A new leadership and new challenges in North Korea?

Since Kim Jong-il passed away in December 2011, on one hand it seems that new elites are appearing at the head of North Korea. However these people were not belonging to the former flagship structures of the North Korean system. On the other hand, from the standpoint of economical issues, the North Korean army (the KPA – Korean People’s Army) which was at the head of many companies in the field of the public infrastructure in North Korea had lost a part of its power (by losing its control on mining and agriculture infrastructures) due to an increasing power of the Korean Workers’ Party (KWP-the North Korean Communist Party) and affiliated organizations. In other words, companies run by military structures are now under the control of organizations affiliated to the Korean Workers Party (the Ministry of International Trade, the Ministry of Foreign Affairs, the Second Economic Committee,…).

Indeed, the army is not merely a military force, it is also the largest employer in North Korea. Given the strong involvement of the military structures in the political and economic life in North Korea since its inception in 1948, the army has become a key organization of the North Korean system.

A monument to the glory of Kim Il Sung: the founder of North Korea (© 2010 / N. Levi)
A monument to the glory of Kim Il Sung, the founder of North Korea
(© 2010 / N. Levi)

Over the years, new paramilitary organizations have been created in North Korea (including among others the Worker-Peasant Red Guards established in 1959) so that the army refocus around its military actions. Since the mid 90’s , the Kim family (the biological family of Kim Jong-eun, the current leader of North Korea) has been increasingly opposed to the economic role of the KPA. Thus the economic functions of the KWP have been strengthened by creating hybrid organizations affiliated both to the KPA and the KWP (such as the second Economic Committee, a sort of Ministry of Economic Affairs or the military Commission of National Defense, a military organization jointly managed by the KWP and the KPA). Nevertheless the KPA is still managing some strategic economic structures. Paramilitary organizations are also managing structures of less importance. The KWP (especially some specific KWP cells) seeks to take control of some economic structures because the KPA economical policy diverges from the KWP one. The KPA continues to be considered as a conservative organization while cells mentioned below are significantly more open to economic change in North Korea and its leaders consider themselves as better managers of companies that the military representatives to business entities.

The referred changes appear to be orchestrated by the Kim family, the family of those who rule over North Korea since 1948 (the establishment date of North Korea). Indeed the structures of the Party involved in assets management which were previously managed by KPA affiliated organizations are currently managed by some members of the Kim family (Paek Se- bong, the director of the Second Economic Committee is a cousin of Kim Jong-eun, Kim Yong -chun , the director of the Worker-Peasant Red Guards is the great uncle of Kim Jong-eun, … ) . These elements indicate that the real power is in the hands of the Kim family.

Why the Kims ? We must here mention that in the 40s, Joseph Stalin, the Soviet dictator personally decided that Korea should be under Soviet administration. In fact he knew that the Americans had the same type of claims. Thus Stalin decided that a North Korean named Kim Song -ju (the original name of Kim Il-sung) was chosen as the representative of Moscow in the Korean Peninsula. Then the same Kim Il-sung encouraged Mao and Stalin to attack South Korea, which was under U.S. occupation. This is ultimately a bloody conflict that broke out between the two Koreas between 1950 and 1953Neither Korea won the war in July 1953 and an armistice was signed. 2 million of civilians and soldiers were killed in this conflict.

After the death of Stalin, Kim Il-sung was worried by the results of the XXth Congress of the Soviet Communist Party in 1956. He noticed that Stalin’s successor, Nikita Khrushchev, had strongly criticized the policy of his predecessor. Therefore it was necessary to implement another strategy in order to remain at power in North Korea. Therefore Kim Il-Sung decided to set up another system of loyalty, a system based upon links blood and loyalty to the Kim family.

Consequently in the 60’s, the Kim family members were appointed at key positions of the North Korean system (Kim Jong- ju, the younger brother of Kim Il-sung was responsible in the 60’s for the Department of Propaganda and Agitation of the KWP. Kim Sung-ae, the second wife of Kim Il-sung, was in the 70’s the first secretary of the North Korean Democratic Women’s Union. After the death of Kim Il -sung in 1994, the son of Kim Il-sung, Kim Jong-il took the head of North Korea. When Kim Jong-il passed away in December 2011 he was replaced by his son Kim Jong-eun. The family of Kim therefore continues to play a key role in all structures of the socialist state since 1948.

