GoodFriends: Research Institute For North Korean Society

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North Korea Today No.305 November 2009

[“Good Friends” aims to help the North Korean people from a humanistic point of view and publishes “North Korea Today” describing the way the North Korean people live as accurately as possible. We at Good Friends also hope to be a bridge between the North Korean people and the world.]
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[Hot Topics]
Closing of Pyongsung Market Causes Increase in Migration to Soonchun
Management Committee of Soonchun Market in Trouble for Lax Enforcement
Staff of State-Run Stores in Haejoo Work to Stock Shelves with Wholesale Goods
Markets Prosper along the Soosungchun Railroad in Place of Markets of Chungjin and Soonam

[Food]
Snow Hinders Harvest in North Hamgyong Province
Farmers Live on Grass Porridge since March in Jaeryong County
Gilju County, Its Life depends on Vegetable Farming after Failed Corn Harvest

[Economy]
Kusung Textile Factory, Outdated Machines are Preferred to Unreliable Replacements
Intense Crackdown on SoonChun Pharmaceutical Factory Workers

[Politics]
National Security Agency Intensifies Spy Patrols
Sariwon, the Investigation of the Anti-Socialist Activities

[Society]
Doctors Mobilized for Rebuilding Nampo People’s Hospital
Residents of Chungjin City Feel Burden Providing Supplies for the Heochun Power Plant in Jagang Province

[Women/Children/Education]
South Pyongan Province Democratic Women’s Union (DWU), “Make Indomitable Pride of North Korean Women Widely Known”
National Border Area, “Number of Women Crossing the River Decreases due to 150-days Battle”
The Academic Performance of Seojoong Middle School in Rakwon County is Not Up to Par Yet

[Accidents]
Onsung County, Mother Committed Suicide After Her Daughter Fled the Country

[Editorial]
Not Market Closure, but Revitalization of Factories is the Solution
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[Hot Topics]
Closing of Pyongsung Market Causes Increase in Migration to Soonchun
As the general market of Pyongsung, South Pyongan Province has been closed, more residents are leaving Pyongsung. Residents who have been leaving are typically those who cannot find a way to make a living locally. Many move to Soonchun, which arose as a wholesale town of privately fabricated products. The residents, mainly merchants, receive permits to move by bribing officials of the Residents Registration Section of the city police and then move to Soonchun. In the past, the City of Pyongsung played the role of a wholesale market for the nation, taking advantage of geographically favorable conditions along the line connecting Sinuiju and Pyongyang as well as a convenient transportation system. As a consequence, Pyongsung residents could enjoy a higher standard of living in comparison with other regions. However, the enforced market closing dealt a severe blow to the living conditions of residents. Even though there was a ration of grain last October, it was such a meager amount that it was not of any help to the residents. Residents are complaining that they cannot survive without commercial activities. As the number of residents wishing to move to Soonchun has increased, the provincial party of South Pyongan Province finally issued a directive to the provincial security department and the city police department: “Do not issue any permits to residents of Pyongsung who wish to move to Soonchun. Approve the permits only of those who are ordered to move to Soonchun according to national policy.” The intervention of the party slowed down the entry of non-residents into Soonchun temporarily. However, residents are likely to continue trying to make a living one war or another. In the meantime, on October 17, economists of the central party and the cabinet held meetings in order to find ways to rejuvenate the economy and to improve the daily diets of residents. Their conclusion was that general markets should be closed, such as the Pyongsung Market, and that the markets in the capital area should be abolished as soon as possible. Their announced policy was that state-run stores should take the place of private markets and play a more active role.

