North Korean Economy Watch

From the New York Times (h/t MR):

In early April, when North Korea called President Lee Myung-bak of South Korea an “impostor,” a “traitor” and an “American running dog,” the verbal barbs sounded all too familiar to Jin Yong-seon. He has a museum filled with them.

Sounds like a great place to visit if in South Korea.

Read the full article here (requires free on-line registration):
Koreans Recall an Era of Propaganda Battles
New York Times
Choe Sang Hun
5/2/2008

UPDATE: Follow up by Dr. Petrov in the comments. 

One of the big question marks for policy makers (both inside the DPRK and internationally) is the state of knowledge and public opinion inside North Korea.  How much do North Koreans know about the outside world?  How much of the propaganda do they believe?

Being able to answer these questions scientifically is not possible.  Political expression has never been encouraged in the DPRK except through state-sponsored solidarity events.  Additionally, the role of the media in North Korea is to broadcast information from the top down, not to let it percolate from the bottom up.

Numerous scientific efforts at extrapolating North Korean public opinion have been made by journalists and scholars conducting surveys in northern China along the North Korean border (most recent examples here and here).  However, these surveys are subject to various sample biases: the interviewees have already decided to leave the DPRK, most of them come from the provinces along the Chinese border, and most of them are not mid- upper- level cadres.  So extrapolating the opinion of the median ri-level party secretary in a small village near the DMZ is not possible. 

In the absence of a scientific survey, we are forced to resort to anecdotes and ethnographic data (usually with a very small “n”).  A single anecdote is not so valuable, but multiple anecdotes taken together help us paint a more comprehensive picture. The opinions of most “North Korea watchers” on this topic are formed by this kind of ethnographic analysis. 

I rely on personal anecdotes collected from North Koreans, visitors to North Korea, and former residents of North Korea, supplemented by stories in the media such as the popularity of South Korean films in the DPRK.  These lead me to conclude that though North Koreans are generally not internationally savvy, they do not believe the official propaganda and do not pay attention to political speeches (if they can help it) for many of the same reasons that Americans do not pay attention to political speeches: namely that they have little to do with one’s day-to-day needs, and they get very old very fast.

This story in the Daily NK is one more anecdote:

A source from Yangkang Province told DailyNK in a phone interview on May 1st, “At the Union of Democratic Women (UDW) conference, commemorating the founding of the Chosun People’s Army on April 25th, a speaker humiliated herself when she blamed South Korean President Lee Myung Bak [for the crisis].”

The source told our reports that “during the conference, a speaker explained the international and domestic state of affairs, saying that ‘the U.S. and the puppet regime (the Lee administration) have overridden the peaceful agreements between the North and South (referring to the June 15th Joint Declaration and the October 4th Agreement) in order to create a serious food crisis in our Republic (North Korea)’.”

The source described an awkward atmosphere at the conference: When a chairperson of the People’s Unit of Hyehwa-dong in Hyesan asked outright, “We can understand that fact that Americans and Lee’s puppet factions are not aiding us with rice, but, why won’t China help us, as our closest ally?” The speaker’s face turned pale at the question and a sudden silence and tension filled the hall.

“At that moment, the lady next to the chairperson started chuckling, putting her head down, people began to chuckle here and there, and eventually, the entire hall was engulfed in laughter,” the source told DailyNK.

The speaker reportedly responded through his own laughter, “’You know the lecture material always reads like this. You can well understand the situation and know what I am saying, right?’” The source said that “his comment sent people rolling in the aisles,” and pointed out, “The situation showed how absurd the propaganda released by the authorities is.”

Read the full story here:
Government Lectures are Losing Effect
Daily NK
Lee Sung Jin
5/8/2008

Via Yonhap:

North Korea’s new envoy to the United Nations presented his credentials to U.N. Secretary-General Ban Ki-moon here Wednesday, along with envoys from several other nations, to officially begin his service, Ban’s office said.

Ambassador Sin Son-ho replaced Pak Gil-yon, who had been at his country’s U.N. mission since 2001. He served as deputy chief of the mission from 2000 to 2003.

Summary by James Person, North Korea International Documentation Project:

This Document (full journal article including documents here) consists of a memorandum of a conversation between DPRK Ambassador Li Sangjo to Moscow and Soviet Deputy Minister of Foreign Affairs N.T. Fedorenko, as well as a letter addressed to N.S. Khrushchev. Li sought a meeting with either Khrushchev or A.I. Mikoyan to press upon the Soviet leadership the gravity of the situation inside the DPRK and KWP CC following the historic 1956 August Plenum.
 
