Sheena Chestnut Greitens writes in the New York Times:
What kind of deal do you make with a 20-something who just inherited not only a country, but also the mantle of one of the world’s most sophisticated crime families? When Kim Jong-un, who is thought to be 28 or 29, became North Korea’s leader in December after the death of his father, Kim Jong-il, he became the de facto head of a mafia state.
According to the Daily NK:
The North Korean authorities have ordered the formation of ‘Day of the Sun Gift Preparation Committees’ at the provincial Party level and subordinate ‘Day of the Sun Gift Subcommittees’ at the city and county scale, Daily NK has learned.
A Yangkang [Ryanggang] Province source who spoke with Daily NK on the 6th explained, “The ‘Day of the Sun Gift Preparation Committee’ was formed at the start of this month by the provincial Party Committee to prepare for the Suryeong’s birthday, and groups of areas were banded together to form the ‘Day of the Sun Gift Subcommittees’.”
“There was no distribution for February 16th,” the source recalled. “Possibly because the central Party received reports of popular discontent about this and asked some searching questions of provincial cadres, now they are running around trying to get ready for April 15th holiday distribution.”
“Enterprise traders are mostly bringing in soy bean oil, soap and towels via Chinese customs. They are printing ‘Day of the Sun 100th Anniversary’ on the towels,” he added.
The formation of the committees has also reportedly had a noticeable influence on levels of public expectation of the April 15th festivities, representing as it does the first time that ‘Gift Preparation Committees’ have been formed since they disappeared without a trace in the mid 1990s.
“They are already saying that each household is going to receive a huge gift for this Day of the Sun, so people are really expecting a lot,” the source said, adding, “The rumor among jangmadang traders is that every house is going to get a DVD player made by Hana Electronics in Pyongyang.”
As the source noted, the move comes following significant public discontent at the lack of gifts on February 16th (Kim Jong Il’s birthday).
On February 21st, Daily NK reported new of that discontent, citing a Yangkang Province source as saying, “There was a flood of criticism about the total lack of holiday distribution for Gwangmyungsung Day, so they began telling every organ, enterprise and people’s unit meeting, ‘That is because we are close to the 100th anniversary of the Suryeong’s birth, and the Party is preparing big gifts for that.’”
North Korea began giving snacks, rice and other foodstuffs to the people every year on the birthdays of Kim Il Sung and Kim Jong Il, along with things like school uniforms and blankets every 5th and 10th year, in the 1970s. However, the system ceased to function in the 1990s as the country was gripped by famine and economic disintegration.
Meanwhile, sources also report that with the arrival of the early spring lean season, a time when many people on the Korean Peninsula have traditionally struggled to find sufficient sustenance, prices in the market are beginning to creep up.
According to the Yangkang Province source, “Until late last week the Yuan price was 607 won, but now it is up to 635 won. The price of rice has also gone from 3,300 won to 3,800 won.”
Read the full story here:
North Forms Party 4.15 ‘Gift Preparation Committees’
Daily NK
Lee Seok Young
2012-3-5
UPDATE 1 (2012-2-21): According to the Korea Times, this store is now providing people with a legal window to exchange local for hard currency:
North Korea is apparently allowing foreign currency to be exchanged at unofficial, black market rates at a newly-renovated department store in Pyongyang, according to a diplomatic source who recently visited the country, Tuesday.
The source said people could exchange euros, dollars and yuan at kiosks at Kwangbok Area Supermarket, which recently opened after refurbishment and is said to resemble department stores in the South. The North has long kept the value of its local currency artificially high.
Euros were being exchanged at the rate of one euro for 4,420 North Korean won, while the official rate is around 130 won per euro, the source said.
“They are exchanging hard currency at a rate that seems to be an unofficial rate,” the source told The Korea Times. “People can also shop at the department store using foreign currency by taking their receipts to the booths.”
…
The source added that the exchange rates were written on a board inside the kiosks.
ORIGINAL POST (2012-1-6): See the original post below.
Pictured Above: (L) The original facade of the “Kwangbok Department Store (광복백화점)”. (R) The new facade of the “Kwangbok Area Supermarket (광복지구상업중심)”
Here is KCNA coverage of the opening of the facility (Posted to YouTube):
Astute observers will notice the American beer, Pabst Blue Ribbon, featured prominently in the beer section.
