North Korean Fast Food: Evidence Of Economic Reform?
Among the less noticed business news stories to have emerged over the past 48 hours were reports that North Korea recently opened its first American-style fast food restaurant, Samtaeseong, in Pyongyang, and plans to open further branches in future.
If this had happened in any other country, it would probably not merit any attention. But this is North Korea, the last truly hardline communist state in the world. Thus, the emergence of a US-style fast food chain, however embryonic, might – just – be seen as a step in the direction of economic reform – something that the regime of Kim Jong Il has struggled with since 2002.
Tentative market reforms were announced in July of that year, but progress has been very much go-stop-reverse-go-stop-reverse over the years. According to the reports, Samtaeseong is affiliated with a Singaporean firm, which provided supplies and training. This means that Pyongyang is willing to tap foreign ‘expertise’ where required. A photo of the joint in South Korea’s Chosun Ilbo newspaper shows a reasonably pleasant looking environment, which even serves beer, although prices seem steep by local standards – possibly beyond the affordability of most people.
None of this means that North Korea is about to welcome McDonald’s, which at this stage would be a step too far, probably for both parties. And even if McDonald’s did eventually enter North Korea, this would not automatically guarantee good relations between Washington and Pyongyang. New York Times columnist Thomas Friedman was wrong when he came up with the McDonald’s theory of conflict prevention, namely that any two countries that simultaneously had McDonald’s outlets in them would not go to war. This was disproved when NATO went to war against Yugoslavia in 1999 (Belgrade had several Golden Arches).
However, another of Friedman’s mantras – that McDonald’s cannot flourish without McDonnell Douglas – may be more applicable to Pyongyang. That phrase means that US businesses need the US defence complex to maintain order in the world. For Samtaeseong to prosper, the North Korean regime probably needs to feel secure enough to tolerate reform. This means no let-up in its long-held ‘Military First’ policy, and ultimately, no nuclear disarmament.
July 29th, 2009 at 9:49 am
Like Taedonggang beer and Pyeonghwa Motors, this sounds like an industry catering for an elite that is finding life in North Korea to be boring and wants to enjoy some of the material trappings of Western society. The Dear Leader himself has a penchant for the high life, which is possibly a cause of his pancreatic cancer. It is also not the first fast food outlet in the country; Kim Jong Il’s love of Italian food prompted him to permit the opening of a pizzeria some years ago.
The barometer of North Korea’s economic health and policy direction is the Ryugyong Hotel white elephant in Pyongyang, which is currently undergoing a face-lift overseen by an Egyptian company. The final transition to a market economy will come when the giant edifice of this monstrosity is toppled.