Kaesong regulatory environment set

December 11th, 2004

From Chongryun:

On December 11, 2004, the DPRK finalized management, entry and residency regulations, and customs regulations for the Kaesong Industrial Zone.

Set up under a de facto constitution, the “Kaesong Industrial Zone Management Institution” consist of 21 articles.

The Management Institution is a corporation in charge of administrating the region.  People who have experience in these kinds of managemnt fields can work for the Institution, but employees of firm that operate in the zone are no allowed to serve.

The Institution will make annual plans for the development of the zone on its own and carry out the plans and will discuss with the central leading organ of the zone in case an important problem arises in the course of its work.

Entry and residence articles: 30

The regulations apply to South Koreans, overseas Koreans and foreigners who come to the zone from the South or do so by transportation means using the same route. According to the regulations, persons can enter the zone by showing their passports or certificates issued by the management institution.

They can stay in the zone for a long or short term. A short term stay is within 90 days and a long term stay is over 91 days. The extension of their stay is permitted if they applied for it at the immigration office of the industrial zone. Excluded from extended stay are those who are expected to leave the zone within 7 days from their arrival, as well as members of international organizations and foreign missions in South Korea, tourists and those who are not required to register themselves for their stay.

The regulations also clarify the issue of certificates related to entry into the zone, procedures for issuing the certificates of stay and residence registration cards and the extension of their term of validity, orders of deportation from zone, etc.

Customs

According to the regulations, goods, postal matter and persons engaged in transport service who stay in the zone for a certain length of time, can pass through the customs clearance house.

The goods that are sent by organizations and enterprises in the DPRK to the zone are exempt from customs procedures. But customs should be imposed on the goods from other countries which are to be sold in the DPRK as they are, without being processed.

Also clarified in the regulations are the rules of customs registration, the rules of customs exemption and payment, presentation of applications for permits to carry goods into and out from the zone, declaration of postal matter and personal belongings, customs inspection and supervisory institutions, the inspection method of goods to be carried into or carried out from the zone, standard customs rates and calculation methods, etc.

The goods prohibited to be carried into the zone include weapons, bullets, explosives and other materials for military use, narcotics, radioactive material, toxic chemical agents, printed matter that may adversely affect public order and good manners and customs of the nation and listed goods coming from contagious disease-afflicted areas.

Those goods banned to be taken out from the zone include weapons, bullets, explosives, materials for military use, lethal weapons, wireless apparatuses and their accessories, poisonous substances, powerful medicines, narcotics, radioactive material, toxic chemical agents, historical relics, secret documents, printed matter (copies included) and their manuscripts, films, photos, cassettes and video tapes, records, compact disks and other goods which are banned from being carried out under related agreement.

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N Korea envoys ‘smuggled drugs’

December 9th, 2004

BBC
12/9/2004

Turkey has deported two North Korean diplomats accused of smuggling drugs, Turkish officials say.

They said the two men – named as Ryang Thae Won and Kim Son Jin – were caught in a police raid in Istanbul on Sunday.

They are alleged to have been in possession of large quantities of Captagon – a synthetic amphetamine-type stimulant.

The diplomats – who have immunity – were taken by car to Bulgaria, where they are based, on Tuesday.

“They were declared persona non grata in line with related international agreements,” a Turkish diplomat told AFP news agency.

Turkish officials say the diplomats brought the pills from Bulgaria and delivered them to two Turks, who were arrested in the Istanbul raid.

The government in Ankara recognises North Korea but Pyongyang does not have its embassy in Turkey.

The embassy in Bulgaria usually deals with North Korean affairs in Turkey.

North Korean officials have not commented on the incident.

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Welcome to capitalism, North Korean comrades

December 4th, 2004

Asia Times
Andrei Lankov
12/4/2004

A creeping revolution, both social and economic, is under way in North Korea and it seems there’s no turning back. For decades, the country served as the closest possible approximation of an ideal Stalinist state. But the changes in its economy that have taken place after 1990 have transformed the country completely and, perhaps, irreversibly.

For decades, Pyongyang propaganda presented North Korea as an embodiment of economic self-sufficiency, completely independent from any other country. This image sold well, especially in the more credulous part of the Third World and among the ever-credulous leftist academics. The secret of its supposed self-sufficiency was simple: the country received large amounts of direct and indirect aid from the Soviet Union and China, but never admitted this in public. Though frequently annoyed by such “ingratitude”, neither Moscow nor Beijing made much noise since both communist giants wanted to maintain, at least superficially, friendly relations with their small, capricious ally.

But collapse of the Soviet Union made clear that claims of self-sufficiency were unfounded. From 1991, the North Korean economy went into free fall. Throughout 1991-99, the gross national product (GNP) of the Democratic People’s Republic of Korea (DPRK) nearly halved. The situation became unbearable in 1996, when the country was struck by a famine that took, by the best available estimates, about 600,000 lives. The famine could have been prevented by a Chinese-style agricultural reform, but this option was politically impossible: such a reform would undermine the government’s ability to control the populace.

The control on daily lives was lost anyway. What we have seen in North Korea over the past 10 years can be best described as collapse of what used to be rigid Stalinism from below. In the Soviet Union of the late 1950s and in China of the late 1970s, Stalinism-Maoism was dismantled from above, through a chain of deliberate reforms planned and implemented by the government. In North Korea the same thing happened, but the system disintegrated from below, despite weak and ineffectual attempts to keep it intact.

In the 1960s, North Korea was unique in being the only nation in the world where markets were outlawed. The retail trade in a strict sense almost ceased to exist since virtually everything, from socks to apples, was distributed through an elaborate public distribution system with money payments being rather symbolic. The rations depended on a person’s position in the intricate social hierarchy, which eventually became semi-hereditary. In Kim Il-sung’s North Korea, there was almost nothing that could be sold on market since production outside the state economy was almost non-existent.

Unlike governments of other communist countries, until the late 1980s the North Korean government did not even allow its farmers to cultivate kitchen gardens – the individual plot was limited to merely 20-30 square meters, hardly enough to grow enough chili pepper. This was done on purpose. In many other communist countries, farmers had bigger plots and made their living from them, ignoring their work obligations to the state-run cooperative farms. Without their own plots, farmers would work more for the state – or so believed the North Korean government. In the utopia constructed by Kim Il-sung, every single man or woman was supposed to work for the state, and was rewarded for his and her efforts with officially approved rations and salaries.