Management Committee of Soonchun Market in Trouble for Lax Enforcement
The City of Soonchun, South Pyongan Province, attracts people looking for jobs from other regions. As the city has developed many privately run handicraft shops and has a balanced distribution of commercial activities, from merchandise production to sales, more non-residents have sought to enter. In comparison with the City of Pyongsung, which got hurt by the closing of general markets, Soonchun has allowed its markets to function rather freely until recently. However, some time ago authorities ran inspections of market stalls, looking for restricted merchandise. These sales booths with unrestricted merchandise, including contraband items as well, were tacitly permitted by the officials of the management committee. After the public prosecutor’s office discovered the illegal sales, they ordered the arrest of the manager and the treasurer of the committee and investigated them for two days. Fortunately, there was no bribery involved and they were released only with reprimands. But this incident has caused the city to initiate a market inspection procedure with a new organization, involving the city party, city administration and city police. As a consequence, the sale of contraband items will result in a fine of 3,000 to 5,000 NKW. All merchandise is also strictly limited to less than 50 Kg. In comparison to the unrestricted activities of merchants in other regions, those who cannot conduct business under the tacit permission of officials suffered devastating losses. However, secret deals by merchants continue as long as they are able to avoid inspectors’ observations.

Staff of State-Run Stores in Haejoo Work to Stock Shelves with Wholesale Goods
The sales people in state-run stores are playing the role of wholesalers as they fill up the shelves in Haejoo, South Hwanghae Province. An import-export trade company delivers approximately sixty percent of the merchandise in state-run sores, the remaining forty percent is supposed to be provided by the sales people of the stores. Because the import-export trade company can only provide a limited variety of goods, the sales staff has to rely on private wholesalers. Because ninety percent of the payment for the merchandise is in promissory notes and only ten percent is in cash, the response to these deals with private wholesalers has not been positive. Most of the items are made in China and merchants cannot purchase them from China with promissory notes. The inability to pay for Chinese goods with cash has lead wholesalers to avoid deals with state-run stores. Nonetheless, sales people of the state-run stores devise creative ways to earn money in those deals.

Markets Prosper along the Soosungchun Railroad in Place of Markets of Chungjin and Soonam
Markets have along the railroads at Soosungchun, in the City of Chungjin, North Hamgyong Province, are in high demand these days. Merchants unable to find sales booths at Soonam market sell their wares here. There are around 200 to 250 merchants here. Previously on September 25, the police chief of the Soonam district delivered a long and threatening speech to the merchants. The message was that fines will be imposed on merchants in accordance with the guidelines for maintenance of the market and that merchandise would be subject to confiscation. In other words, merchants should follow the proper procedures and processes to enter the market for commercial activities. Merchants do not seem to care about the threats made by the police chief because they cannot afford to pay for stalls in the market and thus feel that they do not have anything to lose. Starting a few days after the threatening speech, eight policemen from the Soonam district show up at the market at two o’clock to conduct regular inspections. Those merchants who can afford to bribe them with cigarettes can avoid big losses. Other poorer merchants have to rely on ‘guerilla’ tactics, hiding and avoiding the regular inspections.

Kim Gyehwa (alias) told a story about a big loss suffered at three o’clock in the afternoon on September 29, when policemen appeared suddenly out of nowhere. “Normally at 2 PM, the policemen are beside the railroad and the merchants in hiding watch the policemen trying to figure out when they will disappear. When the policemen disappear, the merchants show up slowly one by one and display their merchandise. Once in a while, the policemen suddenly rush to the market from nowhere on motorbikes. It was like that the other day. When it happens, it reminds me of a scene in a movie. Merchants scatter around in all directions to avoid confiscation of their merchandise. The whole place looks like it has just been bombed. Many items on display are damaged because they cannot be carried away by the scattering merchants, or are torn apart or trodden. I suffered a big loss because a lot of my clothing was torn apart. I also had to pay a fine. The torn clothing and the fine broke my heart. How long do I have to be treated like a wild animal while trying to make a living? “

[Food]
Snow Hinders Harvest in North Hamgyong Province
Early winter snow has hindered the harvest in North Hamgyong Province. At farm units 4 and 5 in Yingye-ri, Heoryong City, snow buried sheaved rice before it was able to be removed from the fields. A large inevitable loss is predicted because snow covered grains easily fall off during transportation. Furthermore, farmers said that it would be difficult to thresh harvested corn and rice due to the snow.

Farmers Live on Grass Porridge since March in Jaeryong County
Jaeryong County in South Hwanghae Province is known to have one of the best granaries in North Korea. The Jearyong Plain not only produces vast amounts of food, South Hwanghae Province also produces good quality rice. Even during the 1990’s Arduous March, when many people from Hamgyong Province died from starvation, people from in this area did not experience severe starvation. However, since 2007, there are growing numbers of people suffering from severe starvation. In the collective farm town of Jaeryong, less than 6-months worth of food provisions were distributed in both 2007 and 2008.

