North Korean Economy Watch

It has been a couple of years since we heard from Sean Garland, but the Irish Times reports that the alleged purveyor of alleged North Korean “supernotes” is fighting his exztradition to the US at Ireland’s high court.  According to the story:

A veteran republican handed over almost $250,000 in Russian hotels in an international plot to spread the notes across Europe, a court heard.

Authorities in the US have accused Sean Garland of being the ringleader of a massive forgery racket that distributed the top grade counterfeit $100 bills.

The former IRA leader is fighting his extradition to the US at the High Court in Dublin, which heard Garland met a co-conspirator twice in Moscow with the fake cash.

Garland, 77, also the ex-president of the Workers’ Party of Ireland, denies the allegations.

In an affidavit to the court, Brenda Johnson, assistant US attorney, said: “This case involved a long-standing and large-scale supernotes distribution network (the Garland organisation) based in the Republic of Ireland and headed by Sean Garland, a senior officer in the Irish Workers’ Party.”

The US Secret Service (USSS) discovered the ‘supernotes’ were sourced in the Democratic Republic of North Korea, she said, and were transported around the world by North Korean officials travelling under diplomatic cover.

They also allege Garland and six co-conspirators used couriers to transport supernotes and payments to avoid detection themselves.

The international probe, which also involved the UK’s National Crime Squad (NCS) – now the Serious and Organised Crime Agency (Soca) – and the interior ministry of Russia (MVD), found the high-grade counterfeit bills were in worldwide circulation from the late 1980s until at least July 2000.

Ms Johnson alleged one of Garland’s alleged co-conspirators, Hugh Todd, later told investigators he purchased more than $250,000 of supernotes from “the Garland organisation” which were redistributed into the world economy through currency exchanges across Europe.

He maintained he first met the Irishman in the Radisson Hotel in Moscow in April 1998, where Mr Garland emptied a leather bag packed with approximately 80,000 dollars of counterfeit US notes on to a bed for $30,000 in genuine notes.

Two months later, the pair met in the Savoy Hotel in Moscow, where between $160,000 and $180,000 of counterfeit US currency was handed over, it is claimed.

Records with Scandinavian Airlines prove Mr Garland was in Russia on both occasions, she added.
An undercover NCS officer infiltrated the group in 1999 and met with members in several pubs and hotels around Birmingham, where they discussed the counterfeit notes and how their boss ’Sean’ sourced them in Russia.

Ms Johnson’s affidavit states Garland knew the Federal Reserve notes were counterfeit, that he travelled circuitous routes and met with other conspirators to discuss the supernotes operation and engage in transactions.

“Some members who were apprehended in possession of or passing notes have admitted that Garland was the source and leader of an illegal supernote distribution organisation and that (Christopher) Corcoran was his direct contact, communicator and negotiator,” she said.

“Their statements are substantiated by documentary evidence, physical and electronic surveillance and other witness accounts.”

Garland, of Beldonstown, Brownstown, Navan, Co Meath, was a former IRA leader in the late 1960s and early 1970s. He was a key figure in securing the official IRA ceasefire of May 1972.

He was initially arrested by the PSNI on foot of an extradition warrant by the US authorities in October 2005 at the Workers’ Party annual conference in Belfast. He fled to the South when released on bail.

He was later arrested outside the Workers’ Party in Dublin in January 2009 and released on strict bail conditions, which included surrendering the title deeds to his family home.

Barristers for Garland maintained the pensioner should not be extradited as the alleged offence happened in Ireland and was based on hearsay.

Michael Forde, senior counsel, argued his client had been accused of a complex, sophisticated trans-national conspiracy, but that the charge fell under Ireland’s own forgery or money-laundering laws.

“The rationale is very simple,” said Mr Forde. “If the offence was committed against Irish law, and a substantial part committed in the State, then the State should prosecute.”

His legal team also argued Garland’s fundamental rights have been infringed, that there had been a delay is making the second extradition order and that the extradition was connected with a political offence.

Mr Forde also claimed the application was hearsay based on hearsay and had not established a prima facie case.

