North Korea Leadership Watch

Research and Analysis on the DPRK Leadership

KJI Concerned About "Unrest" in Early February Over Money Crunch (revised 18 April)

Choson Ilbo, citing a story from Open Radio for NK, reports that Kim Jong Il was worried about public discontent at a meeting in early February.

At a meeting on Feb. 2 in which he received a briefing on the progress in the North’s project to earn dollars, Kim said, “If the most important thing is single-minded unity under current circumstances, public sentiment is the very basis of such a unity,” the radio quoted a high-level North Korean source as saying. “If this problem is solved, it will not be as difficult to earn foreign exchange as now,” he reportedly added.

His remarks suggested he, in fact, admitted that he has difficulty raising his own funds and that the North Korean people are agitated.

In early February, officials previously known to earn foreign currency for the regime in the Third Floor, took on a greater prominence in the country’s economic activities.  If this report on KJI’s state of mind is accurate, it may explain reports of the execution or incarceration of Pak Nam Gi, and one of the vice chairmen of the State Planning Commission.

KJI’s concerns about security were likely assuaged.  The Ministry of Public Security was upgraded, and directly subordinated to the National Defense Commission.  The chief of the State Security Department was given a military promotion.  While MPS was already on the fast track for the Supreme Commander’s affections, and U Tong Chuk’s promotion was not entirely unexpected, the lack of any major, and embarrassing, popular revolts may have facilitated, if not ensured, these institutional and career advancements.

KJI’s concerns about earning foreign currency may take more time.  Yonhap, citing sources in Beijing, reports that Office #39 (3rd Floor) deputy director (and KJI high school buddy) Jon Il Chun had traveled to China around 9 April.  He is also, concurrently, President of the State Development Bank and chief executive of DPRK Taephung International Investment Group, acting on behalf of the National Defense Commission.

Jon Il Chun was reportedly leading a delegation to Beijing to negotiate and attract investments in the country.  Mr. Jon was one of the foreign currency-earning technocrats KJI promoted to handle the economic fallout from the 2009 currency redenomination.

Meanwhile, Kyodo reports that the public face of the DPRK Taephung International Investment Group Pak Chol Su (whom one recent report noted does not sport a KJI badge) is talking up Rason, the country’s other ports and other infrastructure repair:

North Korea has launched a five-year, $120 billion infrastructure-building project in eight cities as part of a 10-year plan to rebuild the economy, a manager of a state-run investment group said Friday.

Pak Chol Su, chairman of the Korea Taepung International Investment Group, expressed hope companies from Japan, South Korea and other neighboring countries will invest in the development plan that began this year.

”We believe the plan will lead to the establishment of a Northeast Asian economic community” involving the two Koreas, China, Japan and Russia, Pak said in an interview with Kyodo News in Pyongyang.

Kim Jong Il conducts a field guidance tour of the renovated Hyangsan Hotel in North Pyongan Province in late January 2010. The official on the left is Han Kwang Sang, deputy director of the KWP Financial Planning Department. (Photo: KCNA).

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