This year, two crops of potatoes and barely were planted at the end of April. The Farm Management Council promised that these food provisions would be distributed after an early harvest at the end of June. However, right after the harvest on June 30th, a nearby army unit took most of the food due to their food shortages. This left households to receive at most, a total of 12-kg of potato and barley.

Last year, the farmers ate grass porridge from May until August. The situation this year has worsened and the farmers have been eating grass porridge since March, even in the midst of harvest season. During last spring’s lean season, many families could not work due to starvation and this year the situation has declined further. A farmer complained, “The army units took away the entire early harvests of potato and barley and left none for us. It’s going to be difficult for them to force absent farmers to work.” The collective farm mangers visited absent worker’s houses to talk to them about coming back to work. Once they witnessed and realized that the farmers only had a mixture of corn powder and grass porridge to eat, they were silenced.

Potato and barley seeds were urgently distributed to the farmers on July 4th. Each household received 10.5-kg of barley, 3.7-kg of potatoes, and was told to hold out until the end of July. The farmers were encouraged to work once the July food shortage was surmounted. They were told that there was a better food provision outlook in August because they expected an early corn harvest. However, due to a severe drought in August, corn farming failed as well as the plan to give farmers corn. Therefore, farmers are still living on grass porridge, even during harvest season.

Recently, farmers have been going to the fields in the evening to glean grains from rice plants. Afraid of getting caught for stealing, the farmers do not take the grains to the rice mill to polish at the collective farm; instead they pound the grains in a mortar at home. They end up with a very small amount of polished rice that they use sparingly to make porridge. They say that the gluteus from the rice makes the porridge stickier than if it were made with corn powder and grass only; it makes their stomachs fuller longer.
Similar to last year’s situation, the food shortage is causing the number of scattered households, where family members scatter to survive, to increase. To reduce the number of mouths to feed, parents petition and request their grown children to enter the army or special labor brigades. The farmers from Jaeryong Town stated, “We’ll make it this year, but what about next year? The government needs to put out proper countermeasures to save people.”

Gilju County, Its Life depends on Vegetable Farming after Failed Corn Harvest
Gilju County in North Hamgyong Province ruined its corn harvest this year due to draught and below average temperature. If they harvested about 4 tons from one jungbo (2.45 acres) last year, this year’s harvest was about half of that. In early spring, it was evaluated that the initial seedling was done well. During the 150-Battle period, the farmers worked especially hard under the guidance of the farm official. Nevertheless, in May and June there were many cloudy days and lots of rain, and corn worms appeared a lot. The farm workers plowed up the damaged corn fields using tractors and in mid July they planted cabbage, radish, and other vegetable seeds, but draught began less than a week after the planting, causing insufficient sprouting of seeds. Desperate that they could not afford another failure after the corn, every farmer worked day and night to water the vegetable fields.

Not only the farms but also the individuals threw themselves on small patch vegetable farming as if their lives depend on it. Every member of the family was mobilized to get water from the river. These vegetables go to Heasan City, Ryanggang Province. Gilju County is located near the railroad and highways going to Ryanggang Province, and is convenient to transport vegetables to Heasan City. Every year Gulju County residents had sold their vegetables to the Haesan City where the low temperature was not suitable for vegetable farming. A household at least produces 1-2 tons of cabbage, 1 ton radish per jungbo and sell them to purchase food items for the next year. This year as usual the success of vegetable farming and the proceeds from the sale will decide how much food items they could buy for the next year. The draught in the summer caused a big drop in the total harvest. Those farmers who farmed small patch of land had failed both corn and vegetable crops and were worried that they may not even recoup the seed money. However, those who stubbornly cared for the vegetables were able to begin selling their produce to Heasan City starting in mid October. Those who are good at selling can earn more than 1 million NK won. The average is about 600,000 – 700,000 NK won of income. From the total amount, they have to deduct the cost of seed, fertilizer, transportation, and use the remaining balance to buy next year’s food items. Because this is a lot of money for the farmers who have no other means of income, they give all their might to vegetable farming.

