February 10, 2020:
North Korean leader Kim Jong Un has kept insisting that he will never denuclearize, no matter what. But what if China decides that for the current communist dictatorship to survive in North Korea, the nukes must go and, if necessary, the Kim dynasty as well? North Korea is, so far, coping with the shortages the sanctions have caused. The additional stresses caused by dealing with the coronavirus may become too much to handle but so far the Kim dynasty is coping.
The current coronavirus emergency is demonstrating how decrepit North Korean infrastructure and public services have become. At the moment North Koreans are hungrier from lack of food, colder from lack of fuel and more frequently without electricity because over a decade of sanctions have cut maintenance on power plants and distribution systems. Since the early 1990s, when Russia halted decades of economic aid, the government has had to cut back on most public welfare spending. The only exception to all these cuts was the capital; Pyongyang. As a result, the capital and the rest of the country now seem like two different countries. The capital looks very different, with lots of visibly recent construction. The electric supply is the most regular in the country as are supplies of fuel for heating. There are more food and consumer goods available. At the moment the most critical difference is that Pyongyang has a medical system that could handle a coronavirus outbreak. The rest of North Korea would quickly exhaust medical resources and coronavirus victims who would have otherwise survived the virus would be dead. This would mean a lot more popular anger at the Kim dynasty and possibly more disorder than the security forces can handle.
Aware of that risk, the government has taken extraordinary measures to keep coronavirus out of the country. So far the official position is that there have been no confirmed cases in North Korea much less any deaths. Suspected coronavirus victims in the capital are effectively quarantined but in the rest of the country, local officials are on their own with orders to cope as best they can and not report any people coming down with coronavirus or dying from it. Coronavirus symptoms are similar enough to influenza and other similar diseases that can, up to a point, to be blamed for coronavirus infections and deaths. But if the number of people stricken and then dying reaches unusual levels the local population will do the math and realize they have been lied to and abandoned by their government. North Korea leaders are hoping that does not happen because if it does it will have a major crisis on its hands and few resources with which to handle it.
The border with China has been closed for over three weeks and that means bulk imports of food and fuel are not arriving. These are legal imports that China is the major supplier of. North Korea cannot afford to maintain much in the way of food or fuel reserves and what reserves do exist are for the military, in case there is a war or other national emergency. These supplies may already have been released to provincial security forces (soldiers and police) but they won’t last long if the Chines border remains closed.
In China, where most of the coronavirus victims and fatalities are, the death toll now exceeds 900 with over 40,000 confirmed infections. South Korea, unlike the north, has ample health care resources do deal with coronavirus. Here have been only 27 confirmed cases of coronavirus in South Korea so far
The South Korean army has about 1,100 soldiers quarantined until they are cleared of any possible coronavirus infection. All these soldiers had visited China, Hong Kong or Macao in the past two weeks and the quarantine was just a precaution often applied to any recent South Korean visitors to China. There have been no coronavirus deaths in South Korea so far.
Incentives
Despite the halt in North Korean coal exports, which used to account for the majority of coal mined, there are shortages in North Korea and productivity at coal mines is declining. The problem is that the mines are much less profitable now because the only market for coal is in North Korea, where prices are set at low levels that allow for little or no profit. Managers of coal mines are responsible for the profitability and with those profits sharply reduced the government responded by dismissing and punishing coal mine managers. The best qualified replacement managers refused to take the job, knowing that there was no way they could generate profits as long as the sanctions and government price controls were still in force. So even less qualified managers get the jobs and the mines are poorly run and are now deteriorating from lack of maintenance and upgrades. This is a process that has occurred in other export dependent industries, with generally the same results.
This damaging government interference with management trying to adapt to new conditions is found in most workplaces. The only exception are the few (but growing) number of operations run by donju (entrepreneurs). These operations have managers largely free of government interference and for that reason, plus more effective management, these firms are much more profitable than their government controlled counterparts. The donju firms also pay their workers a lot more and expect more from them. The government tolerates this because the donju firms are so efficient and profitable. The donju firms pay a lot in taxes and, unofficially, in bribes.
