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North Korean Children Have to Learn Computers As Well

Friday, December 7th, 2007

Daily NK
Han Young Jin
12/7/2007

In North Korea nowadays, individual-use PCs concentrated in Pyongyang and Chongjin, Shinuiju and other large-size cities have been gradually increasing. The trend has been rapidly increasing due to the propagation of computers by North Korean party organizations, the administrative committee office and middle schools.

The computerized citizen registration project by the North Korean village office was completed around the Local People’s Assembly representative elections last July.

A source from Shinuiju, North Pyungan said in a phone conversation with DailyNK on the 5th, “Provincial organizations and the village office are taking on computer-based projects. Large-city wealthy people are also acquiring computers left and right due to their children’s education.”

The new-rich class, who have made huge profits from recent trade with China, believe gradually that “The outer society cannot do anything without computers. Our children have to learn computers, too, to not get behind.”

A majority of computers provided to North Korea are Chinese and South Korean-made and have entered through official trade with North Korea, but a portion has been going through smuggling. South Korean computers, with the exception of Korean software, are permitted. North Korea uses North Korean word processors, such as “Dangun” and “Changduk.”

A portion of the upper-class use the new model computers smuggled from China, but a majority use secondhand Pentium IV-processor or below imported from China. In North Korea’s Shinuiju, a computer (Pentium II) which includes a used CTR monitor is 100~120 dollars and a computer which includes LCD monitor is 300 dollars. The offering price for a used laptop is around 300 dollars.

He said, “People cannot connect to the internet via computers, but can use most programs set up on computers. The resident registration computerization project has been completed and in Pyongyang, networks between libraries are in operation.”

North Korea is the single country in the world that is not connected to an internet cable network. North Korea, while being endowed with the national domain suffix, “kp”, does not operate a domain. People cannot use internet, but can use software programs set up on individual computers such as MS-Word, Excel, and Photoshop.

In North Korea, after 2000, the import of used and new computers from China, Japan, and South Korea through individuals and companies increased dramatically. Around 2001, around 2,000 Samsung, LG and TriGem Computer were provided to North Korea’s main colleges such as Kim Il Sung University and Kim Chaek University of Technology.

Mr. Kim said, “Chosun (North Korea) people prefer LCD monitors, not CTR monitors. Computers that have been coming in North Korea are mostly made in China and South Korean computers such as Samsung, LG, and TriGem Computer have been widely distributed as well.”

Electronic Publications Service using Domestic Network Possible

North Korea prohibits internet, so computer education mostly focused on program usage are taught in colleges and high schools. In schools for the gifted and college computer majors nationwide, a new generation of software developers is being nurtured.

Major organizations in the area of software development are Chosun (North Korea) Computer Center (KCC), Pyongyang Program Center, and the Academy of Sciences.

Since 2002, North Korea has created a network connecting the libraries of Grand People’s Study House, Kim Il Sung University, and Kim Chaek University of Technology. The network has been expanded throughout Pyongyang and the provinces. Currently, a few high officials in Pyongyang can use reportedly the Grand People’s Study House’s electronic publications service at home.

Posted in Black markets, Civil society, Communications, Computing/IT, Economic reform, Education, General markets (FMR: Farmers Market), Internet, Intranet, Kim Chaek University of Technology, Kim Il Sung University, Korea Computer Center (KCC), Price liberalization | Comments Closed

Update on North Korea Markets and Market Regulations

Wednesday, December 5th, 2007

Daily NK
Yang Jung A
12/5/2007

After the Inter-Korean Summit held in October, the North began to place age limits for females who can do business in the market. The regime has risen the minimum age from 35 to 49 years old. Since most men are enrolled in workplaces, it is mostly women who engage themselves in business activities and are therefore being targeted by the age limit.

According to a study conducted by DailyNK on North Korean markets, business activities have slowed due to the regulation of the market. However, if a woman bribes the officers in charge of enforcing the regulations, she can continue to do business. In the rural areas, it is known that the regulations are not strictly enforced.

The complaints of the North Korean people regarding the regulations are growing ever more intense because their livelihoods depend on market activity. Below is an overview of the current market situation in the North..