“The question this court has to ask itself is there enough admissible evidence here to justify putting Mr Garland on trial,” he added.

The extradition hearing before Mr Justice John Edwards is listed for four days.

Stories related to the DPRK’s alleged counterfieting activites can be found here.

Read the full story here:
Ex-IRA man Garland ‘led fake dollars plot’, court told
Irish Examiner
2011-7-18

Pictured above (Google Earth): KPA Unit 963 (Escort Bureau/Guard Command) in Pyongyang.  See in Google Maps here.

On July 14th, KCNA reported that Kim Jong-il visited the command of KPA Unit 963.   According to the Daily NK:

Kim Jong Il has conducted an onsite inspection at No. 963 Base of the Chosun People’s Army, Chosun Central News Agency reported this morning. No. 963 Base is operated by Escort Command, the unit charged with overseeing the safety of the Kim family.

Taking in the base’s revolutionary history museum, Kim is said to have proclaimed, “This army base repelled the united imperialist factions including America, carrying out the noble mission and duty of the Fatherland Liberation War. The personnel from this base are keeping alive this proud tradition, and will surely be known in future too for the splendor of protecting the fatherland with one hundred wins in one hundred battles.”

Kim also expressed his great satisfaction at the work of the officers in command of the base, commending their readiness to carry out their duty on the battlefield with superior strategic and command abilities.

The report also went on to explain, “This base has inherited the bright tradition of defending the Suryeong with their lives pioneered in the forests of Mt. Baekdu and our revolutionary chronicles, has defended the Party and Suryeong and in the process turned out dozens of distinguished individuals, including 72 heroes of labor and 28 heroes of the Republic.

Kim was accompanied on the inspection by son Kim Jong Eun, Jang Sung Taek and another member of the Party Central Military Commission, Kim Kyung Ok.

According to Joseph Bermudez (The Armed Forces of North Korea):

The State Security Department and the Guard Command are the agencies most directly responsible for the security of Kim Chong-il and only he is reportedly exempt from their scrutiny. (p 199)

This compound recently acquired a new facility (probably the focus of the visit):

Additional information:
1. Here, here, and here is some additional information on the Escort Bureau (Guard Command).

2. Kim Jong-il’s military related visits this year: On February 2 Kim Jong-il visited KPA Unit 6556 and the Jongsong Combined Medical Institute of the Korean People’s Army. On March 16th he visited a factory under KPA Navy Unit 597. On May 4th he visited an undisclosed new KPA Sports Complex (This could possibly be at Kim Jong-il Political Military University which recently received a similar new facility).  Kim Jong-il also attended KPA cultural events on February 2, February 9, March 13, April 15, April 22, June 10, July 1, and July 2.

These are not his only military-related public appearances since he has also visited several factories suspected of being dual-use complexes, including the Namhung Youth Chemical Complex, Kanggye General Tractor Plant, Hungnam Fertilizer Complex, and the January 18 General Machinery Plant.

UPDATE: Martyn Williams notes how the DPRK has been caught photo shopping news pictures which portray flood damage. They have done similar work before (and maybe here too).

What a great way to begin a business relationship!

ORIGINAL POST:

Pictured above (Google Earth): Counties reported flooded by the DPRK

According to KCNA (July 16):

Heavy rains hit different parts of the DPRK from July 12 to 15, causing damage.

Hard hit were North and South Hwanghae provinces and South Hamgyong Province.

Rainfall registered more than 250 mm in all parts of South Hwanghae Province.

The downpour left at least 15,000 hectares of farmland inundated, taking the province as a whole. 10,000 hectares of them completely went under water and a lot of dwelling houses, public buildings and roads were destroyed.

More than 3,000 hectares of paddy and non-paddy fields were submerged or brought under silt in Chongdan County. Haeju City, Thaethan, Ongjin, Pyoksong, Jaeryong and Sinchon counties were also hit hard by torrential rain.

Several dykes were destroyed and at least 5,900 hectares of paddy and non-paddy fields were inundated or brought under silt in North Hwanghae Province.

