Water Trade Burgeoning in North Korea

December 15th, 2008

Daily NK
Moon Sung Hwee
12/15/2008

Amidst the trend of increasing numbers of civilians trying to make ends meet through trade in the wake of the July 1st Economic Management Reform Measure, medical students in North Korea have started doing business by drawing water from the Yalu River.

However, due to the territorial nature of the Yalu River, water-selling, and attendant incidents of violence in order to grasp commercial rights, have become more frequent.

A source from Yangkang Province said in a phone conversation with the Daily NK on the 9th, “Three Hyesan Medical School students who were selling water near the People’s Committee of Yangkang Province building attacked a couple in their 30s, who had to be taken to hospital on the 7th.”

The source said, “Generally, the Yeinbong-dong (in Hyesan) is where students of Kim Jong Sook College of Education and Bongheung Middle School sell water, and the area around Hyemyung-dong is designated for Hyemyung Middle School and Hyesan Medical School students. The Hyesan Medical School students mistook the villagers drawing water for people trying to enter their zone, so the incident erupted.”

According to the source, the medical school students used their handcart to crash into the couple’s sleigh. The husband, angry at this, hit one of the students, which provoked the two remaining students to collectively assault the couple and flee.

The source relayed, “Subsequently, the relatives of the couple and their friends sought out the Hyesan Medical Student dormitory with axes and spades, so the People’s Security Agency (PSA) was called. The PSA searched all over the dormitory, but ultimately could not find the suspects.”

In Hyesan, Yangkang Province, as water provision to civilians became more erratic due to failing subsistence, the business of drawing supplies from the Yalu River to take to far-flung regions started springing up. Not only does the business not require much capital, but water can be fetched from the Yalu River with a handcart or a sleigh and be sold in residential areas, so it is popular among college students who come from farming regions to Hyesan, or among middle school students.

“Selling water is mostly monopolized by middle school and college students. This is a job that ordinary people will take up as a last resort,” the source said.

He added, “Those college students who come from the country side and live in dormitories take up this business. A portion of middle school students, in order to contribute to the livelihoods of their families or to make personal allowances, choose to do it as well.”

“In Hyesan right now, 50 liters of water costs around 300 North Korean won, and a 70-liter Chinese bucket sells for 400 won,” he explained.

He then said, “Water is fetched from the Yalu River with a handcart or a sleigh: one sleigh can carry about four to five 50-liter water buckets. This business cannot be done solo, so people usually undertake this in groups of three or four.”

The source stated, “Water merchants go back and forth between the Yalu River and where they are based at least four times a day. Sometimes, they can even go seven to eight times a day, but there are not too many people who buy water.”

“Those who buy water are mostly cadres or merchants who have to go to the markets. Also, people who sell liquor or tofu require a lot of water. With so many water merchants, incidents of fighting over territory are quite common.”

Hyesan, which began receiving aid from international organizations in 2003, was the pride of the North Korean authorities, especially since the completion of a “natural water supply system” which took two years to construct. However, as a result of simultaneously burying the water and the sewage system at the time of construction, the polluting of the city’s water resulted. The residents of densely populated areas, which are located mostly on hillier regions relatively far from the Yalu River, have not been receiving tap water, noted the source.

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Number of North Koreans in the Kaesong Industiral Zone increases

December 14th, 2008

Quoting from the article:

North Korea has increased the number of its nationals working at a Seoul-funded industrial estate in the communist state since tighter border controls were introduced, data showed Sunday.

Statistics from South Korea’s unification ministry show North Korean workers numbered 37,168 in Kaesong, the estate just north of the border, on Friday, up from 36,618 on November 31.

On December 1 North Korea imposed stricter border controls and expelled hundreds of South Koreans from Kaesong amid strained cross-border ties, leading to fears in Seoul that Kaesong will eventually be closed down.

“The latest statistics show North Korea will not shut down Kaesong but thoroughly protect business there,” Kim Yong-Hyun, a professor of North Korean studies at Seoul’s Dongguk University, told AFP.

“The North is saying tighter border controls are targeting the Seoul government, not private businesses there, in a dual-track policy on the South.”