◆ Market Conditions

Although detailed statistics are not available, it is reported that there are around three to four markets in each North Korean city.

In Pyongyang, the city with the largest population, there is one market for every district (19 in all). On densely populated “Tongil (unification) Road,” there are two markets. Kangdong, administratively located within Pyongyang, has three markets. Additionally, there are small-scale markets, such as the No.67 Munitions-Factory market and Hari Plaza market. The one in Kangdong is relatively large.

Shiniju, known as the center of trade between North Korea and China, has three markets: Chaeha, Namjoong and Dongseo (aka Pyonghwa). South Shiniju has only one. There are two markets for each of the larger districts in Chongjin, the second largest city after Pyongyang. Overall, each town in each county has at least one market and each county has one or two small-scale farmer’s markets.

◆ Average income

In the past, markets were always bustling with people except during the rice-planting and harvest seasons. However, since the State has begun controlling prices and enforcing an age limit on merchants, the markets have become stagnant.

Around 50 to 60 merchants used to engage in business in each block of each market in Pyongyang. Now, there are only seven or eight merchants on each block. Therefore, nowadays, shoppers are finding it hard to buy quality products in the market.

The average daily earning for merchants depends on the types of items sold. Merchants who sell agricultural products make about 3,000 won, and those who sell sea products earn between 5,000 and 6,000 won. Those who trade industrial products are reported to make as much as 10,000 won per day.

◆ Prohibited sales items

The North Korean authorities are now exercising control over the types of products that can be sold in the market and have increased the list of banned items.

The list of prohibited sales items in Hamkyung Province, centering on Hoiryeong, is as follows: electric rice cookers, electric frying pans, automobile tires and parts, diesel fuel, gasoline, beef, medicines, electric blankets, VCRs (Even home-manufactured VCRs cannot be traded in the market. They are only available at State-run shops.), rubber belts, bearings, welding rods, electric motors, electrical wirings, alcohol, foreign films, and so on.

It has been reported that market managers exercise control inside-market activities, whereas security agents patrol outside of the market. The level of regulation depends on the individuals charged with enforcing the regulations. Bribed officials do their job only perfunctorily.

◆ People’s responses to market regulation

Unlike markets in major cities such as Hoiryeong, Musan, and Chongjin in North Hamkyung Province, markets in small cities and towns of the province operate as usual regardless of the State’s market regulations.

In small cities and towns, people know each other, and market managers and safety agents do not strictly enforce the state’s regulation as their counterparts do in big cities. Even in major cities, however, many merchants under the age of 40 continue to do business. If they fail to get inside the market, they do business in alleys adjacent to the market.

Many merchants complain about the market regulations, and some even get into altercations with market managers.

For instance, they violently stand against and even swear at the mangers, saying, “You guys live in comfort because you receive food from the State and take bribes from us. However, we live from hand to mouth each day here in the market. How could you then regulate the market?”

◆ Some servicemen secretly engage in business

Some poverty-stricken soldiers and officials as well reportedly steal rice distributed to the army and sell it to merchants. Unlike commoners, servicemen are tightly watched, so they cannot readily involve themselves in money making activities.

Some destitute low ranking soldiers clandestinely take their emergency rations and sell them in the market. Canned beef manufactured at Ryongsung Meat Processing Plant is sold at 3,500 won and Canned mackerel at 2,500 won in the market.

However, heavy punishment awaits servicemen who are caught engaging in illegal market activities. So, they covertly sell military provisions to only personal aquaintences.

Posted in Economic reform, Finance, Fiscal & monetary policy, General markets (FMR: Farmers Market), Labor conditions/wages, Price liberalization | 1 Comment »

Koreas sign security guarantee for planned cargo railway service

Wednesday, December 5th, 2007

Yonhap
12/5/2007

South and North Korea signed a security guarantee Wednesday for daily cross-border freight train service scheduled to start next week, the first substantial measure to follow up on agreements by the two countries’ leaders at their October summit, the Defense Ministry said.