In 1969, Kim himself admitted that the anti-market policy had been a failure. Thus private markets were gradually legalized, but remained small and strictly controlled. However, as late as late 1980s, markets were still considered inappropriate for a “socialist paradise”. They were something to be ashamed of, so they were pushed to the margins of the city. Until the early 1990s, most markets were in places more or less hidden from view, inside residential blocks and behind high concrete walls. In Pyongyang, the main city market was set up under a huge viaduct at the easternmost part of the North Korean capital, as far from the city center as possible.

However, the economic disaster of 1991-95, and especially the subsequent famine, changed the situation. Markets began to spread across the country with amazing speed. From 1995-97, nearly all plants and factories ceased to operate. The rations were not issued anymore: in most areas people still received ration coupons but these could not be exchanged for food or other rationed goods. Only in Pyongyang and some other politically important areas did food continue to be distributed. But even there, the norms were dramatically watered down. In such a situation, the ability and willingness to engage in some private business became the major guarantee of physical survival.

The government also relaxed the restrictions on domestic travel. Since around 1960, every North Korean who ventured outside his native county was required to have a special “travel permit” (an exception was made for one-day travel to neighboring counties). However, in the mid-1990s, the authorities began to turn a blind eye to unauthorized travel. It is not clear whether it was a deliberate relaxation or just inability to enforce regulations when the state bureaucracy was demoralized. After all, a bribe of some US$5 would buy such a permit from a police officer.

The tidal wave of small trade flooded the country, which once came very close to creating a non-money-based economy. People left their native places in huge numbers. Many sought places where food was more available while others enthusiastically took up the barter trade, including smuggling of goods to and from China. Women were especially prominent in the new small businesses. Many North Korean women were housewives or held less-demanding jobs than men. Their husbands continued to go to their factories, which had come to a standstill. The males received rationing coupons that were hardly worth the paper on which they were printed. But North Korean men still saw the situation as temporary and were afraid to lose the trappings of a proper state-sponsored job that for decades had been a condition for survival in their society. While men were waiting for resumption of “normal life”, whiling away their time in idle plants, the women embarked on frenetic business activity. Soon some of these women began to make sums that far exceeded their husbands’ wages.

The booming markets are not the only place for retail trade. A new service industry has risen from the ashes: private canteens, food stalls and inns operate near the markets. Even prostitution, completely eradicated around 1950, made a powerful comeback as desperate women were eager to sell sexual services to the newly rich merchants. Since no banking institution would serve private commercial operations, illegal money lenders appeared. In the late 1990s they would charge their borrowers monthly interests of 30-40%. This reflected very high risks: these lenders had virtually no protection against the state, criminals and, above all, bad debtors.

In North Korea, which for decades was so different, this meant a revolution. The new situation undermined the government’s ability to control the populace. People involved in the new market activities are independent from (or inured to) subtle government pressures that had ensured compliance for decades. One cannot promote or demote a vendor, transfer him or her to a better or worse job, nor determine his or her type of residence (though admittedly, most people still live in the houses they received when the old system was still operating).

The growth of new markets also undermined some pillars of old North Korean hierarchy. Of course, many people who became affluent in the new system came from the old hierarchy – as was the case in most post-communist countries. Officials or managers of state-run enterprises found manifold ways to make an extra won. These managers often sold their factories’ products on the market. But many hitherto discriminated-against groups managed to rise to prominence during this decade. The access to foreign currency was very important, and in North Korea there were three major groups who had access to some investment capital: the Japanese-Koreans, Chinese-Koreans and Korean-Chinese.

The Japanese-Koreans moved into the country in the 1960s (there were some 95,000 of them – with family members, children and grandchildren, their current number can be estimated at 200,000-250,000). These people have relatives in Japan who are willing to send them money. Traditionally, the authorities looked at Japanese-Koreans with suspicion. At the same time, since money transfers from Japan have been a major source of hard currency for Pyongyang, their activities were often tolerated. This particular group even enjoyed some special rights, being privileged and discriminated against at the same time. When the old system of state control and distribution collapsed, Japanese-Koreans began to invest their money into a multitude of trade adventures. It did not hurt that many of them still had the first-hand experience of living in a capitalist society.

Another group were people with relatives in China. The economic growth of China meant that the relatives could also help their poor relatives in North Korea. In most cases, this was not in the form of money transfers, but assistance in business and trade. The local ethnic Chinese were in an even better position to exploit the new opportunities. For decades, they have constituted the only group of the country’s inhabitants who could travel overseas as private citizens more or less at their will. Even in earlier times, the ethnic Chinese used this unique position to earn extra money by small-scale and part-time smuggling. In the 1990s, they switched to large operations. There is an irony in the sudden economic advance of these groups. For decades, their overseas connections have made them suspect and led to systematic discrimination against them. In the 1990s, however, the same connections became the source of their prosperity.

Until recently, the government did not try to lead, but simply followed the events. The much-trumpeted reforms of 2002 by and large were hardly anything more than the admission of the situation that had been existing for a few years by then. The official abolition (or near-abolition) of the public distribution system did not count for much, since this system ceased to operate outside Pyongyang around 1995.

But the North Korean economy has indeed come a long way from its Stalinist ways. Now the government has neither money nor support nor the political will to revive the Stalinist-style central economy. There is no way back, only forward. Stalinism is dead. Welcome to capitalism, comrades!

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DPRK health care data quality audit

December 1st, 2004

The GAVI Alliance (formerly known as the Global Alliance for Vaccines and Immunisation) is a public-private partnership focused on increasing children’s access to vaccines in poor countries. Partners include the GAVI Fund, national governments, UNICEF, WHO, The World Bank, the Bill & Melinda Gates Foundation, the vaccine industry, public health institutions and nongovernmental organizations (NGOs). The GAVI Fund provides resources for the Alliance programs. The Alliance provides a forum for partners to agree upon mutual goals, share strategies, and coordinate efforts.

In 2004, The GAVI Alliance commissioned a data quality audit of the North Korean immunisation system to facilitate future collaboration.  The audit was designed to assist countries receiving support to improve their information systems, and aid with accuracy in reporting.

