For business success, look up

North Koreans often jokingly refer to their capital city as the “Republic of Pyongyang.” There might be some humor in this epithet, but it reflects a deeper reality within North Korean society that discriminates against those not fortunate enough to live in the capital. The state refers to Pyongyang as the “holy land of the revolution” and the “heart of the Chosun people,” bestowing priority upon its residents for everything including construction materials, food rations, and electricity. 

In a country where an individual’s fate is determined by their political and social background, the chasm between those living in Pyongyang and elsewhere is even evident in each person’s identification card: Pyongyang residents carry ‘Citizen IDs,’ while all other citizens are issued ‘Provincial IDs.’ Much of the reasoning behind this likely comes from a strategic calculation to negate the possibility of uprisings in the area where the leadership resides and to use Pyongyang citizens as a tool to defend the regime. 

However, the leadership is not alone in the realm of strategic calculations. Being in a position of privilege, Pyongyang residents are quick to adapt and use their advantages to compete against provincial residents in the market economy. Knowledge about the leadership and Kim Jong Un’s interests can be used to determine where money can be made.

One could say that people mingle with others of the same economic status. The areas that cadre from the department-head level reside are very different from where the average citizens live. State supply of power and gas is at a different level in cadre neighborhoods, and the difference in standard of living between them and others is like day and night. They decline to use Chinese products, and have a preference for Japanese or South Korean goods when it comes to appliances like televisions, and even their food products and condiments are from the South. 

These days in high-end apartments, Japanese TOTO showers and South Korean faucets are the latest fad. Because these apartments are gifts (from Kim Jong Un), the house fittings are mass imported and so things like shower heads tend to break down not long after moving in. So people end up buying their own. 

People in Pyongyang are quick to recognize how things are developing around them to identify new opportunities to make money, but it’s never simple. You need to know how society is operating to find profit-making opportunities, but more importantly, you need to know the right people and how to use your cadre connections. 

There’s a designated fuel supplier for each district and neighborhood. Cadre receive a normal supply of gas, but the average residents only receive a partial supply. Some households use the sporadic supply of gas to sell in the markets to buy rice. For national holidays or special celebrations, we will sometimes get six 15 kg gas cylinders (a year’s supply) for a four-person household. These cylinders sell for as little as 20 USD a tank or over 40 USD, depending on market prices. Households that are well-off buy Chinese gas and those that are not buy local gas.  

Oil is only about half the price of gas, so some use it instead, but the price of gas and oil coming in from China depends on the volume of imports. If China decides to apply pressure, the prices skyrocket very quickly. China seems to think of North Korea as nothing more than one of its provinces. Pyongyang residents lament having to deal with China and being bullied instead of being able to trade freely with the South. They think that even purely economically speaking, trading with China instead of the South is only doing good for a third party.

Some buy their own coal and make briquettes or buy those made in the markets. Home prices in Pyongyang are higher in the neighborhoods that have better gas supply. 

Visas for China are, simply put, a revenue generator for state security agents. Visas are issued by the city’s foreign affairs department, but if you can’t get your local security agent to sign your verification papers, you can’t even lodge an application. Depending on how large your bribe is for your local security agent and foreign affairs managing agent, you might get a visa in two months or several years. Smart security agents can spot fake invitations from relatives in China, but they will actively help people who they know have good prospects for their businesses. 

In the past, you only needed a letter of invitation from a Chinese relative to apply for a visa. But once they discovered forged letters and envelopes with global mail stamps circulating on the black market, things changed. Now you need a stamp from China’s immigration office on the letter of invitation in order for it to be recognized. 

If donjuLiterally "masters of money," donju refers to people who hav... More (newly affluent middle class) want to apply for visas, resourceful security agents will even provide consultation on the illegal methods they can use to get one, even if they don’t have an invitation or are not eligible to apply. Also, during education sessions for people who are about to leave for China on these visas, they will inform them that it is okay to stay past their visa expiration but that good money must be earned before they return. This of course implies that the donjuLiterally "masters of money," donju refers to people who hav... More will have to pay the agent some money after they get back. This is how they build up close connections with security cadres. The bribe typically depends on how old you are: those aged 55 and older pay 500 USD; those in their 40s pay around 1,000 USD; and people in their 30s need to have several thousand dollars. But these days even with large amounts of cash, it’s believed there are greater limitations on visa issuance. 

I ran a public bathhouse. I rented an old factory warehouse and borrowed 3,000 USD to renovate it into a bathhouse. I had some connections with cadre at a military base, so I was able to use soldiers for the construction virtually for free. I had two pumps installed – one manual, and the other with a motor for the water, and bought coal at market price to heat up the water whenever I needed it. 

Public bathhouses fall under the purview of the district people’s committee, so I had to pay a portion of my profits. In the beginning, I was very honest and told them it would be hard for me to make the required payment because I wasn’t turning profits yet, and they let it slide for a few months. Cadre on the people’s committee are human, so they give you about six months. But if you make a lot of money and still don’t pay up and pretend there’s not enough profit, they’ll revoke your business permit. 

I started serving people tea for free to draw more customers, and that’s how I started making profits. A year later, I opened up a drink stand in one corner of the bathhouse and ran that. Instead of hiring individual daily workers, for the most part, I tried to rely on state workers. Individual workers are paid according to market prices, but state workers are paid via monthly state wages and rations, so it’s much more efficient. 

If you want to succeed in your business, before you look to get a permit from the district people’s committee, you should look into what the interests of the higher-up’s (Kim Jong Un) are. You just need to choose your business endeavor according to his interests. Also, when you’re coming up with a name for your business, you need to think it through so you attract less attention during law enforcement crackdowns. 

I’ve heard this is why a lot of people are interested in establishing orphanages. The state doesn’t have the room to look after orphans. If there’s interest in anything from above, people become interested in running a related business. I heard someone is thinking of naming their facility the “Ri Sol Ju (First Lady) Orphanage.”

But this is all part of the game. Pyongyang people think of running an orphanage as a step towards running a bigger business. When it comes to propositions like these, more people are willing to lend you money. In other words, individual lenders are always willing to give you a loan if they think you have a business that’s good collateral.