Causes And Effects
Corruption remains a major problem for North Korea and unlike China and South Korea there have been no major efforts to deal with the problem in North Korea. That is one reason why North Korea is such a wreck economically. The global aspect of this can be seen in the international surveys of nations to determine who is clean and who is corrupt. For 2019 North Korea ranked 172nd out of 180 nations in international rankings compared with 176th in 2018. Corruption in the Transparency International Corruption Perception Index is measured on a 1 (most corrupt) to 100 (not corrupt) scale. The most corrupt nations (usually Yemen/15, Syria/13, South Sudan/12 and Somalia/9) have a rating of under 15 while the least corrupt (Finland, New Zealand and Denmark) are over 85.
The current Chinese score is 41 (versus 39 in 2018) compared to 30 (30) for Ukraine, 45 (44) for Belarus, 58 (60) for Poland, 80 (81) Germany, 65 (61) for Taiwan, 39 (40) for Turkey, 41 (40) for India, 28 (28) for Russia, 59 (57) for South Korea, 14 (17) for North Korea, 37 (35) for Vietnam, 85 (84) for Singapore, 73 (73) for Japan, 40 (37) for Indonesia, 38 (38) for Sri Lanka, 29 (33) for the Maldives, 34 (34) for the Philippines, 32 (32) for Pakistan, 26 (28) for Bangladesh, 26 (30) for Iran, 16 (15) for Afghanistan, 29 (30) for Burma, 71 (71) for the UAE (United Arab Emirates), 60 (64) for Israel, 69 (75) for the United States, 26 (27) for Nigeria, 44 (43) for South Africa, 20 (18) for Iraq, 39 (40) for Turkey, 53 (49) for Saudi Arabia and 28 (28) for Lebanon.
The North Korean corruption score has improved since 2012 when it was 8. South Korea was 56 in 2012.
The state of living conditions in both Koreas can be measured compared to the rest of the world. The effectiveness of governments and the societies they represent is rated each year in the Human Development Index. The UN has compiled these ratings for 29 years. The index ranks all the world nations in terms of how well they do in terms of life expectancy, education and income. In 2019
South Korea was 22 out of 189 nations and tied with Israel. North Korea was not ranked because sufficient information could not be obtained. Based on conditions of low-ranking nations that could be measured North Korea was at the bottom of the list, perhaps the very bottom.
The rank of other nations puts this into perspective; United States is at 15 (tied with Britain), China 89, Israel 22, Saudi Arabia 36, Iran 65, India 129, Pakistan 152, Afghanistan 179, Bangladesh 135, Russia 49, Venezuela 96, Colombia 79, Mexico 76. Egypt 116, Lebanon 93, Syria 154 and Jordan 103. The top ten nations are Norway, Switzerland, Ireland, Germany, Hong Kong, Australia, Iceland, Sweden, Singapore and Netherlands. The bottom ten are Mozambique at 180th place (there are a lot of ties) followed by Sierra Leone, Burkina Faso, Eritrea, Mali, Burundi, South Sudan, Chad, Central African Republic and in last place, Niger.
February 9, 2020: In North Korea, the government canceled the big parade in Pyongyang that, each year, celebrates the anniversary of the founding of the military. This year would be the 72nd anniversary and preparations, including bringing thousands of provincials to the capital, were underway. Those travel plans have been canceled, lest any outsiders brought coronavirus to Pyongyang. South Korea media reported that there have already been five coronavirus deaths in the north but the government there is suppressing that news. This cancellation is a major disappointment for Kim Jong Un because this parade was going to stress the loyalty of the military to the Kim dynasty. At the moment that loyalty could use a boost.
February 5, 2020: North Korea banned foreign diplomats from entering the country, as part of their effort to prevent the coronavirus from entering North Korea.
February 2, 2020: There are unofficial reports that at least five people have died from coronavirus in North Korea. The official position is that North Korea has managed to keep the country free of the coronavirus, with only one confirmed case so far. That one case was a North Korean who returned from China and was tested at the border and found to have coronavirus. North Korea has kept the virus out because it normally has little traffic across its borders and these are the most heavily guarded borders on the planet. North Korea has halted all Chinese tourism (a major source of foreign currency) and curbed normal (business and government) travel to China. North Korea is also very poor and in no condition to deal with an outbreak of the new virus. Yet North Korea still has a lot of smugglers operating along the Chinese border and in some coastal areas.