Read the full article here:
Number of NKoreans increased at Seoul-funded estate
AFP
12/14/2008

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Female N. Korean worker defected from Kaesong complex: activist

December 10th, 2008

Yonhap
12/10/2008

A North Korean defector who escaped from an inter-Korean industrial complex in the border city of Kaesong where she was employed remains in a third country, a South Korean activist here said Wednesday.

The 27-year-old woman, whose identity was withheld for her safety, fled Kaesong in late September and has since asked for help to travel to South Korea, according to Kim Yong-hwa, who leads a Seoul-based civic group advocating for the human rights of North Korean defectors.

The Unification Ministry and officials from South Korean firms operating in Kaesong said they had not heard about the defection and that there was no sign of abnormality at the complex around that time.

If confirmed, it would be the first known defection from the industrial complex, where about 36,000 North Koreans are employed by dozens of South Korean factories operating under the tight control of authorities from Pyongyang.

Seoul officials say the workers were carefully selected from a pool of young people with good family backgrounds from the North Korean border city or Pyongyang to ensure they would not be unduly influenced by the atmosphere of capitalism at the comoplex.

Exactly what motivated the woman to defect is not known, but Kim said she was apparently forced to choose between her marriage and her job, which earned her a relatively good salary in the impoverished nation.

The communist North bans female workers at Kaesong plants from getting married, a violation of their rights, Kim added. “(The young woman) is said to have gotten a warning once from the authorities over the matter,” he said.

Kim says North Korea exploits its workers at Kaesong by giving them only US$2 out of their monthly wage of about US$60 paid by South Korean firms.

Currently, 88 labor-intensive garment, kitchenware and various other South Korean factories operate in Kaesong. Pyongyang recently expelled hundreds of South Korean officials and managers from the complex in an effort to pressure Seoul to change its hardline North Korea policy.

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Behind North Korean Plan to Reopen State Stores

December 10th, 2008

Daily NK
Moon Sung Hwee
12/10/2008

The North Korean authorities recently announced the intention to sell all industrial products in state-operated stores, soon after announcing the revised “10th-day farmers markets,” which open only on the 1st, 11th and 21st of every month, starting from next year.

According to an inside source in North Hamkyung Province, a new instruction on the sale of industrial products in state-operated stores was introduced during the latest cadres’ lectures. As rumors of the large-scale entry of Chinese goods onto the market due to Chinese loans circulate among people, there has been in a flutter in the market.

The source stated that the idea of industrial product sales was introduced during a cadres’ lecture on the 29th of November under the title, “measures to improve the current situation and people’s lives,” which also explained the transformation of the current market system into the “10th-day farmers market” system.

In the source’s opinion, “It signifies the government’s attempt to monopolize the industrial-product market, which was actively and spontaneously established by the people after the ‘march of tribulation’ in the late 1990s. Industrial goods to be sold in the state-operated stores would include both Chinese and North Korean products.

During the lecture, it was stated that “All industrial goods that have been passing through the jangmadang (markets) must now be sold in the state-operated stores and only vegetables or certain agricultural products can be sold within the farmers markets,” which suggests the prohibition of individuals selling food-related products and industrial goods.

With regard to the backdrop of this policy, the authorities explained that, “The current market was a temporary measure taken by the state considering the difficult situations caused by the march of tribulation. However, the markets after some time deviated from the state’s intention and socialist economic principles and have become a hotbed of crimes generating capitalist and anti-socialist trends. Therefore, we are ridding ourselves of all markets and reviving the farmers market.”

The source explained that this measure does not seem to “simply control the markets. But if they begin selling industrial products in the state-operated stores, they would be able to circulate money within the regime that has been circulating within private markets and among individuals by tying purchase profits to national banks.

He said, “Due to the jangmadang, the gap between the rich and the poor has widened. And, because money is not flowing within the regime, the authorities are getting rid of private sales to revive the banks so as to recover the regime economy… It seems the state-controlled economy will become better next year” he added.

However, the source also relayed that “Although they announced the selling of industrial goods only in the state-operated stores from next year, nothing, regarding exactly when and how, was mentioned during the lecture.”