Here is coverage of the opening in KCNA (2012-1-5):
Pyongyang, January 5 (KCNA) — The Kwangbok Area Supermarket was opened with due ceremony on Thursday.
All business service at the supermarket built as a commercial service center has been put on IT and digital basis. Customers can buy varieties of goods according to their taste and requirements in the sales rooms on each floor stacked with household appliances, electronic products, foodstuff, fibre, sundries and others.
Present there were officials concerned, officials of the Korea Taesong General Trading Corporation, officials and employees of the Kwangbok Area Supermarket, members of the Feihaimengxin Trading (Beijing) Co. Ltd. staying in the DPRK and the Chinese embassy here.
O Ryong Il, general president of the Corporation, said in his speech that the work to build the supermarket was successfully completed under the energetic leadership of leader Kim Jong Iland the dear respected Kim Jong Un and the positive efforts of the peoples of the two countries.
He expressed belief that the supermarket would help towards improving the people’s living standard and promoting the well-being of the two peoples through better service and management.
Xue Rifei, executive managing director of the Feihaimengxin Trading (Beijing) Co. Ltd., said in his speech that Kim Jong Il and Kim Jong Un gave field guidance to the supermarket on December 15, 2011 and named it the Kwangbok Area Supermarket.
He expressed the expectation that an effort will be made to reenergize the supermarket to win high appreciation for its best management, service and credit.
The Korea Taesong General Trading Corporation is a sanctioned organization, and according to the US Treasury, it is a “key node” in the illicit activity of Office 39. According to NK Leadership Watch:
One of the participants at the opening ceremony was Jon Il Chun (Chon Il-chun), deputy director of the Korean Workers’ Party’s Finance and Accounting Department and section chief of Office #39. Mr. Jon accompanied Kim Jong Il on a visit to the Kwangpok store in mid-December 2011, which was KJI’s last reported public appearance before his death.
On a more casual note, the supermarket marks a point of administrative departure from the way department stores are typically managed in socialist countries. The Kwangbok Department Store (the former name) was one of Pyongyang’s premier formal retail outlets. For decades it operated in the same way as other socialist department stores: customers ended up standing in three lines before they were able to collect their merchandise (one line to order, another line to pay, and another line to pick up). The new Kwangbok Supermarket has adopted a market-style check out line. Though unnoticed by foreigners, this is the first such check out line I have seen in a North Korean department store.
This point was also highlighted in AP coverage:
A separate story in KCNA notes that the shop will sell both foreign and domestic goods:
The supermarket is supplied with home and foreign-made products which are in demand in the country.
Although I have not acquired data specific to this store, I believe it is reasonable (even rational) to assume that if the supermarket sells imported goods it will charge had currency for them. This opinion is based on the following assumptions: 1. The Chinese investors will not accept North Korean won under any circumstances. 2. The goal of Office 39 is to acquire hard currency for the Kim family. 3. North Korean retail outlets frequently post prices in multiple currencies so I don’t see any reason why it would be different here. Today a plurality of North Koreans can easily acquire foreign exchange.
Here is my working assumption of the business model: Chinese partner acquires merchandise and imports it to the DPRK. Sales in hard currency go towards allowing the Chinese supplier to recover its costs. Chinese partner either earns a profit from a markup it charges Kwangbok or it divides the profit with Office 39 along some agreed percentage.
If Chinese profits are earned from a cost-plus markup that it charges Kwangbop, then the partnership is closer to an exclusive supplier deal rather than a true joint equity deal. The North Koreans could cheat on this deal by finding cheaper suppliers and decreasing its purchases from the Chinese partner. If after-sales profits are split between the Chinese and Office 39, then both partners will need auditors on hand to make sure the books are accurate. The Chinese partner will also need a good relationship with the Chinese embassy if it runs into problems with the DPRK managers should they unilaterally change the terms of the contract (the split).