Japan launched another photo-reconnaissance satellite, a new model that will replace one of the seven already in orbit or simply help Japan in its efforts to expand its operational orbital spy satellite count to ten. Up until the 1990s Japan refrained from launching military satellites, but this changed when North Korea fired a ballistic missile over Japan in 1998. Japan promptly set out to get eight surveillance satellites in orbit by 2006, in order to keep an eye on North Korean nuclear weapons and ballistic missile efforts. This proved impossible to do. For more than two decades now Japan has regularly launched new and improved satellite and managed to keep at least seven photo or radar surveillance satellites in orbit. Japan has long relied on commercial photo satellites, and whatever they could get from the Americans. But for high-resolution shots, on-demand, of North Korea, and electronic eavesdropping from space, they need their own spy satellites. It is believed that the Japanese spy satellites are also being used to watch military developments in China and Russia as well.
February 1, 2020: By U.S. accounting South Korean defense spending (currently $44 billion a year) ranks as ninth largest in the world while North Korea is 74th (spending $1.6 billion).
January 31, 2020: North Korea suspended all train and air traffic with China in an effort to keep the coronavirus out.
January 30, 2020: North Korea declared a state emergency because of coronavirus and effectively shut down imports from China. On January 21st most foreign visitors were banned from entering the country. Medical personnel were sent to all border crossings to check any people coming in for coronavirus. North Korean workers in China were ordered to stay home from work until further notice. North Korea has done this before (2003 and 2014) when there was an epidemic outbreak in China. This prompt action is critical for North Korea where the level of medical care is very low and there are a lot of malnourished people with lower resistance to diseases.
January 27, 2020: American intelligence believes that North Korea is continuing to work on building a reliable, multi-stage ICBM (Intercontinental Ballistic Missile). Satellite photos show continuing shipments of items needed to build another missile for testing. So far North Korea has been trying to make the outside world believe that it has a working ICBM. It doesn’t, but in 2017 some desperate measures were taken to make it appear they did. Back then North Korea launched what it described as a new ballistic missile, the Hwasong-14. North Korea described the test as successful and proof that North Korea had a working ICBM design. None of that was true. What North Korea did do was launch a two-stage ballistic missile that went higher (over 2,500 kilometers) than an ICBM normally goes (about 1,200 kilometers) but did not have enough momentum to go very far and the second stage (or what was left of it) came down in the ocean 930 kilometers from where it was launched. To be a working ICBM Hwasong-14 would need rocket motors in the first and second stages that could fire longer (carry enough fuel or be efficient and reliable enough) to keep it going at that orbital (where low orbit satellites regularly operate) altitude long enough for a third stage to separate and use a reliable guidance system and re-entry vehicle able to handle the heat of high-speed descent to the surface. North Korea is still missing a lot of key components but managing to keep the media spotlight on the few features that do work and imply that the missing capabilities will appear in due course. Like many North Korean assurances, about their economy, their ability to feed their population and much else, “due course” actually means; “eventually but not yet and maybe never.” North Korea knows that this is not a popular subject for the mass media and has been able to get away with this sort of thing for decades.
January 25, 2020: In North Korea leader Kim Jong Un appointed a new Defense Minister, the eighth in eight years. The rapid turnover is due to Kim wanting younger, and more loyal, officers in senior military jobs and heading the Defense Ministry. Early on Kim forcibly retired or even executed senior commanders he was not satisfied with. Now the Defense Ministry job is a test for able and loyal officers that Kim wants to keep promoting. For example, the former Defense Minister created by the new appointment was given the job of Foreign Minister.
January 24, 2020: In Russia, despite earlier claims that they had sent all their North Korean workers home, officials now admit that there are still about a thousand North Korean workers in Russia, mostly because of difficulties in finding transportation for those working in remote areas.
January 22, 2020: North Korea closed its Chinese border in an effort to keep the coronavirus out. This includes Chinese police returning North Korea defectors they have caught. North Koreans working in China have been ordered to remain in their living quarters until further notice, even if Chinese workers are free to work. Not all of China is shut down because of the coronavirus threat and many North Korean workers are in those virus free areas. Similar measures were enforced on the smaller Russian border.
