In its latest issue, U.S. weekly Time magazine reported on a supposed 'wave of capitalism' in North Korea, saying that even previously verboten material such as porn can now be obtained in cities close to the North's border with China.

The paper said the budding signs of change are not limited to border regions such as Hoeryeong in North Hwanghae province, pointing out that privately-run bakeries, tailor shops and gas stations have sprung up across the nation.

It also said that North Koreans living in border areas are engaged in trade activities with South Korean or Chinese merchants via Chinese-made cell phones.

Time said that particularly in the border city of Hoeryeong, North Koreans have access to a bounty of capitalist goods, from Japanese TV sets and South Korean-made cosmetics to pornographic videotapes.

An American expert on Korean affairs was quoted as saying that few in North Korea still believe in socialist ideology, and that its people only believe in money.

The expert noted that such phenomena coincide with similar events that were detected in the Soviet Union just before its collapse in 1989.