Huichon Power Station on Google Earth
The Huichon Power Stations 1 & 2 (희천1호발전소, 희천2호발전소) are too new to appear on Google Earth satellite imagery. I have, however, mapped them out by hand on the old imagery to give a better idea of their locations. I have also tagged them on Wikimapia.
In the picture above you can see that the Huichon Power Station’s headwaters begin in Ryongrim County (룡림군) where the newly-built Ryongrim Dam holds back a large reservoir. This reservoir drains through a tunnel [in orange in the image above] approximately 30 km long (18.5 miles) and empties through the Huichon Power Station No. 1 in Tongsin County into the Chongchon River. The river flows south where it crosses into Huichon County and builds up behind a second reservoir. From this second reservoir the water drains out directly through the Huichon Power Station No. 2.
The construction of the Ryongrim Dam has resulted in the destruction of at least two villages, Toyang-ri (도양리) and Sinchang-ri (신창리). Toyang-ri was destroyed for the dam itself. Sinchang-ri was flooded by the reservoir. A third village, Kuryong-ri (구룡리), was also likely flooded or relocated—although this cannot be confirmed with current satellite imagery. The destroyed villages were probably relocated to Ryongrim Town itself. On several recent occasions North Korean television has highlighted improvements in housing and leisure facilities within the town.
When Kim Jong-il gave guidance visits to this site he often stood on the eastern side of the dam which offers the view captured in the image above (R).
The Huichon Power Station No. 1 itself is located in Tongsin County aproximately 30km due south from the Ryongrim Dam (40.273568°, 126.526565°).
In the satellite image above I have drawn the physical location of the power plant. Next to and below it I have posted images from KCTV dated 2011-3-10.
The Huichon Power Station No. 2 lies on the Chongchon River just south of the border with Tongsin.
This project might have resulted in the destruction of one village, Kyonghung-ri (경흥리), in Tongsin County, but this is impossible to confirm without better satellite imagery.
So where will the electricity produced at these new power stations be consumed? On January 21, 2012, Rodong Sinmun reported the answer:
Like the warm hands of leader Kim Jong Il, the transmission lines from the Huichon Power Station are now almost stretching out for the capital city of Pyongyang.
To meet the great expectations of Kim Jong Il who entrusted them to such a gigantic work, the builders of the power station have gained great successes.
They have erected big dams, cut waterway tunnels and carried out other bulky tasks that were said to take ten years and more; and in the wake of trial operation of generating equipment at the Huichon Power Station No. 1, they successfully assembled the hulks of generators at the Huichon Power Station No. 2.
These successes had an immediate chain reaction on the scaffold workers laying transmission cables from the power station to the capital city.
They have already laid transmission cables in scores of kilometer long section, while preceding the construction of pylons in two months.
By their heroic labor, the excavation work to lay the foundation for the pylons have been wound up, too.
Now, their job is concrete tamping of the pylons’ foundations. By introducing new work methods they are hastening their work of erecting pylons as firm as would stand for many hundred years.
Now that power lines have been lain in major sections, they have buckled down to laying the power lines in the remaining sections and erecting transformer substations to reach the capital city as early as possible.
It won’t be long before we can see the power lines reach Pyongyang amid the cheers of the citizens.
Since I have mapped out a significant portion of the North Korean electricity grid on Google Earth, I can point out an area where I believe these power cables are being constructed. In the image below, dated 2010-9-14, I have connected the power cable tower construction sites with a yellow line:
In the image above there are approximately 146 power cable towers under construction between Pakchon (North Pyongan-top of image) and Sunan (Pyongyang-bottom of image). Of course, to be certain that these are the specific lines connecting Huichon and Pyongyang, I will need more imagery.
More on the Huichon Power Stations here.
Ryesonggang Power Station 2 update
I previously wrote about the Ryesonggang Power Station No. 2 here. Since a newer satellite image has come to my attention that shows the project completed, however, I thought I would post an update.
Ryesonggang Power Station No. 3
On June 25, 2011 North Korean television showed construction of the Ryesonggang Power Station No. 3 had begun. The DPRK submitted this project to the UNFCC’s Carbon trading program. Using satellite imagery, we can see that construction is indeed well under way:
The satellite images above are dated 2007-10-4 (L) and 2011-3-23 (R). In the right-hand photo I have boxed in the construction site and the quarters and facilities of the construction workers.
