Thursday, January 06, 2005


So says, Andrei Lankov in a nice summary of recent economic changes in North Korea. The freefall of the official economy has resulted in a blossoming of heretofore unseen economic activity. This has empowered many groups who were previously suspect. The include

Women were especially prominent in the new small businesses. Many North Korean women were housewives or held less-demanding jobs than men. Their husbands continued to go to their factories, which had come to a standstill. The males received rationing coupons that were hardly worth the paper on which they were printed. But North Korean men still saw the situation as temporary and were afraid to lose the trappings of a proper state-sponsored job that for decades had been a condition for survival in their society. While men were waiting for resumption of "normal life", whiling away their time in idle plants, the women embarked on frenetic business activity. Soon some of these women began to make sums that far exceeded their husbands' wages.

But many hitherto discriminated-against groups managed to rise to prominence during this decade. The access to foreign currency was very important, and in North Korea there were three major groups who had access to some investment capital: the Japanese-Koreans, Chinese-Koreans and Korean-Chinese.

The changes have been so sweeping as to make the recent state-sponsored reforms merely a rubber stamp acknowledgment of contemporary realities:
Until recently, the government did not try to lead, but simply followed the events. The much-trumpeted reforms of 2002 by and large were hardly anything more than the admission of the situation that had been existing for a few years by then. The official abolition (or near-abolition) of the public distribution system did not count for much, since this system ceased to operate outside Pyongyang around 1995.

These changes are, for the most part, to be applauded. I can't help but wonder why, however, it seems that any liberalization from state tyranny inevitably seems to lead to the introduction of new (or old) private abuses and tyrannies:
Even prostitution, completely eradicated around 1950, made a powerful comeback as desperate women were eager to sell sexual services to the newly rich merchants. Since no banking institution would serve private commercial operations, illegal money lenders appeared. In the late 1990s they would charge their borrowers monthly interests of 30-40%. This reflected very high risks: these lenders had virtually no protection against the state, criminals and, above all, bad debtors.
One might hope that market liberalization in some areas wouldn't automatically lead to a state where everything (even sexual services) is for sale, but alas, human nature would appear to dictate otherwise.

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