GoodFriends: Research Institute For North Korean Society

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North Korea Today No. 328 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]
Skyrocketing Rice Price Hit 1,000 Won in a Week, Chungjin
Retail Merchants Low on Business Funds as Prices Soar
Residents, “Buy at today’s price or wait until tomorrow?”
Soaring Prices Invite People’s Hostility against New Economic Policies

[Food]
Provincial Residents Yearn for “Government Food Release” after Learning about January Food Distribution in Pyongyang

[Economy]
In Hoeryong, Government Ban on Market Enforced against Public Sentiment

[Politics]
North and South Hamgyong Provinces Censure Electricity on Shifts
“Make an example”, As the Foreign Currency Prohibition Decree Not Work Well

[Society]
Hair Salon Customers Turned Away because of High Cost of Perm Chemicals
People’s Anxiety Increases as Prices Soar and Rumors Circulate

[Women/Children/Education]
Eunduck County DSW Troubled by Large Number of Female Border Crossers

[Accidents]
Suspected Accomplice of Hoeryong Spy Incident Commits Suicide
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[Hot Topics]
Skyrocketing Rice Price Hit 1,000 Won in a Week, Chungjin
Rice price is breaking the record every day. Particularly, the rice price in Chungjin City, North Hamgyong Province shows the most noticeable increase. The price jumped from 240 won/kg on January 15th to 280 won/kg on 20th and on the next day, the price rose from 300 won in the morning to 350 won in the afternoon. On 22nd, the price soared to 500 won and yet again to 650 won in the afternoon. On the same day, the rice price exceeded 300 won/kg in Pyongyang and major cities including Sariwon in North Hwanghae Province, Haeju in South Hwanghae Province, Wonsan in Kangwon Province, Pyongsung in South Pyongan Province and Sinuiju in North Pyongan Province. The price hit 350 won in Sinuiju and it reached 400 won in Pyonsung. The soaring price did not stop there. On 24th, the steep rise of the rice price reached as high as 1,100 won in Sunam market in Chungjin. The price hit 800 won in Hoeryung. Dollar price reached 42,000 won per dollar in Pyongyang and Sinuiju. Rumors say it would exceed 60,000 won soon.

Residents of Chungjin are in devastation at the news of skyrocketing rice price. Merchants are raising the price while not selling rice, and residents cannot even try to buy it. If the situation persists, some people even projects, the price would hit the level of old currency era (2,000 won) in no time. Residents appear very anxious, saying “The food price seems to be a mess.” Food and other prices are rising so rapidly that the residents who were unable to secure daily necessities are experiencing great difficulties. Residents of Chungjin harbor a question that the financial management policies of the authorities might have been wrong, saying, “It has not been long after the currency exchange but the new money has lost the value like old currency already.”


Retail Merchants Low on Business Funds as Prices Soar
The numbers of merchants going bankrupt with high debt due to soaring price are increasing in major cities including Hamheung City, South Hamgyong Province, Soonchun City, Pyungan Province and Haeju City, South Hwanghae Province. Buying low and selling at slightly higher price, retail merchants had no problem making profit when rice price was 80-90 won. However, in January, they could no longer afford buying any more products with skyrocketing prices. They suffered tremendous loss because price for their product soared and they cannot afford to buy other products to sell. A bean oil seller from Sinam District at Chungjin City, North Hamgyong Province said that 80kg was priced at 150-170 won but it increased to 450-500 won in the next week. Last 22nd, price tripled to over 1,500 won so he complained as he no longer can sell bean oil even if he invests all his past profits. Because price skyrocketed, merchants who did not secure enough products are worried that they would lose all their capital.

Residents, “Buy at today’s price or wait until tomorrow?”
Residents are having difficulties with steep price increase. They need to buy food and daily necessity but are debating whether to buy at today’s price or wait until price stabilizes. New currency is losing its value everyday so residents can not easily purchase food or merchandise. Even if they try to buy something, they have hard time finding a merchant and market does not carry many products. Households that used to consume rice are now eating soup for a meal to save food. Poorer households are now eating wet dried radish leaf soup with corn noodle for each meal. They complained that it is hard to buy 1 kg of rice or even a handful with the current skyrocketed food price, so everyone is trying very hard to save food.

