By Emily Gibson, HRNK Research Intern Edited by Rosa Park, HRNK Director of Programs and Editor and Benjamin Fu, HRNK Research Intern August 25, 2020 Historical Overview Characterizing the struggles under the North Korean regime as “hardship” is an understatement. This struggle is not the touted ideological struggle to reach a socialist paradise; rather, it is a battle to achieve a life of sustenance for the average North Korean. During the initial years of the Kim regime, North Korea rationed food to its people, albeit not equally. Even before the 1950 Korean War, food was not distributed equally among the people north of the 38th Parallel. Distribution was rather based on an individual’s level of devotion towards the military and one’s field of work. For example, workers in physically demanding blue-collar jobs were more likely to receive more desirable foods, such as white rice.[1] The food distribution system also favored the military. Korean historian Charles Armstrong reports that during the war, peasants ate acorns, pine bark, and grass, while soldiers were given rice three times a day.[2] This sentiment is known today as songun jeongchi, or “military-first” politics.[3] The food ration system was achievable through the destruction of private land ownership, the establishment of a centrally-planned socialist state, market suffocation, and the invention of Juche ideology also known as “self-reliance.[4]” North Korea’s public distribution system has evolved from its initial system, which consisted of a combination of the National Distribution System, Cooperative Distribution System, and the Farmers Distribution System.[5] These systems lasted until the 1990s, when the current Public Distribution System (PDS) was created and private markets, also known as jangmadang appeared. [6] The space for private markets evolved from the “August Third People’s Consumer Goods Production Movement” in 1984, when the regime approved civilian production of consumer goods. This movement focused on the development of consumer goods utilizing local materials and production facilities.[7] The movement was intended for small-scale production, but became increasingly attractive as the economy began to slow in the late 1980s. The economy went from a growth rate of 10.5% in 1970 to 2.1% in 1986.[8] The interest in private markets compounded during the 1990s famine, when the PDS collapsed, forcing people to seek goods and foods once secured through government rations. North Korea’s state-induced famine originated from its Stalinist economic system, rather than from wholly natural causes.[9] U.S. Ambassador Andrew Natsios, former USAID administrator, writes that the famine was due to the lack of incentives among farmers to produce food.[10] Further, the combination of outdated farming techniques degraded the land, making it susceptible to flooding. People chose to look outside of the centrally planned economy to produce goods in secrecy. Such goods needed a marketplace, giving birth to illegal “frog markets.” These markets got their name from the leapfrog-like activity between vendors and the police. When authorities discovered a “frog market,” the vendor would quickly hop away with their goods to escape without being caught.[11] The North Korean state officially recognized jangmadangs in 2002 and 2003. In 2002, economic measures allowed the establishment of general markets and in 2003, gave the directive to establish trading conditions.[12] It can be observed that market demand was higher than the supply offered by the sanctioned markets since non-sanctioned markets continued to persist outside of the legal marketplace. Interestingly, the Center for Strategic and International Studies writes that the North Korean government is estimated to earn $56.8 million per year in revenue from taxes and fees imposed on legal markets.[13] The markets operating outside of the legal space do not pay fees and taxes to the government, and it would be in the regime’s economic interest to extend its control to all markets. Market Development and Distancing from Regime Ideals Markets in North Korea are places where supply and demand converge. A large portion of North Koreans have experience with capitalistic behavior at markets. Approximately 83% of North Koreans who are at least 16 years old have engaged in market activities.[14] The high prevalence of exposure to markets and capitalistic tendencies has forced the regime to reclassify the songbun social classification system. The January 2020 revisions added two new classes to reflect the jangmadang generation’s evolving social presence. The new classes are intended to check the activities of the jeok-dae, or “hostile class” by identifying new terms to identify their negative status. [15] Presently, there are 12 categories—including the two new categories of “ideologically wavering” and “complainers and discontents.” The new classification of the caste system brings to question the extent of influence that the market system has on what little civil society North Korea has, since the regime is taking steps to deter people from engaging in such activities. Markets in North Korea operate in a unique social space. The North Korean regime tacitly allows markets, yet strives to maintain social indoctrination over its people. This dynamic resulted in the legal framework to develop the markets in 2002 and 2003. Additional crackdowns ensued in 2009, when measures were established to close markets and shops,[16] and in 2019, when the distribution of counterfeit medicine and alcohol was targeted.[17] These examples present the regime as an indecisive actor since it is unable to maintain a consistent policy on markets. In the period following market legalization, both legal and illegal markets grew. Even after the implementation of new measures against markets, market activity continues to persist. There are currently about 436 officially sanctioned markets, with the first legal building for markets being established on Tongil Street in Pyongyang in late 2000.[18] A New Sphere of Influence for Women? For many North Koreans, the legal and illegal markets offer an avenue for North Koreans to accumulate capital that might have been impossible for both people of poor songbun and women. Women are the main actors in both legal and illegal North Korean markets. Men are not readily seen working in markets because the North Korean regime forces men to report to work wherever the regime dictates and most men are also forced to serve in the military for ten years.