Heavy rains caused damage to some parts of South Hamgyong Province.

Torrential rain hit Hamhung City on Thursday and Friday, leaving dwelling houses destroyed and causing casualties. It also left hundreds of hectares of farmland completely inundated and roads destroyed to bring traffic to suspension.

Steps are being taken to recover from the damage in the afflicted areas.

According to Yonhap:

The minimum wage for workers at the inter-Korean industrial park in the North Korean border town of Kaesong is likely to rise 5 percent this year, the same annual rate of increase since 2007, industry sources said Friday.

More than 46,000 North Koreans work at about 120 South Korean firms operating in the complex, despite the South’s suspension of all other economic ties with the North over the deadly sinking of a South Korean warship last year. The local workers currently earn a minimum monthly income of US$60.775 following a 5 percent increase that took effect last August.

This year’s new minimum rate goes into effect next month after negotiations between the factory park’s management officials from the two sides. Under the park’s labor regulations, the minimum wage can increase only up to 5 percent from the previous year.

“The North Koreans are demanding an increase of more than the upper limit (of 5 percent), citing wage levels in other parts of the world,” said an official from one of the South Korean firms in Kaesong. The person spoke on the condition of anonymity.

“In effect, this is equivalent to demanding a wage rise of 5 percent,” the official said, adding that the businesses operating in the joint industrial park had tentatively agreed to accept the demand. After the increase, the North Korean workers will earn $63.814 monthly.

Meanwhile, production at the industrial zone has continued to grow, according to recent data. The park’s output of clothes, utensils, watches and other goods rose 26.1 percent last year from 2009. Since its opening in 2004 under former liberal South Korean President Roh Moo-hyun, the complex has served as a source of tens of millions of dollars for the cash-strapped North annually.

Read the full story here:
Minimum wage for N. Koreans in Kaesong likely to rise 5 pct
Yonhap
2011-7-15

Pictured above (Google Earth): Two official marketplaces in Kaesong highlighted in yellow.  South Korean treats are popular in these markets.

According to the Daily NK:

Shin Ramen (a brand of instant noodles), Choco-pies and coffee mix, the snacks offered to Kaesong Industrial Complex workers, leak out and are now very popular in the jangmadang in Kaesong, according to sources.

The news was revealed by a South Korea government official and a staff member from an enterprise in the Kaesong Complex on the 15th.

North Korean workers often ask their employers for Shin Ramen uncooked and packed so that they can sell it in the jangmadang to augment their wages, according to the Ministry of Unification.

One staff member from a company stationed in the Kaesong Industrial Complex explained, “The time when the North Korean workers are given Shin Ramen, Choco-pies and coffee mix is the time they look forward to the most.”

“I am aware that North Korean workers take the several ramen given to them at snack times or when doing evening overtime back into North Korea,” he added. “They sell the ramen they take for roughly the same price as a kilo of rice. But it is not just Shin Ramen; Choco-pies are very popular with the North Korean workers, and they also use Shin Ramen soup as a seasoning at home.”

Kaesong Industrial Complex companies are known to get assistance from domestic companies, so pay less than market price for the Shin Ramen and other snacks that they offer to workers.

The company staff member said he saw the situation in a positive light, explaining,, “There have been almost no inter-Korean exchanges of late, so in this situation the Shin Ramen and Choco-pies and other things offered by enterprises provide a link between the North Korean people and South Korea. If the workers take the Korean-made products and sell them in the jangmadang then not just the workers but also the North Korean people get to know about South Korea.”

Unfortunately, meanwhile, although workers in the Kaesong Industrial Complex receive a wage of approximately $100/month, they are not free to keep it. 30% is taken by the North Korean authorities in the form of a ‘Socialist Culture Policy Tax’, and other costs are extracted as well. Therefore, the take-home pay is around $30/month, although even this is not paid in cash but in the form of an exchange coupon.

A Ministry of Unification explained one part of that system, saying, “Most of the money and other things that come from the South go to the central North Korean authorities, but a proportion goes to Kaesong city authorities. That money which goes to Kaesong City is meant to be for the purpose of buying rice for distribution to the local people.”