The report is saved to this website here:DQA_2004_KoreaDPR.pdf
On the web, it is located here.

The results of the audit are not surprising given the centrally-planned nature of the North Korean health bureaucracies combined with their penchant for secrecy.  I recommend reading the full report to get an idea of how efficient of how socialist institutions are with data, but here are some points I considered interesting:

-District immunization information is not passed on to the national level, but combined at the county level.

-Out of 206 counties, 168 were audited.  The rest were excluded for “security reasons”.

-The Ministry of population and Health contains a National Hygeing Control Committee, which controls the National Hygeine and Anti-Epidemic Institute which is responsible for the Expanded Programme on Immunization.  This program was supported by UNICEF and the WHO.

-Officially, immunizations are offered in all 206 counties to children under one year old.  Records are suposed to be made on an individual’s Child Health Card, and in the doctor’s own ledgers.  These health cards are stored at local health facilities and are supposed to move with the child.  Immunizations are distributed by the national government and are carried out one day per month.

-Outside of the national level, where one computer was used to for entering data, no computers were seen (all done by hand).

-In cases of county data, many errors were detected in the addition of monthly subtotals which could not be explained by the district staff.  The auditors concluded that the district used the 2003 figures rather than admit to missing 2002 data to meet the criteria of the audit.

-County managers do not take the previous year’s achievements into account in order to set realistic targets for the next year.

-Supervision of immunization activities was weak.  Only two counties could provide a written schedule of supervision.

-One health unit destroyed its records.

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North Korea has bigger harvest

November 23rd, 2004

UNFAO
11/23/2004

Despite its best harvest in ten years, the Democratic People’s Republic of Korea (DPRK) will post another substantial food deficit in 2005 and require external aid to support more than a quarter of its 23.7 million people, two United Nations agencies said today.

A report by the Food and Agriculture Organization (FAO) and the World Food Programme (WFP) projected domestic cereals availability in the 2004/05 marketing year (November-October) at 4.24 million tonnes, including milled rice and potatoes – a 2.4 per cent increase on 2003/04.

However, it warns that insufficient production, a deficient diet, lower incomes and rising prices mean that 6.4 million vulnerable North Koreans – most of them children, women and the elderly – will need food assistance totaling 500,000 tonnes next year.

Good weather improves 2003 harvest

The 2004 rice paddy harvest was estimated at 2.37 million tonnes, up from 2.24 million tonnes in 2003, thanks primarily to favourable weather, a low incidence of crop pests and diseases, and improved irrigation in the country’s cereal belt. Maize output was unchanged at 1.73 million tonnes.

Forecasting total cereal needs for 2004/05 at 5.13 million tonnes, the UN agencies projected an import requirement of almost 900,000 tonnes. Given anticipated concessional and commercial imports of 400,000 tonnes, the residual gap will be about 500,000 tonnes.

Most of the 16 million people receiving subsidized cereals from the government-run Public Distribution System (PDS) averaging 300 grams per person per day – half a survival ration – cannot make ends meet. They turn to more expensive private markets yet “they are still not able to cover their basic energy requirements,” FAO and WFP said.

Despite good harvest, external food aid needed

The report, which followed a joint assessment mission by the Rome-based food agencies in September and October, says, “the continuing national shortage is still a problem” so “external food aid is in part seen within the context of overall domestic availability.”

It also noted that, increasingly, “the most critical problem for poor households is their lack of access to basic and nutritious food because of declining purchasing power.” As a result, assistance to the food-insecure population “should now be determined more by their household food gap than the national food gap in cereal production.”

“A balanced diet is out of reach for all but a few PDS-dependent households,” the report says. “The situation remains particularly precarious for children in kindergartens, nurseries, orphanages and primary schools, pregnant and nursing women, and elderly people.”

Price of food on new private markets up dramatically

While the prices of state-subsidized rice and maize rationed through the PDS have remained low and stable (at 44 and 24 won a kilo, respectively), prices in private markets have risen dramatically since the introduction of economic reforms in mid-2002.

Last month, rice cost as much as 600 won a kilo in such markets – almost 30 per cent of a typical monthly wage – compared to the 2003 average of 120 won; maize was 320 won a kilo, up from last year’s peak of 110 won. In September, one Euro bought 1600 won on the parallel market.

“The ability of low-income families to obtain food from the market is severely restricted due to their deteriorating purchasing power affected by under- or unemployment and sharp rises in food prices in the market,” according to the report.

An unintended consequence of reform has been the problem of higher food prices, which has been compounded by widespread and steep cuts in already meagre wage earnings as ailing enterprises in predominantly industrial DPRK shed labour.
Food rations meet just half a person’s minimum needs

The typical wage earner’s family now spends one-third of its monthly income on PDS rations that meet only half its minimum caloric needs. Another one-third is spent on non-food essentials – rent, heating and clothing. The remainder is insufficient to purchase enough food in private markets to meet the rest of the family’s very basic needs.

Much of the population, consuming very little protein, fat or micronutrients, suffers from critical dietary deficiencies. Fresh vegetables and fruit are either scarce or very expensive outside of the July-September period.

Traditional coping mechanisms such as animal husbandry, the cultivation of household gardens and hillside plots, the gathering of wild foods and transfers from relatives in the countryside, afford some relief to hard-pressed urban residents. Small-scale income-generating activities, notably petty trade and services, allowed under an easing of restrictions on private and semi-private enterprise are other sources of much needed income.

Better farm machinery and improved soil fertility needed

To deal with the chronic, structural food deficit, the FAO/WFP report recommended that the international community enter into a dialogue with the DPRK government toward the eventual mobilization of the economic, financial, and other resources needed to promote sustainable production and overall food security.

The report also proposed examination of investment projects on soil fertility and better farm machinery to allow further expansion of the country’s double-cropped area.

WFP has provided the DPRK with almost four million tonnes of food assistance, valued at $1.3 billion, since 1995.

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Kaesong regulations finalized

October 11th, 2004

From KCNA:

Regulations of Insurance in Kaesong Industrial Zone Adopted

Pyongyang, October 11 (KCNA) — Decision No. 35 of the Presidium of the DPRK Supreme People’s Assembly “On the Adoption of the Regulations of Insurance in the Kaesong Industrial Zone” dated September 21, Juche 93 (2004) has been published. The decision says the regulations were adopted and the Cabinet and organs concerned of the DPRK are to take working measures for their implementation. 

