North Korea: Northeast Asia’s New Tourism Hub?
At first glance, last week’s wrestling exhibition in Pyongyang seems to have been a one-off event similar to others with which North Korea has used in the past to try to shift attention away from its nuclear program. As such, it could be dismissed as little more than a dose of regime propaganda. However, this interpretation seems inaccurate. Instead, Kim Jong Un appears intent on actually developing the tourism sector to attract much needed capital inflows. Seen in this light, a group of international wrestlers fighting inside a North Korean ring and holding arm-wrestling competitions with local children can be interpreted as in line with recent efforts to attract more visitors.
A few interrelated aspects help explain Pyongyang’s increasing focus on the tourism sector, including: 1) East Asia’s exponential growth as a recipient and sender of tourists; 2) the expertise and knowledge-sharing underpinning UN World Tourism Organization (WTO) activities, in which North Korea has recently become more interested; and 3) tourism’s potential to bring revenues without significantly affecting short-term regime stability.
North Korea and East Asia’s Tourist Boom
UNWTO statistics show that—as is the case in many other areas of the economy—East Asia’s tourism sector is booming. With almost no exception, countries in both Northeast and Southeast Asia have shown increased tourist arrivals and receipts. For instance, an interesting case for North Korea to watch is Myanmar, which pulled in 25.9 percent more tourists in 2012 compared to the previous year, and posted the largest percentage increase in the region. That is, as soon as its government decided to open up slightly, Myanmar witnessed a mini tourism boom. Meanwhile, tourists from China, Japan, Singapore and Hong Kong, in this order, are among the top 15 biggest spenders in the world by country of origin—with China having become number one in 2013.
The UNWTO does not publish comparable statistics for North Korea. Nonetheless, anecdotal evidence suggests that the number of tourists visiting the country has been increasing over the past few years, with Pyongyang easing restrictions on foreign travellers who want to visit in a private capacity. A recent example is the launch of an hours-long bicycle tour departing from Tumen City in China into Namyang in North Korea.
Beyond anecdotes, however, what evidence is there that Kim Jong Un is seeking to systematically develop the tourism sector as an engine for economic growth? Facility building since Kim took office, a new mentality towards foreign visitors and the recent opening of a tourism college provide some evidence.
Starting with facility development, several hotels, hospitals, sport complexes and entertainment amenities—including the Aprok/Yalu River Amusement Park and the Pyongyang Folk Park—have been built or renovated since Kim Jong Un came to power. Furthermore, the Masik Pass Ski Resort in Kangwon Province was opened in October of last year, and a government-linked official travel agency announced the re-development of the Mt. Kumgang Tourism Special Zone (TSZ) in May.
Put together, these developments point towards a shift in North Korea’s approach to tourism. The government seems intent in attracting East Asian leisure travellers since the most popular destinations for travellers in the region are neighboring countries, according to Euromonitor International data. From time to time, North Korea’s official media also mentions the country’s proximity to East Asian neighbors when discussing tourism projects. Attracting these travellers would be a change from tourists with only an interest in tightly controlled officially-approved tours of carefully selected sites or in attending the Arirang Mass Games. The Masik Pass Ski Resort, in particular, has the potential to benefit from the increase in intra-Northeast Asian winter sport tourism that is expected to follow the celebration of the 2018 Olympic Winter Games in the South Korean city of Pyeongchang. It may be recalled that in September of last year, the North Korean International Olympic Committee even raised the possibility of the Masik Pass resort hosting some of the 2018 events. Although this proposal was rejected, international media will likely run items on the resort in the run up to the Pyeongchang games.
The nature of recent facility building and upgrading already hints at a new mentality from North Korean authorities towards foreign visitors. Pyongyang seems to be more relaxed towards giving foreigners (limited) freedom to see North Korea in different, less controlled ways. A striking example occurred during this year’s Pyongyang marathon, held in April. Foreign amateur runners were allowed to join for the first time. For several hours, foreigners, who until a month before would have had to join an officially-sanctioned tour, were able to run through the capital city while being cheered on by North Korean spectators.
