Archive for April, 2008

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Just in time for the weekend: DPRK soju arrives in New Jersey

Thursday, April 24th, 2008

UPDATE: According to the Choson Ilbo:

Exports to the U.S. of the North Korean liquor Pyongyang Soju have been halted due to a lack of interest from consumers, Radio Free Asia reported Tuesday. Tang Kap-jeung of importer Tang’s Liquor Wholesales in Flushing, New York, told RFA, “There was some interest at first because people were curious, but the poor taste led to dwindling orders and we stopped imports a year ago.”

Customers in the U.S. enjoy South Korean soju, which is smoother and odorless, and nine out of 10 people said the North Korean variety was not to their taste, he added.

He said the price tag of the North Korean liquor at US$3.75 a bottle due to special tariffs was another factor behind the poor sales. 

Sales of Pyongyang Soju began in 2008 primarily in New York, New Jersey, Georgia, Maryland and California, RFA said. Export versions of the soju are also sold in China and Japan. 

ORIGINAL POST: According to Yonhap, North Korean Soju has finally (again?) landed in New Jersey (h/t One Free Korea):

The first shipment of North Korean-made liquor to the United States has arrived in New York and will go on sale as soon as it clears customs, the importer said Wednesday.

Tang Gap-jeung, head of Tang’s Liquor Wholesale, which is in charge of U.S. distribution, told Yonhap that 1,660 boxes of Pyongyang Soju arrived Tuesday. Each box has 24 bottles of liquor made from corn, rice and glutinous rice flour. (Yonhap)

This is not the first time that someone has tried to import North Korean soju into the US (part 1 of the story here).  Unfortunately, that effort came to an end when the entrepreneur who launched the venture was arrested for being an unregistered South Korean spy (again, h/t One Free Korea).  The fate of the soju went unreported.

Mr. Tang is probably not importing the “adder soju” (with a dead snake in the bottle), which is absolutely vile, but worth the money just to keep in the liquor cabinet for show.  Adder soju aside, North Korea can make some tasty liquor, so if you want to try something new this weekend, here is where you can pick some up (call first and make sure the shipment has cleared customs):

Tang’s Liquor Wholesale of NJ
530 Church St
Ridgefield, NJ 07657
(201) 313-8800

The full story can be read here:
N.K. liquor import arrives in New York
Yonhap
4/23/2008

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Posted in Alcohol, International trade, USA | 1 Comment »

Market activity flourishes in the DPRK

Thursday, April 24th, 2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-4-21-1
4/21/2008

The March issue of “Rimjingang”, a magazine publishing stories on life inside North Korea as reported by defectors and those still inside the DPRK, contains an eye-opening report on activities in North Korea’s markets.

Since 2003, North Korean authorities have legalized DPRK markets throughout the country. The previously existing farmers’ markets were remodeled into ‘combined’ general markets and all traders were permitted to sell their wares. After the legislation was passed, even in Pyongyang general markets emerged in each neighborhood.

According to the magazine, more than 60 markets have been set up, with each market housing around 50 traders. The use of mannequins at clothing stores and attractive price tags used to catch the eye of the shopper are in force. These days, it is not even surprising to hear cassette players extolling the virtues of a particular vendor’s goods. Sellers here do not speak abruptly to customers as they might in a State-run store. In markets, one can hear respectful language used even to children. These are not ideas taught by the labor bureau, but rather independent ideas put to use by the sellers.

Stalls selling a variety of seafood can also be found in a number of markets. Mackerel, squid and flatfish from the East Sea are among the surprisingly fresh products on display. This seafood is not on display courtesy of the North Korean government, but rather is delivered by private entrepreneurs running refrigerated trucks from the coast to Pyongyang. According to the magazine, a number of delivery services are in operation, providing goods to the highest level of North Korean society.

Around Pyongyang, a number of flower sellers have also popped up in the capitalist markets. It is custom to give flowers whenever there is an event in honor of Kim Il-sung or Kim Jong-il; but these days it is also popular for couples to give each other flowers as gifts. Even before the emergence of these markets, there was nothing that couldn’t be found in Pyongyang as long as someone had the money to purchase it.

