ABSTRACT
From the early 1980s and onward with increasing speed in the 1990s, the DPRK fell into a spiral of economic decline. Some say it was triggered by the ruinous fi xed costs imposed on the small North Korean economy by the 1989 Festival of Youth and Students, which was held in Pyongyang. 1 Others put it down to deteriorating terms of trade with the Soviet Union after 1985. 2 Former KWP International Secretary Hwang Jang-yop said that systemic economic stress had been in evidence since the mid-1970s. 3
Whatever the cause(s) may have been, Kim Jong-il knew that the economic system over which he and his father were presiding required greater inward fi nancial fl ows. He responded to this imperative by fostering a “system with Party organizations from every level at its core, giving the work of earning foreign currency to loyalty fund-earning agencies to be created in provinces, municipalities and counties, with the money earned to be given to the Party.” 4
These measures were not designed to improve livelihoods for the wider population per se, however, and by the early 1990s dangerously fragile food security was the norm nationwide. Certain groups came under exceptional stress. The country’s general food distribution system, the Public Distribution System (PDS), collapsed across the northern provinces of North and South Hamgyong, Ryanggang and Jagang, leaving urban residents in those regions without access to the state distribution channel that had hitherto provided them with a small but steady trickle of food and daily necessities for survival.
