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THURSDAY, SEPTEMBER 9, 2010 InNorth Korea, signs of public discontent about Kimsuccession BY CHICO HARLAN


seoul — Almost every night, seeking to gather opinion from a country where opinion is often punishable, Kim Eun Ho calls North Korea. He talks mostly to people in Hoeryong city in Ham- gyong-bukto province, and the conversationsnever last long.Ho- eryong city employs 14 men who monitor the region’s phone con- versations, Kimbelieves, and typ- ically they can tap a call within two or threeminutes.Kimsays he knows this because, as a North Korean police officer before he defected in December 2008, he sometimesmonitoredthe conver- sations. But thesedays,withPyongyang


preparing for a Workers’ Party convention that could trumpet the rise of leader Kim Jong Il’s youngest son, Kim Eun Ho and other defectors who speak regu- larlytoNorthKoreanshearplenty of opinions reflecting what he described as a broad sentiment against hereditary succession. “Of 10 people I talk to,” he said,


“all 10 have a problem with Kim Jong Eun taking over.” Just as North Koreans know


little about their potential future leader, the restof theworldknows almost nothing about North Ko- rean opinions. Recent academic research, based on surveys with defectors, suggests thatNorthKo- reans are growing frustratedwith a government that allowed wide- spread starvation in the early 1990s and orchestrated brutal currency reformin 2009 thatwas designed to wipe out the private markets that enable most resi- dents to feed themselves. The defectors aremotivated to


emphasize theworst-case scenar- io in their homeland. There are some who think that Kim Jong Eun will take power and gradual- ly leadNorthKorea toSoviet-style reforms. Some defectors say that even though the younger Kim is largely unknown, they hope he’ll allow for a free economy after his father dies. Still, in SouthKorea, an emerg-


ing patchwork of mini-samples suggests that many North Kore- ans view their government as a failed anachronism, and they see the young general, as he’s called, as a sign of the status quo. They associate Kim Jong Eun with the December2009currencyrevalua- tion. They don’t know his age —


he’s thought tobe inhis late 20s— but they thinkhe’s too young tobe anythingmore than a figurehead. SohnKwang Joo, chief editor of theDailyNK,aSeoul-basedpubli-


“They’ve almost perfected the system of social control.”


—Katy Oh Hassig, expert on North Korea, discussing its government


cation focusing on North Korea, receives frequent reports from stringers in four North Korean provinces. Those ground-level re- porters, gathering information mostly from intellectuals, farm- ers and laborers, suggest to Sohn that “eight or nine out of every 10 people are critical of Kim Jong Eun.” A recent report from PSCORE,


a Seoul-based nongovernmental organizationpromotingharmony ontheKoreanPeninsula, suggest- ed that two party officials were sent to a gulag last month for slandering the chosen heir. Kim


Young Il, a PSCORE director who was in China duringKimJong Il’s recent trip, said: “Criticism of Kim Jong Eun is very strong. . . . What you see now is face-level loyalty, but it’s not genuine.” KimEunHo, the former North


Korean police officer, works as a reporter for Seoul-based Free North Korea Radio. The nightly routine testifies tothedifficultyof gathering information fromwith- intheworld’smost reclusivestate. Kim first calls a friend who


lives close to the Chinese border, where a smuggled foreign cell- phone receives a clear signal. When Kimreaches his friend, the friend uses a second phone — a NorthKorean line—to call one of Kim’s police sources in Pyong- yang. The friend then places the


NorthKorean phone and the Chi- nese phone side-by-side, volume raised on the receivers, allowing Kiman indirect,muffled connec- tion. For extracaution, the conversa-


tions rely on codewords. “For general citizens,KimJong


Eun is vastly unpopular,” Kim says. “People cannot take him se- riously, in reality.He just sudden- ly appeared, and he’s too young.”


A defector-based survey re-


leased in March, co-written by North Korea experts Marcus No- land and Stephan Haggard, pro- vided the first sharp indication of growing discontent with Kim Jong Il’s regime, linked in large part to an information seal that no longer keeps everything out. North Koreans have access to South Korean television shows. Some travel toChina for business. For now, though, experts and


U.S. officials see little likelihood that North Koreans’ closely guarded skepticism about their government will pose a threat to the government.Without church- esandsocial clubs,NorthKoreans have few places where opinion can harden into resistance. “They’ve almost perfected the


system of social control,” says Katy Oh Hassig, an expert on North Korea at the Institute for Defense Analyses, which does re- search for the Pentagon. Like KimEunHo, Jin Sun Rak,


director of Free North Korea Ra- dio, calls his old country almost every night.Hiswife and 14-year- old daughter live in North Korea. He decided to defect — telling nobodybuthisbrother—in2008, after traveling to China and see-


ing the relative wealth. The first time he went, hoping to sell 80 grams of unrefined gold, he bribedaborder guardandcarried a dagger, tucked near the lower part of a leg. His first night in China was “beyond imagination.” He said he went to a restaurant, had some drinks and ended up at a karaoke bar where he knew none of the songs. Days later, he returned to North Korea with some money and a new frame of reference. “Whenever they say some-


thing,”Jinsaidof thegovernment, “they’re lying. They’re as worth- less as barking dogs.” As for a greater cynicism about the gov- ernment, Jin said: “I think it’s something unstoppablenow. Peo- ple’s minds have been changed. Young people know the value of money. They don’t want to be partymembers anymore. They’ve been exposed to the private mar- kets.” Jin, who lives in Seoul, rarely


talks to hiswife and daughter.He doesn’t think it’s safe to tell them his opinion.


harlanc@washpost.com


Special assistant Yoonjung Seo contributed to this report.