[Economy]
Kusung Textile Factory, Outdated Machines are Preferred to Unreliable Replacements

The Kusung Textile Factory in Kusung, South Pyongan Province purchased new machinery from abroad in order to improve productivity. Last October, they dispatched technicians to the Pyongyang Textile Factory to have them learn how to operate the machines. However, since February of this year there have been many days when they could not operate the machines due to malfunctions. All the best technicians at Kusung Textile Factory were mobilized and attempted to repair the machines, but to no avail. So, they had no choice but to call for help from technicians at the Pyongyang Textile Factory because they thought repairing the machines would be more effective since the new machines can get the job done in 8 hours instead of the more than 3 days that the old machines require. Then, the machines broke down again in April. So, they had to hire three technicians from Pyongyang Textile Factory, but the compensation they had to provide to the technicians was costly. Each visit by the technicians costs at least 600,000 NK won, in addition to providing them with deluxe treatment during their stay. Although Kusung Textile Factory is one of the top enterprises in North Korea, the financial situation at the factory has declined to the extent that it is unable to provide food to its workers. The factory provided 10-days-worth of food to the workers in June and July. Since then, their financial situation has prevented them from distributing any ration whatsoever to workers. Therefore, hiring the technicians from the Pyongyang Textile Factory is a big burden upon them.

Since another breakdown of machines that happened in June, the factory has not been able to afford to call technicians from the Pyongyang Textile Factory. The workers are saying that not using the brand new machines would be better since they have to leave them idle for such a long time when they break down. Moreover, there is not much chance of an improvement in the power supply, which is always unstable. No matter how fast and how high quality the machines are that are purchased from abroad, they tend to break down easily because of frequent power outage and big variation in voltage. In addition, the fact that the new machines require only 5-6 workers while the old machines require 30 workers has been another complication. If the new machines run without problems, then the factory has to fire many employees, which poses a problem. Thus, the workers say, “The productivity can be a little bit low, but it is better to use old machines and produce fabrics considering the current situation.”

Intense Crackdown on SoonChun Pharmaceutical Factory Workers
The pharmaceutical factory in SoonChun City is a reputable production facility located in the West coast region of South Pyungan Province. It produces various types of over-the-counter drugs including aspirin, streptomycin and laxatives. The factory received compliments and was highly regard by the central party for its contribution of free medicines that were provided to military compounds in July and October of 2008 and May of this year. However, in spite of the honor that the factory received, its workers’ food rationings were often late. Consequently, as a means of sustenance, the general factory workers and pharmacology staff resorted to stealing medicine from the production line or producing homemade medicine for sale. The homemade drugs were reported to have inadequate potency and some caused severe side effects that almost resulted in fatality. The authorities began closer observation of the pharmaceutical factory workers as suspects. Similar tragedies occurred last July in Ryunpo Dong where a homemade streptomycin injection shot killed a patient. Adverse side effects were noted in other cases because of misuse of medication. The authorities continued strict enforcement to confiscate all homemade medicines and impose heavy fines.

[Politics]
National Security Agency Intensifies Spy Patrols
Last October 11, the National Safety and Security Agency of North Korea announced that a South Korean spy network is being formed. North Hamgyong Province and other border area are in search of spies in response. On October 15, the Border Defense Security Command was ordered to begin cracking down against spies who are selling confidential military information for financial gain. The initial surveillance targets are individuals smuggling goods by bribing border patrol guards and people who travel to China to visit relatives. Officials are strengthening supervision of family members with missing relatives and defectors. All security agents from the brigade visited Sanha Battalion and began a political campaign with all high ranking officers and soldiers. They emphasized that there will be severe punishment of all crimes committed at national border areas. They are also calling on residents to be vigilant. Last October 19, a meeting of neighborhood unit heads was called by security officers and the superintendent of the police department and officials were told, “There will be harsh punishment for anyone found guilty in our province (North Hamgyong Province)”. They explained that a manager at a factory in Gimchaek City was angry after being fired from his job. Instead of repenting, he took his family and two other families to South Korea on a boat. A few hours after the meeting, three families from Onsung County, Jongsung District and one family from Heoryung were caught when they tried to cross into China. On the next day, provincial national security and national border patrol brigade ordered a special patrol and strict residential management. In addition, they launched a strategic plan for all border areas against “all unemployed, anyone who was paid for their work and do not go to their workplace, anyone who doesn’t attend work, anyone with 8.3 (absentees who pay money to avoid work), anyone who does not go to work without a doctor’s note, anyone with repeated troubles, anyone with a criminal record, anyone with a defector in the family.” They ordered the head of the neighborhood units to help security agents in charge. Their instructions included a check for those who are sick and staying home from work. Neighborhood leaders were expected to talk to physicians to check the validity of an absentee’s excuse, verify how many times an individual came to visit and if the illness prevents them from working. They also need to find out in details on everyone who has traveled outside their region including their purpose, destination and people they met. Such intense security requirements are stretching the nerves of every unit and section.