In this context, last weekend’s wrestling exhibition in Pyongyang can be seen as an attempt to show a friendlier face to potential tourists. Former Japanese wrestler-turned-politician Kanji (Antonio) Inoki brought around 20 professional fighters to the North Korean capital for a two-day exhibition. During this time, the world’s media focused on this event rather than on North Korea’s nuclear program, missile launches or rhetorical threats. Potential visitors to North Korea and people in general saw a more open and friendly image of the country than they normally do.
While it is still too soon to know whether this new, more open attitude towards foreign visitors will continue or not, especially in light of continued detention of tourists for alleged crimes against the state, Chinese tourists have been roaming relatively freely in different parts of the country in recent years. Likewise, Malaysian and Singaporean citizens can visit North Korea without a visa for up to 30 days. Furthermore, last October, a Mongolian delegation visited North Korea to—among others objectives—boost tourist links. It seems, therefore, that there is a trend towards the easing of restrictions on foreign nationals intent on visiting North Korea—at least those coming from East Asia who are among the highest spenders in the world.
One last indicator signalling a more systematic and strategic approach towards tourism on the part of the North Korean government is the launch of the Pyongyang Tourism College. The college opened its doors on April 1, 2014. According to North Korea’s official media, its main goals are to educate professionals for the tourism sector and to promote engagement with foreign institutions. The government seems to be running the college for now, but is expected to sign a sister-school agreement with Peking University. The launch of tourism training facilities in other places such as the coastal city of Wonsan and the border city of Sinuiju has also been announced. Wonsan, in particular, has long been seen by North Korea as potential tourism hot-spot. In July, the Pyongyang Times again reported plans to develop it into a tourist city.
North Korea has, of course, long been training foreign language specialists, a number of whom end up working as tour guides. The launch of the Pyongyang Tourism College and similar educational facilities, however, indicates that the government is seeking to systematically create a large and well-prepared group of tourism professionals. Presumably, many of them could end up working in the hotels and entertainment facilities mentioned above, especially if more foreign travellers opt for experiences outside of the official guided tours.
UNWTO as a Hub for Tourism Expertise
As is the case in many other economic areas, North Korea lacks expertise in the field of tourism. What do foreign travellers want? How can one attract them? Once there, how do you provide a comfortable experience that will make them return or recommend your country? And how do you lure them to part with their money? These and broader issues such as minimizing the impact of tourism on a country’s resources or using tourism to foster development form part of the UNWTO’s remit.
In a recent interview, North Korea’s Ambassador to Spain, Kim Hyok Chol, admitted that the presence of the UNWTO headquarters in Madrid was one of the main reasons why Pyongyang decided to open a delegation in the Spanish capital in October of last year. Indeed, Spain’s Asia watchers and diplomats alike concur that the UNWTO presence was probably the top reason why Pyongyang decided to do so. It should be noted that North Korea became a member of this agency in 1987. Links since then, however, have been tenuous at best. The main reason seems to have been a lack of engagement with UNWTO activities on the part of the North Korean government.
As stands to reason, Ambassador Kim has also been appointed as North Korea’s representative to the UNWTO. Previously an ambassador-at-large with the Ministry of Foreign Affairs, Kim is considered to have enough leeway to deal with the UNWTO with relative independence from Pyongyang. His presence in Madrid gives North Korea permanent direct access to the organization.
The UNWTO holds programs focusing on education and training, market trends, risk and crisis management and technical cooperation. These and other programs offer a holistic approach to tourism. The agency’s Knowledge Network, in particular, conducts useful research on tourism development. Since many important UNWTO activities and meetings take place in Madrid, having an embassy there offers Pyongyang a cost-effective platform to be abreast about the latest developments in the field. The agency also hosts affiliate members from the private, education and non-governmental sectors, to which North Korea will now also have direct access.
