North Korean Refugees Now - Part 1: Changing Economy

In our new blog series, we will explore the newest developments in the world, which affect the flow of North Korean refugees in China. If there is any silver lining to the Great North Korean Famine, it is that North Korea was forced to fundamentally change the way that it distributes goods and resources throughout the country.

The famine killed up to 3 million people and put the country in a tailspin from which it has still not recovered.

Resources during the famine were so scarce that the country had to start a PR campaign to ask its people to eat two meals a day. At the famine’s height, many were left to eat grass, tree bark, pets, and other people.

Much of the starvation in the country can be attributed to a failed distribution system. The irony of the famine is that there was food sitting in warehouses for people to eat. But distributors were afraid to go to the outer regions for fear of starting riots. They also had no incentive to distribute food because, under the old system, they would get paid regardless. So the people starved.

Amidst the chaos, North Korea allowed the economy to be privatized under heavy restrictions.

As a result, private markets popped up all over the country and distributors were paid based on the deliveries they made. Experts say that there is actually less food in North Korea today but people are not dying of starvation because of better distribution.

North Korea has said that this is a temporary solution to the country’s food problems. But the current system has remained intact for almost 20 years.

This has sparked what many have called the Jangmadang, or Black Market generation. This generation carries cell phones, styles their hair to mimic the South Korean pop stars they have seen via illegally imported DVDs, and, most importantly, have not lived through famine.

Change is also coming to the country's vast number of farmers. North Korea is making strides to incentivize farmers for greater yields. After giving their share to the government and paying their operating expenses, farmers can now share profits with their workers.

Manufacturers have also been given more leeway to operate based on market principles. They can negotiate contracts with foreign entities and also pay their employees what they wish.

All these factors have, along with beefed-up security at the border, slowed the pace of North Korean refugees spilling over into China.

But many experts say that these changes enacted by the North Korean government are not drastic enough to revive the moribund economy and to cause change.

“In the economics sphere, the regime seems to lack any real strategic vision,” Marcus Noland, of the Washington-based Peterson Institute for International Economics told the Associated Press earlier this year.

Food remains the biggest issue. There might not be a famine but much of the country is still malnourished and very hungry. All this while food aid is on the decline and experts predict a smaller harvest this year, due to an unusually dry winter.

How this will affect the flow of North Korean refugees into China is yet to be seen. Regardless, Crossing Borders will continue to work in China to give vital protection and aid to these people.

China Facts: China's Economy - North Korean Refugee Crisis

How do China's economic ties with North Korea affect the North Korean refugee crisis in China? In order for the Communist Party in China to remain in power, it must have a growing economy. Unemployed people = Unhappy people

Graph of China, US GDP Growth Rate Since 2000 Source: World Bank

Though China’s growth has made it the world’s second-largest country by GDP, because of the sheer size of the country, many of its people remain in poverty ranking 121 out of 228 countries.

China must support its breakneck economic growth by securing resources from around the world for cheap.

This is part of the reason why China wants to keep close economic ties to North Korea.


China represents about 60 percent of North Korea's economy, according to the Congressional Research Service. And this relationship continues to grow.


What China gets out of this relationship are cheap raw materials, which are abundant in North Korea.

Natural resources accounted for 73 percent of North Korea’s bilateral trade with China in 2012, according to the Korea Times.

Over the past 10 years, China has effectively propped up the dysfunctional North Korean economy and provided little incentive for the regime to change its ways. It has done so at the expense of the people of North Korea, many of whom report to us widespread poverty in the country's outer-regions.

The people of North Korea continue to suffer while the elite in North Korea prospers. The Daily NK reported that Kim Jong Un spent $644 million dollars in luxury goods last year. North Korea recently requested $600 million in food aid.

China's economic ties to North Korea creates the situation from which the North Korean refugees flee from. These same North Korean refugees are those who China refuses to accept into their country. This is why the work of Crossing Borders is essential in the region. As North Korean refugees cross into China and as China refuses to offer any human rights to these people, we will continue to be a safety net for the people of North Korea, who have suffered so greatly.

Stay tuned for more facts about China.