The regulations consist of 28 articles.

The mission of the regulations is to strictly establish the system and order in the work of insurance in the Kaesong industrial zone so as to help toward stabilizing the business activities and life of those who reside and stay there.

The regulations are applied to the enterprises, branches and offices established in the Kaesong industrial zone.

They are applied also to the south Koreans, overseas Koreans and foreigners who stay and reside in the industrial zone.

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Pyongyang’s first Western law firm

September 8th, 2004

First foreign practice is a lure to investors : Law firm allowed in Pyongyang
Associated Press (via Herald Tribune)
Andrew Salmon
9/8/2004

North Korea has allowed the establishment of the country’s first private law firm as part of its efforts to attract international investors, according to a principal in the new venture.

Hay, Kalb & Associates opened its office on Kim Il Sung square in Pyongyang on Aug. 15, according to Michael Hay, who owns the firm with a North Korean partner.

The establishment of a partly foreign-owned law firm in North Korea is a rare instance where the Communist state is more open than its capitalist neighbor to the south.

South Korea remains closed to all foreign legal entities.

“The North Koreans recognize that foreign investors need a comfort level in the legal environment,” Hay, a British lawyer turned business consultant, told foreign journalists recently.

“Many foreign companies think it’s a dirt-poor country legally. It’s not. They are really revising laws.”

So far, there has been no official confirmation of the new firm by the North Korean government.

The firm has a dozen local lawyers and plans to focus on foreign companies seeking opportunities in North Korea.

“We are looking at two main areas,” Hay said. “The legal area for foreign

investors, and transparent accounting, bookkeeping and repatriation of funds.”

Foreign companies seeking to do business in North Korea have previously had to rely on legal advisers provided by the government, as no private law firms exist.

Hay said the North Korean authorities hoped that the establishment of Hay, Kalb and Associates would be a stage in the arrival of a completely foreign-owned, international blue chip law firm in Pyongyang.

Hay said international law firms that have flirted with entering North Korea have pulled back in recent years because of the recurrent crisis over the country’s capability to produce nuclear weapons.

Foreign lawyers working in South Korea were skeptical of the new firms prospects. “This sounds like a great romantic adventure,” said Brendon Carr, an American lawyer working for Seoul’s Aurora law firm.

Hay said, however, that business activity in the North was on the rise.

“Last time I was up there, I counted over 1,200 vendor stalls in Pyongyang, using the local currency, not dollars,” Hay said. “And reforms aren’t over; there are more coming.”

He cautioned, however, that reform had its detractors: “Young Turks are not always popular.”

Other foreign visitors have noted changes since economic reforms announced by North Korea in 2002.

“You see a lot of Chinese investment now, and Chinese are there for profits,” said Jean Jacques Grauher, Secretary General of the European Union Chamber of Commerce in Korea, which maintains offices in Seoul and Pyongyang. “There is more money circulating now, and there is a clear law on repatriation of funds,” he said.

The most promising business areas for foreign investors are agriculture, infrastructure development and power generation, Grauher said.

He noted, however, that major foreign investment is unlikely until North Korea is approved to receive financial assistance from international bodies such as the Asia Development Bank.

Areas where North Korea has core skills are animation and software, as well as textiles, Grauher said.

South Korea, Asia’s third-largest economy, maintains a legal market that is closed to foreign firms. Foreign lawyers working for South Korean law firms are titled “legal consultants.”

UK lawyer opens firm in Pyongyang
BBC
http://news.bbc.co.uk/2/hi/business/3634274.stm
9/7/2004

Betting on the further liberalisation of North Korea’s economy, a UK lawyer is opening a law firm in Pyongyang to advise investors doing business there.
Hay, Kalb Associates, which was set up by Mike Hay and the North Korean government, started business in August.

The firm offers legal advice, accounting services and help with repatriating funds from the North.

“[The North Korea government] realises they need a comfort level on the part of foreign investors,” Mr Hay said.

‘Opportunities’

North Korea is currently locked in dispute with its neighbours and the US over its nuclear programme.

Investors there have to wade through red tape, put up with power cuts and surveillance, amid widespread criticism of North Korea’s human rights record.

Some observers also wonder if money really can be made there.

But two years ago, the country did introduce economic reforms, including price and wage liberalisation.

Mr Hay said there are more reforms to come and that he is already advising a Western European firm though he declined to give its name. He added that there were rewards for those prepared to take the risk.

Areas of interest include tourism, mineral extraction and energy software.

Hay, Kalb Associates employs about 12 North Korean lawyers, all graduates of the Kim Il-sung University.

The company’s offices will be located in Kim Il-sung square in the central government complex.

Mr Hay, whose contacts with the North date back to 1998, said the level of legal expertise in the country is high.

“People think it’s a dirt track country in terms of law but it’s not,” he told foreign correspondents in Seoul.

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Mother of All Mothers: The Leadership Secrets of Kim Jong Il

September 1st, 2004

Atlantic Monthly
B. R. Myers
9/1/2004

You’ve just finished your life’s work, a bold new history of the Watergate burglary in which you manage to prove that the White House was out of the loop, but the ink is hardly dry when an eighteen-minute tape surfaces in a Yorba Linda thrift shop, and soon the whole country is listening to Nixon gangsta-rap about how he personally jimmied the door open. It’s every revisionist’s nightmare, but Bruce Cumings, a history professor at the University of Chicago, has come closest to living it. In a book concluded in 1990 he argued that the Korean War started as “a local affair,” and that the conventional notion of a Soviet-sponsored invasion of the South was just so much Cold War paranoia. In 1991 Russian authorities started declassifying the Soviet archives, which soon revealed that Kim Il Sung had sent dozens of telegrams begging Stalin for a green light to invade, and that the two met in Moscow repeatedly to plan the event. Initially hailed as “magisterial,” The Origins of the Korean War soon gathered up its robes and retired to chambers. The book was such a valuable source of information on Korea in the 1940s, however, that many hoped the author would find a way to fix things and put it back into print.

