World

Flourishing street stalls show entrepreneurial undercurrent in North Korean economy

  • In this Aug. 16, 2015 photo, people queue up at kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)

    In this Aug. 16, 2015 photo, people queue up at kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)  (The Associated Press)

  • In this Aug. 16, 2015 photo, people queue up and have their meals at a food kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)

    In this Aug. 16, 2015 photo, people queue up and have their meals at a food kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)  (The Associated Press)

  • In this Aug. 21, 2015 photo, food vendors serve customers at a kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)

    In this Aug. 21, 2015 photo, food vendors serve customers at a kiosk in Pyongyang, North Korea. Street stalls that offer North Koreans a place to spend - or make - money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema. (AP Photo/Dita Alangkara)  (The Associated Press)

Street stalls that offer North Koreans a place to spend — or make — money on everything from snow cones to DVDs are flourishing in Pyongyang and other North Korean cities, modest but growing forms of private commerce in a country where capitalism is officially anathema.

In sharp contrast to the common but semi-clandestine activities of old women hawking loose cigarettes on city backstreets or farmers selling their produce in makeshift fruit stands along highways, the kiosks appear to have the support of some important backers and are both conspicuous and spreading fast.

Near Pyongyang's main train station, for example, a hamburger stand is doing good business. A few blocks away is a kiosk that stocks buns and bakery goods. Other kiosks sell flowers, soft drinks and junk food. Since it's summer now, the big items are snow cones and ice cream, affordably priced at less than 1 U.S. dollar.

In the winter, it's roasted chestnuts, sweet potatoes and hot drinks.

Most of the kiosks are decidedly small-time. But fancy ones associated with well-established restaurants or state-approved enterprises are also multiplying, which could suggest the Pyongyang status quo may be trying to tap into, or even develop, the nascent domestic consumer market.

The first street stalls appeared about a decade ago in the capital, organized by the state on holidays to provide citizens with subsidized treats — often in exchange for government-issued coupons — as a show of the leadership's largesse. But following a broader experiment with allowing the stalls to grow in 2012, the 100th anniversary of the birth of North Korea's founder, Kim Il Sung, they have mushroomed in number and variety.

Pyongyang's acceptance of their spread may have been inevitable.

North Korea's nanny-state system was severely damaged by the country's economic crisis and famine in the 1990s, prompting many North Koreans to sell whatever they could on the black market, either for cash or food, just to survive. Kiosks and the growth of private enterprise in general since then is seen by North Korea watchers as evidence of how the lean years changed people's attitudes toward relying on the state, spurring a kind of grassroots entrepreneurism.

Officials still frown on market-style capitalism, which they see as an anomaly and a potential threat to their old-style centralized, state-run economy. Without their tacit approval, however, the stalls and larger quasi-official marketplaces that have also become a fixture in most cities would not be allowed to operate as openly as they do. It is widely believed by outside observers that bribes and corruption play a role.

In the larger markets, most of which are kept from the prying eyes of foreigners, stalls are leased to individual sellers who are then allowed to hawk their wares and haggle with customers over prices, creating an atmosphere that is very similar to public markets in other countries.

Though state-issue coupons are still in use, most transactions at the kiosks are done in cash — local currency for the most part. Cash transactions sidestep the rationing system, are harder for the state to monitor and control and could also widen the already growing gap between the haves and the have-nots, particularly in the capital.

Andray Abrahamian of Choson Exchange, a Singapore-based nonprofit group that works with North Koreans on a wide-range of business and entrepreneurial projects, said it's not clear whether the spread of the kiosks is due more to individual initiative or to the involvement of state-owned enterprises.

Either way, he said, the kiosks are a positive sign of innovation. He said that if they work in a manner similar to state-sanctioned markets, where sellers give the state a cut but are basically able to run their own show, they are "a great opportunity for the entrepreneurially minded."