PYONGYANG, Phnom Penh's North Korean government-owned restaurant, has long been one of the city's stranger tourist attractions
A window into kingdom Kim
Monday, 15 June 2009

The closure of the city’s North Korean eatery casts a spotlight on the
isolated regime

PYONGYANG, Phnom Penh's North Korean government-owned restaurant, has
long been one of the city's stranger tourist attractions.

Opened in 2003, South Korean tourists and expats flocked to the
Monivong Boulevard eatery, where North Korean-born waitresses -
wearing traditional dress and pasted-on smiles - served up servings of
kimchi, barbecued squid and shrill karaoke.

No portraits of the Great Leader adorned its walls, but Pyongyang
provided customers with a rare glimpse into the hermit kingdom of Kim
Jong Il - and a taste of its homely native cuisine.

The enigma only deepened when the restaurant was unexpectedly
shuttered in February along with Pyongyang branches in Bangkok,
Pattaya and Siem Reap, prompting further speculation about the
restaurant's obscure operations.

Some experts contacted by the Post suggested the restaurant, just one
of dozens across Asia that provide annual remittances and help keep
the isolated North Korean regime afloat, may have been hit hard by the
global economic downturn.

Clean money
Journalist Bertil Lintner, who has done extensive research on North
Korea, said that in the early 1990s, when both the Soviet Union and
China began demanding that Pyongyang pay for goods in hard currency
rather than barter goods, it was forced to open "capitalist" foreign
ventures to make up funding shortfalls.

He said the restaurants are part of this chain of trading companies,
controlled by Bureau 39 - the "money-making" (and, according to
Lintner, money laundering) arm of the Korean Workers' Party.

"The restaurants were used to earn additional money for the government
in Pyongyang - at the same time as they were suspected of laundering
proceeds from North Korea's more unsavoury commercial activities", he
said by email. "Restaurants and other cash-intensive enterprises are
commonly used as conduits for wads of bills, which banks otherwise
would not accept as deposits."

Sheila A Smith, a senior fellow for Japan studies at the Council on
Foreign Relations in Washington, DC, said she had no insight into the
restaurants. But she added that a sharp drop in revenues from illicit
activities and remittances from Koreans in Japan may have forced the
regime to find new income.

"I cannot imagine they make that much money, but then again the North
Koreans are desperate for cash - of any amount," she said by email.

"Overall, it will be very hard now for North Korea to access foreign
exchange as the international effort to develop sanctions produces
greater sensitivity than ever."

A 2007 article in the Daily NK, a North Korean news source created by
activists from the Network for North Korean Democracy and Human
Rights, cited a defector who ran a similar restaurant in China as
saying that each establishment affiliated with government "trading
companies" is forced to make annual fixed payments of between US
$10,000 and $30,000 to the government coffers.

"Every year, the sum total is counted at the business headquarters in
Pyongyang, but if there's even a small default or lack of results,
then the threat of evacuation is given," he said.

"Capitalist" ventures, however, are vulnerable to market pressures,
and Lintner quoted an Asian diplomat in Bangkok as saying the
restaurants have been closed down "due to the economic situation".

"Even if those enterprises were set up to launder money, operational
costs and a healthy cash-flow are still vital for their survival,"
Lintner said.

Grand reopening?
But when contacted Tuesday, staff at the gated restaurant compound
suggested Phnom Penh may not have seen the last of Pyongyang's
totalitarian kitsch.

"We will be reopening soon, in about three months," a staff member
said by phone. When asked whether the closure was a result of
renovations, the staff member, who declined to be named, merely said
that the restaurant had "a few problems that needed to be taken care
of", raising the possibility that economics is not solely to blame.

Moon Young-soo, the manager of Le Seoul Korean restaurant on Monivong
Boulevard, said he had heard that the restaurant closed because of
internal problems in the DPRK but could not comment further.

But one worker at a nearby business who did not give his name said the
restaurant had closed after a dispute with a customer who wanted to
take one of its North Korean waitresses out after dinner and
encountered resistance.

If true, it would not be the first time. In 2006 and 2007, the Daily
NK reported several incidences in China's Shandong and Jilin provinces
of restaurants' having been shuttered after its waitresses tried to
flee the premises.

According to one report, the waitresses are subjected to a tight
screening process before being allowed to work overseas, adding that
if even a minor detail is undesirable the candidate is "discarded".

The report also claims two or three DPRK security agents live on-site
at the restaurant to "regulate" the staff, and that any attempts at
flight result in the repatriation of the entire staff.

"Because they are pursuing business competitively, they have had to
shut down operations one after the other due to the inability to
manage internal affairs, such as employees breaking away," said the

The North Korean Embassy in Phnom Penh could not be reached for
comment. But as the pariah nation continues to remain in the headlines
over its nuclear weapons programme, a reopened Pyongyang would likely
continue to attract visitors eager for a small taste of the reclusive

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