North Korean leader Kim Jong-un. Picture: AFP By RICHARD LLOYD PARRY THE TIMES 9:00PM DECEMBER 26, 2020 Kim Jong-un is making risky adjustments to the North Korean economy, executing traders and threatening to reverse market reforms as he tries to reduce the devastation caused by isolating his country from coronavirus. Fear of the pandemic has led the North to cut itself off almost entirely from China, its only significant trading partner, choking off imports and causing a rise in food prices. To prevent uncontrollable inflation the government appears to be deliberately driving up the value of the currency. Among its methods has been the arrest of currency traders who exchange dollars for the North Korean won. At least one has been executed, according to a briefing last month by the South Korean intelligence agency. Two women hold North Korean flags as they sit in a park in front of the Grand People's Study House in Pyongyang. Picture: AFP After overseeing an unprecedented relaxation of the economy and limited free-market liberalisation, Mr Kim, 36, appears to be reasserting control over the emerging capitalist class. “The history of North Korea since the late 1980s can be presented as a chain of cycles, with the North Korean government moving back and forth between pro-market and anti-market policies, making yet another U-turn every five to seven years or so,” Andrei Lankov, an analyst, wrote on the NK News website. “For a while it looked like Kim Jong-un was going to break the vicious circle, but the recent news indicated that this is probably not the case.” North Korea closed its borders in January to avoid a spread of the virus and has insisted that it has had no cases. Experts have suggested that this is unlikely since the virus first emerged in China and North Korea relies on its neighbour for trade. North Korea’s economy is as opaque as the rest of its affairs. Assessments are largely based on foreign trade figures, South Korean intelligence assessments, anecdote and guesswork. Even so the damage done this year is clear. China accounts for more than 90 per cent of its external trade and statistics from Beijing say that it is down this year by three quarters. In October trade all but shut down, falling by 99 per cent on the previous month. Commuters and pedestrians pass along a street in central Pongyang on Christmas Eve. Picture: AFP This statistical picture is corroborated by satellite images that show Pyongyang’s merchant fleet confined to port. Independent estimates of the extent to which the economy has shrunk vary from 8.5 per cent to 10 per cent or more. This is worse than in 1992, when it shrank by 7.1 per cent shortly before a famine that killed millions. It is likely that some informal trade and smuggling continues along the 880-mile land border with China, although shoot-on-sight orders against unauthorised interlopers will have discouraged it. North Korea never manages to feed its own people and it depends on imports. South Korean organisations that monitor economic data, based on information covertly relayed from inside North Korea, report rising prices for corn, sugar and soya beans (though not rice, the price of which is set by the authorities). They have also recorded surges in the value of the won. In 2009 North Korea carried out a disastrous revaluation of its currency, which wiped out savings. Since then many people have kept their money in foreign currency; technically it is illegal to change money other than at the unfavourable official rate, but in practice it is done openly and without penalty. Life of labour: North Korea ordeals of South's POWs Only 13 days before the armistice that ended the Korean War, Southern soldier Lee Sun-woo was captured. He spent the next 50 years in North Korea, toiling for decades in a coalmine like thousands of his compatriots. In October the government informed the few foreign diplomats and aid workers left in Pyongyang that they could no longer exchange more than dollars 100 a day, making it even harder for international organisations to operate. Since then, after years of stability, the won has surged by 23 per cent against the dollar and 40 per cent against the Chinese yuan, suggesting government intervention. Separately, new rules governing the conduct of local markets have leaked. Since the famine of the 1990s these have also been tolerated. Under Mr Kim state-run enterprises have been given the freedom to function as independent businesses, setting wages and prices and reallocating part of their own profits. “These rules indicate that a new system of market control is just about to be introduced, with the local party committees given a right to control the markets,” Professor Lankov wrote. “This system also implies a significant increase of government control and government power.” The Times https://www.theaustralian.com.au/wo...e/news-story/94fee844f77551aa02de6795a779786d
Fascinating country. For those that haven't seen it, I can recommend The Mole: https://www.imdb.com/title/tt13243898/
Absolute horrible place to live. The life goal of every citizen there should be to escape. Imagine being the guy who cuts Kim's hair. No amount of wealth would justify the stress that person must experience.