UPDATE: This was picked up by Radio Free Asia.
According to the Daily NK:
There has been an upswing in prices and exchange rates in North Korea as East Asia moves towards the lunar New Year’s holiday, which falls on the 23rd.
A source from Hyesan in Yangkang Province told Daily NK this afternoon, “The number of people in the jangmadang is rising and trade is getting more active, and so the Yuan exchange rate and rice price are both on the up.” According to the source, the Yuan is trading for 680 North Korean Won, while rice is hovering at approximately 4,300.
A source from Musan in North Hamkyung Province previously reported similar circumstances to Daily NK on the 16th, with the Yuan at 780 Won and rice and corn at 4,500 Won and 800 Won respectively in the jangmadang there.
The current situation follows on from a price spike before Kim Jong Il’s death on December 17th [see here and here], the following mourning period (to the 29th) and criticism sessions (to January 8th). However, while at its height last month the price of the most expensive rice had hit 5,000 Won, by January 11th-14th it had declined to 3,000-3,500 Won in eastern regions. Now, however, with the holiday period ahead, prices are rising again.
“Although the self-criticism period ended, we still had to keep an eye on the security forces so the number of sellers in the jangmadang was what it used to be, but from a few days ago people started using the jangmadang as normal and the rice and Yuan prices started rising a bit,” the Hyesan source explained.
Interestingly, while the authorities have tried a number of measures to regulate the Sino-North Korean border and limit the use of foreign currency of late, sources report that the measures have only had a minor effect on prices and have not daunted the will of local people to trade at all.
Overseas currency is even being traded publicly somewhat more frequently now, sources report, showing the skepticism with which the people view official threats to stop the use of Yuan and U.S. Dollars in the market.
As the Musan source commented wryly, “People are saying that ‘If his dad couldn’t stop it, what is the young one going to do about it?’ and ‘As long as the Tumen River keeps flowing, they can’t stop the Yuan, the smuggling, or the defection.’”
Read the full story here:
New Year Seeing Active Trade
Daily NK
Lee Seok Young
2012-1-18
UPDATE 1 (2012-1-19): Writing in the Asia Times, Michael Rank offers an update on the Ponghwa group (Ponghwajo, 봉화조):
It is widely assumed that if anyone knows what the North Koreans are up to, it’s the Chinese, and Chinese-language Internet sites have provided news stories about drug smuggling and border-crossing refugees. But there seems to have been a clampdown in the last year or two and these sources have dried up.
However, the Beijing magazine Kan Tianxia published a noteworthy article after Jong-il’s death highlighting the so-called Ponghwa group consisting of the sons (and presumably the occasional daughter) of the Pyongyang elite.
This privileged clique, which was first formed around 2000, consists of people mainly in their 30s and, the magazine claims, included Jong-eun himself after he returned home from his studies in Switzerland.
It says the group’s purpose is to strengthen Jong-eun’s power base and to act as his backstage support.
The article quotes an informed source as saying the Ponghwa group are mainly graduates of Kim Il-sung University, Pyongyang Foreign Languages University and other elite institutions, and that they tend to work in the security and intelligence apparatus and in top government organs such as the supreme procuratorate (prosecutor’s office).
The word Ponghwa means “smoke of battle” and also has connotations of “advance guard”. It is the name of the area of Pyongyang on the Taedong River that was the home of Kim Il-sung’s mother Kang Pan-sok; it is also the name of Pyongyang’s most elite hospital and there is a Ponghwa underground station.
The group is said to be headed by the sons of two generals. One of these is O Se-hyon, the second son of General O Kuk-ryol, who, according to the North Korea Leadership Watch (NKLW) blog, participated in a crucial meeting hours after Jong-il’s death which “began the order of operations which publicized KJI’s [Kim Jong-il’s] demise and taking on KJI’s remaining administrative and command mechanisms”.
The other leader is Kim Chol, son of General Kim Won-hong, who, according to rumors, was involved in various scandals but was nevertheless promoted to full general in 2009. General Kim, like the fathers of several Ponghwa members named in the article, belongs to the super-elite as is clear from his listing as a member of Jong-il’s funeral committee.