Soaring Prices Invite People’s Hostility against New Economic Policies
An abnormal surge in prices provokes people’s antipathy against new economic control measures. Soaring prices make people’s livelihood difficult. Furthermore, the ban on business and commerce makes their basic livelihood even more difficult, so their clamor is high. The residents in Sunchun, South Pyongan province do not hide their opposition. They complain that “the government’s new economic measures make people die of hunger. Instead of making a Strong and Prosperous Nation for people, the new economic measures open the door of poverty and hunger for people.” Heyoung Kim (alias) said “women who feed a family have many opinions on the new economic measures. Compared to the days of old monetary system, our living condition is much worse. Many households cannot even eat corn porridges. Since people’s living condition is at the bottom, they talk badly to the government.” Police officials agree with such sentiments. “In these days, people are increasingly angry and harshly blame the government. Their firm belief and commitment about the Strong and Prosperous Nation are already gone. Political speeches and lectures these days are not effective to reorient and realign the people to the nation’s ideology. They seem to think only about the means and ways to make their living.”

Meanwhile, the authorities encourage people through various political speeches and lectures. They assert that “difficult living conditions are only temporary. The new economic measures will soon improve the living conditions of workers and farmers. So please be patient and let’s overcome the difficulties together. Do not have fantasy about foreign countries and do perform well on what you are supposed to do in order to make a breakthrough in building the Strong and Prosperous Nation.” However, people do not appear to take the government’s words very seriously. They say “the government enticed the people through the rosy promise of improving people’s living via the new economic measures. However, prices are soaring and the value of new money is plummeting now. The current situation is a real mess. How further will the authorities only talk about the Strong and Prosperous Nation?”

[Food]
Provincial Residents Yearn for “Government Food Release” after Learning about January Food Distribution in Pyongyang
Pyongyang received early January food distribution followed by early December distribution last year. In Hoeryong, January food distribution was supplied with corn. Other areas, except for these two cities, did not receive food supplies. The residents in other areas say, "All prices would stabilize if the government released reserve rice." They say they cannot make a living unless soaring prices are controlled in some way. It is not that people are asking the government to distribute rice for free, but they want the government to lower the price of rice by releasing its stock into the market because people cannot afford to it when the price of rice goes over 300 won per kg and then to beyond 1,000 won per kg. People say that it would be a relief if the price comes down to 70 won per kg when the price was going up and down at about 100 won per kg. Now, they do not even mention that. So, they do not even dream about the government-set price of 44 won per kg. People are wishing for releasing of rice in one way or another.

[Economy]
In Hoeryong, Government Ban on Market Enforced against Public Sentiment
It did not take long for the City Party in Hoeryong, North Hamgyong Province to re-open the general markets and allow merchants to do business on sales booth. This was in response to public outcry over the severe hardship that resulted after the conversion from general markets to a farmers’ market. Outcry went through the roof, with the public complaining that; “there was no increase in whole corn distribution, contrary to the official announcement. In addition, the sharp increase in corn prices, caused by the ban on markets, coupled with meager corn distribution would leave us with the risk of starvation.” The residents have constantly requested, “If the distribution of (food) provisions is not feasible, then at least allow market operation.”

In response to the outcry, the City Party reported the public sentiment to the Province and the Central Party and re-opened the markets temporarily until the food and daily necessities were supplied. In other words, on the afternoon of the 17th, the City Party lifted the restriction on the markets, which sold only agricultural and local goods. The market is supposed to be banned again, once the foods and necessities are distributed normally. As such, merchants were allowed to trade banned items in farmers market. However, not much trading took place because wholesalers had no goods to supply to the local market. Although the restrictions were lifted temporarily to help people’s livelihood, the restrictions had to be enforced in less than two days after the reopening of the market after being reprimanded by the Central Party.

[Politics]
North and South Hamgyong Provinces Censure Electricity on Shifts

The North Hamgyong Province and South Hamgyong Province are executing the censorship of the electricity on shifts for the first time this year. The censorship of the electricity on shifts is done every year, but it is more emphasized this year as the National Defense Committee commanded to adhere to the New Year’s Day Joint Editorial of January 1, 2010 that said, “The electricity must be secured in the munitions security enterprises and workplaces even if the electricity cannot be provided in the social institutions.” Currently, the electricity is not provided at all in civil and nonproductive sectors and only the approved places among the productive factories and public enterprises are provided of electricity 6 hours per day.