Instead Cumings went on to write an account of postwar Korea that instances the North’s “miracle rice,” “autarkic” economy, and prescient energy policy (an “unqualified success”) to refute what he calls the “basket-case” view of the country. With even worse timing than its predecessor, Korea’s Place in the Sun (1997) went on sale just as the world was learning of a devastating famine wrought by Pyongyang’s misrule. The author must have wondered if he was snakebit. But now we have a new book, in which Cumings likens North Korea to Thomas More’s Utopia, and this time the wrongheadedness seems downright willful; it’s as if he were so tired of being made to look silly by forces beyond his control that he decided to do the job himself. At one point in North Korea: Another Country (2004) we are even informed that the regime’s gulags aren’t as bad as they’re made out to be, because Kim Jong Il is thoughtful enough to lock up whole families at a time.

The mixture of naiveté and callousness will remind readers of the Moscow travelogues of the 1930s, but Cumings is more a hater of U.S. foreign policy than a wide-eyed supporter of totalitarianism. The book’s apparent message is that North Korea’s present condition can justify neither our last “police action” on the peninsula nor any new one that may be in the offing. It is perhaps a point worth arguing, particularly in view of the mess in Iraq, but Cumings is too emotional to get the job done. His compulsion to prove conservative opinion wrong on every point inspires him to say things unworthy of any serious historian—that there was no crime in North Korea for decades, for example—and to waste space refuting long-forgotten canards and misconceptions. Half a page is given over to deriding American reporters who once mistook Kim Il Sung’s neck growth for a brain tumor—talk about a dead issue.

Cumings is even harder to take when he’s in a good mood. By the time he has noted a vague resemblance between Kim Jong Il and Paul Anka, sniggered about “horny” Korean housewives, and mocked both a tour guide’s English and an African man’s surname (“I dissolved in hysterics”), most readers, with no photograph of the author to go on, will find themselves mentally exchanging his professorial tweeds for a very loud leisure suit. Most offensive of all is the book’s message that we shouldn’t be too hard on the dictatorship in Pyongyang, because human rights aren’t as important to Koreans as to the rest of us.

Does this system promote human freedom? Not from any liberal’s standpoint. But from a Korean standpoint, where freedom is also defined as an independent stance against foreign predators—freedom for the Korean nation—here, the vitriolic judgments do not flow so easily. This is a cardinal virtue among a people that has preserved its integrity and continuity in the same place since the early Christian era … After all, there is one undeniable freedom in North Korea, and that is the freedom to be Korean.

It seems to have slipped the professor’s notice that many countries manage to stay independent without dragging children off to gulags, and that North Korea is a place where a lot of characteristically Korean behavior—speaking bluntly, for example—is punishable by execution. The only significant part of the culture that can be freely indulged under Kim is its ethnocentric streak, which is what Cumings all but reduces it to; confusing cause and effect, he sees propaganda as the reflection of the popular soul instead of (to use Stalin’s metaphor) the engineer of it. The Korean people have always been more outward-looking than their insecure leaders, and for centuries this was especially true of those in the northern part of the peninsula. Even in the months after our disgraceful bombing campaign during the war—a campaign that Cumings rightly calls a holocaust—diplomats in Pyongyang noted no signs of indiscriminate xenophobia.

This was soon to change. Throughout the 1950s the regime resorted to crude racism in its anti-American propaganda, often treating inset eyes, big noses, and other Caucasian features as the manifestation of villainy. To the consternation of the diplomatic community, little effort was made to enlighten people about the existence of friendly big-noses, even though—as this spring’s Cold War International History Project bulletin makes clear—North Korea’s cities were rebuilt and its people fed and cared for with enormous amounts of assistance from Eastern Europe. “They expect foreign countries,” one Hungarian diplomat noted, “to give them everything.” Reading the CWIHP bulletin has the odd effect of making one realize what a relatively sensible bunch of people the Soviets were. In the mid-1950s they opposed Kim Il Sung’s brutal collectivization of agriculture; Kim brushed off their advice, only to demand food aid when a murderous famine ensued.

The more the regime evinced its incompetence by relying on foreigners, the more it needed to restrict the people’s contact with them. By the 1960s the party line had taken a turn that reminded a Soviet diplomat of Nazi Germany, as citizens who married Europeans were banished to the provinces for “crimes against the Korean race.” A diplomatic report translated in the CWIHP bulletin shows how the masses finally got into the spirit of things. In March of 1965 the Cuban ambassador was driving his family and some Cuban doctors around Pyongyang when they stopped to take pictures. Hundreds of adults and children quickly swarmed the diplomatic limousine, pounding it with their fists, tearing the flag off, and ordering the occupants to get out. Their rage and insults, directed mainly at the ambassador “as a black man,” abated only when a security force arrived to beat back the mob with rifle butts. (Not for nothing did Eldridge Cleaver say that the North Korean police made him miss the Oakland police.)

“The level of training of the masses is extremely low,” a party official later admitted to the ambassador. “They cannot differentiate between friends and foes.” In other words, everything was going as planned. The regime went on to blur the distinction further by excising all mention of outside assistance from the history books, even as it continued to squeeze billions of dollars from its cash-strapped allies. For decades a foreign proletariat toiling in dingy factories from Vladivostok to Karl-Marx-Stadt helped bankroll Pyongyang’s transformation into a proud monument to ethnic self-reliance, so that someday a Bruce Cumings could boast that it is anything but the ugly Communist capital one might expect. Well into the 1980s Kim was telling leaders of aid-donating states that he was having trouble meeting the basic needs of his people. If South Korea’s dictatorships were America’s running dogs, then North Korea was the Eastern bloc’s house cat: intractable, convinced of its superiority, and to some observers a more independent creature, but never much good at feeding itself—even after the can openers started falling silent in 1989.

The question of where Europe ends and Asia begins has troubled many people over the years, but here’s a rule of thumb: if someone can pose as an expert on the country in question without knowledge of the relevant language, it’s part of Asia. Europeans hoping to lay claim to North Korea should therefore brace themselves, because Bradley Martin’s publisher is touting Under the Loving Care of the Fatherly Leader (2004) as the definitive work on its subject, though it belongs squarely in the “a puzzled look crossed the faces of my guide and interpreter” tradition of monoglot scholarship. Although hardly definitive, it is still an excellent book, well researched and lucidly written. It is especially refreshing to find someone showing serious interest in North Korean propaganda instead of merely hooting at it.