Ponghwa members also include the son of former veteran ambassador to Switzerland Ri Chol (Ri Tcheul) who is said to have been close to the young Jong-eun when he attended the International School in Bern, as well as the son of vice premier Kang Sok-ju. Kang was until 2010 the senior vice minister of foreign affairs and is, according to NKLW, a cousin of Jong-il; he also has has ties to Jong-eun’s mentors and uncle and aunt, Jang Song-taek and Kim Kyong-hui.
Members of elite groups such as the Ponghwa set are visible to the foreign community in Pyongyang where they frequent hard currency shops and restaurants, and have a clear parallel in China where the sons and daughters of top officials are assiduous in exploiting family connections.
Although Jong-eun is said to be as omniscient and omnipotent as his father and grandfather, almost nothing is known for sure about him. There is little doubt that he went to school in Switzerland, and the Chinese magazine claims this has been confirmed in North Korean “propaganda documents” – probably internal briefing materials distributed to senior officials.
Pyongyang watchers experienced a mild frisson when his mother was mentioned in a television documentary earlier this month, as this was the first time there had been official recognition that he has a mother. She has never been officially named, apparently because she was a Japanese-born Korean, and also because her relationship with Jong-il was not a happy one. She is said to have died in Paris in 2004.
Nobody is sure if Jong-eun was born in 1983 or 1984. According to a book written by his father’s former live-in chef [Kenji Fujimoto], his birthday is on January 8, but there were no signs of celebration in Pyongyang on that day. Perhaps it was considered unfitting to celebrate so soon after his father’s demise.
The only utterance attributed to Kim Jong-eun is a paean of praise to the joys of working all night. “Even when I work night after night, once I have brought joy to the comrade supreme commander, the weariness vanishes and a new strength courses through my whole body. This is what revolutionaries should live for.”
His father and grandfather were also fond of lauding the joys of working through the night, and there’s nothing North Korean leaders fear more than original thinking.
ORIGINAL POST (2011-4-18): Today the media was abuzz with rumors of the DPRK’s most exclusive club: Ponghwajo (aka: Bonghwajo, 봉화조). This club is composed of the children of ruling elites, and according to the rumors, they not only generate substantial sums of hard currency, but they also know how to spend it. Below are some stories about the group:
When Kim Jong-chol, the second son of North Korean leader Kim Jong-il, spent 10 leisurely days in Singapore in February going on a luxury shopping spree and attending an Eric Clapton concert, he was apparently joined by a brat pack of children of powerful officials in North Korea.
An official source here said Sunday intelligence information reveals Kim Jong-chol (30) and members of the so-called Ponghwajo or torch group not only visited Singapore, but also went to Macao and Malaysia to gamble and shop.
The Ponghwajo consists of the regime’s princelings, not to be confused with the children of early high-ranking officials who fought as revolutionaries along with former North Korean leader Kim Il-sung. These sons of the revolutionaries are now in their 50s and 60s and have recently been tapped to serve in key positions under North Korea’s heir apparent Kim Jong-un.
But the Ponghwajo are in their 30s and 40s and are not viewed favorably by the regime’s leadership. Though they are often engaged in activities that generate dollar revenues through drug sales, counterfeiting and black market trade, they apparently do not wield much political power.
The group was formed in the early 2000s by O Se-won, the son of Gen. O Kuk-ryol, a senior leader in North Korea’s powerful National Defense Commission, and Kim Chol, the son of Kim Won-hong, head of the People’s Army Security Command. Its members include Ri Il-hyok, the first son of Ri Chol, former North Korean ambassador to Switzerland and the official in charge of handling Kim Jong-il’s secret bank accounts, as well as Kang Tae-seung, the eldest son of First Vice Foreign Minister Kang Sok-ju and Jo Song-ho, the eldest son of the late Jo Myong-rok, first vice chairman of the National Defense Commission who died last year.
Certain members of Bonghwajo, a club of the children of North Korea’s power elite, accompanied Kim Jong Chul, 30, the second son of North Korean leader Kim Jong Il, when the junior Kim attended Eric Clapton’s concert in Singapore in February.