In the letter, Li described in detail the actions of the party leadership after being criticized both before and during the August Plenum by opponents to Kim Il Sung’s development strategies. Although the existing historiography, as well as North Korean propaganda characterizes the events of August 1956 as an attempted coup, Li suggested that the challenge was a democratic one aimed at eliminating the serious consequences of the personality cult and ensuring intra-party democracy and collective leadership, completely in accordance with the statutes of the KWP accepted at the Third Party Congress in April 1956. However, sycophantic and hostile elements in the party leadership “took revenge” on those who “courageously” criticized them. Li, who had long been a proponent of outside intervention, encouraged fraternal assistance. Despite the failure of earlier attempts to press upon Kim Il Sung the need to reform through comradely criticism by fraternal leaders, Li asked that a senior Soviet official be sent to Pyongyang to call a new plenum with all present, including the purged members of what became known as the “consumer goods group.” Li also indicated that he had sent a similar request to Mao Zedong.

Read the documents from the Soviet archives, including historical context here.

Last August I posted an excerpt from Andrei Lankov’s book, North of the DMZ, on the preservation of Kim il Sung’s body in Kamsusan Memorial Palace.  This year, the Daily NK (here and here) provides some new information on Kim il Sung’s imposing presence on the North Korean landscape.

First some statistics:

1.  There are approximately 70 Kim il Sung statues in North Korea (large statues a la Mansu Hill in Pyongyang).

2.  There are approximately 30,000 plaster busts.

3.  There are approximately 140,000 monuments and memorials

4.  There is allegedly one Kim Jong il statue in Pyongyang (although the Daily NK is the only source I have ever heard make this claim). 

5.  The first Kim il Sung statue was at the Mangyongdae Revolutionary School on 10/24/1948.  The second was in front of the Changjeon School in 1949. The most recent is at Kim il Sung University in 1996. 

Apparently all of the statues are made of bronze, but are coated in a gold paint every two years to prevent them from corroding.  The gold paint is allegedly imported from Germany (Can any German readers/speakers find out which German company supplies the paint?  How much? And at what cost? ).   

All of the likenesses of the Great Leader are exclusively constructed by the Mansudae Art Studio’s “Number One Works Department”  in Pyongyang.  The workers in this group are tested annually by a deliberation committee so they can be certified to work on Kim statues, etc.  These individuals are the only ones legally allowed to reproduce the leader’s image in North Korea.

Once a Kim statue is completed, it is transported by numerous agencies (security, party, and artists) to its destination where it is erected.  Lamps are supposed to shine on the statues from 10:00pm until 4:00am.  Local citizens are charged with keeping the area around the statue tidy (which can be verified on Google Earth).  In the event of an emergency (such as a war), many statues allegedly have dedicated bunkers in which they can be stored.

The Daily NK is running a couple of interesting pieces on Kim il Sung monuments and statues in the DPRK.  Both articles are worth reading (here and here), and I will comment on them more extensively in the near future, but the first article made a startling claim that I had to put to NKeconWatch readers: That there is a Kim Jong il statue in Pyongyang.

In contrast to the many Kim Il Sung’s statues, there stands only one Kim Jong Il statue. This is located in on the lawn of National Security Agency office building at the foot of Mt. Amee in Daesung district, Pyongyang. It was erected on Kim Jong Il’s 46th birthday in 1988 and is constructed not of bronze, but of gold.

In addition to the one standing statue of Kim Jong Il, all Colleague Kim Il Sung Revolutionary History Institutes, which are located in each major local office or agency, showcase plaster busts of the Kim son, and at the International Friendship Museum in Mt. Myohang, a large sitting statue was constructed.

I have spent about 20 days in the DPRK.  I know many people who have spent many many more, and I have never heard of any Kim Jong il statues.  Can anyone confirm this?  Any photos out there?

If you want to make money, you have to spend money. 

Excerpts from Yonhap:

North Korea regards [Chongryun] the pro-Pyongyang residents’ group in Japan as its major overseas support base. The pro-communist group operates a number of primary and junior and high schools in Japan where students of Korean ancestry learn the Korean history and language.

