GoodFriends: Research Institute For North Korean Society

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North Korea Today No. 321 Full Version January 2010

[“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]
Note: The Hot Topics of No. 321 were published ahead of time as a separate edition.

[Food]
Note: Food section of No. 321 was published ahead of time as a separate edition.

[Economy]
Prices Rise in the Hamgyong Province After Ban on Use of Foreign Currency
Shortage of Smaller Bills Makes Business Difficult
Hamheung Woodworking Factory Demands Constant Labor from Starving Workers

[Politics]
Forty Arrested for Burning Old Currency in the North Hamgyong Province
Hamheung City Released Public Statement on the Results of Drug Crackdown
Resident Registry Center Transferred from Safety Agency to Security Department
Law officials Conduct Investigation on Families and Relatives who Fled the Country

[Society]
Police Returned Stolen Objects to Owners after Receiving Payment
A 75-year-old Woman Works at the Construction Site on Behalf of Her Son

[Women/Children/Education]
Students Born in 1993 Face Biggest Obstacles

[Accidents]
Fisheries Management Office in South Hamgyong Province Reported 40 Casualties Out at Sea in 2009

[Editorial]
North Korea Must Have a Plan in Place to Supply Food and Essential Goods
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[Economy]
Prices Rise in the Hamgyong Province After Ban on Use of Foreign Currency

Ever since the use of foreign currency has been forbidden and the use of exchange voucher mandated, prices have been rising in the North and South Hamgyong Provinces because goods sold in foreign shops are no longer available. People do not exchange large sums of foreign currency because it reveals how much foreign currency an individual or companies possess. As a result, there has been a decrease in the number of sellers who purchased goods in foreign currency shops with exchange voucher to sell them in the northern region. As goods become scarce in the northern region, prices are rising. For example, on December 31, a pack of Cat Cigarette doubled its price from 25 won to 50 won, and the price of sugar rose from 70 won to 100 won. People are saying, “The government’s financial incentives are not sufficient to help us, and the decrease in the value of money worsened our living conditions.” Others are saying, “Prices rose since the ban on the use of foreign currency. That has made our lives more difficult.”

Shortage of Smaller Bills Makes Business Difficult
Markets in major cities and state-owned national convenience store chain are suffering from a shortage of smaller new money bills. Currently, there is a significant shortage on 5 won, 10 won, and 50 won bills. The shortage of smaller bills is making it difficult for merchants to sell goods because they are unable to give change to buyers. Food processing service centers and bicycle storage centers are giving gum or candy to customers instead of change.

Hamheung Woodworking Factory Demands Constant Labor from Starving Workers
Laborers at the woodworking factory in Hamheung City, South Hamgyong Province are known to have sacrificed a great deal during the 100-Day Battle, which began after last year’s 150-Day Battle. In the beginning of the 100-Day Battle, the economic management officers, including managers of public enterprises and party secretaries, encouraged greater effort with the stated goal of achieving the modernization and reconstruction of industrial technologies. The encouragement was in accordance with the party’s intentions. However, problems with the food rations for laborers have led to difficulties for the managers who try to increase their employees’ will to work. A slogan was posted in front of the Hamheung factory’s entrance that says, “Toward a Modernized Factory According to the Demand of the Coming Age,” but they have proven to be empty words. Managers were supposed to prepare construction materials and funds for the reconstruction work, but it was discovered that they have not completed this necessary work. Therefore, laborers endeavored to complete the reconstruction work with the profit made by selling logs. They sold a board for 600 won, an engraving for 600 won, and door frame materials (thick plate and white quartz), for 3,000 won each in old currency. The customers for the timber were ordinary people, institutions, and public enterprises. In addition, the factory collected funds for basic construction work by making doorframes and doors needed for the construction of private houses. In order to gather construction materials and earn enough money to begin work, the laborers were mobilized and moved into the mountains, where they logged for three months. The laborers were forced to labor continuously, even though they did not receive their rations and had no guarantee that they would later receive food or firewood. Some laborers have asked to have a leave of absence, if only for a few days to tend their small patches of fields because they and their families had no food. Any requests to leave the logging camp were rejected. Naturally, attendance rates among laborers decreased. “The officers are well provided for, so they do not understand the condition of the suffering laborers who have nothing to eat,” complained laborers. Due to the endurance and sacrifice of these laborers, they were just able to finish the basic reconstruction work on October 29th of 2009.

[Politics]
Forty Arrested for Burning Old Currency in the North Hamgyong Province

After the November 30 currency revaluation, the search continues for those who dump or burn the old currency. There have been at least 40 cases since December. The Province Police Department stated, “Burning or throwing out old currency instead of returning to the bank is treason,” stressing those caught will be severely punished.