There are now approximately 46,000 North Korean workers in the Kaesong Complex, and complex operations are, as such, a $4.6 million monthly subsidy for the North Korean authorities.

Despite the measures put in place by the South Korean government following last year’s Cheonan and Yeonpyeong Island incidents, the number of workers earning money in Kaesong has continued to expand. According to the Ministry of Unification, at the end of February there were 46,420 workers, an 11% increase on one year previously. Earnings have also risen significantly in the same period.

Donald Kirk was the first (of whom I am aware) to write about the subversive nature of Choco Pies back in May 2009.

Read the full story here:
Shin Ramen Popular in Kaesong Jangmadang
Daily NK
Kim Yong-hun
2011-7-15

Pictured above (Google Earth) is the electrified fence around the Rason special economic zone.

Lankov writes in the East Asia Forum:

SEZs are acceptable to the North Korean government because they are relatively easy to control. North Korean SEZs have been fenced off with barbed wire and all visitors have had their IDs carefully studied at checkpoints.

The North Korean government obviously hopes that small areas of controlled capitalism will generate enough income to make a difference — or at least to keep afloat the long-decaying economy.

Similar SEZs with China to those recently declared have been attempted before. At Raseon a major problem was its isolated location and underdeveloped transport infrastructure, even by meagre North Korean standards. At Sinuiju there were numerous problems. One was North Korea’s choice of the Chinese entrepreneur Yang Bin to lead the project as he wanted to transform the city into a gambling centre, a Macau of the North. This was not welcomed by the Chinese government. Also, it did not help that the North Koreans, following their modus operandi, did not bother to liaise with the Chinese beforehand.

…

The success of KIZ might seem encouraging, but it is actually a very special case. It is viable because the South Korean government is willing to go to great lengths to support it. It has subsidised industrial development and has provided adventurous developers and companies with generous subsidies and guarantees that made the entire undertaking possible. This willingness is driven by a multitude of political considerations. Frankly, it is doubtful whether the Chinese side would be equally interested in subsidising a similar undertaking by Chinese companies in Sinuiju.

…

What will happen to these two planned new SEZs? The fate of Raseon seems pretty certain. Available evidence indicates it is largely about transportation links. Chinese Manchuria is landlocked, so Chinese companies will save a small fortune on transportation costs if they are given access to a seaport on the Eastern coast of the Korean Peninsula. If this is what happens in Raseon, it has a relatively bright future.

The future of the Hwanggumpyong SEZ is far less certain. Obviously Chinese businesses want to do there what their South Korean counterparts did in Kaesong, take advantage of low labour costs in North Korea. Even though Chinese labour is cheap, North Korean labour is much cheaper still, since US$15-20 a month would be seen by the average North Korean worker as a good wage. For the same labour, they would have to pay a Chinese worker between US$100 and US$150 a month.

But that said, the business reputation of North Korean managers leaves much to be desired. They are likely to intervene in operations − partially as a way to extort bribes, but largely because they will worry about excessive exposure of their population to dangerous Chinese influences. South Korean businesses in Kaesong accept such interference, but they are backed by the South Korean government. It remains to be seen whether the same situation will develop in a Chinese-led zone.

Previous posts on the Sinuiju (including Waudo and Hwangumphyong) can be fond here.

Previous posts on Rason (Rajin-Sonbong) can be found here.

Read the full story here:
North Korea-China special economic zones
East Asia Forum
Andrei Lankov
2011-7-14

According to Yonhap:

North Korea is expected to become larger and older in 40 years with its population growing at a slower pace, data showed Tuesday.

According to the U.S. Census Bureau, North Korea’s population is estimated to rise 10 percent by 2050 to 26.96 million from this year’s 24.45 million.

The census bureau also projected that South Korea’s population will decrease 11 percent from 48.75 million last year to 43.37 million in 2050.

North Korea’s population has been on a steady increase since 1995, when it totaled 22.11 million, and the trend is likely to continue into 2050, the bureau said.

