Entrepreneurs of the future

How do you make a business plan? How do you turn products into brands? How do you advertize products professionally? Only a few people in North Korea can provide the right answers to these questions, which are rarely asked in the state-controlled economy under communist dictator Kim Jong Un. At least, not yet. Andray Abrahamian wants to change that. He's the director of the Singapore-based non-profit organization "Choson Exchange" which specializes in teaching basic business knowledge in North Korea.

Since 2009, "Choson Exchange" has conducted workshops in the capital city, Pyongyang, in Wonsan, and in Rason, with training sessions also available outside of the country. More than 800 people have participated so far.

The participants are carefully selected and invited to be on site by a partner organization. "Last year alone, we had a total of ten workshops – seven of which were in North Korea," Abrahamian told DW, who travels every few months to the country.

Designing the lessons of the workshops is a great challenge for everyone involved, he explains. The team of trainers is made up of seasoned professionals who have worked at financial institutions such as Goldman Sachs or Bank of America Merrill Lynch. Even the former finance minister of Singapore has reportedly been one of them.

"Its tough to find the right level - often participants are very knowledgeable, but there can be huge gaps," says Abrahamian. "It's a challenge for our volunteer workshop leaders to find the right tone." During these courses, the participants learn about the basics of economics, trade, and entrepreneurship.

Additionally, they cover subjects such as urban planning, tourism, or inflation management. There are also classes specifically designed to support and promote women. "We want to support pragmatic, talented Koreans by equipping them with skills and knowledge that they may not have been exposed to yet, but need to run businesses or bigger ventures," he says.

Disconnected

Abrahamian says he wants to see the participants help run their businesses and economy better by applying what they learn in the program. However, daily life in the highly militarized and impoverished country is rough. The vast majority of the population lacks almost everything; even their existential needs aren't met by the regime. This is also due, in part, to the difficult natural conditions the county has to struggle with, which include a lack of farmable land and poor climate conditions.

Even in successful harvest years, the crop yields are not enough to feed everyone. More and more, the centrally-planned economy is pushed to its limits. Infrastructure is dilapidated, foreign currencies are in short supply, and competitive goods are hardly produced.

Weak economic system

"The North Korean economy is characterized by an array of strong contradictions," Rüdiger Frank, a professor at the Institute of East Asian Studies at the University of Vienna wrote in his latest book, "Nordkorea: Innenansichten eines totalen Staates" (German Edition).

The analyst argues that while, on one hand, North Korea maintains a sophisticated and expensive nuclear program, on the other hand, the country suffers from chronic food shortages, low productivity, and a lack of innovation.

At the same time, said Frank, geography provides a host of economic opportunities for the East Asian nation as it is located between some of the world's largest and most dynamic markets which feature not only vast natural resources, but also well-trained and disciplined populations.

Traditionally, the economy in North Korea has been key to ensuring that political objectives are met. Private property does not exist in this process. "Market entry and market exit are strictly regulated. Aspiring entrepreneurs cannot start businesses and bankrupt, state-owned enterprises cannot close."

While these conditions don't necessarily make teaching economics any easier, there seems to be great interest in the "Choson Exchange" workshops , explains Andray Abrahamian. Entrepreneurship, he says, "happens at all levels of society and with varying levels of official sanction.

At the bottom, people are finding things they can make at home, or items to trade and making it happen." These ventures, he added, will gradually be approved.

Small changes

As a matter of fact, Pyongyang has eased restrictions following the widespread famine in the 1990's which claimed the lives of an estimated one million people, according to the CIA. As a result, people are allowed not only to buy, but also to sell goods in public markets in exchange for stall fees.

"State-owned enterprises are becoming more autonomous in management and are able to create subsidiaries that look increasingly like private companies," Abrahamian observed during his visits to the country. "There is a real grey area where private-like businesses exist. It's hard to know numbers, but increasingly the idea of running a business is seen as increasingly attractive and socially acceptable."

Abrahamian is convinced that most of what the participants learn in the workshop is useful for their daily lives. However, there are other topics such as online trading which are likely to remain theoretical, at least for the time being. But he maintains that, "they need to know that that is what is happening in other markets."

Difficult conditions

The North Korean government is aware of everything being taught at the "Choson Exchange" program, as nothing happens without having the appropriate authorization. "North Korea has an active surveillance system," said Abrahamian, "it can go totally unnoticed, but its one of those things that you feel if you want to feel."

Nevertheless, he has a positive view of working in North Korea. "Overall, if you demonstrate commitment and staying power and have capable partners you can build trust and make things happen."

The responses so far have been positive, says Andray Abrahamian. "There is a real thirst for more information."