As the Pyongyang Tourism College has engagement with foreign institutions within its remit, many of the college’s potential partners will have links with the UNWTO or even have delegations in Spain. Thus, North Korea’s new embassy could play a role in brokering deals between the college and foreign tourism experts.
It should be noted that Spain did not object to North Korea’s decision to open an embassy in Madrid. The two countries established diplomatic relations in February 2001. Discussions for Pyongyang to open a diplomatic representation in Spain almost bore fruit in 2003, but were apparently disrupted by the onset of the second nuclear crisis. Nevertheless, Spain has issued three Asia Pacific strategies in 2000, 2005 and 2008. For a country that, for the most part, had neglected Asia since the loss of the Philippines as a colony in 1898, these strategic documents signal a newfound interest in the politics and economics of Asia. North Korea’s opening of an embassy fits within Spain’s plans to be more actively involved in Asian affairs. Thus, Pyongyang is likely to be able to deal with the UNWTO without interference from Spanish authorities.
Possible Reasons for Developing the Tourism Sector
Economic reasons seem to underpin North Korea’s decision to develop the tourism sector. Despite recent growth in inward foreign direct investment, the country remains cash-strapped. As the success of the Mt. Kumgang TSZ until 2008 or the recent growth in the number of Chinese tourists demonstrates, North Korea is an appealing destination for many. It is not unthinkable that the country would be able to significantly increase visitor numbers shortly after opening up even tentatively. China and Vietnam did so in the past. Myanmar has done so recently. East Asia’s middle class, in particular, forms a very attractive group that the North Korean government seems to be targeting.
Increasing tourism revenue would also help Pyongyang to mitigate economic dependence on China. Similar to efforts over the past few years to attract investment from companies from other countries, boosting tourist numbers holds the promise of reducing the share of the economy directly related to trade and investment with its neighbor. Tourism as an economic activity is not difficult for the North Korean authorities to police and manage, given that tourists have limited ports of entry into the country and generally stand out from the domestic population thanks to their clothes, spoken language and often size. Therefore, it would be relatively uncomplicated for the government to avoid having tourism receipts disappear in the black market.
However, opening up to larger numbers of tourists holds the risk of attracting more people intent on changing the regime or to preach their beliefs. Each time the North Korean authorities arrest one of these visitors, a small crisis ensues. In theory, the possible economic gains coming from a larger number of tourists far outweigh the possible political costs of having to deal with more of this type of visitor. In practice, however, every detention attracts negative attention. This would not only create reputational damage, but also limit the number of people who could potentially conceive of visiting North Korea. It could also have a negative impact on relations with the US or any other country where these tourists might come from, especially if arrests become more common.
Some might argue that opening up to foreign tourists could foster instability, therefore deterring Pyongyang from introducing anything more than cosmetic changes to its tourism sector. However, there are many examples of authoritarian regimes in Asian countries receiving millions of foreign visitors that are able to maintain political stability—China and Vietnam are among them. It is true that welcoming large numbers of tourists means more local people coming into contact with different ideas, with the possibility to foster changes in attitudes. Therefore, as with all its economic reform efforts, as Pyongyang experiments with reform in this sector, it will need to consider the long-term impacts on an evolving North Korean society.
 Problems between the two Koreas around the Mt. Kumgang TSZ since a South Korean tourist was shot there in 2008 certainly offer a cautionary tale to potential investors. In order to increase the appeal of the TSZ, Pyongyang is reportedly offering 50-year land leases, tax benefits, enhanced legal protection, and the possibility to employ South Koreans and other workers of Korean origin.
 Data acquired by Ramon Pacheco Pardo, April 2014.
 As a side note, North Korea’s new-found interest in the UNWTO confirms that Pyongyang is willing to participate in the activities of international institutions when it suits the government’s policy goals.