Statue of Kim Il Sung (© 2010 / N. Levi)
Statue of Kim Il Sung
(© 2010 / N. Levi)

North Korea, from its inception until 1990, received a substantial international aid from countries of the Eastern bloc primarily from the Soviet Union which have actively participated in the reconstruction of North Korea. Many technicians from other eastern European countries (Poland Czechoslovakia, Hungary, East Germany, Romania,…) sent also funds to North Korea. Many North Korean orphans were also living in East Germany and in Poland.

In this international context, the key decisions of the Kim family chaired the fate of the North Korean population. Ongoing support of the Soviet bloc and China helped North Korea to avoid any reforms which could jeopardize the stability of the North Korean regime and thus have maintained the conservative wing of the family Kims (under the leadership of Kim Jong-il ) at the head of North Korea.

The fall of the Berlin Wall in 1989 and the collapse of the Soviet Union in 1991 led to the end of the economic support from the Soviet Bloc to North Korea. The consequences were tough for the regime of Pyongyang : starvation (more than 3 million people passed away according to secret North Korean reports disclosed to the general public), a never-ending energy crisis, …

The period from 1995 to the present day implicated structural and organizational changes in North Korea. The Kim family is still at the head of the main political, economic and military structures of the country, however, it seems that the “liberal” wing of the family took major policy decisions. These decisions are of course accepted by the former North Korean leader and by Kim Jong-eun. Those who advised the Kim family are politicians, businessmen, considered as being loyal to the Kim family . They studied abroad (in China, Europe, in the United States under false names), they  manage companies and have strong relations with the KPA .

Among the members of the “management board ” of North Korea, there are also other personalities such as Ri Su- yong, the tutor of Kim Jong-eun, now responsible for a number of investment in North Korea (especially in the resort of the Mount Kumgang), Kim Sung-nam , advisor of Kim Jong-eun on Chinese matters, Kim Sul-song , the older half-sister of Kim Jong-eun , who is managing some North Korean companies jointly with the millionaire brothers Jon (Sung-hun and Young-hun ) in the transport sector and in the supply of consumer goods (cars , etc.). The full list is much longer and includes many other members of the family who do not live necessarily in North Korea (such as Kim Jong-nam , the eldest son of Kim Jong-il who continues to manage some of the accounts of the Kim family).

The North Korean Supreme People's Assembly (corresponding to the British House of Commons or the U.S. House of Representatives) (© 2010 / N. Levi)
The North Korean Supreme People’s Assembly
(corresponding to the British House of Commons or the U.S. House of Representatives)
(© 2010 / N. Levi)

The advent of this liberal wing has led to radical changes in the North Korean system Since Kim Jong-il passed away in 2011, the KPA lost much of their decision-making abilities. The KPA was also forced to pass the economic entities that were under their control to the KWP. This raises the following question: Can the reorganization of these structures (which constitutes 70 % of the economic capacity of North Korea) lead to political and social changes in North Korea? The liberal wing of the Kim family which tries to avoid an internal unstability has to set new rules of the “game”. They reward the former KPA managers of important economic societies in North Korea (for example in the mining industry) or strategic military divisions (such as those near the borders with China and South Korea ). Kim Jong-eun gives them some kind of annual “gifts” (in form of cars, foreign currencies, furniture “Made in Europe” – some North Korean elites have homes where all products are Austrian!). That ensures the sustainability of the new relationship between the KPA and the KWP. This reflects also the increasing degree of corruption at the highest level of decision channels in North Korea and can subsequently lead to more radical changes with which the liberal wing could not cope in the future. How to know whether North Korean generals will still accept a loss of power in exchange of lavish “gifts” ? These same general are convinced that Kim Jong-eun will keep them alive? The recent history doesn’t give them reason. Ri Yong-ho, Kim Jong-gak and Hyon Chol-hae former leaders of the KPA were simply removed from their prestigious positions in the North Korean Army: so who’s next?

The next was Jang Sung-thaek, the former husband of the aunt of Kim Jong-eun. For unknown reasons ( Jang Sung- thaek allegedly threatened and thrown in doubt the power of Kim Jong-eun ), this North Korean politician was executed  on the 13th December 2013 after an quick military trial. It is still too early to draw conclusions from this event but if it is true that Jang Sung- thaek was executed, it would mean that nobody can feel safe in North Korea and that the Kim family has less power than in the past years if they were not responsible for the eviction of Jang Sung- thaek . It is also highly possible that the eviction of Jang Sung- thaek was due to conflicts that are not directly caused by opposing military factions. Indeed, in recent years, although the Kim family continues to dominate the political scene, other families (side-branches of the Kim family) have seen their roles increase in the recent years. Including among others, the Kang family ( Kang Sok-ju is a North Korean Deputy Prime Minister whose children manage companies in North Korea) , the Oh family (Oh Kuk-ryol’s children work in import-export companies between China and North Korea). Therefore, some disputes among these families may have lead to the eviction of Jang Sung- thaek ?

