Does ousted finance minister face execution?
Kim Jong-un shifted the blame of economic crisis and soared exchange rate to the Finance Minister Ko Jeong-bum (left), who in fact couldn’t even execute a single economic policy on his own (Image: iStock.com/LUHUANFENG, KCNA)
When Kim Jong-un replaced his finance minister at the end of last month, flagging “obstacles to economic development,” the rumor mill went into top gear. Had the booted official, Ko Jeong-bum, messed up seriously enough that he might be executed?
Certainly, the decision, made at an important Workers’ Party meeting, looked bad for Ko.
Back in December, with the exchange rate soaring to 20,000 won to the dollar and food and commodity prices skyrocketing, the finance minister came under pressure to solve the problem. The authorities issued proclamations about stabilizing exchange rates and prices every month until this year. But prices just kept on rising.
Finally, at the end of the first half, Ko was replaced and the poisoned chalice was handed to a new face, Ri Myong-guk.
As everyone knows, in North Korea’s system, the dictator is positioned as making all decisions. But every time the economy worsens and public sentiment wavers, officials are held accountable. In serious enough cases, they’re executed.
For example, in the 1990s, then-dictator Kim Jong-il deflected responsibility for the mass famine that caused hundreds of thousands, if not millions, of deaths by blaming it on the minister of agriculture, So Kwan-hui. Accused of embezzlement and spying, he was shot in front of a large crowd in 1997.
Similarly, in 2010, the director of the party’s planning and finance department, Pak Nam-gi, was executed after a botched currency reform. Nobody really believes that one person was responsible, so suitable charges had to be found. Pak was charged with being the “son of a bourgeois conspiring to infiltrate the ranks of revolutionaries to destroy the national economy.”
Such harshness is brutal evidence of the extent to which the leadership will go to avoid bearing responsibility.
At that time, Kim Jong-il had suffered multiple strokes and had designated his third son as his successor. But it hardly makes sense to single out Pak as responsible for the currency reform, particularly given how extreme it was. The state confiscated funds held by ordinary citizens, exchanging them at a ratio of 100 to 1.
North Korea’s economy is in such a mess that we may expect more crises of this sort until the system changes.
With central planning paralyzed and the rationing system no longer functioning, the regime has lightened up and relaxed its controls over the unofficial markets so that people can scrape a basic living.
Thus, workers no longer earn money from their enterprises but instead earn it independently and pay the workplace in order to maintain their official association with it. Doctors, teachers, fishermen, and cooperative farm workers all have their own illegal way of surviving in these circumstances.
None depend on the state’s economic policies and nobody trusts them. The government, meanwhile, maintains the official system and labels any activities that deviate from this policy as anti-socialist.
This ambivalence, it must be said, serves to provide survival opportunities for law enforcement officials who are able to top up their own meager salaries by confiscating money and goods under the pretext of crackdowns and controls.
Such chronic difficulties are way too complicated to be resolved by the execution of a finance minister.
Era is a North Korean defector and an experienced journalist who offers a unique perspective on one of the world's most secretive nations. Having escaped the oppressive regime, Era has leveraged her keen understanding of North Korean society to become a beacon of truth. Through her extensive network of in-country reporters, she maintains real-time communication with sources inside North Korea, providing unparalleled insights into the ground realities of the closed society.
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