Sariwon, the Investigation of the Anti-Socialist Activities
Youth Union Officers are now mobilized within the Investigation of the Anti-Socialist team activities throughout the nation including Sariwon, North Hwanghae Province. Starting in 2007, the Youth Union Officers are inspecting young men and students who recently graduated and are unemployed gang members who are creating disorder. Anyone caught during the inspection is sent to a disciplinary center that is managed by the discipline education center office. Upon their release from the disciplinary center, they are dispatched to factories or enterprises. The Youth Union Officers of Sariwon are also mobilizing disciplinary teams to inspect dress code violations in the main streets, near marketplaces, train station and other main areas. Young women are caught if they are wearing Chinese straight leg pants or a necklace. Their items are confiscated and they are sent to the Youth Union and are forced to work without compensation.

[Society]
Doctors Mobilized for Rebuilding Nampo People’s Hospital
Nampo City People’s Hospital in South Pyongan Province worked on a rebuilding project during the last 150-day battle. Since the construction materials provided by the city were not sufficient, the medical workers of the hospital had to find the resources.

Having failed to find a viable solution, the director of the hospital sold 8 cartons of UN-provided medicine in the market. The money allowed them to complete the outside work, but the interior was not finished until the 100-day battle started. They managed to complete the whole rebuilding process by October 5.

During the period, the doctors and nurses were also mobilized for work on the reconstruction site. They met patients for two hours and spent the rest of the day working on the construction site. As fewer doctors showed up because of food shortages, on October 1 the City Party of Nampo barely managed to provide them with a week’s supply of food, obtained from the Grain Administration Department and the Health Department. The distribution was made for the individuals but was not nearly enough for the families.

Residents of Chungjin City Feel Burden Providing Supplies for the Heochun Power Plant in Jagang Province
The Shinam District People’s Committee in Chungjin, North Hamgyong Province, is collecting supplies to support building the Hoechun Power Plant in Jagang Province.
Working tools are needed so shovels, pickaxes, Chisel, hammers and gloves are collected. Five pairs of work gloves and one piece of the rest of the tools are assigned to each family. Each household is required to write two letters of support.
Residents of Shinam District said they would write any number of letters but are frustrated with the burden of submitting supplies because of the cost.

[Women/Children/Education]
South Pyongan Province Democratic Women’s Union (DWU), “Make Indomitable Pride of North Korean Women Widely Known
The South Pyongan Province DWU is strengthening political organization business, declaring to “make indomitable pride of North Korean women on today’s offensive movement for the key to the advanced country.” Directive workers of the South Pyongan Province DWU went to major companies such as Chollima steel manufacturing enterprise, Daean heavy machine united enterprise, Victory car manufacturing united enterprise and Geumsung factory to seriously discuss the issues about exalting DWU laborers and members. Considering these points, Chollima County and Daean County DWU committees decided to organize ‘Family supporting Group.’ These members will provide operation tools to laboring site of each company or work with the laborers. DWU members must pay 500 NK won for tool preparation. Despite the difficulty of retaining livelihood due to lack of food, DWU claims that members should support military business, Mt. Baekdu construction business and Heachun power plant business. Some members complain DWU’s suggestion because it is burdensome to support companies in provinces and other supporting businesses.

