North Korea is awakening from an egalitarian communist dream with vast economic reforms, ranging from price and wage spirals to a phase-out of state rationing and a currency shake-up, according to visitors.
Despite its reputed Orwellian control of thought and speech, it is even daring an adventure into cyberspace with plans to allow ”full scale” access to the Internet, Japanese journalists reported from Pyongyang over the weekend.
”Economic reforms, aimed at boosting zeal for industrial production, constitute a system in which people earn more wages if they make more profits,” a North Korean foreign ministry official told the Jiji news agency.
A Jiji reporter said that one public servant in the North Korean capital saw his salary rise 17 times.
Workers’ earnings, previously based on the length of their work hours, have been made proportional to profits they make, his report said.
”It is aimed at stimulating production by abolishing egalitarianism. It has made farmers and workers work hard,” the ministry official was quoted as saying.
In a rare move, the secretive state has allowed a group of some 20 Japanese journalists to visit Pyongyang and cover Red Cross talks between the two countries.
They seized on the opportunity to take a first-hand look at economic changes said to be under way since the beginning of July, including wage increases of nearly 20 times to make up for soaring prices.
Jiji said that rice prices had skyrocketed by more than 500 times — from 0,08 won per kilogram to 40-50 won (27-33 cents) ? in a general price upswing. A bus and subway ticket cost two won, up from 0,1 won.
”Various policy measures are in the process of implementation and have led to changes little by little,” a North Korean guide told a reporter from the Tokyo-Chunichi newspaper group.
The guide said that state rationing of rice had not been changed but other items had been shifted to markets. ”If you have income, you can buy what you want to buy.”
His remarks conformed to a recent comment reportedly made by Choe Gang, deputy head of general economic planning at the North Korean State Planning Commission that state rationing of clothes and other daily necessities, except for grains, was abolished on July 1.
The won was also massively devalued and a foreign exchange certificate for use by foreigners was abolished on August 1, Japanese reports said.
The value of the Korean currency has been slashed from a theoretical 2,15 won to the dollar to 150, a level close to the reported black-market rate of about 200.
A certificate is issued for won exchanged by foreigners at the top-rate high-rise Koryo Hotel and the money cannot be used elsewhere, the Kyodo news agency reported.
At a shopping centre for foreigners at the hotel, prices have been raised by about 70%, Kyodo said. A carton of Japanese cigarettes cost 1 950 won ($13), a big bottle of instant coffee 1 347 won (nine dollars) and a can of European beer 91 won (60 cents).
The 500-won note had not been widely circulated since it was first issued in the late 1990s, when ordinary citizens earned 100 won to 200 won a month. But the new economic set-up has made the bill visible, prompting one citizen to guess that ”it is a bill newly created in July,” Kyodo said.
Kyodo, quoting a North Korean telecommunications official, reported North Korea planned to introduce the Internet on a ”full scale” in October.
The agency added, however, such details as the scope and method of Internet access, were not immediately known. – Sapa-AFP