North Korea's Lifeline Cut? Kim Jong Un Moves to Nationalize Private 'Jangmadang' Markets by Year's End

Is the engine of North Korea's grassroots economy about to be seized by the state? For decades, the informal economy has been a lifeline for ordinary citizens. Now, a recent report from sources inside the country suggests the Kim Jong Un regime is moving to incorporate private market businesses, known as the 'jangmadang', under state control by the end of this year. The move signals a decisive shift from the tacit acceptance that characterized the first nine years of Kim Jong Un's rule toward a broader reassertion of central authority.

From Famine's Offspring to Economic Pillar

The jangmadang's origins trace back to the devastating 'Arduous March' famine of the mid-1990s. As the state's Public Distribution System collapsed, North Koreans, facing starvation, began bartering and selling goods to survive. What started as small-scale trades—a haircut for some fish, excess vegetables for other necessities—grew into a sprawling network. This was fueled by smugglers bringing in goods from across the Chinese border, creating a de facto free market economy that became essential for survival and even offered a chance for social mobility.

COVID-19: The Perfect Pretext for a Crackdown

When Kim Jong Un took power in 2011, his government largely turned a blind eye to the jangmadang. Dismantling them was complicated; a deep-rooted system of bribery involved state officials, and the markets had created a new class of wealthy entrepreneurs known as the 'donju.' Furthermore, the markets had become too integral to daily life. However, for the regime, the jangmadang posed a threat, allowing contraband like USB drives and cell phones to enter the country and reducing the populace's reliance on the state.

The COVID-19 pandemic offered the perfect opportunity to change course. In January 2020, North Korea sealed its borders, deploying special forces with shoot-to-kill orders. While framed as a public health measure, this move effectively choked off the smuggling that fueled the jangmadang. The regime then began a gradual process of co-opting the markets, first by opening state-sanctioned facilities for trade and now, it appears, by mandating full integration.