National Border Area, “Number of Women Crossing the River Decreases due to 150-days Battle”
DWU of National Border Area in the North Hamgyong Province declared that the number of women crossing the river has decreased because of the 150-Day battle. Of course, there were still women crossing the river, but the number of women crossing the river decreased largely in the past two years. The DWU surmises that the efforts of labor mobilization and education business prevented women from thinking about crossing the river. In Heoryong City, women suffered difficult days due to the construction work during the 150-Day battle. It was normal for women to leave for work every morning and return at 9 p.m. Because the construction work was difficult, many women were not able to do any housework after returning home from work. If they did not want to go to the construction site, they had to pay a fee of 4000 NK won a day. In Onsung City, there was a problem of rich women who missed work by paying large sums of money. The DWU chairwoman and vice chairwoman received bribes and exempted the rich women from having to work at the construction site. They were also accused of embezzling the money collected for taxes and the chairwoman resigned. Despite these events, the financial burden on women continues. Since October 18, the DWU has been collecting 4500 NK won from each member in order to raise silkworms. If a person cannot pay the fee, she is punished for disobeying the Dear Leader and punished by spending 10 days receiving refinement education in the morning and working at night. This punishment is such that the women try to get the money in any way they can. The labor support is also continuing. The DWU members carry pebbles and soil on their backs for the construction of bridges and roads. If a person misses a day of work, she must pay a fee of 5,000 NK won. Even terminal patients are required to pay 2,000 to 3,000 NK won a day. Because of the 100-Day battle, which started recently, the DWU members receive lectures daily. Women are complaining because of the demands to either pay fees or work harder.

The Academic Performance of Seojoong Middle School in Rakwon County is Not Up to Par Yet
Seojoong middle school in Rakwon County, South Hamgyong Province, is not reaching up to the academic expectations. Because the school has a great facility and good teachers, Kim Jung Ill even visited the campus this spring. Thanks to the government’s consideration and investment, the school has laboratories and experimental resources including 20 computers. Since the East Sea Naval Headquarters is located in Rakwon County, almost half of the students are children of government or military officials. Children of executive officials, Unit workers, and labor workers make up for 30%, 15%, and 5%, respectively, of the rest. Because those with bad class foundation were already expelled from the county, residents in Rakwon County only composes of those with strong ideology and enthusiasm for their children’s education, which attracts national interest to the school. The school was originally established to foster young intellectuals, but the academic performances of the students are not satisfactory yet because the proper educational system is not in place. According to the results of a diagnostic test administered in September, the performance of the school was lower than that of any other school in rural areas that did not receive funds from the government. The County Education Administration instructed the school to find ways of increasing the students’ performance.

[Accidents]
Onsung County, Mother Committed Suicide After Her Daughter Fled the Country
On September 24th in Onsung, Onsung County, North Hamgyong Province, a woman in her 60s committed suicide because her daughter fled the country. The daughter had been in a re-education center because she got caught in three days after her attempt to flee the country three years ago. It was difficult for the mother to take care of the daughter who was in the center. Moreover, the suspicion and constant watch from the police and government were even more difficult for the mother to bear. When the daughter was released, the mother was relieved to see her free. However, it was not long before the daughter escaped the country again because she could not endure the severe food shortage. According to her neighbors, the mother always worried about the ordeals she had to go through again because the Police Station and Police Officers would constantly torment her asking her daughter’s whereabouts or whether her daughter had defected to South Korea. She also worried whether her daughter was going to be caught again. She eventually committed suicide in her own home because constant starvation and worry seemed too unbearable for her. Her neighbors, who visited her house after the suicide, were astonished to find out her poor living conditions. Some said, “We don’t know how she managed to support for her daughter when she was kept in the re-education center.” Others wondered whether taking care of her daughter could be the reason she became so poor. These days, residents become more careful about what they say due to the tightened border security, but they say under their breath, “Who in the world would flee their own country if the country actually provides livable conditions for its citizens? The government is to blame but, on the contrary, it is taking away innocent citizens’ lives.”

