North Korea policy failures causing food shortage: experts

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Transparency needed in humanitarian assistance to Pyongyang

By Kang Seung-woo

North Korean leader Kim Jong-un's unusual acknowledgement of a food shortage is stirring up legitimate questions about the current situation inside the reclusive state and the reasons behind his admission.

Pyongyang watchers also believe the country is facing a quite serious food shortage, and they see Kim's failed major policies as the culprits for the ongoing crisis, along with the triple whammy of last fall's typhoons, COVID-19 and international sanctions. When it comes to humanitarian food assistance from South Korea and the United States, experts also question whether, if accepted, such aid will be distributed to the intended end recipients.

Kim admitted on June 17 during a plenary meeting of the ruling Workers' Party that his country is facing food shortages due to last year's typhoon and floods.

"By most indications, there appear to be food shortages in the range of 1.35 million to 1.5 million tons ―the worst food crisis since the Great Famine of the 1990s," said Robert Manning, a senior fellow at the Atlantic Council. The 1994 to 1998 food crisis is estimated to have caused millions of deaths.

"But it would be a mistake to just view it as a food shortage. It is not just the result of typhoons and floods, but also due to major policy failures and corruption."

According to Manning, there are a number of elements behind the shortage ― including North Korea's inward-looking posture lasting more than a year, the admitted failures of its economic plans and its heightened vigilance about foreign influence ― which suggest some measure of internal turmoil, although he admits to not having a good sense of the internal dynamics.

William Brown, a former CIA analyst and member of the Korea Economic Institute of America's board of directors, said it was more of a currency problem than an actual food shortage.

"The regime has lost control over corn and rice prices, which normally are capped, so there is now wild speculation in some places with prices soaring. This causes people to panic and store up grain, rather than sell it, adding to the shortages in marketplaces," Brown said.

"Meanwhile, the government is not filling its ration obligations because it also is short of funds. One indicator that needs to be watched closely is the relationship of the price of corn to rice. As the corn price gets closer to the rice price, deprivation concerns should increase."

Brown also said that the currency problem is due to extensive use of the U.S. dollar ― referred to as dollarization ― inside North Korea, which has made it difficult for Pyongyang to manage its money supply.

"People can easily sell won and buy dollars so the government has to be very careful in printing too much won, leading to inflation," he said.

Kim's admission of the country's ongoing hardships is seen as rare, and observers believe that the current leader is differentiating himself from his father, Kim Jong-il, who led the country from 1994 to 2011.

"Kim has distinguished himself for trying to be a bit more open than his father, when it comes to acknowledging the problems that North Korea is suffering. I think that acknowledging the food shortage is in line with this approach," said Ramon Pacheco Pardo, an associate professor of international relations at King's College London.

"Also, it serves him to try to show that the leader is aware of the problems that (ordinary) North Koreans are suffering from. And he could also use this acknowledgement as a way to blame some officials in the future if the situation continues."

Manning also said, "Unlike his father, he has acknowledged food shortages. I suspect the admissions of failure are aimed at mobilizing North Korea ― both policy elites and citizens ― to urgently take corrective action. It may also be aimed at creating sympathy for food aid."

Brown pointed out that everyone will see price jumps, so Kim had to acknowledge something, and he did it in a tone of "work harder and everything will be okay," adding that he seems to have no good solutions for the monetary imbalances and dollarization that are crippling his government.

Following the North Korean leader's acknowledgment, assessments here are that the country is signaling its need for outside help before the shortage turns to a mass famine, raising speculation that the South Korean and U.S. governments may undertake humanitarian relief efforts.

North Korean leader Kim Jong-un talks with Kim Tok-hun, the premier of the country, during a plenary meeting of the ruling Workers' Party in Pyongyang, June 17. Yonhap

But the issue of transparency surrounding the distribution of such aid may hold it back.

"Kim would only want food aid that likely comes with no monitoring agents or outside representatives that would want to come into the country and check on who is receiving the aid," said Harry Kazianis, the senior director of Korean Studies at the Center for the National Interest.

"He would likely offer the excuse of the pandemic as a reason no outside monitors can come in to watch any food distribution, a concession the international community should not grant, as any aid could be sent with vaccinated observers."

Pacheco Pardo suggested that it would be better to frame any assistance as part of international efforts to help the populations of countries suffering from the pandemic, not as something specific to North Korea.

"No government likes to be told that it is unable to feed its own population, and North Korea is no exception in this regard," he said.

Kazianis also said that even if North Korea eventually accepts an offer of humanitarian aid, it most likely will not acknowledge it.

"For the DPRK, they do not want to be seen as giving any leverage in any future nuclear talks, and I doubt they would want to show any weakness," he said. The DPRK refers to the Democratic People's Republic of Korea, North Korea's official name.

Brown said that humanitarian assistance will keep North Korea from making necessary but tough changes, a phenomenon that has been seen over and over.

"If I am correct and the problem is monetary in nature, the only good solution is (to implement) policy changes that make the markets work better," he said.

"Kim has several options and he needs to plunge in and accept at least one. These of course include negotiations on the nuclear issue to lower sanctions, but in my view, the more important ones relate to the economic system, creating a normal money and banking system, as South Korea did in the 1960s," Brown advised.

"This would allow (for) reform from within and improved productivity ― in other words, better use of labor and capital. With that underway, foreign assistance and more importantly, investment, would put the economy in takeoff mode."