NK media normally say nothing about economic reforms soon to be implemented

The biggest news from North Korea on 25^th September was the lack of any important news. When few weeks ago the North Korean government suddenly announced another session of the Supreme People’s Assembly would be convening on that day, North Korean watchers were expecting something significant to take place. Indeed, in recent months we have seen significant shifts in cultural policy, and talks about coming reforms have been unusually strong.

Of course, no North Korean watcher was so naive to expect that the coming SPA session would hold a meaningful discussion of issues of economic reforms and high politics. Communist parliaments are not known for unrestrained debate, but the SPA is exceptional even by Communist standards. To start with, from the late 1950s to the mid-1990s, the North Korean state claimed that exactly 100.0% of all eligible voters took part in the elections. Of late the figure has decreased to 99.9%, but it is still officially stated that all those who voted, voted for the government’s candidate.

The SPA usually meets once a year, and occasionally twice. It votes obediently and unanimously in support of all government bills. Nonetheless it was expected that at least something would be said about the putative economic reforms at this forum.

But these expectations have so far come to nothing. The September 25 session discussed a number of routine issues and also decreed that obligatory secondary education would be extended from eleven to twelve years, and that was all.

What does this mean? Frankly, nothing.

If history is any guide, a session of the SPA is not a place where new economic policies are declared. Even though there have been some exceptions to this rule, like for instance the promulgation of the 1984 Joint Venture Law. Admittedly, at that time, the SPA was more important because had the job of approving the economic plans of the state. Such plans are a thing of the past now, and economic pronouncements have become significantly less common at SPA sessions.

Over the last three decades, nearly all important economic measures were not introduced at SPA sessions, and as a matter of fact were usually not mentioned at all.

Good examples are provided by what were arguably the two most important economic measures introduced by the North Korean government since the death of Kim Il Sung in 1994 – the economic reforms of 2002, and the currency reform of 2009.

The ‘First of July Economic Management Improvement Measures’ of 2002 were much overrated in the foreign media at the time, but nonetheless constituted the most radical attempt ever undertaken to reform the North Korean economy by Kim Jong Il and his advisors. The reforms legalized many market activities, provided industrial managers with significant autonomy in decision making, and also increased state procurement and consumer prices to levels comparable to the black market at the time (for example, one kilo of rice before the reform was officially priced at 0.08 won, after the reforms the price had been raised to 44 won – a near 500-fold increase).

The 2002 reforms were soon rolled back, but what is important here is the fact that the world was to learn about the reforms not when they were first introduced in July, but some two months later, when some mentions of the reforms began appearing in official publications. This might sound strange to a Western reader, but measures that significantly changed the economic life of the country remained unreported by the official media for a significant amount of time (and indeed were never fully explained).

The currency reform of 2009 presents us with an even more striking example of a well-arranged complete media blackout.  The reform itself produced the greatest economic and social upheaval in North Korea since the famine of the 1990s. The North Korean populace was suddenly told that the currency they held was now null and void, and could be exchanged for new notes in limited amounts (usually only to the equivalent of few months of official salaries). At the same time, the use of foreign currencies was banned, and markets and state-run shops were closed. For a few months in early 2010, even members of the Pyongyang elite experienced difficulties in getting their daily rice. According to foreign observers in Pyongyang, popular discontent was palpable and for a brief while, a violent collapse of law and order appeared possible.

This dramatic upheaval of course was completely ignored by the North Korean media; TV, radio and newspapers failed to mention the fact that retail trade was at a complete standstill and the fact that a currency reform was underway. All information was provided to the average North Korea through the cable radio network – officially known as ‘radio number 3’, as well as through confidential letters sent to petty officials and bank clerks. North Korean media outlets also sometimes mentioned the currency reform – of course whilst extolling its alleged virtues – but in the domestic media references to the reform were a complete taboo.

As a matter of fact this is very different to the way thing were done in the Soviet Union under Stalin, which was in many way the proto-type of the North Korean state. The 1947 currency in the USSR was front page news in Moscow’s newspapers.

Therefore, one should not be surprised by the silence of the SPA session kept on the proposed economic reforms. This silence means nothing in itself, as a matter of fact, over the last two months, a number of unconnected sources have reported that the North Korean government has embarked on what appears to be a rather radical reform program. Just a few days ago, there were reports of reforms in agricultural; farmers are allegedly to be given half of the harvest (the other half will still be taken by the state). There are also reports of coming changes in the currency system and industrial management as well. These changes, if implemented (and this seems likely), will put North Korea on a path similar to that of China in the late 1970s.

However one should not expect news about this and other reforms to appear on the front pages of Rodong Shinmun, the official mouth piece of the North Korean government. It is likely that the readers of this venerable newspaper will be treated to the usual paeans to the greatness of the Great Leader and the historic feats of workers at state-run iron foundries. Real news will be kept from the pages of the newspaper, and SPA sessions, at least for a while.