State-run factories in Pyongsong languish as private investors cash in
North Korea’s nouveau riche, in Pyongsong, South Pyongan Province, are reported to be actively investing in commercial facilities. This comes as many of the state-run factories located in the provinces face difficulties due to a lack of raw materials and the failure to create demand for their products.
Daily NK sources based in South Pyongan Province reported on circumstances faced by three state-run factories in Pyongsong that stand in stark contrast to two commercial facilities being operated with money from private investors.
“The design and layout of Pyongsongwon is good and the operations are going well,” said the source, referring to a “comprehensive service [business] center” that was built in Pyongsong’s Undok-dong (neighborhood) in 2017. Pyongsongwon features a public bath, sauna, barbershop, restaurants, and stores, and was built with financing from a private investor who has been involved in currency-related business activities. The center remains popular among local residents.
“Trading companies like Taedonggang, Sogyong, Nakwon, and Moranbong are bringing in foreign goods from China and other places along with some domestic goods to sell here. The prices are cheaper than those in the markets, so it’s popular among locals,” the source continued, adding that “the railway station and the road that stretches from Pyongyang to Sunchon are both nearby, so the center functions a bit like a wholesale outlet.”
The Pyongsong Department Store is officially run by the Pyongsong Business Management Office, but in reality, individual investors (donju) and a number of trading companies are financing operations at the center and hiring their own sales staff. The city’s Business Management Office has essentially given these entities the right to operate their businesses at the center in exchange for fees, the source said. ......
[Source: Daily NK]