[Editorial]
Not Market Closure, but Revitalization of Factories is the Solution

Recently, the conflict between people and the government over markets has grown worse. These days, the government has gone so far as to close the Pyungsung market. However, now markets are opening up everywhere. The closure of the Pyungsung market resulted in the opening of a market in Soonchun, and the closure of the Sunam market in Chungjin resulted in the flourishing of a market along the levy of the Susung River. People are not concerned about setting up proper sales stands any more. They don’t mind going any distance as long as they can find a place where they can trade and make money. Essentially, the government control is not working. It is not that people are refusing to follow government policy. Rather, it is because people cannot survive if they conform to government policies that they disobey directives.

Under this circumstance what is the North Korean government trying to gain by closing markets? Firstly, officials always stress the view that markets are a breeding ground for resistance to socialism. No matter how hard they try to stop the influx of capitalism, there is not much they can do as long as there is an opening of markets. The government had no choice but to allow markets as they evolved naturally out of necessity. Nevertheless, they believe that markets should be abolished as soon as the economy revives and society becomes stable. Second, as a more realistic issue, the biggest problem is the fact that the government has no money. People have money, but the government has no money. Money is being circulated freely through market activities, but no money is flowing into government coffers. Since nobody wants to deposit money in banks, they are trying to siphon off private savings by revitalizing government-run stores.
If that is the case, let’s set aside the ideological aspect of market closure policy and examine the appropriateness of the policy in terms of economics. We need to question the assumption that the closing of markets will lead to a revitalization of government-run stores. Is this a rational assessment? If we look at related news, the assumption itself is wrong. Unlike the expectation that closing the Pyungsung market would lead to the closure of other markets, a new market is emerging in Soonchun. This suggests the failure of a market closure policy. How about government-run stores? They are having trouble with their supply of goods. This is because as much as 40 percent of the merchandise is being obtained by the sales staff through their personal connections with wholesale merchants, which allows them to profit personally from government transactions. People are reluctant to supply merchandise to government-run stores because only 10 percent of the money is paid in cash, the rest is paid with script. Because of this situation, contrary to the expectation that closing markets will lead to a revitalization of government-run stores, wholesale merchants just avoid government-run stores and move their business to the provinces.
The presumption that closure of markets would lead to a revival of government-run stores and an influx of money into government banks was a wrong in the first place. Even if there is a revitalization of government-ran stores, they are no match for the market when it comes to convenience and the scale of currency circulation. Moreover, the merchandise sold at government-run stores is primarily produced in China like the ones sold at markets.

The return of a policy of using government-run stores has reached a dead end, as it can neither produce the economic advantages of the market nor encourage the production of domestic goods. The solution to this policy failure should resolve both issues of economic advantage and domestic production. First of all, the market closure policy should be withdrawn. Currently, most of the activities that can be considered economic in nature are already performed by individuals in a market setting. The growth of a national economy should be based on people’s economic activities in markets.

The government should also face the reality that Chinese-made products are the only ones that can be supplied to markets and government-run stores. If they want to fill the stores and markets with domestic products, they should focus first on increasing the output of the light manufacturing industry. A revival of the light manufacturing sector would naturally allow money to flow into banks. That will open the door for the government to accumulate revenue. Of course, these steps will not be easy. There are numerous obstacles in the way of any upgrade to the manufacturing sector and to markets, such as a lack of raw materials, outdated equipment, and the capabilities of labor. Most raw materials must be imported from abroad, depleting reserves of foreign currency. Even manufacturing goods using imported raw materials would not create a situation where goods could be exchanged for foreign currency. These production obstacles create a vicious circle. The only option is to focus on products that can satisfy both domestic consumption and the demands of foreign markets. That requires government-led strategic investment instead of relying only on self-reliance. The central party has to make a decisive decision and leave this problem to economists rather than continuously interfering with the market using the excuse of ideological issues. The most important issue that has to be reemphasized here is that a revitalization of the economy should not be approached in such a way that it restricts people’s livelihoods by closing markets. The market closure policy is not only ineffective, but also negatively affects people’s feelings toward government because it poses a threat to their livelihood. The solution for the problem lies not with market closure, but with a revitalization of light manufacturing industries.

1 comment:

Brandy Thompson said...

It is a good information on the current North Korea Today packed with a clear picture and good example of what is happening.




Name: Brandy Thompson
Email: brandythompson88@gmail.com
URL: http://www.brandythompson.com

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