Kim Jong-Un's modernization and tourism plans: Fake Starbucks, North Korean Ikea & ‘Waikiki’ resort

Seoul, South Korea: North Korea is taking inspiration from the West. In Pyongyang, elites drink coffee at a fake Starbucks and pay by mobile phone. About 100 miles away on the east coast, a seaside resort that’s a pet project of the country’s leader, Kim Jong Un, is stocked with foreign beers and decked out with water slides, ready to receive tourists.

To blunt the impact of international sanctions and bring in cash, North Korea is creating the look of prosperity by imitating its capitalist enemies.

The New York Times obtained footage from three recent visitors to the country: a Russian tourist, a Swedish marathon runner and a Chinese student. While the foreigners had North Korean chaperones and were not allowed to film construction sites and military personnel, they provided a rare glimpse into how Kim’s modernization plans are nurturing a new culture of consumerism in one of the world’s most isolated and authoritarian countries. The goods they encountered are out of reach for most North Koreans, who earn, on average, a little more than $1,000 a year, according to South Korea.

‘North Korean Ikea’

A student from China who is taking language classes in Pyongyang said he initially thought the country would be backward.

“I was worried about not having enough food or warm clothes,” he said. “But when I arrived, I found it to be quite luxurious.”

The student, whose name is being withheld out of fear of reprisals from officials, said one of the city’s most upscale spots is a multistory shopping mall, Rangrang Patriotic Geumganggwan, which sells a range of furniture, kitchenware and food products. He said he and his fellow Chinese students called it “North Korean Ikea” because the layout and products looked like they had been directly lifted from the Swedish furniture company.

While it is unclear if the products are imitations or real ones that are smuggled in, some items like lamps and lampshades appear to have the same name and packaging as those sold at Ikea stores.

The mall also has a coffee shop that is a copy of Starbucks’ premium brand, Starbucks Reserve, except that North Korea calls the cafe “Mirai Reserve.” The star in the Starbucks Reserve logo is replaced with a stylized version of the letter M.

The student said he usually paid in U.S. dollars and personally found prices in Pyongyang expensive, recalling the time he paid about $25 for three coffees at Mirai Reserve.

U.N. sanctions ban foreign brands from selling luxury goods to North Korea or opening joint business ventures there. Starbucks said it had no store in North Korea.

Jakob Holmström, an Ikea spokesperson, said the same was true of his company.

“We have no authorized Ikea sales channels in North Korea,” he said. “We are continuously monitoring for infringements of our intellectual property rights and, where appropriate, take action.”

Kim condones and even encourages consumerism in Pyongyang because it is home to the elites, many of whom have traveled abroad as diplomats and traders or as workers sent to earn cash for the regime. They have been exposed to Western goods and have money and a taste for them, according to analysts and officials in South Korea. Kim seeks to draw some of the dollars these elites have privately amassed into state coffers, they said.

Most payments in the capital seem to be made with mobile phones, said Johan Nylander, 53, a Swedish runner from Hong Kong who participated in the Pyongyang marathon in April. Even small street vendors selling bottles of water and juice preferred digital payments via QR code over cash, he said.

“Mobile phones are a big part of daily life,” Nylander said. “They have a lot of the apps that you can find in the rest of the world: video, texting, North Korean-style Uber and shopping.”

Imitating Western consumer brands is a way for Kim to bring a look of modernization.

“It shows duplicity in their approach,” said Kang Dong-wan, an expert on North Korea at Dong-A University in South Korea. On one hand, the regime wants to show Pyongyang off as a modern city. On the other hand, however, it seeks not to acknowledge Western influence.

North Korea’s ‘Waikiki’

This summer, Kim opened his most ambitious resort project, the Wonsan Kalma beach complex. Called “North Korea’s Waikiki” by South Korean media, it features a line of new hotels along a 2.5-mile-long scenic sandy beach.

At the opening ceremony, North Korean state media footage showed Kim walking around a colorful water park while watching people zip down water slides.

Last month, North Korea allowed the first foreigners into the resort, around a dozen tourists from Russia. Daria Zubkova, 35, a veterinarian from St. Petersburg, Russia, said North Korea had long been a country she wanted to visit, so she paid about $1,400 for the weeklong trip.

Zubkova said everything appeared brand new, from the train that brought the group to the resort, to her hotel room and the beach amenities. “It looks like a picture that was painted for you,” she said.

The Russians sped around in personal watercraft and had barbecues on the beach with an assortment of beers from the United States, Japan and China. Zubkova said the food was plentiful, and her group ate a lot of seafood, sashimi and grilled meats. She said she even went shopping, buying a pair of Ugg-branded shoes because she had not been able to find her size in Russia.

Tourism is one sector of the economy that has not been sanctioned by the United Nations. Under Kim, “North Korea has considered tourism a multipurpose industry that could bring in foreign currency, create jobs, stimulate domestic consumption and improve the national image,” said Choi Eun-ju, an analyst at the Sejong Institute in Seoul.

Zubkova said that she had not felt like she was being monitored because she was allowed to roam the resort freely, but that wherever she went there was always resort staff nearby, from lifeguards to waitresses and doctors. “I felt like a hero in a movie because everyone is watching you and whatever you ask is immediately fulfilled,” she said.

But “promoting tourism presents North Korea with a dilemma in seeking a balance between openness and control,” said Hwang Joo Hee and Na Yongwoo, analysts at the Seoul-based Korea Institute for National Unification, in a report published in March.

Since 2020, North Korea has enacted a series of draconian laws aimed at cracking down on outside cultural influence. Tourism runs the risk of weakening Kim’s totalitarian control on information, a key to maintaining his unquestioned authority. Information about his country and news from the outside world will inevitably flow in and out of North Korea through foreign visitors.

In recent months, foreign tourists who have visited North Korea reported asking the country’s tour guides about the deployment of North Korean troops to Russia’s war against Ukraine​ — something the government ​had not made public until April. North Korea briefly stopped receiving foreign tourists this year after social media influencers posted ​videos of their trips to North Korea with unflattering comments​.

The biggest potential source of tourist cash for North Korea is China. In 2019, the year before North Korea shut its borders to keep the pandemic out, it attracted a record 300,000 foreign tourists, most of them from China.