Currently, women under the age of 39 are prohibited from working in markets, and efforts to extend this restriction to women under 49 have raised tension with many women trading in the markets. ‘Good Friends’, an organization aiding North Korea, has reported that recently thousands of women have organized in protest against security forces in the farmers’ market in Chungjin.

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Posted in 2002 Economic reforms, Civil society, Economic reform, Food, General markets (FMR: Farmers Market), Institute for Far Eastern Studies, Price liberalization, Private property, Rimjingang | 1 Comment »

DPRK enacts measures to prevent bird flu

Tuesday, April 22nd, 2008

From Yonhap:

North Korea on Tuesday asked South Korea not to bring poultry products to the inter-Korean industrial complex in Kaesong, a North Korean border town, in an attempt to prevent the introduction of bird flu into the communist state, the Unification Ministry said.

The ban from the North Korean quarantine office in the Kaesong complex includes birds, poultry and eggs, and will go into effect on Saturday, ministry spokesman Kim Ho-nyoun said.

There have not been any cases of bird flu reported in North Korea.

South Korea sends some 8.5 tons of chicken and 127,000 eggs every month to eateries in the complex, the ministry said.

If South Korean chicken has been taken off the menu in the Kaesong Zone, maybe they will replace it with some of that new low-cost American beef that should be on its way soon! 

I won’t hold my breath.

The full story can be read here:
N. Korea bans S. Korea from bringing poultry, eggs to Kaesong
Yonhap
4/22/2008

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Posted in Avain Flu, Epidemics, Food, Health care, Kaesong Industrial Complex (KIC) | 1 Comment »

More dam construction…

Tuesday, April 22nd, 2008

The Donga Ilbo reports that the DPRK going to supply water to the the Kaesong Industrial Complex by diverting it from a river that flows into South Korea:

North Korea is confirmed to be trapping water behind the walls of the Hwang River Dam in the upper stream of the Imjin River, something which will lead to a water shortage in certain parts of South Korea.  

The multi-purpose dam has a water storage capacity of 300 million to 400 million tons, much more than that of the Hantan River Dam (270 million tons), the Paldang Dam (244 million tons) and the Cheongpyeong Dam (180 million tons).

North Korea is expected to supply water for industry and drinking to the Gaesong Industrial Complex from the Hwang River Dam via the Ryesong River.

North Korea can directly control 420 million to 520 million tons of water with the Hwang River Dam in addition to its fourth “April 5 Dam,” which can store 30 million tons of water in the upper stream of the Imjin River.

The (South) Korea Water Resources Corp. said, “When North Korea suddenly traps or discharges water, South Korea cannot respond to such actions with just the Gunnam Flood Control Dam and the Hantan River Dam.”

Rad the full article here:
N.Korean Dam to Cause Water Shortage in S.Korea
Donga Ilbo
4/22/2008

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Posted in Dams/hydro, Kaesong Industrial Complex (KIC), Special Economic Zones (Established before 2013) | Comments Closed

Air Koryo’s new Tupolev

Monday, April 21st, 2008

A recent traveler with Koryo Tours sent this photo of Air Koryo’s new Tupolev parked at Pyongyang’s Sunan Airport.  According to a woman at the airport, it starts flying May 1, 2008 (May Day).

airkoryothumb.JPG

Click on the image for larger view

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Posted in Aviation, Koryo Tours, Tourism, Transportation | 3 Comments »

Nosotek: First European software firm based in DPRK

Sunday, April 20th, 2008

 “Nosotek is the first European-invested software development & research company in the DPRK, with the head office in Pyongyang.” – Interview with Mr. Ju Jong Chol (Vice-President of Nosotek)

Klaus-Martin Meyer: Mr. Ju, you are the Vice President of a very interesting company named Nosotek (www.nosotek.com). Could you please tell us something about this venture?

Ju Jong Chol: Nosotek is the first European-invested software development & research company in the DPRK, with the head office in Pyongyang.

It is founded by the General Federation of Science and Technology (GFST) of DPRK and experienced European IT-entrepreneurs. Felix Abt, the president of the European Business Association (www.eba-pyongyang.org) is one of Nosotek’s directors.

Nosotek is jointly run by European IT engineers together with their Korean counterparts. We have presently 50 engineers and a strong production line. We expect rapid growth thanks to our qualified, experienced and committed staff.