The problem is that the official translations on which Martin was forced to rely do not always reflect the original. Kim Il Sung’s title Eobeoi Suryeong means not “Fatherly Leader”—a common rendering that encourages Martin to exaggerate the influence of Confucianism on the personality cult—but “Parent Leader,” the most feminine title the regime could get away with. As the country’s visual arts make clear, Kim was more a mother to his people than a stern Confucian patriarch: he is still shown as soft-cheeked and solicitous, holding weeping adults to his expansive bosom, bending down to tie a young soldier’s bootlaces, or letting giddy children clamber over him. The tradition continues under Kim Jong Il, who has been called “more of a mother than all the mothers in the world.” His military-first policy may come with the title of general, but reports of his endless tour of army bases focus squarely on his fussy concern for the troops’ health and comfort. The international ridicule of his appearance is thus as unfair as it is tedious. Anyone who has seen a crowd of Korean mothers waiting outside an examination hall will have no difficulty recognizing Kim’s drab parka and drooping shoulders, or the long-suffering face under the pillow-swept perm: this is a mother with no time to think of herself. When it comes to the Workers’ Party, the symbolism is even more explicit, as in this recent propaganda poem:

Ah, Korean Workers’ Party, at whose
breast only
My life begins and ends
Be I buried in the ground or strewn
to the wind
I remain your son, and again return to
your breast!
Entrusting my body to your
affectionate gaze,
Your loving outstretched hand,
I cry out forever in the voice of a child,
Mother! I can’t live without Mother!

It’s easy to imagine what Carl Jung would have made of all this, and he would have been right. Whereas Father Stalin set out to instill revolutionary consciousness into the masses (to make them grow up, in other words), North Korea’s Mother Regime appeals to the emotions of a systematically infantilized people. Although the propaganda may seem absurd at a remove, it speaks more forcefully to the psyche than anything European communism could come up with. As a result, North Korea’s political culture has weathered the economic collapse so well that even refugees remain loyal to the memory of Kim Il Sung.

The Yangs, for example, are former Party members who recently defected to the South with their two boys. As part of a campaign to prevent the formation of a refugee ghetto in Seoul, the family was resettled in Mungyeong, a charmless sprawl of apartment blocks and love hotels a few hours to the southeast. I visited them there in May. As we sat on the floor of their tiny living room, I told them how a young refugee once shrank from my approach because—as she later explained—I looked like the stick-nosed Yankee effigies she used to run knives into after school. “Yes, you do have …” the mother shouted over the general laughter, but she caught herself in time. Turning to the older boy, who is sixteen, I asked what wisdom he could remember from the Parent Leader. “Man is the master of his own destiny,” he said shyly, his voice trailing off. What about his parents? “We didn’t memorize sentences,” the mother said, embarrassed, so I asked her to explain Kim Il Sung’s ideology of Juche for me in her own words. “The main thing is, man is the master of his destiny,” she said briskly. “And?” I asked. Silence. “Well,” I said, “if people are the masters of their destiny, why do they need a leader?” The younger boy came to his mother’s aid: “It was something about flowers needing the sun to grow.” Everyone frowned at my pen scratching away; they were letting the Parent Leader down. “It wasn’t so much what Kim Il Sung said,” the father blurted out at last.

This is of course true. Expanses of tautological prose have been ghostwritten to fatten the spines of the two Kims’ collected works, but few people ever read them. North Korea is a unique socialist country in that its ruling ideology is conveyed through what is written about its leaders, not by them, and the message could hardly be simpler: Foreigners bad, Koreans good, Leader best. “The most important thing to us was that Kim Il Sung suffered for the people; he fought for us,” the boys’ mother said. With a start I realized that this elegant fortyish woman, who now sells American cosmetics for a living, had tears in her eyes. “The Leader would sit on the ground with farmers, just like we’re sitting here now. And if he shook someone’s hand, that person would be happy forever. Of course, Kim Jong Il is not like that.” Conversation turned to the railway explosion in the North at the end of April, and to the regime’s immediate focus on the material damage. “It’s because Kim Jong Il never suffered,” the father said bitterly. “What does he know about the common people?”

It would appear that Kim knows just enough. The border with China remains so porous that even children often sneak back and forth, and yet no more than three or four percent of the population has chosen to flee for good. The regime obviously did the smart thing by publicly acknowledging the food shortage and then blaming it on American sanctions, instead of pretending there was no food shortage at all, as Stalin used to do. The Dear Leader has also deftly exploited the tradition according to which Koreans care for their parents in old age: the masses are told that it is their job to feed him, not the other way around, and his famed diet of “whatever the troops are eating” is routinely invoked to shame everyone into working harder. Never has a dictator been such an object of pity to his people, or such a powerful source of guilt. In 2003 North Korean cheerleaders, living it up on a rare visit to a sports event in the South, responded to a rain-soaked picture of Kim by bursting into a hysterical lament that baffled their hosts.

To concede the effectiveness of the personality cult is not to agree with Selig S. Harrison’s startling assertion, in Korean Endgame (2002), that Koreans have a “built-in readiness … to accept as truth what is dispensed from higher authority.” No regime ever needed to subject its citizens to a lifetime of brainwashing in order to make them follow their natural inclinations. What must be acknowledged is that Kim Jong Il has evinced a genius for propaganda ever since managing the efflorescence of his father’s cult in the 1960s. Even so, he cannot cover his lack of charisma completely; it’s as if Hitler died and left the Third Reich to Goebbels.

Kim must also be aware that the infantilization of the people has come at a price. Away from Pyongyang’s carefully monitored tourist sites, North Korea is a much more raucous place than any dictator could be comfortable with. “One surprising thing,” Michael Breen writes in Kim Jong Il: North Korea’s Dear Leader (2004), “surprising because you expect robots, is … how frequently fights break out.” According to refugees, even women fight out their differences, and young female teachers are said to hit children the hardest. This lack of restraint is a problem for many North Koreans trying to adjust to life in the South. Social workers complain that the refugees pick fights with strangers, and storm off jobs on the first day. “I’d have thought they’d be better at controlling themselves, coming from a socialist system,” is a common lament.