Kim Jong-il “sent 205 million yen as educational aid fund and stipends to the General Association of Korean Residents in Japan for the democratic national education of the children of Koreans in Japan,” the Korean Central News Agency said in a report, monitored in Seoul.

The latest North Korean financial donation comes amid warnings by international aid groups that the isolated communist country faces its worst food shortage in years.

Read the full sotry here:
N. Korea donates US$2 million to pro-Pyongyang group in Japan: report
Yonhap
4/12/2008

From the Donga Ilbo:

A black Benz with the red license plate of “087” passed by quickly. 087 is a number used exclusively for the sedans of North Korean diplomats. It was easy to tell that the North Korean embassy located on this street recently purchased the luxurious sedan.

“The North Korean embassy has been full of life since the latter half of 2006 because of the increased number of North Korean workers sent to Russia, diversified businesses and growing efforts to secure energy supplies,“ said North Korean defectors that the Dong-A Ilbo report team met in Moscow.

North Korean workers will construct the next APEC forum venue:

In order to prepare for the APEC, the Primorsky regional government (on the North Korean border) plans to issue work permits to 12,000 North Korean workers in 2008, four times higher than the number of those last year. A foreign national, who has hired North Korean workers, said, “North Korean senior officials are lobbying fiercely in order to increase the quota for laborers. They even arrange free tours of North Korea for Russian government officials.”

North Korea companies revived:

Recently, North Korean companies, such as Daedong River, Neungra, Baekdu and Goonpyo, have established their offices in many parts of Russia.

A 39-year-old North Korean defector who has stayed in Russia for 12 years said, “I believe, out of the 49 Russian provinces, North Korean firms have established their offices in about 30 provinces. Some 90 percent of them are responsible for overseeing North Korean workers.”

Joint ventures between Russia and North Korea, which went into hibernation after the United States froze North Korea’s account at Macau’s Banco Delta Asia in 2005, have recently resumed their activities. “Joint companies, which were active in the early 1990s, such as Dongbang Seafood and Far East Marine Transportation, have resumed their businesses,” said one Korean-Russian residing in Nakhodka.

Wages and Taxes:

“North Korean companies, which are spread across Russia, have been collecting about $400 to 500 from each North Korean worker every month. It is then used as high ranking officials’ business expenses,” said a 46-year-old North Korean defector.

“The discontent of workers is growing because high ranking officials dine out at fancy restaurants and their wives purchase expensive clothes with money earned by them,” added the defector.

(Uncle Sam is the only other government I know of that also taxes the income its citizens earn outside of its territory)

The story also makes a big deal out of the fact that the North Koreans pay huge bribes to do business in Russia, but who doesn’t?

Big players, who deliver a large sum of bribes to Russians, have also recently emerged. A captain of a North Korea freight ship was caught March 12 on site while shipping 100 tons of crude oil without reporting to customs at the Slavyanka shipyard, southern Vladivostok. It was found that the captain gave $45,000 to the president of the crude oil storage company as a kickback.

Read the full sotry here:
N.Korea’s Businesses Thriving in Russia
Donga Ilbo
4/4/2008

The DPRK is sending a barrage of signals that it is not happy with the policy changes that are on the new South Korean government’s agenda (denuclearize and account for all nuclear activities, reform, repatriate missing South Korean citizens, etc):

1. February 25, 2008: the DPRK increases fighter jet maneuvers near the DMZ. (Source: N.K. flight maneuvers rise near border, Korea Herald, Jin Dae-woong
4/1/2008

2. March 27, 2008: the DPRK expels eleven South Korean officials from industrial zone. (Source: South Koreans kicked out of North Korea’s Kaesong industrial centre, The Times of London, Leo Lewis, (3/27/2008)

3. March 28, 2008: the DPRK test fires missles off its coast. (Source: North Korea sends a missile warning, Asia Times, Donald Kirk, 3/29/2008)

4. March 30, 2008: the DPRK issues blunt statements about deteriorating relations and suggesting complete destruction of the South if it is attacked. (Source: Pro-North Korea newspaper says relations with South at lowest since after nuclear test, Associated Press, 3/31/2008)

5. April 1, 2008: The DPRK breaks its silence on direclty challenging South Korea’s new president, labeling Lee Myung Bak a “traitor” and a “sycophant toward the U.S.” (Source: North Korea Calls South Korean President a `Traitor’, Bloomberg, 4/1/2008)