Like “Crown Prince Party, or The Princelings,” a group of the children of prominent and influential senior communist officials in China, Bonghwajo is comprised of children of ranking officials of the North Korean Workers’ Party, military and senior members of its Cabinet.
Due to their parents’ influence, the children reportedly landed jobs at powerful organizations and are earning money through illegal activities such as counterfeiting and narcotics trafficking.
A source on North Korea said, “Kim Jong Chul is forming a closer relationship with Bonghwajo members after his younger brother Jong Un was named Kim Jong Il’s heir apparent.”
“When Jong Chul went to Singapore to watch Eric Clapton’s concert, certain Bonghwajo members accompanied him and paid all of the costs for his stay and shopping in Singapore.”
The source said, “Jong Chul and Bonghwajo members visited not only Singapore but also Macau and Malaysia in February,” adding, “Visiting the three countries, they gambled with up to 300,000 U.S. dollars and purchased expensive products at department stores.”
Formed in the early 2000s, Bonghwajo is reportedly led by O Se Hyon, second son of National Defense Commission Vice Chairman O Kuk Ryul, and Kim Chul, first son of the General Political Department Director Kim Won Hong at the People`s Army. Kim Jong Un joined the club when he turned 20, while Kim Chang Hyok, son of Kim Chung Il, deputy director of Kim Jong-Il`s personal secretariat, also became a member.
Bonghwajo was named after the village of Bonghwa in Pyongyang`s Kangdong County, where Kim Jong Il’s grandmother Kang Ban Sok lived. Bonghwa is construed as meaning “frontier” in North Korea.
Bonghwa Medical Center, the North’s top hospital, is where Kim Jong Il underwent treatment when he suffered a stroke in 2008.
Bonghwajo is also known to deal in illegal activities such as counterfeiting and drug trafficking. The Washington Times reported in May last year that Bonghwajo was involved in illegal activities, including circulation of “super notes,” or ultra-high precision counterfeit 100-dollar bills, and drug trafficking.
U.S. intelligence say O Se Hyon was entangled in the incident of the Bongsu-ho, North Korea’s drug trafficking boat that was caught by Australia in April 2003, and is related with counterfeit bills discovered in Las Vegas in 2004.
Bonghwajo members are said to be habitually taking drugs as well as trafficking them. Kim Chul, who works at the general surveillance bureau under the (North) Korean People’s Army Ministry, is earning money through drug trafficking in China and elsewhere and paying kickbacks to Kim Jong Un and Kim Jong Chul.
The group is even called a narcotics club because drug use is so rampant among members, with leader O Se Hyon undergoing treatment at a detention facility due to heroine inhalation.
The existence of ‘Bonghwajo’, a grouping of the children of North Korea’s highest leadership including Kim Jong Eun, has made headlines in South Korea in recent days, raising questions about what role this group of powerful youngsters might be playing in the succession.
‘Bonghwajo’ members are said to be involved in foreign currency-earning businesses, many of them illegal, while also working in key areas of the National Security Agency, General Bureau of Reconnaissance, Ministry of the People’s Armed Forces, Central Prosecutors’ Office and other high organs. They reportedly curry favour by financially supporting both Kim Jong Eun and elder brother Kim Jong Cheol.
Therefore, one analysis has it that the Bonghwajo, which is analogous with China’s ‘Princelings’ is both a group for the strengthening of Kim Jong Eun’s power and a private bank through which to finance the successor’s activities.
Cho Young Ki, a professor with Korea University, told The Daily NK today, “Bonghwajo can be read as being Kim Jong Eun’s support group. The Three Revolutionary Teams took the initiative in the establishment of Kim Jong Il’s power, and I presume that Bonghwajo might be performing the same role.”
Professor Cho added, “Kim Jong Cheol, who lost his practical power after publicizing the succession structure, is likely to be providing this group with his support.”
Head of World North Korea Study Center An Chan Il agreed, suggesting, “It appears that Bonghwajo may be intervening in personnel management while offering funds for Kim Jong Eun obtained from foreign currency-earning businesses.”