Klaus-Martin Meyer: What are Nosotek’s main products?

Ju Jong Chol: As we specialize on offshore IT outsourcing services we already have produced a large range of software products. Among our finished products, you find scientific software, video games, web applications, embedded software and 3D virtualization tools.

In case our customer needs a field of service where we don’t have experienced engineers in our own staff, the GFST will help us finding good people among the scientists of the universities. We can rely on sustainable DPRK and European engineering and business ressoucces.

Klaus-Martin Meyer: The DPRK is not the Silicon Valley or Bangalore. What are the customer’s benefits to do Business with Nosotek?

Ju Jong Chol: Of course, we’re not Silicon Valley or Bangalore. But we take the challenge to compete with these locations. The DPRK government took the strategic decision to give strong support to our IT industry which now bears fruits.

In the DPRK, software engineers have an average academic math level superior to their western or Indian counterparts.

Computer science education involves understanding of deep low level processes: when was the last time you hired a PHP programmer to realize he was quite at ease in assembler?

Klaus-Martin Meyer: Outsourcing to Asia is often identified with a risk of IP leak. Many western companies are complaining that after outsourcing their partners start copying their technology.

Ju Jong Chol: Then they are all invited to do their outsourcing projects in the DPRK! Our country is well known to have strong laws to protect secrets and we respect the value of IPs. And unlike what is common in other countries like China, there is only very little fluctuation of the workforce. Like in Japanese companies, our employees usually enter the company after university and stay their entire business life with the high personal motivation. This does not only help to keep trade secrets, it also helps to keep the experienced persons, who are needed for long-term partnership.

Klaus-Martin Meyer: How are the working conditions at Nosotek?

Ju Jong Chol: Our employee’s working conditions are far better than average, compared with both domestic and international standards: They work with state-of-the-art hardware, have free lunch, more holidays than in Europe and even a one-week vacation trip to a touristic place every summer, which is completely paid by the company.

Klaus-Martin Meyer: How difficult is it for you to acquire international business? What exactly are the main challenges?

Ju Jong Chol: Currently the main problem is the US sanctions against our country. For example, western customers are threatened by the US to prevent doing business with us. At the moment, it is very difficult to transfer money to DPRK. Luckily, together with our European partners we found good solutions and our customers will make their contracts with companies outside of DPRK.

Klaus-Martin Meyer: Is it possible to name some of your reference projects?

Ju Jong Chol: Unfortunately, this is not possible. Our policy is not only to respect our customer’s trade secrets and software IP, but also not to disclose the names of our customers. But please be assured, that some of our work products are used in large public companies, all over the world including USA.

Klaus-Martin Meyer: There are quite a lot companies from South Korea and also international companies working at the Kaesong special economic zone in North Korea. Are these Companies potential customers for Nosotek?

Ju Jong Chol: We are doing business all other the world. Of course, companies from Kaesong may be potential customers. Currently, our main focus is on Europe and Japan.

Klaus-Martin Meyer: The last question is our famous 5-years-questions. What is Nosotek’s outlook for the next five years?

Ju Jong Chol: Our goal is to create public awareness of the DPRK as a place where IT outsourcing can be done at the best ratio between price and quality. Nosotek will grow and the business volume will highly increase.

Source here.

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Posted in Banking, Computing/IT, European Business Association, Finance, General Federation of Science and Technology (GFST), Intellectual Property, Labor conditions/wages, Nosotek | 2 Comments »

$USD in North Korea

Sunday, April 20th, 2008

The Daily NK, reports on a interesting claim by Kim Kwang Jin, senior fellow at the Institute for National Security Strategy:

In his article “The Dollarization of North Korean Economy and Dependence on Foreign Currency by the Residents,” [Kim Kwang Jin] analyzed “dollarization of North Korean economy is a result of the disintegration of the official economy and the subsequent spread of foreign currency rather than the government’s foreign currency policy.”

The total amount of U.S. dollars circulated and amassed by North Korean people was estimated 500 to 600 million dollars (100 per each household), [Kim Kwang Jin] suggested.

Kim’s further specification is as follows: “In the China-Korean border region, the Yuan is particularly popular, while in Wonsan (a seaport on the East Sea)[where the Mangyongbong 92 docks], the Japanese yen is attractive.”