6. April 3, 2008: North Korea accuses the South Korean Navy of violating its territorial waters, “The South Korean military’s warmongers have sent three battleships deep into our territorial waters in the West Sea (Yellow Sea) at around 11:45 am (0245 GMT) on April 3,” and “South Korea’s military should clearly bear in mind that an unexpected countermeasure will follow if they continue to push battleships into (our waters) and raise tensions.” (Note here they are trying to pin the military escalation on South Korea) (Source: North Korea accuses South of entering its waters, Reuters, 4/3/2008)

7. April 3, 2008: North Korea announces it is suspending all dialogue with South Korea and closing the border to Seoul officials, its toughest action in a week of growing cross-border tensions. (North Korea cuts contacts with South, The Austrailan, Park, Chan Kyong, 4/3/2008)

8. DPRK violates NLL three times (Yonhap) 5/22/2008

Reasons not to panic:

1.  Although eleven South Korean officials have been expelled from the Kaesong Zone, Some 48 South Koreans and five North Koreans still work at a separate inter-Korean management committee overseeing the industrial zone, where about 800 South Koreans work along with more than 25,600 North Korean laborers for 69 South Korean companies.  In other words, it is still business as usual for the most part. (Source: Pro-North Korea newspaper says relations with South at lowest since after nuclear test, Associated Press, 3/31/2008)

2.  DPRK statements about about attacking the South are a response to statements aired in public by General Kim Tae-young at a National Assembly hearing on his nomination as chairman of the joint chiefs of staff where he claimed his people had plans for use any time it was deemed necessary to take out the North’s nuclear facilities. (Source: North Korea sends a missile warning, Asia Times, Donald Kirk, 3/29/2008)

3. While all of this was going on, 159 CEO’s of small- to medium-sized South Korean enterprises toured North Korea in search of investment opportunities. (Source: 159 CEOs Begin Trip to North Korea, Korea Times, Kim Sue-young, 3/19/2008)

4. Tourism to the DPRK continues unhampered.

5.  The Pyongyang International Trade fair in May is on and business delegations are still welcome.

6. April 3, 2008: The South’s unification ministry said it did not believe civilian exchanges would be affected. Two Seoul-funded projects in the North – the Kumgang resort and the Kaesong industrial complex – are major hard currency earners for the impoverished nation. (North Korea cuts contacts with South, The Austrailan, Park, Chan Kyong, 4/3/2008)

7. Inter korean trade this year is up! (Yonhap)

Dr. Lankov publishes some great information on the relationship between the early DPRK state and the Soviet Union…

[F]rom the very start the land reform program in North Korea was planned by the Soviet military authorities, and Kim Il-sung simply signed the documents, which had been prepared for him by the Russian officers.

This fact is well-known, since Russian papers on the land reform issue were declassified and published in South Korea almost a decade ago.

and… 

[E]ven a cursory look through the available documents clearly indicates: in 1945-1950, the North Korean regime operated under the complete control of the Soviet supervisors. Who drafted the above-mentioned land reform law? The Soviet advisers. Who edited and, after some deliberation, confirmed the North Korean Constitution? Stalin himself. Who arrested all the major opponents of the emerging Communist regime? The Soviet military police. Where were they sent to do their time? To prison camps in Siberia, of course!

The available papers leave no doubt that even the relatively mundane actions of the North Korean government needed approval from Moscow. The Soviet Politburo, the supreme council of the state, approved the agenda of the North Korean rubber-stamping parliament and even “gave permission” to stage a parade in 1948. The much-trumpeted conference of the politicians from the North and South in the spring of 1948 was another Soviet idea, even if the leftist historians now love to depict it as yet another expression of Pyongyang’s will to negotiate based on its alleged national feelings. The most important speeches to be delivered by the North Korean leaders had to be pre-read and approved in the Soviet Embassy.

My favorite story in this regard happened in December 1946, when the first elections for the North were being prepared. On Dec. 16, the Soviet Colonel-General Terentii Shtykov discussed the composition of the North Korean proto-parliament with two other Soviet generals. The generals (no Koreans were present) decided that the Assembly would consist of 231 members. They did not forget to distribute the places among the various parties, decided how many women would become members, and the social composition of the legislature. If we have a look at the actual composition of the Assembly, we can see that these instructions were followed with only minor deviations.

Read the full story here:
Southern Biases About North Korea
Korea Times
Andrei Lankov
3/9/2008