Market forces expand in North Korea despite repression

A marketplace is crowded with people wearing masks at Hyesan in Ryanggang Province, North Korea, in this file photo taken Sept. 5, 2020. Despite state-led efforts to suppress market forces, North Koreans increasingly resort to one-on-one trade for survival amid a sluggish economy and growing distrust in their government, according to a report revealed on Tuesday. Kyodo-Yonhap

N. Koreans increasingly rely on one-on-one trade amid growing distrust in state: studyBy Jung Min-ho

Despite state-led efforts to suppress market forces in North Korea, people there increasingly resort to one-on-one trade for survival amid a sluggish economy and growing distrust in their government, according to a report revealed Tuesday.

A study, conducted between 2013 and 2022 based on in-depth interviews with 6,351 North Korean defectors, shows the importance of markets has been expanding in the decades since the de facto collapse of the country's food rationing system in the 1990s.

Today, many would go to the market to take care of their various needs, from buying medicine to hiring workers, in spite of the laws that ban such transactions, the report suggests. More than 90 percent of the interviewees said life would not be sustainable without markets, while 56 percent even said they prefer money to political power.

Asked whether they have any experience using private car transportation services in North Korea, 27.1 percent of those who escaped the regime between 2016 and 2020 said they do, compared with 17.9 percent among those who fled between 2011 and 2015.

When asked whether they have any experience hiring someone for work, 14.7 percent of those who escaped between 2016 and 2020 said yes, compared with 12.8 percent among those who escaped between 2011 and 2015.

People in North Korea are prohibited from lending money and charging interest. But such transactions are very common these days, the respondents said. One notable change is the reasons for borrowing money.

Asked about the purpose of their decision to borrow money, 57.4 percent of those who fled North Korea between 2012 and 2020 said they did so for business — another indication of growing market forces. This figure is higher than the 48.8 percent among those who fled before 2012.

In response to the question over whether they have received food from the state rationing system, 72.2 percent of those who fled the North between 2016 and 2020 said they have no such experience.

North Korea has been suffering from food shortages for decades. Apparently concerned about the increasing power of money, experts say authorities there recently tightened state control on the market economy, particularly on food, which could worsen the problem.

“The influence of the market is growing, while the state is trying harder to strengthen its control,” an official at the Ministry of Unification told reporters at a briefing.

The irony is that the economic difficulty appears to have helped drive improvements in one important area of North Korean society: women’s rights. Most interviewees who took part in the study said North Korean women’s status has improved as more women engage in economic activities, with more than 40 percent saying their status is now higher than that of men or about the same.

The study also suggests that North Koreans are becoming increasingly skeptical of the hereditary succession of power, which began there with North Korea’s founder, Kim Il-sung.

“Negative public sentiments have been growing toward the ‘Paektu bloodline’-based power succession and this has become more evident since Kim Jong-un rose to power (in 2011),” it said.