We don’t really know what life is like inside North Korea. We do know it’s ruled by this
guy, we know it’s the subject of numerous insane rumors and we know the sealed borders
prevent us from learning much of anything about the place. But one thing that is becoming
a little more clear is the state of the Hermit Kingdom’s economy, one that may have been
built on the backs of smugglers and black market traders.
For the most part the economy in North Korea is run by the government, including imports,
exports and manufacturing. In fact, private trade is illegal, but that doesn’t mean
it doesn’t happen. Over the last couple of decades North Koreans have developed a
gray market, or an informal economy, one that is not monitored, controlled or taxed by the
government. And, according to one North Korea expert, its success can be partially attributed
to Kim Jong Un himself.
"Kim Jong Un's policy is remarkably friendly towards the private businesses, because his
father was uncertain. He oscillated from toleration of the private economy to occasional support
of the private economy, and then back to attempts to eradicate the private economy….Kim Jong
Un's policy is different. It's a quite tacit approval and encouragement and support of
private economic activities."
And if this is true, if Kim Jong Un really does support more private business, than this
is big news. Sure, he may still rule the country with dark age tactics, like using executions
as a means to flex his power, but he is North Korea’s first leader in a long time to support
an economic system that even slightly resembles a free market.
But, it’s not just Kim Jong Un who is helping the North Korean economy. The grey market
has origins in a flourishing black market, one that was brought upon by a devastating
famine in the mid 1990’s. You see, back then the government had a public distribution
system that gave out - or withheld - food to its citizens based on political affiliation
and loyalty. The famine collapsed this system and forced citizens to fend for themselves.
Insert black market here. North Korean leadership knew they had to either look the other way
or see their people starve. But, the black market soon grew past its origins became a
place for goods that were illegal or unavailable.
This is Kim Danbee, a North Korean defector who started working in the black market at
the age of 13, helping smuggle in items from China.
“The products I usually smuggled were the ones that everyone can use...I would illegally
import electronic goods like television sets, refrigerators, rice cookers...I also smuggled
cosmetics, face masks and clothes that women like, and even needles and hair extensions”
This was groundwork for today’s North Korean grey market, which in turn may be laying the
groundwork for an actual private sector. This is an economy that went from the Kim Jong-il
parceling out meager food rations to the 2010 opening of a department store in Pyongyang,
shelves stocked high with imported goods priced only in US dollars.
No one knows for sure where North Korea’s economy will go from here, but they seem to
be tiptoeing towards a free market...which could ultimately lead to looser borders. But
for now those borders remain closed, the country is still cloaked in wild rumors and this guy
is still in charge. Yes, he may support the black markets and a grey economy, and yes,
he may be more economically progressive than his father and grandfather. But he still is
an unpredictable leader who may have just executed a high level military general for
falling asleep in a meeting. So, who can really tell what lies ahead for North Korea, its
economy, and its people.
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