Anchor: More than 500 street markets known in North Korea as jangmadang are said to be operating in the reclusive country. As the communist government's distribution channels are quickly eroding, sources say even state agencies are said to be involved in business activities in the jangmadang market grounds, which started to emerge since the 1990 famine in North Korea.
Our Kim In-kyung has more.
 
Report: A satellite photo of Hyesan, Ryanggang Province, a city of just 190-thousand at the northern border with China, shows at least five marketplaces as of Monday.
 
In an interview with KBS, a former senior official of the North Korean Workers' Party said the number of "jangmadang," or market grounds in Korean, has surged after Kim Jong-un assumed power. 
 
[Sound bite: Former senior official of the North Korean Workers' Party (Korean)]
"There are 538 officially recognized state-authorized jangmadang markets like Pyongyang's Tongil market, Daedonggang market and so forth."

The number rose from some 400 at the end of 2015.

The market first came about in the 1990s as the state rationing system failed due to food shortages alongside official markets.

The North Korean leadership turned a blind eye to the jangmadang as its communist distribution network has virtually collapsed and people became less reliant on the Soviet-style economy.

North Korean defector-turned economist Kim Young-hee at the Korea Development Bank says government agencies also had to join the transformation as well.
 
[Sound bite: Kim Young-hee - head of North Korean economy team, Korea Development Bank (Korean)]
"(State agencies) are also going through marketization. They are operating by selling goods to make profits and operate, and pay worker wages..."  
 
Research suggests that fees gained from sellers at the markets amount to as much as 220-thousand U.S. dollars, or about 250 million won, a day.
Kim In-kyung, KBS World Radio News.