The move came at a one-day meeting at the truce village of Panmunjom, which coincided with a separate meeting of deputy prime ministers of the divided nations here on boosting economic cooperation in line with the deal between South Korean President Roh Moo-hyun and his North Korean counterpart Kim Jong-il.

The cargo train will carry raw materials and manufactured goods between South Korea and the North Korean border city of Kaesong, where South Korea operates an industrial park for a number of its small labor-intensive plants.

The agreement calls for guaranteeing safe passage of the cargo rail service linking Munsan Station in the South to Bongdong Station, which serves as a gateway to the Kaesong industrial park, as agreed at the second inter-Korean defense ministerial talks.

“It will take effect at midnight on Dec. 11,” the ministry said at a briefing on the results of the talks. “The train will be allowed to run at a speed of 20-60km per hour. Train drivers and other crew will be banned from taking photos in the other side’s area.”

But the talks did not address the date for the next round of general-grade talks between the two sides or how to improve the operation of the Kaesong industrial complex, including ways to facilitate transportation, customs clearance and telecommunication services, according to the ministry.

The defense chiefs of the two Koreas agreed to support inter-Korean economic cooperation projects in their rare meeting last week in Pyongyang.

The two Koreas plan to run a cargo train every day on the reconnected rail line between Munsan and Bongdong starting on Tuesday. The 19.8-km route between the two border towns was severed during the 1950-53 Korean War.

The cargo service is expected to facilitate the movement of goods to and from the Kaesong industrial complex, a joint venture between the technology-savvy South and the labor-abundant North.

Posted in Economic reform, Kaesong Industrial Complex (KIC), Military, Railways, Special Economic Zones (Established before 2013), Transportation | Comments Closed

North Korea-Russia Relations: A Strained Friendship

Tuesday, December 4th, 2007

International Crisis Group
Asia Briefing N°71
4 December 2007

North Korea’s relations with Russia have been marked by unrealistic expectations and frequent disappointments but common interests have prevented a rupture. The neighbours’ history as dissatisfied allies goes back to the founding of the Democratic People’s Republic of Korea (DPRK) with Soviet support and the Red Army’s installation of Kim Il-sung as leader. However, the Soviets were soon written out of the North’s official ideology. The Sino-Soviet split established a pattern of Kim playing Russian and Chinese leaders off against each other to extract concessions, including the nuclear equipment and technology at the heart of the current crisis. Since Vladimir Putin visited Pyongyang in 2000, diplomatic initiatives have come undone and grandiose economic projects have faltered. Russia is arguably the least effective participant in the six-party nuclear talks.

The relationship between Putin’s Russia and Kim Jong-il’s North Korea has disappointed both sides. Putin has mostly been unable to assert himself as a prominent player in North East Asia, and North Korea has received neither the unalloyed political support nor the economic backing it seeks. Russia has more influence in the region than it did in the 1990s but not enough to change the equation on the Korean peninsula. Opportunities for economic cooperation have been limited, mostly by Pyongyang’s refusal to open its economy but also by Russia’s fixation on overly ambitious schemes that at best may take decades to realise. China’s more nimble investors have moved in much faster than Russia’s state-owned behemoths.

Moscow has been conservative in its political dealings with Pyongyang, playing a minor but thus far positive role at the six-party talks consistent with its concerns about proliferation and the risks of DPRK collapse. It regards the denuclearisation of the peninsula as in its interests, has relatively few commercial opportunities in the North and considers its relations with the other nations in the exercise more important in every way than its ties to Pyongyang.

While Russia has shown interest in building energy and transport links through the North, little progress has been made. Rebuilding railways on the peninsula will cost enormous sums, and overcoming the many obstacles will require years of negotiation. Investments have been hindered by the North’s unreliability and history of default on loans. Russia may eventually have to forgive billions of dollars of debt the North cannot repay. Energy is a major mutual interest but pipelines across the North are unlikely to be built soon; Japan and China are expected to be the main markets for Russian energy, while South Korea is reluctant to become dependent on the North for its supply.