An went on to describe a group led by Kim Jong Il’s half brother Kim Pyong Il and Oh Il Cheong (the son of former Minister of the People’s Armed Forces Oh Jin Wu) at the time of Kim Jong Il’s elevation.
An said, “Even though we didn’t know their name, there was a group that came before ‘Bonghwajo’, and the nature of ‘Bonghwajo’ could be the same as that of the group led by Kim Pyong Il.” He went on, “Kim Pyong Il worked as the group’s main leader, but then he was put in a ‘sub-branch’ and got sent overseas. But Oh Il Cheong switched line and is now a Lieutenant-General.”
The ‘Bonghwajo’ group may well consider that it is in the same boat as Kim Jong Eun. Therefore, its members are likely to work to expand their power in the Party, military and foreign currency earning organs so to ensure Kim Jong Eun’s succession and their own access to power and money for the years to come.
The core members of the Bonghwajo are said to be Oh Se Hyun, the second son of Vice Chairman of the National Defense Commission Oh Keuk Ryul, Kim Cheol, who is the eldest son of Kim Won Hong (the vice director in charge of political organization in the General Political Department of the People’s Army), Kang Tae Sung, the eldest son of Vice Premier of the Cabinet Kang Suk Ju, Kim Cheol Woong, the second son of Kim Choong Il (a former vice director in Kim Jong Il’s Secretary’s Office), and Cho Sung Ho, the eldest son of Cho Myeong Rok (former first vice chairman of the National Defense Commission).
However, professor Cho pointed out, “Even if Bonghwajo make an effort to establish Kim Jong Eun’s smooth power succession, it is doubtful whether they can reign properly. The extent of their activities and legitimacy may decide whether or not they are able to support Kim Jong Eun.”
Meanwhile, Yonhap News has claimed that drugs are so prevalent within the group that it is known as a drug club, and Oh Se Hyun has reportedly been treated for addiction.
According to the Daily NK:
The jangmadang, having been temporarily suspended while the country was in mourning for Kim Jong Il, returned to normal operations on or around January 6th, sources report.
A Shinuiji source told Daily NK yesterday, “The people’s lives were thrown into turmoil by the non-operation of markets during the mourning period. The people are coming out into the market saying ‘now we must keep trading even if they give us hell’.”
The final normalization of market operations follows a December 25th decision to allow some ad hoc grasshopper trading in areas outside the formal markets and on main thoroughfares. This was reportedly done to highlight the caring nature of new leader Kim Jong Eun.
However, the move did not make life much easier for ordinary people, since they were mobilized for daily mourning events, limiting their capacity to trade, while keeping a constant eye on when things might be about to change.
In addition, immediately after the mourning period the people were unable to go back to the markets because of criticism sessions related to the mourning period and Joint New Year’s Editorial study meetings.
The source said, “The authorities allowed the markets again, but even as of the beginning of last week things were not going smoothly as we didn’t know how to mark the prices or if the markets would be operating normally or whether we would get in trouble for selling used or foreign items.”
“The people who had been around after Kim Il Sung’s death were uncomfortable because of the mourning period self-criticism sessions and did not go to the market, instead buying things like rice and daily necessities through individual sellers they already knew. However the market is back to normal now, just as it was in the past.”
Recently, there have been rumors going around that on Kim Jong Il’s birthday (February 16th) there will be food distribution and this is driving down the price of rice, sources say. Currency exchange rates are also falling because the authorities are cracking down on people who trade in or exchange U.S. Dollars and Yuan.
On December 10th, 2011 the Yuan exchange rate was 800-1,000 North Korean Won, while rice was 4,500-5,000 North Korean Won/kg. Now the Yuan is trading for 600 Won and rice is hovering around 4,000 Won.
Read the full story here:
Jangmadang Back to Normal
Daily NK
Park Jun Hyeong and Lee Seok Young
2012-1-12
According to the Daily NK:
A Hamkyung Province source has informed Daily NK this afternoon of a directive completely forbidding the use of foreign currency in markets, saying he was informed that “As part of the last instructions of Kim Jong Il, those who circulate foreign currency including Yuan and Dollars will be punished more severely than those who deal in drugs.”