According to Kim’s article, the North Korean people fully realize impossibility of withdrawing North Korean won from their bank accounts and the depreciation rate is too fast. Kim’s estimate was that “each North Korean household is secretly holding 100 dollars in average.”

Methodologically, I am not sure how valuable we should find the claim that the North Korean economy is dollarized to the tune of $100 per household (max of 6,000,000 households).  Averages do not tell us much in large populations because they do not address distribution questions (which are fairly significant).  For instance, a few individuals might have lots of cash, while most have relatively little.  What is the median distribution of dollars, and what is the mode? This data would tell us much more about grass-roots financial conditions in the DPRK, but this information is not available.

Also, Mr. Kim claims that North Korea has “foreign currency areas” along the Chinese border (Yuan) and around Wonsan (Yen).  This claim at least seems plausible for obvious reasons: These are areas where lots of trade and exchange take place.  So where is the dollar currency area?  With no major trading relations, why would there be one (outside of Pyongyang)? Where would all these $USD come from?

Finally, it seems that in the last couple of decades the Yuan and the Yen would be a superior mechanism than the dollar for protecting one’s savings in North Korea.  These currencies are used by the DPRK’s major (current and former) trading partners; these currencies have experienced low inflation in the last couple of decades (the Yen obviously doing a better job); and North Koreans could probably better explain to any curious officials why they have them if they were under scrutiny.

All of these topics might have been addressed in the paper, but I have been unable to find a copy in English.

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Posted in Banking, Black markets, Civil society, Finance, Fiscal & monetary policy | Comments Closed

Beggar social norms in the DPRK

Sunday, April 20th, 2008

From the Daily NK:

There had been eight of us in the group, including my brother. Among us, the females included myself and a 13-year old named Shin Kyung Rim. Even though we could not wash our face, were worn out, and wore ragged clothes, there were strict rules and order unique to Kotjebis (street children).

Kotjebis have leaders and areas where they beg. Also, they never eat the food they steal or receive from begging alone, but share with others.

Kotjebis, even when they sleep during the winter, seat the children, the weak, and the women in the middle and the stronger ones sleep in the periphery so that they can block the wind. People may think female kotjebis sleeping in the center of the group might be strange, but they have rules to protect women and children. If they ignore such rules, they are chased out of the group and in extreme instances, have to be prepared for death.

Read the full article here:
Want to Show the Painful Legacy Left by Kim Jong Il
Daily NK
Han Soon Hee
4/16/2008

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Posted in 1990s Famine, Arduous March, Civil society | Comments Closed

Air Koryo and DPRK tourism update

Friday, April 18th, 2008

This morning the International Herald Tribune published an interesting AP story on Air Koryo, North Korea’s state airline.

As has been mentioned before, Air Koryo recently began upgrading its fleet–but guess who will seemingly be on the first flight? 

The airline also has taken delivery of its first new jet in years. South Korea’s Yonhap news agency, quoting diplomatic sources in China, reported Thursday that North Korea’s reclusive leader Kim Jong Il was likely to fly to Vietnam and China on the new plane next week.

Kim is widely believed to shun air travel. His previous trips abroad by luxurious special train were shrouded in secrecy and reports speculating on his destinations beforehand were not always accurate.

And although the economy at large is not doing so well, Air Koryo business is brisk. 

“The golden days are now[.]  They’re busier than ever,” says Nick Bonner of Koryo Tours. (paragraph edited)

In 1998, his Koryo Tours — which despite being similarly named for an ancient Korean dynasty is unrelated to the airline — escorted just 98 tourists to North Korea. The number doubled to 200 in 2006 and last year jumped to a still minuscule 1,100. Some of his customers also get into the country by train, a much longer trip.

Bonner said a roundtrip ticket on Air Koryo between Beijing and Pyongyang costs 2,550 Chinese yuan (US$365; €230) for economy and 4,340 yuan (US$621; €390) for business class.

What are Air Koryo’s most recent routes:

Air Koryo now has just three regularly scheduled international routes. Domestic service is said to be virtually nonexistent.

It flies roundtrip three times a week between Pyongyang and Beijing and twice a week to the northeastern Chinese city of Shenyang, an important source of trade for North Korea.