Pyongyang wants Russia to balance China’s growing influence but appears to recognise that Moscow will never provide the level of support it once did. The North has been keen to discuss economic cooperation but has lacked the political will to reform its economy sufficiently for foreign investment, even from a country as inured to corruption and government interference as Russia. It is equally interested in technical and scientific aid. Russian technology, equipment, and “know-how” have featured prominently in the history of both Koreas, and Pyongyang still seeks to resolve its economic problems by scientific and technical solutions. But there is unlikely to be much growth in bilateral cooperation unless the nuclear crisis is resolved peacefully, and the North opens its economy.

This briefing completes Crisis Group’s series on the relationships between North Korea and those of its neighbours – China, South Korea, Japan and Russia – involved in the six-party nuclear talks. It examines Russia’s aims and ambitions in the region, as well as the responses from North Korea and is based on both interviews in Russia, Central Asia and South Korea and analysis of Russian and North Korean statements.

Posted in Economic reform, Energy, Finance, Foreign direct investment, International Aid, International trade, Political economy, Railways, Russia, Transportation | Comments Closed

North Korea’s Hyesan Jangmadang Prohibits Sale of Medical Products

Tuesday, December 4th, 2007

Daily NK
Moon Sung Hwee
12/4/2007

An internal source conveyed on the 30th that due to an extreme decree which prohibits all sales of medical goods, the suffering of citizens has been increasing.

The source maintained that “In August, the sale of medical products was banned, and by the start of anti-socialism inspections in September, no medical products could be found in the jangmadang.”

The North Korean authorities have long since stated its position in prohibiting the sale of medical goods, saying that the sale of medical goods in the jangmadang is a show of democracy that undermines the national medical system. However, regulations usually never went beyond formalities.

Recently, however, anti-socialism inspections have been conducted on a large-scale in Yankang with the theme of “Abolishing capitalist trends in the market.” Medical products, which are mostly from China and South Korea, have been regulated more aggressively. Some have said that the authorities have strengthened regulations due to frequent incidences involving Chinese sub-standard medical products.”

With the harbinger of regulation of medical products, pharmaceutical vendors have sold medical products to their acquaintances on a limited basis. The price has increased significantly as well. Chinese-made aspirin, “Zhengtongbian”, which costs 20 North Korean won per pill, has hiked up to 30 won. A bottle of anti-diarrhea medicine has increased from 150 won to 300 won and penicillin from 120 to 200 won.

Especially the smuggling of Electrolyte Solution, used in IV’s to hydrate hospital patients, has stopped due to regulations, causing a jump in price.

From mid-August to the end of October, the anti-socialism inspections in Hyesan, Yankang were cooperatively conducted by the central Party, the Prosecutor’s Office, the National Security Agency and the People’s Safety Agency. Along with the strict regulation of cell phones, the market, and capitalist “corruption,” the medical goods ban has cast a heavy burden on the civilians.

“Good Friends” reported in October that “Thirty people have been incarcerated as a result of the anti-socialism inspections in Yankang since mid-August, and regulations have tightened.”

When the sale of medical products completely ceased in the markets, citizens and doctors who must treat their patients have been extremely disgruntled.

The source said, “People have to go to the homes of pharmacists in order to buy medicine, but they cannot if the pharmacists do not know them personally. The price has increased dramatically due to the regulations of medicinal products.”

“Even hospitals do not carry medicine and there is no way to procure them, even at doctors’ request.” Doctors have complained, saying “Are we supposed to just sit by and watch the sick people?”

A majority of medical products that could be found in the markets were Chinese-made contraband goods. In some cases, Party leaders or army hospital leaders have illegally procured medicine as well.

The source commented that when civilian discontent rose, the Party Municipal Committee explained the cause of the cease in sale of medical goods as, “In a socialist society, hospitals have guaranteed medical goods, but during this temporary time of suffering, some immoral people have hoarded the national medical supply and are making a profit.”

Posted in Black markets, Civil society, Disease prevention, Economic reform, Epidemics, Foreign direct investment, General markets (FMR: Farmers Market), Good Friends, Health care, Indigenous medicine, Pharmaceuticals, Price liberalization | Comments Closed

College Students Turn to Middlemen in Pyongyang

Monday, December 3rd, 2007

Daily NK
Yoon Il Geun
12/3/2007

An inside source told the Daily NK recently that about 20 to 30% of business agents in Pyongyang are university students.