January 21, 2020: The U.S. confirmed that North Korea has failed to comply with the December 22 deadline to bring all foreign workers home. This was mainly about 50,000 North Korean workers in China and 30,000 in Russia who were supposed to be back in North Korea by December 22nd, as per the UN sanctions. Russia had sent home all the North Korean workers officially still in Far East Russia, where there is a labor shortage and cheap North Korean workers have been popular. Many of the departing North Koreas said they expected to return soon and they did with tourist or other deceptive visas. Using various visas and other deceptions China and Russian managed to keep or replace (with other North Koreans) all their North Korean workers. The UN economic sanctions on North Korea called for all North Korean workers employed in other countries (mainly China and Russia) to be sent home by late December. That did not happen in China, which has long been North Koreas’ major trading partner. China has been allowing more North Korean workers to enter and work, many with no visa at all. Half of the workers’ pay goes to the North Korean government as “tax” but the North Korean workers are still making more than they could in North Korea and most of that pay supports family back in North Korea while the exported workers have more food and heat than they would back home. China and Russia are officially supporting the sanctions but are unofficially tolerating all manner of smuggling and sanctions evasion. The end result is that China and Russia cooperated with North Korea to ignore these economic sanctions. North Korea earns about $500 million a year via this exported labor. North Korea has recently sent more security personnel to China to ensure that the North Korean workers do not try to escape from China and North Korean control. The U.S. subsequently put individual sanctions on two China-based but North Korean controlled companies that provided various support (housing and transportation) services for the foreign workers and the security personnel who keep them under control.
January 20, 2020: Russian oil exports to North Korea increased in 2019, from $32 million in 2018 to $42 million in 2019. Imports from North Korea were also up, to $2.31 million from $1.98 million in 2018. North Korea is under more extensive sanctions than Russia but some legal trade is allowed. Russia is also accused of a lot of illegal trade with North Korea.
January 15, 2020: A recent study of Internet censorship concluded that North Korea had the most heavily controlled Internet with China coming in second followed by Russia, Iran, and Turkmenistan.
January 10, 2020: In what has become an annual ritual the government has launched another “special effort” to curb corruption among those who guard the Chinese border. These troops know they can make a lot of money taking bribes from smugglers and illegal travelers in general. The government has learned, but won’t admit officially, that these anti-corruption efforts don’t last long and that each year the government has to bring in personnel from different security or intelligence organization to try and impose discipline. This year it is people from the military intelligence agency. These fellows have heard of the corruption and have less security and policing experience than their counterparts in the secret police and are expected to be less effective and more quickly corrupted.
Some forms of corruption get less attention from the government. One example is the growing use of bribes and payments for test answers for the university entrance exams. While South Korea has the highest percentage of adults with a college education, North Korea has a much lower rate and in North Korea having a college degree leads to much better life than most North Koreans can achieve. So well-off families can justify paying a lot of money to get their kids into the best universities.
January 2, 2020: This year North Korea publicized a special round of training for some members of the Worker-Peasant Red Guards. This is a local armed militia with a claimed strength of five million adults (out of a population of 25 million). There is supposed to be several periods of annual training, which consists of gathering local militia members together to confirm membership and issue weapons for training, but rarely for target practice. This year a few units underwent longer training the involved target practice at a rifle range and s brief period of time living outdoors as the militia might have to do in wartime. This was apparently a propaganda effort because there are not enough resources to do this on a large scale. The active-duty troops are complaining that there is not enough food, fuel or ammunition for any training and that more and more of their time is spent on raising their own food or working on non-military construction projects. This, not surprisingly, has led to more corruption among officers, NCOs and civilians who work with the military. This problem has become so widespread and visible that North Korea has launched a well-publicized crackdown.
December 29, 2019: China’s two major shipbuilders, CSSC and CSIC, merged to create the largest shipbuilder in the world with 310,000 employees. A decade ago there were nearly half a million employees but recessions continued competition from rivals South Korea and Japan forced the change. The new company, CSG (China Shipbuilding Group), as well as the two it merged from, are all state-owned. The merger is actually a return to the situation in 1999 when CSSC and CSIC were created from the then single state-owned shipbuilding operation. This was meant to encourage competition and it worked. Chinese shipbuilders, mainly the two large firms, account for most of the shipbuilding in China and have been striving to overtake their main rival South Korea as the largest shipbuilder in the world in all categories. There are several ways to measure shipbuilder output South Korea is the champion in most of them. Japan was once in first place but now has to settle for third place. South Korea and China have been close competitors for first place since 2012 and to that end, the two largest South Korean shipbuilders also merged in 2019.