Regarding the nuclear file, it is now run by a group of KWP politicians endow with some military knowledge. This group of individuals (Kim Kyong ok , Ju Kyu-jang , Pak Do-chun and Choe Ryong -hae) represent the cutting edge on the atomic issue and these people should be involved in nuclear negotiations. What remains relevant here is the fact that these negotiations (if they can be considered reliable) are yet conducted by people associated to the Kim family: Ri Gun, Kim Kye-kwan and Ri Yong-ho . All without exceptions were relatives of the Kim family.

A monument to the glory of the North Korean ideology: the 'Juche' (© 2010 / N. Levi)
A monument to the glory of the North Korean ideology: the Juche
(© 2010 / N. Levi)

The Kim family must also deal with a generational challenge. In the past ten years, more and more North Korean leaders sent their children to study abroad (including in Austria, France , Great Britain,…) If this golden youth wishes to enrich themselves and change the fate of their country , then what may be the future of North Korea ? The answer to this question is difficult firstly because the North Korean regime continues to maintain an old hermetic system but on the other way a new generation of North Korean leaders ( for instance Paek Ryong-chon, the current director of the North Korean Central Bank, a former student in China and the son of Paek Nam-Sun , the former North Korean Foreign Minister) wants to get rich and it will necessarily pass through changes in the north Korean system, ie. more explicitly tangible reforms would be implemented

In conclusion, the enlarged Kim family is facing internal changes in North Korea. The Kim family must also take into account the generational changes taking place in its foreign partners (I think especially to the Chinese elites which are more and more opposed to the belligerent policy of Pyongyang) that may affect the future of relations between North Korea and its foreign partners. The changes that have been indicated in this text means that the North Korean leadership is aware of the requested changes but they are also conscious that these changes cannot question the nature of the North Korean political system.

Selected members of the Kim family

Identity Main function Familial Relation toward Kim Jong-eun
Kang Sok-ju Deputy Prime Minister Great cousin
Kim Jong-chol Kim Jong-eun’ advisor Half-brother
Kim Jong-nam Kim Jong-eun’s advisor on economic issues Half-brother
Kim Kwang-sop Ambassador of North Korea to Austria Uncle
Kim Pyong-il Ambassadeur of North Korea to Poland Uncle
Kim Sul-song CEO of companies Half-sister
Kim Yong-chun Director of the Worker-Peasant Red Guards Great uncle
Kim Yong-nam Head of State of North Korea Great cousin
Paek Se-bong Director of the Second Economic Committee Great cousin
Yang Hyong-sop Secretary of the Supreme People’s Assembly Great cousin

The education of North Korean via the organization of the Choson Exchange [SECOND PART]

  1. The selection of students

Andray Abrahamian reminded me about the fact those European scholars who are welcoming North-Koreans students are sometimes more interested in speaking about the Juche Ideology than in getting a top-level education. However, and based upon his affirmation, North-Koreans students who are studying in Beijing are always at the top of their classes: therefore where is the problem? In order to identify and to avoid the issue I presented earlier, a right selection has to be performed. Choson Exchange is conducting and is generally pleased with the quality of our candidates. The candidates are generally under the age of 30. They’re able to talk in English and come mainly from Pyongyang. Given the high costs of full-length academic programs and the limited number of people “Choson Exchange” is able to invest its funds in only the “best and brightest persons.”

  1. Outlining its realizations

Choson Exchange realized various programs for North Koreans students. Some North-Koreans were sent to Singapore (Singapore is a place which was always favored by the North-Koreans leadership- Kim Il Sung wanted to create a second Singapore within North Korea).

, China and other parts of the world where they had an access to tutors and fellow who educate the young North Koreans in the following fields:

– Fiscal Optimization (Adjustments and optimizations in Fiscal Operations in the FDI field);

– Banking Institutions (cooperation with foreign entities, development of joint ventures, laws debriefing, development of a legal context for FDI in North Korea);

– Corporate Finance (Income Statements, calculation of some ratios…)

– Accounting (Balance Sheet, Assets, Ratios calculations…)

According to some documents provided by the Choson Exchange, we can notice that the faculty of finances of the Kim Il Sung University which is existing in North Korea since only 2010, is providing some bright students.