In short, the conventional Western view of North Korea’s official culture as a stodgy combination of Confucianism and Stalinism—two ideologies that prize intellectual self-discipline above all else—could not be further from the truth. Fortuitously enough, this view has so far encouraged Americans to stay cool in the face of Kim Jong Il’s missile-rattling. But misperceptions of hostile regimes are inherently dangerous, especially when Uncle Sam is doing the misperceiving, and this one has as much potential to excite tensions as to reduce them. On August 18, 1976, a detail of U.S. and South Korean soldiers at the DMZ were pruning a tree when People’s Army soldiers demanded that they stop. The Americans refused, prompting the North Koreans to wrest away their tools. In the ensuing clash two American officers were killed. Unable to conceive that Communist troops could act out of spontaneous rage, Washington assumed that Kim Il Sung had ordered the incident. Troops were set on high alert, and nuclear-capable B-52s dispatched to skirt North Korean airspace. Luckily for everyone, the Parent Leader issued an apology for his children on August 21. As the Americans saw it, of course, Kim had “backed down.”

Perhaps the most unsettling thing about the nuclear accord brokered by Jimmy Carter in 1994 is the decade of crowing it set off in North Korea. A high-school textbook remembers, “The Great Leader dragged the Americans, who had fallen into a state of extreme terror and unease, to the negotiating table … All problems discussed during the talks between America and Korea were resolved to Korea’s advantage, and the intense nuclear standoff ended in our victory.” This is evidently sincerely believed; if it weren’t, the North Koreans would not still be so enamored of Carter and Robert Gallucci, the chief U.S. negotiator back then. Both men—and this must thrill them no end—are praised in propaganda literature as fervent admirers of Kim Il Sung.

It is reassuring, then, to read in Harrison’s book that the agreement actually represented a victory of high-ranking North Korean “doves” over their hardline colleagues. I just wish he had explained why even the most hawkish propagandists remember it so fondly. What bothers me more is the author’s insistence on interpreting the two Kims’ every act as part of a rational pursuit of national security. We are told, for example, that the deployment of atomic weapons in South Korea in 1958 frightened Pyongyang into starting its own nuclear program. As the CWIHP bulletin makes clear, however, Eastern European diplomats in the early 1960s were aghast at the North Koreans’ assertions that a nuclear confrontation was nothing to be afraid of, and that the time had come for another invasion of the South. It is by no means certain that this sort of adventurist thinking has been abandoned. In a propaganda novel set in 1993, Kim Jong Il and his generals regard a likely American air strike on the Yongbyeon nuclear facility as the perfect opportunity for a “sacred war” (seongjeon) of reunification. Harrison ignores such things, which may well be better than overreacting to them; but to approach North Korea as if it were the détente-era Soviet Union is asking for trouble. When he gets his next update on the hawk-dove struggle from officials in Pyongyang, a city where most foreigners count themselves lucky to learn their tour guide’s name, he should perhaps keep in mind that North Korea has always viewed the existence of similar factions in Washington as the manifestation of a ludicrous disunity. No one under Kim Jong Il would describe his government in such terms to a Yankee visitor unless the goal were to extract more concessions from the outside world.

Considering that for decades the North Koreans refused to listen to their own allies, it seems naive for the author of Korean Endgame to assume that what Washington does “will largely determine what the North … will do.” The Juche regime has received substantial U.S. aid since the famine, but the dominant slogans of anti-American prop-aganda remain “A hundred thousand times revenge” and “A jackal can never become a lamb.” In other words, even as the regime tells the outside world it wants nothing but better relations with Washington, it tells its own people that better relations are neither desirable nor conceivable. In January of 2003 Pyongyang issued a taunting poster of a missile attack on the Capitol.Later that year, with the six-party talks in progress, an old tale of murderous missionaries was reprinted in four North Korean magazines, complete with racist caricatures.

Still, the thrust of Harrison’s book is valid.

The goal of the United States should be to disengage its forces gradually … over a period not longer than ten years, whether or not this can be done as part of a negotiated arms-control process … The stage would then be cleared, as it were, with the initiative left to Seoul and Pyongyang. Washington would have its hopes and its advice but would recede into an unaccustomed posture of detachment, ready to let the two actors make their own mistakes.

This is excellent counsel. Far from being a stabilizing factor on the peninsula, the U.S. presence serves only to rally the North Koreans around their military-first government. As Harrison makes clear, this is no time to get sentimental about our old ally. Seoul asks that U.S. troops stay, but at the same time it poses as a neutral mediator of the resulting tensions, often playing down the nuclear threat just as Pyongyang seems bent on playing it up; a disastrous miscommunication among the three parties seems all but preordained. It is a shame that Harrison does not place greater stress on the need to extricate our troops even if the arms-control process fails, because it’s hard to see how it can succeed. Kim Jong Il refused to let South Korean doctors tend to blinded children after the North’s railway explosion last spring; such a pathologically secretive man must be expected to balk at an early stage in the verification of nuclear dismantlement, no matter what agreement he has signed. Washington will then renege on its part of the bargain, prompting Seoul to voice regret over American “intransigence.” This, in turn, will embolden the North to demand a re-negotiation of the point in question, and we will all be right back where we started, albeit with even more nukes to worry about.

In the meantime, anything can happen. Having predicted the speedy downfall of the regime back in 1994, Pyongyang-watchers now predict that it will be around forever, but North Korea is already well into a precarious post-totalitarian phase. Thousands of citizens in border regions chat with refugees by smuggled cell phone, and millions more enjoy illegal access to television broadcasts from outside the country. The majority of the population has bought and sold things at open-air markets, and many young people in rural areas have simply stopped attending school and political meetings. The personality cult will find it hard to adjust to this kind of change without routine recourse to anti-American alarmism, and if there are no grounds for confrontation, Kim Jong Il can be expected to create them. All the more reason, then, for America to heed Harrison’s advice and pull out. But will we do so? Our patriotic dash into the Iraqi quagmire hardly inspires confidence that we wouldn’t follow our own Dear Leader into a new conflict in North Korea, especially since the WMD really do look like a “slam dunk” this time.