Hamheung City Released Public Statement on the Results of Drug Crackdown
On November 28th, Hamheung City, South Hamgyong Province publicized the latest results of the drug crackdown. The City launched the campaign since last September. Party officials, including four officials belonging to the Provincial Party, three officials from the city party, two police officers from the Sungchun region, two prosecutors from the Province, and one party official from the Sapo region, who have accepted bribes from drug smugglers were the main targets of the recent crackdown. The police authorities condemned the perpetrators and made their names and ranks public before relieving them of their posts and indicting them.

In addition to these officials, civilians were also arrested for having committed drug-related crimes. On December 13th, the city police presided over an open trial at the Chupyung market one hour before the marketplace opened for business with the police chief announcing the charges in each indictment and making open statements that the Party would sweep out crime.

People grumbled about the unfairness of only subjecting civilians to the humiliation with an open trial. The officials who have been charged for the same crimes did not have to stand an open trial as did the civilians at the Chupyung market.

Resident Registry Center Transferred from Safety Agency to Security Department
Starting January 3, resident registry center is being transferred from the safety agency to the national security department. Following this, the police station’s resident registry department from all cities and counties are being shifted to the security department. The security department is making preparations to take over the works from residential identification center. They are also preparing for safeguard measures for possible bribery incidents involving officials. In the meantime, many residents fled to China and South Korea due to food crisis. The safety agency had difficulties managing statistics of resident registry due to high number of missing person from the Arduous March to present. It was common for people to bribe police officers who were in charge of resident registry records to prevent any disadvantage that might occur during family background check prior to being appointed as an official. If they had any family members who fled the country, they often bribe officials and change the missing person status to death.

Such corruption among officials not only ended here but led to incidents like espionage incident at Yusun Hospital’s primary party secretary in Hoeryong city; therefore, the central party decided to transfer resident registry responsibility from the police station to the security department to strictly manage the system.

Law officials Conduct Investigation on Families and Relatives who Fled the Country
There soon will be a national inspection campaign and follow-up campaign on all security department, safety agency and police department to check whether any family members or relatives fled to China or South Korea. City Party level inspection was completed earlier and this one is identification inquire inspection to investigate whether they have border-crossers within close relatives. Any officials who were not punished or hid the fact their family member fled the country were immediately dismissed from the office. Also, they were banished to labor intensified coal miners or factories with most difficult living condition. The central party ordered resident identification centers to change their status to 1st level social labor. Things will become more difficult for officials with families or relatives who fled the country in the future.

[Society]
Police Returned Stolen Objects to Owners after Receiving Payment

At the Chungjin Preservation Center of Northern Hamgyong Province, possessions stolen during the 100-Day Battle were being returned as of December 8th. Officers have found 20 bicycles, 8 TV’s, 2 motorcycles, and 5 sacks of clothes upon capturing four thieves. Village residents had to pay in order to receive their own things back. These payments supposedly paid for the officers' gas and other traveling costs while they were searching for the thieves. 500 won in new currency was paid for a bicycle, 400 won for a TV, and 20 won per article of clothing. The villagers claimed that travelling costs could not have exceeded 100 won to find one bicycle meaning that the officers were still making a profit of 400 won. They criticized the officers for taking advantage of citizens for their business-centered interests.

A 75-year-old Woman Works at the Construction Site on Behalf of Her Son
Hoeryong Food District construction site of North Hamgyong Province temporarily ceased the construction work because of severe cold. The work went on until last November although the workers had to endure cold and hunger. Some of the workers are from the Special Labor Brigade of the Party but most workers are from factories or companies on once-every-three-month rotation basis. As few of the Special Labor Brigade members volunteer to work, there is always shortage of workforce. When a person is sick and cannot come to work, his coworkers have to cover the missing manpower, making their work harder. The psychological confrontation between the workers and non-workers is very serious and often leads to verbal fights at the self-criticism meeting. Over 80% of workers are from poor families that lack food and are under severe economic hardship. Kim, Guen-sub (alias) of the 2nd platoon of the Special Labor Brigade requested a two-day leave in order to borrow some food from his relatives because he did not have any food in his house. However, he had not reported back to work, and the Special Labor Brigade sent a member to (Kim's) house to bring him back but they failed. In his house, his 75-year-old mother lived alone. Officials of the Special Labor Brigade threatened the mother saying that her son missed the work more than 10 days, causing a lot of disruption of the construction work, so they would send him to the Labor Discipline Center when he comes back. They said if his brothers or relative can work for him, he can be exempted from the punishment. Because she worried about her son, this old woman went to work for her son. She had worked for the Special Labor Brigade for 25 days and young people admired her. She worked as hard as young people and was not lazy, so people were moved by her sincere attitudes toward hard work. However, officials seemed to be indifferent to this poor old woman and were criticized by the workers. Han, Mahn-gil (alias), working with the old woman, lamented that “It is impossible to expect any morality from these officials. Even if her son did not report back to work, how could they put this old lady who is older than their own mother to work? It's such a dirty world!" This is not a rare case as more workers are absent from construction site, officials are increasingly requesting their families or relatives to work instead. When husbands miss the work, their wives are to cover for them while sons do that for their fathers. Residents of Hoeryong sneered at this situation and said, “You can see this situation only in North Korea. The government controls and puts replacement workers for the missing workforce and it is reality of North Korea pursuing Strong and Prosperous Nation and Military First Policy.”