  1. Problems of the Choson Exchange:

The Choson Exchange is facing a large number of issues concerning the realization of its problems. However a big asset lying on their hands is the fact, that the management team of this organization is still the same since a few years and believes in the future of the project. Therefore these proactive people (I think especially to Andray Abrahamian and Geoffrey See – other cannot be omitted) will be able to cope with this challenge especially taking in account the harsh reality of North Korea.

Considering education institutions, Choson Exchange members noticed that foreign books, research journals are not used by academics and scholars[1].  Some foreign journals are available, however there are or old, either not actual. Due to a lack of funds, North-Koreans libraries are accepting foreign donations (in terms of books).

There is also a lack of transparence concerning the information. Concerning the Curriculum of some professors, Choson Exchange had no access to this kind of information. Professors and scholars are publishing, however mainly on internal economical education publications[2].  Some interesting related to the new North-Koreans economy can be found in these kinds of North-Koreans journals.

  1. Possible grounds for the development of the project

Choson exchange is also lacking some funds which may guarantee the viability of the project. This organization is functioning thanks to funds which are coming from various sources. Being not affiliated to the Choson Exchange, I strongly however encourage investing in the activities of the Choson Exchange.

Conclusion

While it is important to help the future North Korean elites, however, I believe it’s ever more important to pursue the formation of a new North Korean elite group. Those can be educated by organizations such as Choson Exchange. I also guess that Choson Exchange should develop its wonderful initiatives inside North Korea because potential elites such as intellectuals who were educated in North Korea know well about the reality of the country, but they face a lot of obstacles in learning modern knowledge. It is an important issue because North-Koreans higher-education reforms will affect not only the future of North-Koreans elites but also the future of the rest of the country and of the society who will get a profit of the situation.

Keywords: North Korea, Education, Reunification, Nation-Building, Trust, Cooperation, China, South Korea, Choson Exchange, Banking Institutions, Geoffrey See, Andray Abrahamian, Daesong Bank, JVIC, Choe Thae Bok, Elites, Kim family

Nicolas Levi

Nicolas Levi is a researcher at the Polish Academy of Sciences and an analyst on Korean Issues at the Poland Asia Research Center (www.polska-azja.pl). Holding a PhD regarding the North-Koreans leadership, his personal website (nkreports.wordpress.com) focuses on North Korea issues. Member of the Réseau Asie et Pacifique (a French association focused on Asian issues). He has overseen the publications of a wide range of analyses. Prestented to the public through media outlets including the British Association of Korean Studies, DailyNK.com, Foreign Policy, New Focus International, Newsweek Polska,…


[1] In 2007, I had the pleasure and the occasion to be in North Korea at the National Library. When I was presented some foreign journals and books, this literature was published in the 70’s and was originally coming from the Soviet Union. The North Korean libraries are receiving books from Foreign Institutions on a regular basis; however these books are being kept away and are only used by selected students and scholars. These “selected students” are generally, but not always, directly connected to the top North-Koreans leadership.

[2]According to Dr Curtis Melvin (nkeconomicwatch.com) “Thompson Reuters, a rating agency of scientific findings, announced NK has published 187 papers in reputable science journals between 2000 and 2012. Reviewing the publication history, from 2000 to 2006 NK scientists annually published articles abroad totaling in the single digits–except in 2004. However, Reuters reports that since 2007 that the annual average has increased to 28 publications per year. Of the publications in these foreign journals, 77.5% (or 145) of the publications were joint-research with foreign researchers. Of these joint-research projects, 61.4% (or 89) publications were with the Chinese. This is followed by Germans (27 publications), Australians (9 publications), South Korean (8 publications), American (7 publications) and Japan (5 publications). The reporting agency claims that the reason why so few NK research was published in international academic journals is that NK lack the appropriate English (communication or writing; it’s not specific) skills.” This text was published in http://www.nkeconwatch.com on the 25th May 2012. North-Koreans scholars should be also encouraged to publish abroad via foreign scholars. I’m actually trying to run this kind of projects.

Un capitaliste en Corée du Nord

Les medias publient sans cesse des textes relatifs à la misère (qui hélas existée et est bel et bien présente) en Corée du Nord, à l’économie étatique (pas si étatique que cela) ou aux droits de l’homme. Oui ces sujets sont cruciaux, ous ces sujets existent néanmoins quoi qu’un certain nombre de personnes en Corée du Nord soient emprisonnées plus ou moins justement (ou plutôt moins), on ne peut pas oublier que la société nord-coréenne se compose aussi de 22 millions d’habitants qui aspirent à vivre ou à s’adapter à la réalité socio-économique qui les entourent.

