting.

According to the Choson Ilbo:

Siem Reap, Cambodia’s second largest city near the sprawling ruins of the Angkor Wat, has two North Korean restaurants, down from three since North Korea recalled all their expat staff after Kim Jong-il’s stroke in 2008 and returned only the employees of two of them. The restaurants rely on South Korean tourists for business since the town is a popular destination for them.

One of them, called Restaurant Pyongyang, sells the famous cold noodles or naengmyeon for US$7 a dish, while North Korean dancers perform and pour drinks for customers. It used to be a regular stopover for South Korean tourists, with tour agencies charging $30 for a visit and a meal. One tour guide said, “In Cambodia $7 a dish is already pretty expensive, but many tourists go to the restaurant because of its attractions.”

After North Korea’s sinking of the Navy corvette Cheonan in March last year, the South Korean Embassy in Cambodia asked tour agencies and South Korean residents’ association there to avoid sending visitors from the South there, but local sources say the plea fell largely on deaf ears. But the North’s artillery attack on Yeonpyong Island in November last year finally did the trick. The South Korean residents’ association in Siem Reap voluntarily boycotted the North Korean restaurants, and tour agencies also voluntarily took them off their itinerary.

The restaurants are apparently suffering. A member of the South Korean residents’ association said, “Almost all of the customers were South Korean tourists, but it seems that even the performances have stopped now there are no customers.”

Around 120,000 South Koreans a year reportedly visited the two restaurants, contributing to an estimated W200-300 million (US$1=W1,126) in monthly sales. North Korea runs over 100 restaurants in China, Vietnam, Thailand, Laos and Russia, which serve as a source of much-needed hard currency for the regime by sending home $100,000-300,000 a year.

The mood in Siem Reap is now desperate. Last month, a placard outside a South Korean restaurant criticizing North Korea’s attacks were torn down by seven people who appeared to be North Korean agents, in what expats there believe was another small-scale North Korean provocation. Tour agencies are also losing revenues after taking the restaurants off their itineraries. “We used to charge $30 per visit and took 30 percent of the profits, but not any more,” a tour guide said.

South Korean residents’ associations abroad rarely voluntarily boycott North Korean restaurants. The Okryugwan chain of North Korean restaurants in Beijing’s Wangjing district is still accessible to South Koreans. A South Korean Embassy official there said, “We asked residents to avoid the restaurant in November but did not force them.”

Meanwhile, a North Korean restaurant in Kathmandu, Nepal closed down in November after its North Korean manager defected to South Korea.

Read the full story below:
N.Korean Restaurants Abroad Feel the Pinch
Choson Ilbo
1/10/2011