The other is return service once a week to Vladivostok. A flight to Khabarovsk, another city in the Russian Far East, stopped in 2005. The airline also had flew to Bangkok and Macau in recent years.

About the fleet upgrade: 

Perhaps illustrative of Air Koryo’s improving fortunes, in December it acquired a twin-engine Tu-204-300 jet manufactured by Russia’s OAO Tupolev, adding to its fleet of other Tupolev, Antonov and Ilyushin jets and turboprops.

Tupolev mentions the deal on its Web site, though did not disclose financial terms when asked.

A non-North Korean with intimate knowledge of the airline, who refused to be identified, confirmed the deal, adding North Korean pilots were receiving training in Russia with the craft set to begin operations at the end of April.

Although the article insinuates that economics are largely behind the fleet upgrade, a little nudging by China certainly did not hurt.  China gave Air Koryo a deadline to meet Beijing safety standards.  But despite China’s concern for air safety, Air Koryo still has one of the best records in the business:

Though concerns about safety have been raised — Air Koryo is banned from flying in the European Union — the carrier has apparently had just one major accident, a crash in West Africa in 1983 when the airline was known under a different name.

The plane, an Ilyushin 62 carrying 23 people, was en route to Conakry, the capital of Guinea, on an “international non-scheduled passenger” flight, when it went down in the Fouta Djall mountains, according to the Aviation Safety Network Web site. All aboard perished.

Air Koryo made its first flight to South Korea in August of 2000 to ferry 100 separated family members for temporary reunions with long-lost relatives in the South. The airline has made occasional flights to South Korea for special purposes as relations have warmed in recent years.

The article does not mention the other (minor) mishap in 2006:

On August 15, 2006 aircraft from Air Koryo (Tupolev 154B-2) on an international scheduled passenger flight from Beijing, China (Beijing Capital Airport) to Pyongyang, North Korea (Sunan International Airport) experienced a runway mishap (exited runway) during landing rollout after landing in bad weather at Sunan International Airport. No injuries were reported and damage to plane was minor. (Wikipedia)

Read the full article here:
North Korea’s quirky Air Koryo survives and, increasingly, appears to thrive
International Herald Tribune (AP)
4/18/2008

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Posted in Aviation, Koryo Tours, Russia, Tourism, Transportation | Comments Closed

High maintenance personality

Thursday, April 17th, 2008

Last August I posted an excerpt from Andrei Lankov’s book, North of the DMZ, on the preservation of Kim il Sung’s body in Kamsusan Memorial Palace.  This year, the Daily NK (here and here) provides some new information on Kim il Sung’s imposing presence on the North Korean landscape.

First some statistics:

1.  There are approximately 70 Kim il Sung statues in North Korea (large statues a la Mansu Hill in Pyongyang).

2.  There are approximately 30,000 plaster busts.

3.  There are approximately 140,000 monuments and memorials

4.  There is allegedly one Kim Jong il statue in Pyongyang (although the Daily NK is the only source I have ever heard make this claim). 

5.  The first Kim il Sung statue was at the Mangyongdae Revolutionary School on 10/24/1948.  The second was in front of the Changjeon School in 1949. The most recent is at Kim il Sung University in 1996. 

Apparently all of the statues are made of bronze, but are coated in a gold paint every two years to prevent them from corroding.  The gold paint is allegedly imported from Germany (Can any German readers/speakers find out which German company supplies the paint?  How much? And at what cost? ).   

All of the likenesses of the Great Leader are exclusively constructed by the Mansudae Art Studio’s “Number One Works Department”  in Pyongyang.  The workers in this group are tested annually by a deliberation committee so they can be certified to work on Kim statues, etc.  These individuals are the only ones legally allowed to reproduce the leader’s image in North Korea.

Once a Kim statue is completed, it is transported by numerous agencies (security, party, and artists) to its destination where it is erected.  Lamps are supposed to shine on the statues from 10:00pm until 4:00am.  Local citizens are charged with keeping the area around the statue tidy (which can be verified on Google Earth).  In the event of an emergency (such as a war), many statues allegedly have dedicated bunkers in which they can be stored.

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Posted in Art, Germany, Mansu Art Studio, Political economy | Comments Closed

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