“Make an example”, As the Foreign Currency Prohibition Decree Did Not Work Well
As the foreign currency rate is rising every hour in spite of the foreign currency prohibition decree, the merchants are trying to receive the foreign currency if possible, saying that they will be on the short end of the deal if they receive the Chosun money. As the foreign currency is still in circulation between merchants and people instead of going to the National Bank, the Central Party has begun to seek the measures to prevent it. On 14th, the Central Party dispatched one officer to each province and instructed them to “arrest people who circulate or use the foreign currency and make an example.” On 18th, the Chungjin City of North Hamgyong Province arrested 7 people who attempted to exchange the foreign currency and cracked down 3 trading companies that used the foreign currency in domestic trade. The leading officer of the foreign currency inspection enforcement team ordered the companies to be shut down. The people who were exchanging foreign currency are arrested one after another in Pyongsung, Haeju, and Hamheung as well as Pyongyang City, and all the foreign currency is confiscated without compensation. In an attempt to produce results in foreign currency crackdown, the enforcement teams dispatched to each province to execute the foreign currency decree are primarily focusing on ex-convicts who had dealt drugs or banned trade items by the state. In addition, the houses that are known to have a lot of money or very successful business, people who exchange foreign currency at a trade company, and negotiators who exchange foreign currency are widely investigated. The surveillance is extended to the wealthy people and those who visit the house of the wealthy in the National Border Area where a large amount of foreign currency are mostly circulated in black market. It is reported that the enforcement teams will inquire about the source of the foreign currency and depending on the seriousness of the crime, will even consider an execution by firing squad if judged to be serious.

[Society]
Hair Salon Customers Turned Away because of High Cost of Perm Chemicals

Salons are rejecting new perm clients in Pyungsung, South Pyungan Province because of the high cost of chemicals. In one salon, the workers were not working but chatting with one another. When asked why they were rejecting new customers, the responded that they do not generate any profit by performing perms. They claimed that the price for a long hair perm was 60 won in the new currency, and 30 won for short hair, but the chemicals for a perm alone cost 100 won. One potential customer, who was turned away, Miss Kim Young Hee (alias), reported that young university students with long hair were being turned away and she was concerned that getting a simple hair treatment would be very difficult now.

People’s Anxiety Increases as Prices Soar and Rumors Circulate
As prices in the market soar, residents of North Korea are feeling anxious amid circulating rumors. Midlevel officials also are not exempt from the anxiety about rising prices. An official in Hamheung City in the South Hamgyong Province said, “After the currency reform, the number of households facing starvation has increased, so the City Party ordered a survey of such households. Maybe they mean to distribute rice. There is also a rumor that China stopped exporting rice to North Korea, and the markets ceased to sell Chinese rice. Because there is no way to verify the rumor, there is increasing fear that the rice price will increase.” The City Party continuously lectures about “stopping rumors circulating the society after the currency reform and the ban on using foreign currency.” The City Party announced that the rumor about counterfeit two-thousand won bills and additional currency reform is not true. Upon hearing about the news that Pyongyang began distributing rice from January, people of Hamheung City are complaining that rural residents do not have the same rights as urban residents. Some residents say, “After the currency reform, people are suffering from rising prices, but instead of solving the problem, the government only regulates the market. They confiscate items from the market, so people are angry. It is like an aftermath of a war. Given the situation, it is natural that rumors are spreading. Indeed, some people are wishing for another currency reform.”

[Women/Children/Education]
Eunduck County DSW Troubled by Large Number of Female Border Crossers
In Eunduk County, North Hamgyong Province, the district office of the DSW (Democratic Women's Union) is troubled by the result of a follow up inspection which shows that there are still many of women fleeing the county across the river. In 2008, more than thirty single women and twenty married women had escaped from February through November. In 2009, thirty-five women left their hometown from May through September. Twenty of them got caught and were sent to the re-education center after being tried in the people's court on November 3. In particular, increase in the number of female 5th and 6th graders in Obong junior-high school who ran away was raised as a major issue, and warned by the county party, police department and youth union. Eunduk County party held a community meeting and warned that crimes of human trafficking - minor trafficking in particular - will be punished by execution by firing squad. In Obong mining district, there are many households without mother because a number of housewives ran away across the river among poor residents who survive with only one or two meal a day.

[Accidents]
Suspected Accomplice of Hoeryong Spy Incident Commits Suicide
It was discovered that Mr. Oh, a man in his forties, who lived in Osanduk-dong in Hoeryung City, North Hamgyong Province committed suicide with his wife. According to neighbors, the couple argued frequently and had been fighting for the last week. The police are investigating whether the incident was a suicide or a homicide based on the facts that he was temporarily associated with drug trade and they have contacted the Party Secretary of Yusun Hospital. Many of the residents have been whispering that “he probably committed suicide in fear of being executed after seeing so many people being taken away.”

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