Defectors: North Korea would fall without capitalistic markets

North Korean defector Cha Ri-hyuk, 31, who came to South Korea in 2013, talks about the many markets that recently have opened up in North Korea

Hundreds of capitalistic markets, each with thousands of stalls, form the glue that holds North Korea’s socialist planned economy together, say defectors who sold medicinal herbs, skinny jeans, TV sets, foreign drama CDs and other goods there to make a living.

“People there say North Korean markets have everything but a cat’s horn. They truly have everything there,” said Cha Ri-hyuk, 31, who came to South Korea in 2013. “If North Korea shuts downs markets, it will collapse too.”

North Korea has tolerated — and taxed — some market activities since the country’s state rationing systems crumbled amid an economic crisis and famine that killed an estimated hundreds of thousands in the mid-1990s. The economic boost the markets provide has helped leader Kim Jong Un keep a grip on power and further his nuclear ambitions, leaving the North’s harsh political system and alleged human rights abuses largely untouched.

But some political analysts note that market activities are gradually infusing North Koreans with new ways of thinking that eventually could loosen the authoritarian government’s hold over its 24 million people.

“It’s like potential forces which can fundamentally shake the North’s systems are growing,” said Lim Eul Chul, a North Korea expert at South Korea’s Kyungnam University.

Satellite photos and testimonies of defectors show there are now about 400 mostly outdoor markets, called “jangmadang,” in the North. Recent surveys of refugees suggest most ordinary North Koreans resort to market activities for a living as the country’s public rationing systems have never been fully restored. Four defectors who talked to The Associated Press said they received no rations at all.

North Korea has periodically tried to prevent markets from growing too fast by restricting the operating hours of markets and barring young people from working there. But such measures often are later withdrawn, according to activists specializing in North Korea affairs.

The harshest measure was taken in 2009, when authorities replaced all currency and limited the amount of old bills citizens could exchange in a bid to reassert control over the economy. But no serious measures have been implemented since Kim assumed power in late 2011, after his father’s death. Kim has vowed to improve public livelihood while pouring resources into weapons programs to cope with what he calls increasing U.S. military threats.

North Korea rarely allows international news organizations to conduct reporting at capitalistic-style markets. In 2004, however, the AP was given an unusual chance to film Pyongyang’s crowded yet clean indoor Tongil Market, where neatly uniformed merchants sold goods including bananas, fish, vegetables, women’s underwear, shoes and tennis rackets.

Defectors say the Pyongsong wholesale market, near the North’s capital Pyongyang, is the biggest.

To work at a market, a merchant buys a stall and pays daily tax to authorities. There is no official data on how much money North Korea collects from market merchants every year.

Items sold in jangmadangs are locally produced, or imported or smuggled from China, South Korea and elsewhere. South Korean-
made clothes, shoes and soap opera CDs are especially popular, though it’s illegal in the North to sell goods made by its archrival. Regular police crackdowns have not sapped demand.

“No matter how high prices for South Korean clothes I called, they were all sold out,” said Lee O.P., who sold such clothes at a Musan market in the northeast before she made it to South Korea in December 2014. She requested her first name be identified only as initials due to worries about the safety of relatives left in the North.

When North Korean police find people wearing South Korean clothes or dresses they consider too skimpy or tight, they often take them to back alleys and rip parts of their garments with razors or scissors, according to Cha and Lee.

The markets have given North Koreans a taste of foreign culture, eroded their dependence upon a government that no longer feeds them and opened up a new gap between rich and poor. There is little to suggest that the country’s authoritarian rule has weakened, but at the same time, experts say, the North must take care to avoid economic policies that harm the markets. For instance, the 2009 botched currency reform reportedly triggered widespread public complaints that led to the execution of a top Workers’ Party official.

There are risks in the business, whether authorities are hunting for contraband, cracking down on foreign currency or simply committing graft. Lee O.P. says she decided to flee after police officers confiscated her whole savings for unauthorized phone calls with her daughter who already defected to South Korea.

Now in South Korea, Lee O.P. said she was amazed at social welfare programs directed at her and other underprivileged people.

“For me, it’s like North Korea is a capitalistic country while South Korea is a socialist country,” she said. “In North Korea, if you don’t have money, you’ll just have to die.”Hyung-Jin Kim, Seoul, AP