Written by Justin Hastings, an expert in international relations and economic globalization, A Most Enterprising Country is a veritable goldmine of information about the evolution and operation of North Korea's trade networks. Earlier studies on North Korean trade have focused either on the socioeconomic relationship between state authorities and small-scale private entrepreneurs (Dong Yong-sueng, Stephan Haggard, Hyung-min Joo, Andrei Lankov, Marcus Noland, Yang Moon-soo), or on the security challenges posed by North Korea's involvement in the global arms and drug trade (Andrea Berger, Bruce Bechtol, Joseph S. Bermudez, Sheena Chestnut, Paul Rexton Kan), with little or no overlap. On the basis of a wide variety of sources—ranging from UN Security Council reports to interviews with North Korean refugees and Chinese businessmen—Hastings successfully integrates the two fields into a well-structured synthesis. He convincingly demonstrates that the dominant features of North Korean entrepreneurship (ruthless pragmatism, adaptability, a focus on quick gains, and a profound disregard for laws or rules) were equally present in both spheres. This resiliency helps to explain how the North Korean regime has managed to stay in power against all odds, but it also illuminates how ordinary citizens could outwit the seemingly all-powerful state.
Hastings's analysis carefully distinguishes between the various forms of North Korean commercial entrepreneurship, both in a synchronic and diachronic sense. On the one hand, he examines the uneasy coexistence of state, hybrid, and private trade networks and correctly emphasizes that the lines between formal/informal and licit/illicit trade have often been blurred. On the other hand, he shows how the famine and the regime's fluctuating anti-market measures have affected domestic entrepreneurs since the 1990s, and how the post-2006 international sanctions compelled North Korean trade networks to develop new brokering and logistical techniques. Thanks to this nuanced approach, Hastings skillfully avoids such simplifications as labeling the North Korean system a “Sopranos state” (as Todd Crowell and Paul Rexton Kan did), or attributing the difficulties encountered by foreign investors mainly to the international sanctions and a lack of personal connections (as Felix Abt suggested). The book's depiction of North Korean state-society relations as a “food chain” (p. 105) is especially insightful: “North Korea is politically centralized but economically decentralized, leading state agencies down to the local level to be reviewed as profit centers by the central state, with units at all levels tasked with raising money and funneling it up the hierarchy to the center” (p. 108).
Hastings colorfully describes how the North Korean trade networks managed to survive under highly unfavorable conditions, including such obstacles as corruption, arbitrary administrative restrictions, the higher authorities’ efforts to skim off profits, the absence of effective legal regulation, logistical problems, unwanted international scrutiny, and so on. As he puts it, the widespread emergence of trading per se was a coping mechanism in a time of crisis, the 1990s famine, when neither Pyongyang's former allies nor the regime's Public Distribution System could be relied upon. Indeed, one might take this view one step further by pointing out that the ubiquity of trade and the relative scarcity of other types of private entrepreneurship (like manufacturing) directly reflected the DPRK's high-risk business environment. In many developing countries, local private entrepreneurs have preferred to engage in trade, rather than in “productive capitalism,” on the grounds that commercial ventures aimed at making a quick profit were less hindered by infrastructural inefficiency, corruption, and administrative uncertainty than long-term industrial investments.
Still, Hastings probably over-extrapolates this thesis when he suggests that “the specific ways in which foreign investors come to grief in North Korea are in part a result of the ways in which North Korean business networks have evolved in response to the terrible environment during and since the Arduous March [the famine]” (p. 137). Providing only a brief summary of the DPRK's ostensibly harmonious trade relations with the Soviet bloc, he seems to have overlooked that North Korea's pre-1990 commercial interactions with its communist allies were riddled with friction because of Pyongyang's habitual unreliability. Much to the chagrin of the “fraternal” states, the DPRK usually fulfilled only 60 to 70 percent of its export obligations, then sought to convert this deficit into a credit, and finally requested that its debts be canceled. The fact that Pyongyang behaved in such a way even under relatively favorable international conditions indicated a deeply rooted, systemic problem. In fact, Hastings perceptively notes that “[e]ven in legitimate business transactions …, North Korean state companies tend to act conspiratorial and engage in shady practices” (p. 73).
In general, Hastings's assessment of the performance of North Korean trade networks is focused on their impressive ability to overcome all kinds of legal, administrative, and logistical obstacles, providing less information on how much they could adapt to external market demand. This perspective is related to the fact that Hastings pays relatively more attention to illicit North Korean exports and imports (arms, drugs, nuclear technology, and sanctioned luxury goods) than to such licit exports as clothes and minerals. Still, the book offers a valuable analysis of how North Korean restaurants exploited a “niche market” (p. 126) and reveals that the authorities’ arbitrary restrictions on seafood and scrap metal exports, apparently motivated by the short-sighted aim of defrauding their Chinese partners, effectively prevented the DPRK from taking full advantage of the opportunities offered by the vast Chinese market.
Indeed, the book masterfully grasps the complex and ambivalent relationship between North Korean state companies and their Chinese partners. On the one hand, it demonstrates that Chinese (as well as Taiwanese) brokers and smugglers played an indispensable role in Pyongyang's efforts to circumvent international sanctions, and points out that “continuous enforcement of sanctions is relatively far down China's list of priorities” (p. 177)—an observation from which Hastings draws the reasonable conclusion that sanctions alone are insufficient to force the North Korean leadership to dismantle its nuclear weapons. On the other hand, the book paints a colorful picture of the well-earned mutual mistrust between North Korean and Chinese entrepreneurs. Notably, Chinese investors’ complaints about the atrocious behavior of DPRK officials were mirrored by North Korean fears of “being cheated by Chinese businessmen” (p. 90).
All in all, A Most Enterprising Country is a must-read for a wide range of readers interested in North Korea. Skillfully combining the perspectives of sociology, political economy, and international relations, Hastings has produced a monograph that is not just an academic analysis of North Korean entrepreneurship but also an indispensable guide for security experts and policy makers who want to assess whether international sanctions might be sufficiently effective, and whether the evolution of North Korean entrepreneurship might eventually lead to political changes in the DPRK. Thanks to its meticulous but lively style, this book would be appropriate reading material for graduate and undergraduate students alike.