Amid crisis, Afghans grow wary of U.S.-style banking kabul from A1


for whatever crisis will come to our country.” Depositors have mobbed Ka-


bul Bank over the past week, withdrawing $300 million of its $500million in cash assets. Some have sought tomove theirmoney into accounts at one of two national banks run by the Fi- nanceMinistry. Those two banks have received new deposits this week totaling $60million, amin- istry official said. But many others who closed


their accounts said they intend to keep theirmoney at home.Only 5 percent of Afghans have a bank account, so this vote of no confi- dence could be devastating to the nation’s fledgling banking sector. “Iwould never keepmymoney


in the bank,” said Shafaq Gebarn, 31, an employee at the Education Ministry who was among scores waiting outside a Kabul Bank branch this week to cash his paycheck. “I’d rather keep it in a pot at home. I’ll get a pistol and two hand grenades to protect it.” For centuries, Afghans con-


ducted financial transactions al- most exclusively through the “ha- wala” system, a trust-based net- work of money handlers who took cash deposits and arranged for them to be collected by cli- ents’ business partners or rela- tives in other provinces. The deals were sealed with hand- shakes rather than paperwork. Even today, some Afghans say


they prefer the hawala system because of its personal touch. Bari Hashimi, 50, an executive at a financial company, said he intends to withdraw the $10,000 he has deposited in Kabul Bank. “These things that have hap-


pened in the last week have destroyed our trust,” Hashimi said. The hawala system might not be perfect, he added, “but at least if it’s a person [you know], you can get your money back by anymeans.”


A bar to terrorist funds Because hawalas operate with


no official oversight and produce virtually no paper trail, their popularity was a major concern forU.S. officials after the Sept. 11, 2001, attacks. American officials sought to implement a Western- style banking sector in Afghani- stan that would make it more difficult for terrorists to getmon- ey, while promising Afghans that


OMAR SOBHANI/REUTERS


As guards stand by, Afghans line up to withdrawmoney from a branch of Kabul Bank. Depositors have withdrawn$300 million of the bank’s $500 million assets in recent days. week, which they did.


a regulated financial system would bemore reliable and trust- worthy. Over the past nine years, U.S.


officials have spent millions of dollars building Afghanistan’s banking sector from the ground up. Treasury Department and USAID officials worked along- side theAfghan FinanceMinistry and the government-controlled Central Bank, designing a finan- cial system that now has $3.6 billion in assets. The first order of business for


the fledgling banks was to woo customers. No institution was better at that than Kabul Bank, founded by a pair of investors with glamorous resumes: Sherkhan Farnood, the country’s only world-class poker player, and Khalilullah Fruzi, a gem trader. At flashy promotional events, the bank doled out lottery prizes to depositors, a creative way to get around the fact that


Afghan banks do not pay interest because the custom is seen as anti-Islamic. Farnood and Fruzi also had the


right political connections, in- cludingMahmoud Karzai, broth- er of President Hamid Karzai, and Haseen Fahim, whose broth- er is the nation’s vice president. Not coincidentally,Kabul Bank is the government’s bank of choice, paying the salaries of 250,000 police officers, soldiers and teachers with a fund of $150 million in government cash. Behind the scenes, Farnood


and Fruzi, who installed them- selves as board chairman and chief executive, respectively, were investing depositors’ cash in lavish properties in the specu- lative Dubai market and giving risky off-the-books loans to rela- tives and friends.These liabilities persuaded U.S. officials to ask President Karzai to order the two executives to step down last


‘It’s just a sham’ The way the bank conducted


business, along with the percep- tion that Afghanistan’s Central Bank and the U.S. Treasury De- partment failed to regulate the banking system, have angered Afghans and frayed their trust. “This is a huge blow,” said


Daoud Sultanzoy, a parliament member who has railed against corruption. “The free market de- pends on the most important thing being trust and confidence. . . . This tells people that democ- racy and the free market do not work. It’s just a sham.” Sultanzoy said the Americans


set a bad example by bailing out Wall Street firms after theirmelt- down. “It’s hard for Americans to


come here and tell people they’re criminals who’ve done some- thing they haven’t done,” Sultan-


zoy said. “The perception among Afghans is that America was complacent and complicit in this, too.” Despite the panic, Afghan


Deputy Finance Minister M. Mustafa Mastoor said the bank- ing sector remains strong and fundamentally healthy. The Central Bank and the


Karzai administration have pledged their full support, sug- gesting they would be willing to offer government money for a bailout if necessary. Echoing complaints from


Karzai and other high-ranking officials,Mastoor blamed foreign reporters for instigating the run on Kabul Bank by overstating its problems. “That is unhealthy for the


economy and investment,” he said. “There might be a pause between now and the time peo- ple come back to the banking sector.”


