The Washington Post

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N. Korea lifts restrictions on private markets as last resort in food crisis
The Washington Post

Bowing to reality, the North Korean government has lifted all restrictions on private markets — a last-resort option for a leadership desperate to prevent its people from starving.

In recent weeks, according to North Korea observers and defector groups with sources in the country, Kim Jong Il’s government admitted its inability to solve the current food shortage and encouraged its people to rely on private markets for the purchase of goods. Though the policy reversal will not alter daily patterns — North Koreans have depended on such markets for more than 15 years — the latest order from Pyongyang abandons a key pillar of a central, planned economy.

With November’s currency revaluation, Kim wiped out his citizens’ personal savings and struck a blow against the private food distribution system sustaining his country. The latest policy switch, though, stands as an acknowledgment that the currency move was a failure and that only capitalist-style trading can prevent widespread famine.

Several analysts who monitor and travel to North Korea said that in recent weeks, Pyongyang has abandoned almost all its rules about who can spend money and when. That would seem to indicate that Kim — who once equated free-market trading with « egotism » and a collapse of social order — now wants to rehabilitate the markets.