Food Prices Spike After North Korean Authorities Relax Controls

Residents, many with no income due to COVID-19 shutdowns, pay more for rice each day.
2020-12-01
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Food Prices Spike After North Korean Authorities Relax Controls A side-by-side comparison of a marketplace in Chongjin, North Korea in December 2019 (left) and March 2020.
RFA

Food prices are skyrocketing in North Korea as authorities have relaxed price controls in local markets amid food shortages and a worsening economy due to COVID-19, sources in the country told RFA.

In the northern parts of the country close to the border with China, fears over coronavirus prompted Beijing and Pyongyang to close their 880-mile border and suspend all trade in January, stifling local borderland economies that relied on trade and smuggling.

Though Pyongyang still claims zero confirmed COVID-19 cases, it has enacted emergency measures to prevent its spread, locking down entire cities and counties and preventing people from traveling beyond their home province.

With incomes and food supplies lower than in recent years in what has always been a hardscrabble economy, the government had intervened to keep prices from rising out of control, but since mid-November, prices suddenly began to jump.

“Here in the city of Chongjin, food prices are rising every day in the marketplaces… they had been stable under authorities’ price controls, but the sudden sharp rise is increasing anxiety among the people,” a resident of North Hamgyong province, in the country’s northeast, told RFA’s Korean Service Sunday.

“Food prices rose all at once in the marketplaces of Pohang, Chongam and Sinam districts, as well as in the Sunam district marketplace in the city center. The people are confused because they do not know the cause of the sudden rise in food prices or why they are rising every day,” the source said.

According to the source, in early November, rice cost about 4,000 won (U.S. $0.50) per kilogram (2.2 pounds), or about as much as the average government-provided monthly salary. Government-enforced controls prevented rice prices from increasing beyond the 4,000 won per kilo threshold, and the autumn harvest brought more of the staple grain on the market, which kept prices stable.

“However, food prices have been on the rise since mid-November, and these days the price has increased to 7,000 or 8,000 won [$0.88-1.00] or in Chinese currency, seven or eight yuan [$1.07-1.22],” the second source said, adding that it was the first time since June, when food prices are always higher, that the price exceeded six yuan ($0.91).

The yuan, the U.S. dollar and other major foreign currencies are preferred by buyers and sellers because they are more stable than the North Korean won.

“With food prices rising day after day, people’s anxiety is giving way to fear. They are shocked to see the price jumping up by several hundred won after a night’s sleep, and they are nervous about whether this means we are heading into a second ‘Arduous March,’the source said.

North Koreans refer to the 1994-1998 famine that killed millions, or as much as 10 percent of the country’s population by some estimates, as the Arduous March.

Another source, a resident of Ryanggang province in the country’s central northern region, confirmed to RFA that prices there were also rising at an alarming rate.

“Rice prices are approaching 8,000 won per kilo, which is about the same as the highest food prices during the ‘barley hump’ period each June, when food stocks hit rock bottom,” the second source said.

According to the second source, prior to November, prices were stable nationwide at between 3,200 to 4,300 won ($0.40-0.53) per kilogram, depending on the region. In the country’s southwestern breadbasket, prices were slightly lower than in the mountainous northern provinces. But the unexplained relaxing of price controls has resulted in increases in every region.

Stuck in their home provinces with no way of making a living, the people are seething with anger toward the authorities, according to the source.

“When the food prices rose too high to get enough to eat, the moneyless people began to strongly criticize the authorities’ measures to restrict the movement of residents. They are now reacting violently, saying if they can’t move around to try to make a living, authorities are basically letting them starve to death,” the second source said.

Reported by Jieun Kim for RFA’s Korean Service. Translated by Leejin Jun. Written in English by Eugene Whong.

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