“There is also another rumor that even ‘procurement stores’ would have to sell products on the same price level with the state-operated stores, or they would have to close down. It basically signifies that the regime will not permit any form of private sales, by selling all products that had been sold by individuals” he added.

The source reported that there have been heated debates on this decision among North Koreans.

“Famers gladly took this decision that industrial goods will sell in state-operated stores because they have been complaining that they sold agricultural products at next to nothing while buying industrial goods at such a high price. They are expecting that industrial goods will cost less than now” the source reported.

“However, workers in urban areas are extremely concerned that they cannot sell anything in the jangmadang. An average workers’ salary is 1,500 North Korean Won and if individuals are not permitted to sell, workers’ families will be harshly affected” he forecasted.

The source continued on and said, “Even though they say workers get paid well, how are they expected to live when a pair of military boots costs 9,000 North Korean won. One month’s salary is not even half a kilo of rice.”

The source in the end expressed concern because workers began “explicitly complaining about cadres who only fill themselves up. I personally think that there will begin a massive war within the markets starting from New Year’s Day”.

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DPRK reemphasizes priority development of national defense industries

December 8th, 2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-12-8-1
12/8/2008

The North Korean online magazine ‘Our Nation (uri minjokkiri)’ emphasized on January 1 that development of national defense industries would be prioritized, stating that it was “the best way to move forward and harden a strong national defense while at the same time developing the entire economy.”

In an article titled, “The Path to Economic Construction of the Military-first Era,” the website reminded the reader of the goal of building a strong and prosperous nation by 2012, and stated that Kim Jong Il had said that building up the economy was the “main line of construction for the building of a Strong and Prosperous Nation.” It went on, “Today’s era is the era in which the national economic strength is determined by the amount of development of the national defense industries,” and, “National defense industries are in a leading position, while the independent establishment of the core economic structure is necessary, and a strong economic base can be constructed.”

The magazine emphasized, “The might of heavy industry can be further strengthened following the completion of the basis of the national defense industries, also ceaselessly developing light industry and agriculture.” The article also stressed that as North Korea’s national defense industries are at a comparatively high level internationally, matching that of the United States, and that he national economy overwhelming potential is easy to see.

The article noted that today’s military competition between nations is practically scientific and technological competition, and, “strengthening of national defense in every way based on science and technology, and establishing a framework of science and technology and deciding to quickly develop a strong and prosperous nation by focusing on science is really the path for building the economy in the Military-first Era.”

The magazine emphasized that this military-first era economic building plan was “truly for the people, and was the most civic path to prepare national economic strength for public services.” “In accordance with changes in the political atmosphere and actual conditions, the amount of energy applied to building of national defense and economic construction, citizens’ livelihoods, or other realms could vary, but the true requirement of the building of the socialist economy is to ceaselessly raise the level of the livelihoods of the people, and ultimately, this goal can never waver.”

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Idolization Ever Increasing

December 5th, 2008

Daily NK
Park Hyun Min
12/5/2008

The North Korean authorities have been expanding the construction of facilities that laud and idolize Kim Il Sung and Kim Jong Il throughout North Korea, in order to unite the people in spite of the severe economic crisis.

Up until the end of the 1990s, North Korea had been focusing on creating “revolutionary memorial halls” or ‘historic sites,’ or erecting statues in order to idolize the Kim family.

The main structure of idolatry, above all, is the Kim Il Sung statue. Among all the statues, the one in front of the Museum of Korean Revolution on the top of Mansudae hill in Pyongyang, erected in April 1972 to celebrate Kim Il Sung’s 60th birthday, is best-known. It is 23 meters (75.5 feet) high, including a 3 meter pedestal. The statue was once covered with gold, but it was removed.

Similar, less grandiose statues are located in all 70 major cities of North Korea. In total, there are 140,000 structures designed to idolize the Kim regime.

Especially after the death of Kim Il Sung, and the succession of Kim Jong Il three years later, in 1997, many mosaic murals were created throughout North Korea with the father and the son as the theme, and many of the revolutionary monuments were erected.