[19] As a result, women are the main traders in markets. Women are able to have access to new ways to earn a living that were not possible in years preceding the creation of markets. Women are now able to amass capital through market activity and leverage it into larger enterprises. Capital is now looked upon favorably within North Korean society and can offer an avenue for social navigation for women and new opportunities to gain a higher social standing. For example, one woman started out selling secondhand bicycles at markets. She generated a sizable revenue from selling bicycles and then transitioned to working at a trading company as a trade clerk. She was able to utilize her knowledge from her position as a trade clerk to identify potential business opportunities. The woman applied her connections at the trading company to reopen an abandoned zinc ore mine in Hamgyong Province. By leveraging each position, the woman was able to become the president of a lucrative business. It appears as if the role of capital is trumping the traditional gender norms and songbun social classification system in North Korea. This woman was able to gain control of the mine because the mine’s Party Secretary was fearful that she would withdraw her investments if he overstepped.[20] The role women have played in the markets has transformed women’s place within North Korea’s male dominated society. Women are becoming heads of their households and women with high songbun and close connections to the Korean Workers' Party are earning a more visible political presence in the KWP. Yet, it is important to note that the presence of women in the KWP is reliant on their personal connections within the KWP, making this mobility strictly limited to a small pool of elite women. Women who work in the markets face a new set of issues that have given them newfound autonomy. One issue that impacts women’s traditional role is the potential for interference in child-rearing. Women who are working in the markets do not receive social benefits or maternity leave from their positions.[21] When women become pregnant, many would have to consider giving up their child or keeping their source of livelihood. For most women, this is a decision that will pit them against the traditional North Korean norm of raising children. Potentially, as more women make a living at markets, they will break tradition and choose work over family. In other instances, women choose to work at markets to put food on the table. The rise in women’s visibility is due to the development of non-traditional jobs and the corresponding accumulation of financial influence.[22] Even though women face cultural hardships in North Korean society, there is hope for the development of new cultural norms. Women play a large role in markets, where they are able to accumulate wealth and influence, and even leverage these into new business ventures. At the end of the day, however, women still face an immense social barrier to success. There is hope that, one day, women will be able to further leverage their positions in markets and make new socially acceptable ways to earn a living aside from child-rearing. Emily Gibson is a Master’s student at Indiana University's Hamilton Lugar School of Global and International Studies. [1] Armstrong, Charles. The North Korean Revolution 1945-1950. Cornell Univ Press, 2004, p. 144.
[2] Armstrong, Charles. The North Korean Revolution 1945-1950. Cornell Univ. Press, 2004, p. 141. [3] Vorontsov, Alexander. “North Korea's Military-First Policy: A Curse or a Blessing?” Brookings, July 28, 2016, www.brookings.edu/opinions/north-koreas-military-first-policy-a-curse-or-a-blessing/. [4] Noland, Marcus. Famine and Reform in North Korea. Peterson Institute for International Economics, July 2003, p.2. [5] Lee, Shin Young. Economic Principles. Cho Sun Ro Dong Publication Inc, September 24,1960. [6] Choe, Sang T. “The New Markets of North Korea: Jangmadang.” American Journal of Management, vol. 15(4) 2015. [7] North Korea - ECONOMIC SETTING. www.countrystudies.us/north-korea/45.htm. [8] Choe, Sang T. “The New Markets of North Korea: Jangmadang.” American Journal of Management, vol. 15(4) 2015. [9] “How Did the North Korean Famine Happen?” Wilson Center, www.wilsoncenter.org/article/how-did-the-north-korean-famine-happen. [10] Lalasz, Robert. “The Great North Korean Famine: Famine, Politics and Foreign Policy.” Wilson Center, www.wilsoncenter.org/event/the-great-north-korean-famine-famine-politics-and-foreign-policy. [11] Everard, John. “The Markets of Pyongyang.” KEI Academic Paper Series, vol. 6, no. 1. [12] Everard, John. “The Markets of Pyongyang.” KEI Academic Paper Series, vol. 6, no. 1. [13] Cha, Victor and Lisa, Collins. “The Markets: Private Economy and Capitalism in North Korea?” Beyond Parallel, 12 Aug. 2019, www.beyondparallel.csis.org/markets-private-economy-capitalism-north-korea/. [14] Choe, Sang T. “The New Markets of North Korea: Jangmadang.” American Journal of Management, vol. 15(4) 2015. [15] Ha, Yoon Ah and Alek, Sigley. “N. Korea Orders Reorganization of the Country's Caste System.” Daily NK, 10 Mar. 2020, www.dailynk.com/english/north-korea-orders-reorganization-countrys-caste-system-songbun/. [16] Everard, John. “The Markets of Pyongyang.” KEI Academic Paper Series, vol. 6, no. 1. [17] Hotham, Oliver. “North Korean Police Threaten Death Penalty for Fake Drug, Alcohol Trafficking: NK News.” NK News - North Korea News, 1 Jan. 2020, www.nknews.org/2019/12/north-korean-police-threaten-death-penalty-for-fake-drug-alcohol-trafficking/. [18] Cha, Victor and Lisa, Collins. “The Markets: Private Economy and Capitalism in North Korea?” Beyond Parallel, 12 Aug. 2019, https://beyondparallel.csis.org/markets-private-economy-capitalism-north-korea/. [19] Everard, John. “The Markets of Pyongyang.” KEI Academic Paper Series, vol. 6, no. 1. [20] Lim, Jae-Cheon, and Injoo, Yoon. “Institutional Entrepreneurs in North Korea: Emerging Shadowy Private Enterprises Under Dire Economic Conditions.” North Korean Review, vol. 7, no. 2, 2011, pp. 82–93., doi:10.3172/nkr.7.2.82. [21] Cathcart, Adam. “How North Korea's Institutions Have Responded to the Changing Role of Women: NK News.” NK News - North Korea News, 21 Oct. 2019, www.nknews.org/2019/05/how-north-koreas-institutions-have-responded-to-the-changing-role-of-women/. [22] Cathcart, Adam. “How North Korea's Institutions Have Responded to the Changing Role of Women: NK News.” NK News - North Korea News, 21 Oct. 2019, www.nknews.org/2019/05/how-north-koreas-institutions-have-responded-to-the-changing-role-of-women/.
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DedicationHRNK staff members and interns wish to dedicate this program to our colleagues Katty Chi and Miran Song. Categories
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