Since the late 90s, college students started working as agents between artifacts buyers and sellers.

Pyongyang middlemen usually connect local merchants in border area and retailers in Pyongyang. Besides trading foreign goods, they also took part in artifact business around Kaesung, which was the capital of Koryo dynasty from 10th century to late 14th, and thus full of ancient artifacts.

College students lack funds, so their only way to earn money is to be agent.

The insider said “Pyongyang’s college students are the smartest and known for their business skills. Among them, students from Kim Chaek University of Technology are best. It is reasonable to assume at least two out of ten students have become working as trading agents since the March of Tribulation in 1990s.”

“Students are perceived as trustworthy because they are from middle class families. And those who are from local provinces and studying in Pyongyang have advantages.”

Most of these business-practicing students are former army veterans, especially those who are interested in earning money rather than studying. A few poor students who have not enlisted do business.

According to the source, these students rarely attend classes and bribe school college administrators in order to graduate. During “farming supporting period” every spring and autumn (every college student is mandatory to work at farms twice a year), business-students are exempt while buying food for those who participate.

A defector from Pyongyang said “There is little to learn at universities and society is changed to capitalist, so there is no shame for doing business among college students. The other reason might be influx of army veterans into colleges.”

Posted in Antiques, Education, Foreign direct investment, Illicit activities, Price liberalization | Comments Closed

Widespread embezzlement among party officials

Monday, December 3rd, 2007

Daily NK
Jung Kwon Ho
12/3/2007

The North Korean authorities are intensifying efforts to crack down corruption and embezzlement prevalent among party cadres.

Lim Sang Il (pseudonym, 43), a native of Pyongyang, said, “The state excommunicated and dismissed both the chief secretary of the Party in the Daedonggang district and the head of the foreign currency-making activity organization. They were found to have embezzled money earned from cocoon business for the past ten years.” Mr. Lim, currently staying in Dangdong, China visiting relatives, said, “Words are circulating around that they extorted over 10 million dollars.”

Mr. Lim said, “The factory manager of the Sangwon Cement Complex located near Pyongyang took his life when he heard the news that he was suspected of corruption and the state inspection group against anti-socialist trends was about to come down to see him for inspection.”

“This manager was notorious for corruption. For years, he had extorted money from the factory and used it for his own use,” Mr. Lim said. “It was widely gossiped that this man killed himself because he knew that his would receive capital punishment considering the severity of his corruption.”

A source from Sinuiju in North Pyongan said in a phone conversation with DailyNK on the 28th of November, “The chief secretary of the local Party in Woonjeon, North Pyongan Province, was expulsed from the party and fired from his job after he was found to have extorted money allocated for public construction works.”

“There are constructions going on in Woonjeon, tearing down old houses and building new ones,” the source said, “However, no one has ever asked people’s permission for constructions in the first place and provided temporary housing for people until the completion of construction works, and that, of course, angered many people.”

“All of a sudden, those without money ended up being homeless whereas those with money became able to purchase two to three houses at affordable price,” said the source.

“Expressing their anger aggregated over time, the local people led by the old directly sent a written protest to the central Party and filed a complaint,” the source said. “After all, the inspection group had to come down to Woonjeun and dismissed the chief secretary of the local Party and head prosecutor.”

“The inspection group discovered that these men were hiding a significant amount of money in their houses,” the source said. “It was so much that the inspectors couldn’t count the money and had to weigh stacks of bills in the scales.”

“Conspiring with the construction manager, the chief secretary accumulated money by overpricing construction materials and selling newly constructed houses,” said the source. “The head prosecutor accepted huge bribe on condition that he should turn down pouring complaints and contesting reports from the locals.”

In regard to the recent incident where some machinery from the Suncheon Vinylon Complex was smuggled to China, the state has dismissed many high-ranking officials implicated in the smuggling such as the chief secretary of South Pyongan Province, the chief secretary of the local Party in Suncheon, the city’s public prosecutor, and director of safety agency and foreign-currency making organization of the city.