[Women/Children/Education]
Students Born in 1993 Face Biggest Obstacles
On January 5th, the college preparation test was held in Sinuiju, North Pyongan Province. Most of the students born in 1993 have not gone to serve military service after graduation and enrolled in colleges. However, the parents of such students and the student describe themselves as the most unlucky class, since medical and educational areas have no room for new students. After visiting her daughter’s school a few days before the test, Mirye Kim (alias) sighed and worried about her daughter. “The principal said that colleges do not accept applications for the new students. I pity my daughter, who desperately wanted to get into medical school.” Even though Province People’s Hospital in North Pyongan Province only has a need for 600 doctors and nurses, there are more than 650 who work at the institution. Similarly, about 15 of the 40 faculty members of a middle school in the city are not receiving wages and so work for nothing.

[Accidents]
Fisheries Management Office in South Hamgyong Province Reported 40 Casualties Out at Sea in 2009
In South Hamgyong Province, the Department of Labor’s Fisheries Management Office reported that 40 laborers have died or have gotten lost out at sea between the months of January and October last year. According to the announcement on November 7, 27 fishery laborers died from accidents and their corpses were identified, while the remaining 13 were missing due to an unidentified cause.

[Editorial]
North Korea Must Have a Plan in Place to Supply Food and Essential Goods
The North Korean government was very clear that the currency redenomination was carried out to “stabilize and improve people’s lives” and “reinforce economy management system and order.” Further, it stated that the currency revaluation was designed to buttress the material foundation upon which to construct a Strong and Prosperous Nation in 2012. We see the purpose of the revaluation as an attempt to lessen the gap between the rich and poor, recover central control over the economy, and reabsorb the monies held by individuals into the State budget. Although not much time has passed since the revaluation was carried out, we see many things in North Korea that we haven’t seen before.

The revaluation came about as a great shock to the traders in the markets who were pushed to despair when they suddenly found themselves holding worthless pieces of paper. At the same time, the majority of farmers and laborers – as well as others in the lower economic class – suddenly found themselves with enough money which they spent with unbridled gusto buying up market goods that they couldn’t afford before. As such, things were selling at a brisk pace in the markets.

As far as North Korea’s stated goal to stabilize the economic order, huge risks lie in wait. Already, prices for most items have doubled or tripled. Further, we see rice prices varying according to time and location; official government price is 22 won per 1 kg, while the state-run stores are selling rice at 44 won and market prices are fluctuating at around 50 won per kg and up. Also, the wholesale increase of salaries for laborers and farmers, despite enhancing their purchasing power, could lead to inflation in short order. We are already hearing complaints by select groups that the revaluation has already lost its effect and everything has gone back to “square one” because the purchasing power of the new currency can’t keep up with price inflation. Some experts are using these cases to conclude that the revaluation effort has already failed.

However, the key to the matter lies not in increasing purchasing power for the people but in providing them with enough food and essential goods. If the North Korean government really wants to rid itself of the current economic system in which the national economy relies parasitically on the market system and reestablish a socialist supply system, then it has to come up with a plan to provide for the people’s needs. Otherwise, the effect of the recent revaluation cannot last. If the State cannot supply the needed goods, then it should just go ahead and legalize the markets altogether so that the people have a way to ensure their own survival. If this currency revaluation were to fail, the people will inevitably undergo a severe hardship and disappointment.

In its New Year message, the North Korean government has emphasized the importance of the people’s economy more than anything else. Coming on the heels of the currency revaluation and other follow-up measures, this emphasis on the economy seems weightier than ever. However, the capacity for the North Korean government to provide the necessary essential goods to the people is very limited, as it waits for the economy to revive. Recent Central Party discussion about reallocating 40% of the national defense budget to invest in the economy should be highly lauded. Nevertheless, if internal production cannot meet people’s needs, then North Korea must rely on external help. The New Year’s message seems to acknowledge this distinct possibility and accordingly expressed a strong desire to improve NK-US and NK-SK relationships. However, it remains to be seen whether this is just lip service or will actually lead to a substantive movement forward.

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