Ri Kon-ho, an alias, who resides in Pyongyang's Taedong-gang district, had served as an ordinary purchasing officer at the Commercial Management Authority until early 1994. Encouraged by Kim Jong Il, dog-meat restaurants mushroomed in Pyongyang at that time, but as the state was unable to supply them with an adequate quantity of dogs, procurement officers had to tour provinces to acquire dogs as best as they could.

With passes issued from the authorities, procurement officers could travel to provincial areas across the country with relative freedom and conduct commercial activities. Ri opted for business in clothes. Japanese-made fatigues smuggled into the country were popular on account of their practicability, however, a pair of genuine fatigues cost over NKW4,000. Through the good offices of an ethnic Korean-Chinese, he was acquainted with, Ri imported from China copied Japanese-made winter fatigues at NKW1,600 per pair. With the goods he rushed to Hoechang County, South Pyongan Province, home to the largest gold mine in North Korea, where quite a few residents, on account of prevailing gold black marketing, held a considerable quantity of gold.

Ri sold a pair of fatigues for one gram of pure gold, which was then exchanged in Pyongyang or the border area for NKW2,500. He made a profit of NKW900 per pair. Due to insufficient capital available, he started with about ten pairs at the beginning. Making two trips a month, he could earn a profit of about NKW20,000. With some NKW3,000 paid by the Commercial Management Agency as the price for the dogs, he pocketed the remainder as his personal income. By gradually enlarging the scale of his business, he managed to earn over US$10,000 in one year. Given that North Korea's average worker's monthly wage stood at NKW100 at that time, equivalent to $0.5 on the black market, this was an enormous sum.

The profit margins have plunged since then, because of severe competition and crackdowns have also intensified, with large quantities of gold uncovered on trains or at checkpoints being confiscated. Of the seven procurement officers at the Commercial Management Agency, he said, three have made fortunes that way.

Private businesses have expanded in the North since the food rationing system collapsed due to the economic woes, and as a result a legion of nouveau riche like Ri have emerged. Most successful are former civil servants who were engaged in foreign exchange businesses. Foreign-exchange earning posts are still coveted. The new rich in the North these days reportedly take lightly a fortune of $10,000. Those making big fortunes do dollar black marketing, and or deal with antiques, gold, marine products, used foreign cars and second-hand consumer electronics.

A North Korean defector living in the South, who had made fortunes in the North by engaging in antique business, said, "Most rich people in North Korea have become rich by taking just one step ahead of others in the initial phase of businesses." Once a rumor spreads that a particular business is very profitable, many rush to the business, a sign that private businesses are thriving.

North Koreans are now accustomed to living according to their own judgment. "If you trust the party only, you starve to death," a stab at the party slogan, "Once the party makes a decision, we act accordingly," is said to have gained popularity among the public. North Korea's recent drastic price and wage raises and introduction of incentives may reflect such a social atmosphere.

(Kang Chol-hwan, nkch@chosun.com )