North Korean Economy Watch

The AFP reports today that the Russians are in North Korea to discuss upgrading the 55km railway from Raijin to the Russian border. What goes unmentioned in the story is that the Russians have been seeking access to a port that does not freeze up in the winter for as long as anyone can remember. How are the Russians seeking to solidify their interest in Raijin:

Russian delegation in NKorea to discuss rail project
AFP
1/27/2008

A Russian railway spokesman told AFP last week a preliminary agreement had been reached with North Korea on renovating the railway section, while North Korea had yet to respond to Russia’s proposal to build a cargo terminal in Rajin.

Reconstruction of North Korea’s railways would cost about 2.5 billion dollars, according to Russian estimates.

South Korea also wants the railways upgraded, but the article does not mention if they are offering contributions:

South Korea sees the port project as an efficient alternative to renovating dilapidated rail networks running the length of North Korea and linking them to the Russian railway.

Also unmentioned in the story is China’s interest in securing access to Raijin:

Beijing also has its eye on the North Korean port, which it envisions as part of its grand design to build a transport network that stretches from the Indian Ocean to the North Pacific.

“Najin Port is near the Jilin area and China’s own ports in the area have already reached their full capacity,” a government official said yesterday.

Beijing has recently notified Pyongyang that it is willing to spend $1 billion to develop port facilities, build railroads connecting the port to China and improve existing infrastructure such as highways, the official said.

In a report published earlier this year, Cho Myung-chul, a researcher at the Korea Institute for International Economic Policy, predicted that China would use investments in the North’s ports and railroads to extend its own infrastructure for export and import purposes. China has made similar investments in Burma and Bangladesh, among others.

This entry was posted on Tuesday, January 29th, 2008 at 12:05 pm and is filed under China, Economic reform, Political economy, Railways, Rajin-Sonbong (Rason), Russia, Special administrative regions, Transportation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.