North Korean Economy Watch

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.