And that pause might be lon-


ger than officials hope because the bank’s troubles have damp- ened Afghans’ faith in a modern, free-market economy.During the standoff at the Kabul Bank branch Wednesday, angry gov- ernment workers scuffled with guards from the National Direc- torate of Security, who used ba- tons to keep the crowd back. Abdul Samad, an employee of


theMinistry of Rural Rehabilita- tion and Development, said he had not been paid in twomonths. He needed themoney to buy food and presents for Eid al-Fitr, the celebration of the end of Rama- dan that begins Friday. “I told my family if I can’t get


my money, they will have to sit quietly and we would have no Eid,” he said. nakamurad@washpost.com


Special correspondent Javed Hamdard contributed to this report.


Karzai seeks to limit role of international investigators in Afghan graft inquiries karzai from A1


frominfluencingtheselectionand augmenting the salaries of the Af- ghan investigators and prosecu- torswho serve inthe two groups. In June, U.S. officials involved


in anti-corruption investigations told TheWashington Post that se- nior officials in Karzai’s govern- ment had derailed investigations of politically connected Afghans. “Above a certain level, people are being verywell-protected,” one se- niorU.S. official toldThePost. The latest controversy began


with the arrest in late July ofMo- hammadZiaSalehi, apresidential aide, oncharges thathe soliciteda bribe of $10,000 and a new car to impede aninvestigationof amon- ey-exchange firmthat is alleged to have funneled $3 billion in unde- clared cash out of the country.


Reports about the firm and the high-level interferencewithinqui- ries had prompted Rep. Nita M. Lowey (D-N.Y.), who chairs the House subcommittee responsible for foreign aid, to place a hold on $3.9 billion inU.S. reconstruction funding forAfghanistan. The case against Salehi was as-


sembled by the InteriorMinistry’s Major Crimes Task Force and the Special Investigative Unit. Al- thoughtheyarepartof theAfghan government, both bodies have re- ceived extensive support from a team of U.S. law enforcement ad- visers in Kabul who work for the FBI, the Drug Enforcement Ad- ministrationandotherarmsof the JusticeDepartment. The advisers have provided vi-


tal support to the two Afghan or- ganizations, U.S. officials said, in- cluding access to wiretaps and


other intelligence data. The U.S. advisers also help the Afghans as- semble cases andconduct raids. U.S. officials insist that the Af-


ghan leaders of the organizations make the final decisions about which cases to pursue and that they have sought to do sowithout being swayed by political consid- erations. ButKarzai’s advisers think that


U.S. officials have de facto control over the groups. “There is suspi- cion that the international part- nershave adecision-making role,” Daudzai said. Another U.S. official familiar


with the issue said the planned limits on U.S. involvement could have a significant impact on the ability of both bodies to conduct the sort of anti-graftwork that the Obama administration deems crucial. Partnership, the official


said, has been “an essential fea- ture of these institutions.” Daudzai denied that the chang-


es would impede investigations. He said Karzai “is not against these twounits.” “Hewants themto exist, and he


wants them to be strengthened,” Daudzai said. “But hewants them to operate within an Afghan framework.” Karzai has expressed anger at


the use of wiretaps to build the case against Salehi — calling it a violation of “human rights princi- ples”—and the decision to arrest himduring an early-morning raid of his house. The president has acknowledged intervening to haveSalehi released,andsincethe incident, he has called for a new law to spell out the roles of both organizations. It isthat legislation,beingdraft-


ed by hisMinistry of Justice, that would set the new conditions on foreigninvolvement.Daudzaisaid Karzai intends to enact the new rules as soonas they are finished. Inadditiontothelimitsonpart-


nership, the rules will bar direct payments tomembers of both or- ganizations to increase their sala- ries.Selectionof investigators and prosecutors forbothbodieswillbe madebytheInteriorMinistry.U.S. officials worry that will allow Karzai and his cronies to choose who serves and to remove anyone targeting the president’s family or close associates. Before Karzai’s proposed re-


strictionswere known, seniorU.S. civilian and military officials ex- pressed support for his desire to provide a legal framework for the organizations. “One of the legiti- mate concerns on the part of the


Afghan government leadership is that their roles are not spelled out in law, and that needs to take place,”Gen.DavidH.Petraeus, the top U.S. commander in Afghani- stan, saidlastmonth. Defense Secretary Robert M.


Gates, speakinginKabul lastweek aftermeetingwithKarzai, said he supports the Afghan leader’s view that anti-corruption investiga- tionsshouldbeledbyAfghans,but he noted that such inquiries should be credible and interna- tionally accepted. Daudzai accused officials of


“unnecessarily enlarging and po- liticizing the issue.” “They want us to move toward


more self-reliance, to strengthen our sovereignty, and then they don’t let us make a decision,” he said.


chandrasek@washpost.com


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