Mosaic murals mainly feature Kim Il Sung, the father with Kim Jong Il and Kim Jong Il’s mother, Kim Jung Sook, made with glass or tiles of natural rocks baked at 1,200.

According to reports from the North Korean state-run media since 2000, one mural was made in 2000, four in 2002, then the number increased to 19 in 2003, 49 in 2004, and a sharp increase to 70 in 2005. Then in 2006, 55 murals were made while 67 were made last year. 88 murals have been made this year alone.

Furthermore, the size of the mosaic murals is growing. On average, the length and height of a mural is 5–10 meters. However, bigger murals with dimensions of 30 meters by 20 meters have been under construction.

The most well-known murals are located on Tongil (Unification) Street in Raknang district and on Kwangbok Street in Mankyungdae district in Pyongyang. The one on Kwangbok Street was made to celebrate Kim Sung Il’s 95th birthday in April, 2008, and goes by the name of “My great country, my nation, live forever.” The height and length of the murals are respectively 42 meters and 25 meters.

The other mural that was completed on Tongil Street the day before that was 33.7 meters long and 22 meters high.

Chosun Sinbo reported with great fanfare, “These murals are the biggest mosaic murals in the nation.”

Revolutionary monuments or historic memorials at places where Kim Il Sung or Kim Jong Il are known to have been, are being made constantly.

North Korea put up 31 revolutionary memorial slabs last year in places such as Pyongyang Music School or Pyongyang Shoe Factory, and 37 so far this year, in places like Suncheon First Middle School and Kangkye Pig Factory. Last year, revolutionary monuments were erected in five places, including the public building of the People’s Safety Agency in North Hamkyung Province and so far four monuments have been erected in places like Pyongyang 3.26 cable factory.

Jane Portal, the author of “Art under Control in North Korea” visited North Korea twice and assessed this idolatry as the world’s most intense, saying that Stalin and Mao Zedong’s idolatry cannot be compared with Kim Il Sung’s hunger for praise.

Additionally, North Korea is focusing on boosting people’s loyalty and revolutionary consciousness through collective visits to these historic sites, and by excavating or renovating them.

Chosun (North Korea) Central Broadcasting (the state-controlled radio station) last month hinted at the strengthened idolization process, saying that “Plans to revive historic sites in North Hamkyung province and the efforts of party members and laborers working on these projects are processing well.”

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Singapore-North Korea trade deal

December 2nd, 2008

The Singaporean government is insuring investment in the DPRK…

Quoting from the article:

Singapore firms keen to expand into the largely untapped market of North Korea now have a foot in the door, thanks to two new agreements inked on Tuesday.

The Ministry of Trade and Industry (MTI) said that Singapore signed an Investment Guarantee Agreement (IGA) with the country on Tuesday.

Trade and Industry Minister Lim Hng Kiang and his North Korean counterpart, Mr Ri Ryong Nam, signed the IGA during the North Korean Foreign Trade Minister’s official visit to Singapore.

MTI said the IGA will help promote bilateral investment flows by protecting investors and their investments.

Under the agreement, investors will be accorded non-discriminatory treatment, compensation in the event of expropriation or nationalisation of their investments, and free transfer of capital and returns from investment – perennial ‘banana peels’ for businesses entering a less-developed and unexplored market.

Separately, the Singapore Business Federation (SBF) also signed a Memorandum of Understanding with the North Korean Chamber of Commerce.

According to the SBF, North Korea remains an unexplored market for many Singapore firms but there exists many opportunities for local businesses to tap into such as its high-quality yet affordable workforce and the abundance of natural resources.

Read the full article below:
S’pore, N.Korea ink trade deals
The Straights Times
Francis Chan
12/2/2008

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DPRK takes measures to restrict market trading

December 2nd, 2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-12-2-2
12/2/2008

North Korean authorities appear to have taken some action on their recent decision to strengthen market restriction policies.

According to information weaned from statements made by contacts within North Korea, the DPRK cabinet passed a measure to turn the North’s markets into ’10-day Markets’, allowing them to open only on the 1st, 11th, and 21st day of each month beginning in 2009.

