Corruption in North Korea

Transparency International recently put out their international rankings, and North Korea finished dead last, tied with Somalia for 182^nd place. (For what it is worth, the US came in 24^th, while South Korea placed 43^rd.) The North Korean result is not entirely surprising: both our surveys of North Korean refugees as well as Chinese enterprises operating in the North depict an economy plagued by cascading corruption where rule of law is weak and political connections paramount. The situation not only represents a drag on growth, but could impair the regime’s capacity to govern, as the parochial interests of corrupt officials diverge from the policy preferences of Pyongyang.

This latter point has been crystallized in a couple of recent reports regarding the behavior of KPA officers. Yonhap reports that a KINU study alleges that Kim Jong-il chastised military officers for profiteering from selling war materials. The DailyNK adds some specificity to the claim, reporting that KPA officers in Yanggang province had been fined for inappropriate civil-military relations, including allegedly paying off a restaurant tab with rice stolen from civilians.