“They said it is part of General Kim Jong Il’s last instructions and didn’t say what the reason is, so it is being strictly enforced,” the source added.
In North Korea’s markets, foreign currency is ordinarily preferred to the North Korean Won, and most transactions are conducted accordingly in Chinese Yuan. Therefore, if the new measure is actually enforced it has the potential to cause chaos.
However, it may be just a part of an ongoing competition to display loyalty to Kim Jong Eun, and given that the use of foreign currency is so ubiquitous in North Korea that it would be extremely hard to strictly enforce such a measure, may not last long.
Dong Yong Seung, a researcher with Samsung Economic Research Institute in Seoul commented after hearing the news from Daily NK, “They could be trying to increase the value of the North Korean Won by stopping use of other currencies.”
Read the full story here:
Authorities Move to Block Currency Usage
Daily NK
Choi Cheong Ho and Cho Jong Ik
2012-1-2
Pictured above (KCNA): Heads and tails images of the DPRK’s gold and silver commemorative coins.
According to KCNA (2011-12-31):
Pyongyang, December 31 (KCNA) — Commemorative coins will be issued in the DPRK on the occasion of the 20th anniversary of leader Kim Jong Il’s assumption of the supreme commandership of the Korean People’s Army.
A decree of the Presidium of the DPRK Supreme People’s Assembly was promulgated on Dec. 23 in this regard.
Gold and silver coins “20th anniversary of great Comrade Kim Jong Il’s assumption of supreme commandership of the Korean People’s Army” will be issued.
Engraved in the center of the front side of the gold and silver coins is the portrait of smiling Kim Jong Il in marshal’s uniform and seen in their upper parts are letters “The 20th anniversary of great Comrade Kim Jong Il’s assumption of the supreme commandership of the KPA” and in their lower parts figures “1991-2011” and 20 five-pointed stars.
Engraved in bold relief in the center of their back sides is the star of marshal and seen in their upper parts are letters “DPRK Central Bank” and in their lower parts the degree of their purity and weight and the year of their issue.
The gold coin is 35 millimeters in diameter and 2 millimeters in thickness. It’s made of pure gold.
The silver coin is 40 millimeters in diameter and 3 millimeters in thickness. It’s made of pure silver.
Additional Information:
1. The last time the DPRK issued commemorative coins was to mark the 65th anniversary of the founding of the Worker’s Party. Read more about them here.
2. Marcus Noland also noted the minting of the coins.
3. Kim Jong-il’s death was officially reported in December 2011.
According to Yonhap:
The North Korean currency has recently gained 20 percent against the Chinese yuan, a rare development blamed on rumors of the North’s counterfeiting, a source familiar with the issue said Friday.
The North Korean won was traded at 1,000 won to 1 Chinese yuan a week ago, but 1 yuan is now worth only 800 won in the country’s major northeastern city of Chongjin.
The source said, on condition of anonymity, that the demand for foreign currencies has surged on rumors a week ago that a lot of North Korea’s currency being circulated in the market was counterfeit.
The rumor quickly spread across the country via merchants who have mobile phones. However, it later turned out to be groundless, which helped the North Korean currency regain strength against yuan.
North Koreans favor Chinese yuan and U.S. dollars over their own currency after a botched currency reform as they believe foreign currencies are more stable, according to the Unification Ministry, which handles inter-Korean affairs.
China is the North’s key ally, economic benefactor and diplomatic supporter.
In 2009, the North carried out a massive currency reform to try to rein in galloping inflation, squash free market activities and tighten state control over the economy. However, the measures failed to halt massive inflation and worsened food shortages and public backlash.
A North Korean defector in South Korea said there are several big shots in Pyongyang who manipulate exchange rates in the market by starting rumors such as the banning of foreign currencies.
In recent years, mobile phones have emerged as tools for spreading news in the isolated country where the communist regime tightly controls its 24 million people.
The number of mobile phone users in North Korea has jumped to more than 535,000 as of March, up 420 percent from the same time last year, according to Orascom Telecom, Egypt’s cell phone service provider in the North.
Read the full story here:
N. Korean currency sustains steep fluctuations
Yonhap
2011-12-16