This information came from a lecture meeting for North Korean authorities, but it appears that workers in the Market Management Office have also been telling average citizens about similar measures since November. Some North Korean residents believe this is an effort to close general markets and convert them into farmers’ markets from next year.

There are some that expect strong opposition from North Korean residents that will make the likelihood of effective enforcement slim. There was much talk at the beginning of this year, as well, of transforming general markets into 10-day markets or farmers’ markets, but ultimately, such measures could not be enforced. Some believe that if current general markets are transformed into farmers’ markets, rioting could ensue.

As most goods circulating in general markets are in some way tied to the authorities, there is some doubt as to whether these authorities would abandon their personal profits in order to crack down on market trading. It has been reported that as of yet, there have been no significant shifts in the North’s major regional markets, and they are open daily and running smoothly.

Since November 10, there have also been rumors that all personal trade would be banned, but it appears that there has been no actual enforcement of this measure, either.

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DPRK crackdown, restrictive measures on first phase of KIC

December 2nd, 2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-12-2-1
12/2/2008

On November 24, North Korea announced measures to the Kaesong Industrial Complex management committee and other organizations involved in the KIC that would suspend tours to the city of Kaesong and cut the number of South Korean personnel in the complex by half, but stated that businesses operations within the complex would be guaranteed.

Kim Il-kun, current director of the North Korean Central Special Zone Development Bureau who had served as chairman of the North Hwanghae Province People’s Committee until October of this year, led the DPRK delegation, and from the South, KIC Management Committee Chairman Moon Moo-hong, KIC Business Council Chairman Moon Chang-sung, and representatives from companies operating in the complex were included in the 103 people in attendance.

First, the North delivered the notice to the public relations officer of the management committee from 11:00 to 11:07 in the morning.

The North’s KIC management committee announced in the notice, “50 percent of the management committee staff, including the committee chairman or vice-chairman, will evacuated by the end of November,” “Total workers, including those for construction and support activities, will be reduced by half,” “transit across the military demarcation line for those working on cooperative projects and exchanges within a one million-pyong area around the border will be strictly limited,” and stated, “The future of the industrial zone and inter-Korean relations depends on the stance taken by the South.”

From 11:10 to 11:20, the North announced the measures to the company representatives in the management committee assembly hall.

The North announced, “It was decided to guarantee as an exception activities of the businesses in the KIC, and so the resident workers of the South’s production companies are exempt from the measures restricting land crossings of the military demarcation line.”

The announcement proclaimed, “The responsibility for this kind of severe situation lies entirely with the Southern authorities who stubbornly pursue confrontational relations between North and South and fail to recognize the June 15 Joint Declaration and the October 4 Declaration…we do not wish for the South’s small and medium-sized enterprises to suffer from the imprudent confrontational policy of the South’s officials.”

In a separate notice, the North announced, “With the exception of those workers necessary to the KIC business operations, all South Koreans crossing the military demarcation line as visitors, tourists, for economic cooperation, etc. will be strictly limited or blocked,” “All unnecessary South Korean workers in the KIC, including the KIC management committee, will be evacuated, and land entry across the military demarcation line will be blocked, “The Inter-Korean Cooperation Council Office will be disbanded and all South Koreans related to it will be deported,” “Kaesong tours operated by Hyundai-Asan are halted,” “All Southern civic organization and entrepreneur coming in our region overland across the military demarcation line in the east and west seas for the purpose of cooperative exchange and economic transaction will be blocked from crossing overland, and if it is unavoidable that goods and their deliverers must cross by land strict inspections will be carried out,” and, “Train operations between our Bongdong Station and the Southern Munsan Stations are suspended.”

With the North’s new measures, because of the inability to repair inter-Korean relations, it appears likely that the number of new overseas companies looking to operate in the KIC will fall, orders from buyers will drop off, public opinion will sour, production will face difficulties, and the gradual withdrawal of businesses operating in the KIC coupled with the lack of new business interest could lead to the closure of the Kaesong Industrial Complex

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Exam time…

December 1st, 2008

Unless something truly amazing happens between now and December 15th, I will be taking a break for exams.  After that I will play catch up and post the latest version of North Korea Google Earth—which has been significantly expanded.

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