Posted in Banking, Black markets, Finance, Price liberalization | Comments Closed

Koreas agree on daily schedule for inter-Korean freight train

Sunday, December 2nd, 2007

Yonhap
12/2/2007

The two Koreas have agreed on the daily schedule for a cross-border freight train that will resume service later this month for the first time in over 50 years, the South Korean Unification Ministry said on Sunday.

The prime ministers of South and North Korea met in Seoul last month and agreed to restart the railway service, which will traverse the heavily armed border, on Dec. 11. The train will run between the South’s Munsan station and the North’s Bongdong station as a follow-up to the October summit between their leaders in Pyongyang.

The ministry said a freight train will depart from Munsan at 9:00 a.m. each weekday and reach the North Korean border station of Panmun before returning to the South at 2:00 p.m.

The train, which will not operate during weekends, will extend its route to Bongdong once the construction of a cargo-handling facility there is completed, the ministry said. The Bongdong station serves as a gateway to an inter-Korean industrial park in Kaesong.

The soon-to-be-resumed service is expected to facilitate transportation of raw materials and manufactured goods between South Korea and the North’s Kaesong park, the ministry said.

The 19.8-km route between the two Koreas was severed in the midst of the 1950-53 Korean War and has since remained closed.

Posted in Inter-Korean summit, Kaesong Industrial Complex (KIC), Manufacturing, Political economy, Railways, Special Economic Zones (Established before 2013), Transportation | Comments Closed

First-ever South Korean wedding held in North Korea

Sunday, December 2nd, 2007

Yonhap
Nam Kwang-sik
12/2/2007

The first South Koreans to tie the knot in North Korea wed in a ceremony at Mount Geumgang, a scenic North Korean mountain frequented by South Korean tourists, tour company Hyundai Asan said on Sunday.

Choe Jeong-in, a 32-year-old employee of Hyundai Asan, and Cho Ah-ra, 24, who works for one of Hyundai Asan’s business partners, married in a ceremony at a Mount Geumgang hotel on Saturday, three years after they first met while working at the North Korean resort.

Posted in Civil society, Dating/Courting, Mt. Kumgang Tourist Special Zone, Tourism | Comments Closed

Two Koreas Join Forces to Develop Linux

Friday, November 30th, 2007

Electonic Times News (South Korea)
Hat tip DPRK Studies
Gil-soo Jang
11/30/2007

South and North Korea team up to develop a version of ‘Hana Linux (tentatively named)’ and set standards.

Reunification IT Forum (South), Chosun People’s Science Technology Association (North) and Chinese Information Society co-hosted ICMIP 2007 in Yenji, China on November 27 to 28.

At the conference, IT experts from two Koreas agreed on the need for cooperation in the Linux sector and developing ‘Hana Linux.’ Besides, the two parties will pursue other projects such as Open Office, an internationally certified (CC) office suite, and developing Korean language for excellent open software.

Such a proposal was initially made by president of Hee-tak Moon of Korea Open Source Software Association (KOSSA) to the North counterpart. A detailed plan will follow at the Speical Duties Committee (SDC) which will be formed soon by two Koreas and China.

President Ho-ik Seok of Reunification IT Forum, Secretary General Kyung Chon of Chosun People’s Science Technology Association, and President Ryong-woon Hyung of Chinese Information Society agreed to five points at issue and to create expert working groups and the SDC soon.

The three parties also consented to nurture software professionals and, as part of that effort, to base Yenben and Dandung of China, and Pyongyang, Kaesong and Hoichun of Korea as training centers. Moreover, they will consider sharing information by establishing an IT exhibition hall, library and history archive.

To further the agreement and issues, IT experts decided to hold an international conference in Pyongyang in the first half of next year to bring IT professionals together.

They were in agreement that there are differences in IT terminology between South, North Koreans and Korean Chinese and agreed to make efforts to standardize the terms.

Posted in China, Communications, Computing/IT, Economic reform, Foreign direct investment, Joint Ventures | Comments Closed

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