Communist Capitalists?
Entrepreneurial North Korea and Vietnam are striding into capitalist ventures. Never thought of North Korea as entrepreneurial? Think again.
Come and Get It! (photo: Shih-Tung)
Admittedly, they started out in Cambodia, that hotbed of free enterprise. The North Korean government opened the Pyongyang restaurant chain – with the first two “franchises” in Phnom Penh and Siem Riep – back in 2002. And they are expanding across Asia, reports the South China Morning Post (subscription), featuring North Korean food, waitresses, decor and entertainment. The SCMP correspondent raved about the food, but expats sampling the fare in the Phnom Penh restaurant have a few complaints. Following their success in Cambodia, the Pyongyang chain moved into Bangkok in 2006, quickly followed by Vientiane and Kuala Lumpur. They have had restaurants in China for years, but I don’t know if they are officially part of the chain. That said, one store manager in China complains that their owners in North Korea (the infamous Bureau 39) exact an “annual franchise fee” of $10,000 to $30,000 per restaurant.
Those franchise fees are what this all about. North Korea needs foreign exchange and has been trying to earn it legitimately through restaurants and other enterprises since the 1990s. Unfortunately, they have also tried illicit trading ventures. There is a report of a Pyongyang Restaurant in Vienna, but I haven’t confirmed that Austrians are now eating kim chee. Chinese restaurants in Vienna are generally pretty poor, and their prime business has often been money-laundering. I recall a gangland style killing at one near my house in the late 1990s.
The recession may be catching up to these new capitalists; there is a report from last summer that many of the restaurants are closing. They depended on South Korean tourists for cash flow.
In a similar vein, says Asia Times, former Vietnamese Army officers who fought in Laos are back on the battlefield. This time their mission is to build a luxury resort and golf course where they fought so many years ago. The Long Thanh Golf Trading & Investment Joint Stock Company (snappy name) is developing their resort just outside of Vientiane, amid charges that the Laotian government has given them a sweetheart deal to obtain the land and get rid of the farmers now living there. It’s curious that, just before the $1 billion golf resort project was announced, the Vietnamese Army gave significant quantities of “armaments” to their counterparts in the Laotian Army. Coincidence, of course.
