Kim Jong-un, the third hereditary ruler of North Korea, gets a really bad press. He is widely seen as a capricious, overweight youngster, fond of executing his generals and threatening the world with war; ruler of an impoverished country ever on the brink of famine but equipped with nuclear weapons.
There is some truth in this description but it does not represent the whole story. He may have a penchant for executions, but Mr. Kim is also the first ruler of the dynasty to implement market-oriented reforms.
The oft-repeated cliche of North Korea as a “starving Stalinist country” is outdated — it is neither starving nor Stalinist.
Experts agree that over the past decade the country has not only recovered from the disastrous famine of the late 1990s, but has also experienced significant economic growth. This growth was brought about, above all, by the emergence of the private economy. While on paper private entrepreneurial activities remain illegal, the law is seldom, if ever, enforced. As a result, some North Koreans — the more entrepreneurial, lucky, well-connected and ruthless of them — have recreated the market economy from scratch. Nowadays, there are private mines, truck companies and oil refineries in North Korea. Admittedly, the owner has to register the enterprise as state property, but this fiction misleads nobody.
It is estimated that 30-50 per cent of North Korean GDP is now produced by the private sector.
The presence of the new rich business people (many of whom are women) is much felt in Pyongyang and other major North Korean cities. They account for the majority of patrons in the upmarket restaurants popping up across the city.
Although meals cost $15 to $25, roughly equivalent to the average family’s weekly or fortnightly income, these places are always crowded.
All these changes began in the late 1990s but the late Kim Jong-Il, the father of the current ruler, did not quite know what to make of the growing private economy. Kim Jong-un is different: he quietly encourages the market economy.
The greatest success of the young dictator has been the reform of agriculture, similar to what the Chinese did in the late 1970s.
Fields, while technically state-owned, are given for cultivation to individual households and farmers work for a share of the harvest (30—70 per cent).
If plans for industrial reforms (decentralisation and partial privatisation of what is left of state industries) are taken into account, the general picture seems clear.
Kim Jong-un wants to apply to his country a model of authoritarian capitalism, a so-called “developmental dictatorship”. This model worked very well in Taiwan and South Korea and now is producing impressive results in China and Vietnam. — © Guardian Newspapers Limited, 2015