Abt

Cette société de nord-coréens qui n’habitent pas à Pyongyang mais aussi dans d’autres villes consomment des produits, à des loisirs ou regardent des comiques dans les medias nord-coréens. Bien sur, tous n’ont pas accès aux medias, tous n’ont pas la télévision mais tous disposent de sensations universelles telle la faim ou la volonté de se faire plaisir. Pour répondre aux besoins de cette population, longtemps le système nord-coréen pensait qu’il y arriverait seul au nom de son idéologie prônant l’autosuffisance – l’idéologie Juche.(Cette idée d’indépendance est tirée du nationalisme coréen qui a pour sa source une histoire difficile (en outre une lourde occupation japonaise)).

Malgré leur témérité, et face aux problèmes économiques, les nord-coréens ont compris que seuls ils n’y arriveront pas et que le système doit change (bien qu’officielles les medias refusaient il y a peu encore de l’admettre). C’est pourquoi, nous pouvons le dire : la Corée du Nord s’ouvre, timidement, mais surement. Timidement car l’ouverture ne concerne que certains secteurs et certaines régions.

Surement (et martelons-le : surement) car depuis 20 ans. Comment vérifier cela ?

Comme source d’inspiration (notamment pour nos amis journalistes qui proposent une image injuste de la Corée du Nord) et de reflexions, je propose la lecture de A Capitalist in North Korea, un e-book preparé par Felix Abt. un homme d’affaire Suisse qui via la société technologique suisse ABB s’est occupée de la gestion de sa filiale en Corée du Nord.

Pour en revenir au premier paragraphe de notre analyse, cet ouvrage démontre que la societe nord-coréenne s’ouvre à plusieurs vitesses. Felix Abt évoque (en tant qu’ancien directeur d’une societe de produits pharmaceutiques) les problemes dans le cadre de la gestion d’une société nord-coréenne, comment les nord-correens vivent au jour le jour (en parlant de la vie de ses employés) ainsi que des défis de la société nord-coréenne. De cette ouvrage ressortent les conclusions que j ai evoquées au second paragraphe : une société qui s’ouvre timidement mais surement.

Le deuxieme sujet crucial (et la seconde conclusion) travaillé par Felix Abt concerne le probleme des sanctions internationales vis à vis de la Corée du Nord. Tout comme l’auteur, je considere que celles-ci doivent concerner certaines catégories de biens et non des produits utiles à la production de bien de premiere necessité. En effet les sanctions de l’ONU ne pénalisent pas vraiment la cible pretendue (certaines élites) mais surtout la societe nord-coreenne. L’ouvrage de Felix Abt le demontre concretement et nous invite à une redefinition de ces punitions. Qui faut-il sanctionner et commencer mettre en place avec efficacite ces sanctions ? Cette question demeure neammoins sans reponses.

Felix Abt parle ouvertement de ce qui change en Corée du Nord. Il souligne aussi que les élites nord-coreennes demandent à se former, c’est pourquoi la question de l’education des futurs élites nord-coréennes est evoquée notamment dans le cadre de la Pyongyang Business School. C’est un sujet qui me tient fortement à coeur, dans la mesure oú moi-même je suis chargé de cours pour des étudiants népalais en Pologne ou je leur enseigne des modules economiques. Tout comme Felix, éduquer la génération des futurs leaders sert de clé de voute à la construction d’un monde plus juste et meilleur.

Pour en revenir au climat des affaires, l’auteur souligne que la Chine investit beaucoup en Corée du Nord et que les sociétés chinoises (plutôt sino-coréennes) réussissent sur ce marché périlleux. Citant l’auteur ou plutôt un rapport utilisé par Felix Abt, il évoque la profitabilité de ces sociétés « In a survey carries out by the U.S. scholars Stephan Haggard and Marcus Noland in 2007 of 250 Chinese business operating in North Korea, 88% said they were turning out profits.” Est-ce un appel à investir en Corée du Nord ? Selon moi oui mais la réponse se fera sentir d’elle-même.

Ces memoires, comme chaque traité, possède certaines limites et certains manques : des sujets ne sont pas évoqués telle la situation des droits de l’homme ou la question des refugies nord-coréens en Chine, ce qui peut gêner certaines personnes au caractère plus humaniste où des personnes qui ne voient la Corée du Nord que par l’image de ces deux sujets. Il faut cependant admettre qu’en se focalisant sur ces deux questions, on aurait alors la fâcheuse tendance à oublier le reste. Ce fameux « reste » est quant à lui presenté de manière prompte et audacieuse par notre confrere helvétique.

Pour les lecteurs potentiels, le livre est disponible à la vente ici