Changes in the North Korean Economy Reported by North Korean Refugees

Abstract

Research Purpose and SummaryThis research is designed to assess the current state of the North Korean economy caused by the July 1 measures in 2002, through interviews with North Korean refugees, whose numbers have recently increased dramatically (see Table 1).* Research target: North Korean refugees who fled into South Korea in 2006 and who currently reside in Seoul, Gyeonggi Province, and Busan* Research period and methodology: November to December 2006, survey and in-depth interviews with ten refugees* Numbers: 335 refugees, or 1 7 percent of the total number of North Korean refugees who fled into South Korea in 2006.* We interviewed 21 9 North Koreans who fled from North Korea between 1997 and 1999 and between 2004 and 2006, to ascertain changes in the North Korean economy after the July 1 measures (see Table 2).* Contents of research: profile of North Korean refugees, income and consumption, and market activitiesResearch FindingsA Profile of the North Korean RefugeesOur findings concerning gender are shown in Table 3:* Among the refugees, the proportion of men increased remarkably, from an average of 7 percent during 1997-9 to an average of 44 percent during 2004-6.* The particularly high proportion of women among those refugees who had left North Korea before the July 1 measures results from the fact that women were allowed to retire early and therefore it was easier for them to escape from North Korea.* The number of male refugees has gradually increased since the July 1 measures, because the increased number of men engaged in trade has made it easier for them to move, and female refugees have helped their families and relatives to leave North Korea.Age profiles are shown in Table 4:* Overall, the proportion of those refugees in their twenties is highest, but in recent years the proportions of the youngest age cohort (those aged between ten and nineteen) and of those in their forties have increased, while the proportion of those in their twenties has decreased.* The shares of the youngest age group and of those in their forties among the total number of refugees have increased since the July 1 measures, because those in their forties engaged in trade and they helped their families to move to South Korea.The educational background of the refuges is shown in Table 5:* The percentage of refuges who had not finished high school has decreased, while the proportion of those refugees who had completed high school and college education has increased.The occupations of refugees when they were in North Korea are shown in Table 6:* The proportion of production workers has declined, whereas that of the unemployed has risen.* This is largely attributable to the gradual increase in the early retirement of women engaged in production.Income StructureIncome structure is shown in Table 7:* As shown in the table, there is not much difference in the income structure of those two groups of refugees who had fled North Korea before and after the July 1 measures.* Wage income amounts to less than 10 percent of total income, and trade income accounts for about 90 percent of total income.* Table 7 indicates that it is difficult even for workers with a job to earn enough money to live on their wages alone.Income level is shown in Table 8:* The income level of the refugees after the July 1 measures is substantially higher than that of the earlier group of refugees.* The average monthly income per capita more than tripled, from $6 for the three years from 1997 to 1999 to $20 for three years from 2004 to 2006.Consumption Structure and LevelThe consumption structure is shown in Table 9:* The table shows that food consumption as a percentage of refugees' total expenditure fell after the July 1 measures, while expenditure on clothing increased after the July 1 measures; food accounted for the largest portion of refugees' total expenditure before and after the July 1 measures. …