The only comfort to be had from the new batch of Korea books is provided by Breen’s biography of Kim Jong Il, which details a hedonistic streak as wide as the DMZ. Apparently the dictator lives in a huge palace stocked with Paradis cognac, and every summer a fresh “Joy Brigade” of high school beauties gets to admire the ceiling. Breen waxes indignant about this, but would he rather Kim were sharing a tent with a mountain goat and a well-thumbed Koran? We can all breathe a little easier knowing that our most formidable adversary wants his virgins in the here and now.

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North Korea’s environment crisis

August 27th, 2004

BBC
Alex Kirby
8/27/2004

[NKeconWatch: Here is the report-  DPRK_SOE_Report.pdf]

The UN and officials in Pyongyang have agreed the first-ever assessment of the state of the North Korean environment.

The report was written by North Korea’s national co-ordinating council for the environment, together with the UN’s Development and Environment Programmes.

The head of Unep said Pyongyang had shown its readiness to work with the world community to safeguard nature.

The report lists a catalogue of neglect and over-exploitation of resources, and says time is short to put things right.

The report, DPR Korea: State Of The Environment 2003, was produced by officials from 20 government and academic agencies, with training and guidance from the two UN programmes.

Future collaboration

It was compiled as a result of a visit to Pyongyang in 2000 by Unep’s executive director, Dr Klaus Toepfer.

He and Dr Ri Jung Sik, secretary-general of the national co-ordinating council, have now signed a framework agreement on joint activities to improve environmental protection.

The report covers five areas: forests, water, air, land and biodiversity. It says the most urgent priority is the degradation of forest resources.

Forests cover 74% of North Korea, but almost all are on steep slopes. In the last decade the forests have declined in extent and quality.

The report says this is because of timber production, a doubling of firewood consumption, wild fires, insect attacks associated with drought, and conversion of forest to farmland.

On water it says demand is rising “with economic development and the improvement in standards of living”, and calls for urgent investment in domestic sewage and industrial water treatment.

It notes that large quantities of untreated wastewater and sewage are discharged into rivers, and says some diseases related to water use “are surging”.

Air quality, the report says, “is deteriorating, especially in urban and industrial areas”. Energy consumption is expected to double over 30 years, from almost 48m tonnes of oil equivalent in 1990 to 96 million tonnes in 2020.

North Korea’s use of coal is projected to increase five times from 2005 to 2020, underlining, the report says, “the urgent need for clean coal combustion and exhaust gas purification technologies, energy efficiency, and renewable energy alternatives.”

On land use, the report says self-sufficiency in food production has been a national policy aim in North Korea.

Changed priorities

But it continues: “Major crop yields fell by almost two thirds during the 1990s due to land degradation caused by loss of forest, droughts, floods and tidal waves, acidification due to over-use of chemicals, as well as shortages of fertiliser, farm machinery and oil.

“Vulnerable soils require an expansion of restorative policies and practices such as flood protection works, tree planting, terracing and use of organic fertilisers.
“Recognising such issues, [the country] adjusted its legal and administrative framework, designating environmental protection as a priority over all productive practices and identifying it as a prerequisite for sustainable development.”

North Korea is home to several critically endangered species, among them the Amur leopard, the Asiatic black bear and the Siberian tiger.

Squaring the circle

It has signed up to international environmental agreements such as the Convention on Biological Diversity, though the report notes a continuing “contradiction between protection and development”, which it says is being overcome.

In a wider context, the report says: “The conflict between socio-economic progress and a path of truly sustainable development is likely to be further aggravated unless emerging issues can be settled in time.”

It says environmental laws and regulations need to be formulated or upgraded, management mechanisms improved, financial investment encouraged, and research focused on priorities.

Dr Toepfer said North Korea “has shown its willingness to engage with the global community to safeguard its environmental resources, and we must respond so it can meet development goals in a sustainable manner.”

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DPRK’s “Morning” firm produces Pentium IV chips

August 26th, 2004

From Asia Times:

North Korea has mass-produced computers with Pentium IV processors since 2002, a Russian journalist says in a new book. The confirmation came at a time when the United States and North Korea are in a war of nerves over US and international export control regulations that would ban 15 South Korean firms selected to operate in an industrial complex in the North’s city of Kaesong from bringing in “strategic materials,” including computers.

The South Korean companies said they must be permitted to bring computers with at least Pentium IV chips, which are essential for normal office work, citing earlier unconfirmed reports that the North already began to produce those kinds of computers.

“North Korea has produced computers with Pentium IV processors since 2002, which I saw during my visit to an electric appliance factory in Pyongyang,” Olga PMaltseva, a Vladivostok-based journalist, said in her new book about the North Korean leader, Kim Jong-il.

The Korean translation of the book, titled “A Waltz with Kim Jong Il” was published here on Monday.

“Seven hundred workers and technicians made 14,000 Pentium IV computers in 2002,” she said.

“The factory has produced tens of thousands of computers since 1986 and half of them were exported to Germany.”

There was a similar report by the Choson Sinbo, organ of the pro-Pyongyang General Association of Korean Residents in Japan, in May last year.

The newspaper reported at the time that a North Korean electronic appliance developer has been selling computers with Pentium IV processors in a joint venture with China’s Nanjing Panda Electronics Co since September 2002.

South Korea’s Korea Trade-Investment Promotion Agency (KOTRA) confirmed the report in August last year, citing data from its North Korean counterpart, the International Trade Promotion Committee.

The KOTRA said the North’s electronics firm “Achim (Morning)” and China’s Nanjing Panda have produced three types of Pentium IV computers.

The Russian author is believed to have visited the joint venture factory.

North Korea is classified as a “dangerous country” under the Wassenaar Arrangement, which replaced the Cold War era’s Coordinating Committee for Export Control to Communist Areas in 1996, and thus signatory countries cannot export items classified as “strategic materials” to the communist state.

The items include computers, various metal machinery, laser equipment, high-tech materials and electronic appliances with US-produced parts.

South Korea is among the 33 signatory nations.

An earlier report said the South Korean government is studying ways for the 15 domestic companies to use production equipment, materials and office supplies in Kaesong without conflicts with the U.S.

The Kaesong industrial complex, being built by the Korea Land Corp and Hyundai Asan Corp, a South Korea firm, is one of the most prominent symbols of inter-Korean reconciliation set in motion by the first-ever summit of the leaders of the two countries in 2000.

The developers are scheduled to open Kaesong’s main complex to hundreds of South Korean manufacturers in the first half of next year.

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