The population growth rate, however, is forecast to dwindle from 0.5 percent this year to a negative growth of 0.1 percent in 40 years, the data showed.

The slower rate of population growth will bring down the North’s ranking worldwide in 2050 to 64th among 228 countries. It ranked 48th this year, according to the agency.

North Korea’s birthrate is forecast to drop to 1.7 in 2050 from 2.0 in 2011, while its life expectancy is estimated to increase to 78 in 2050 from this year’s 69, indicating North Korea will face an aging society.

The agency did not mention what exactly would attribute to such changes in the country’s demographics, but said on its Web site that the estimates were based on the census each country conducted while also taking into account political and social variables alongside specific factors such as natural disasters.

A separate U.N. report published last year found that North Korea’s population is to increase by 600,000 to 24.6 million in 2050.

Information on the DPRK’s last census can be found here.

Read the full story here:
N. Korea’s population expected to rise to 27 mln by 2050
Yonhap
2011-7-12

UPDATE 4 (2011-7-14): The Choson Ilbo is worried about the legal implications of the finding:

The court order marks the first instance where the inheritance rights of children left behind in North Korea were recognized in South Korea. An estimated 5 million North Koreans came to the South during the Korean War. An organization estimates that some 8.3 million of such people and their children and grandchildren are living here, and their families and descendants left behind in the North are also estimated in the millions. The court order is expected to lead to similar lawsuits against parents or half-siblings living in South Korea. Even the grandchildren of North Korean escapees could sue.

According to South Korean law, the direct descendants of deceased citizens are entitled to inherit their assets. The court order would have to be applied across the board to all children of North Korean escapees still living in the North, and this could trigger chaos and an explosive increase in lawsuits. This raises the question how to deal with inheritance suits filed by North Koreans claiming to be members of a particular clan that also exists in South Korea. In such cases, it would be difficult to verify the accuracy of family registers kept in North Korea and whether to recognize their validity.

The Justice Ministry is working on a law that requires government permission when North Koreans transfer inherited assets from families in the South outside the country and allows the transfer of limited amounts only in certain specified cases, such as paying for medical bills and basic livelihood. But North Koreans could file suits claiming that this regulation infringes their constitutional rights, since the South Korean Constitution applies in principle to all Koreans. The court order raises more questions than it answers.

UPDATE 3 (2011-7-13): It appears as if the North Koreans were granted an undisclosed amount of the estate in mediation. According to the Korea Herald:

Four North Koreans from the same family have come to share assets left by their late father with their half-brothers and sisters in South Korea under mediation by a Seoul court in the first case of its kind.

The North Koreans, surnamed Yoon, had filed a lawsuit against their South Korean stepmother and four half-brothers and sisters in February 2009 demanding they split 10 billion won ($9.35 million) worth of assets left by their father who died in the South.

The Seoul Central District Court on Tuesday said the South Korean family agreed to give part of the disputed real estate from their father to the North Koreans along with some of their inherited assets in cash.

The court did not announce the exact amount of assets owed to the North Koreans, citing an agreement between the two sides not to disclose details of the deal mediated by the court.

Several groups of North Koreans have filed similar lawsuits at South Korean courts as the country’s Constitution considers the entire Korean Peninsula as its national territory. But the group involved in Tuesday’s agreement became the first to win partial ownership of assets left by a relative who defected to the South.

The father, who ran a hospital in North Korea, crossed the border to the South right after the Korean War began in 1950, taking only his eldest daughter with him. He had four other children with his South Korean wife and died in 1987.

The eldest daughter later found her North Korean family with the help of an American missionary who traveled between the two Koreas. The family sent letters of attorney, videotapes with their images and hair samples to the sister in the South via the missionary. Based on the materials, the North Koreans filed two lawsuits with South Korean courts ― one asking for a split of the father’s leftover assets and the other seeking court confirmation of their biological relationship with the father.

Last year, the Seoul Family Court acknowledged the blood relationship between the four North Koreans and the deceased, citing DNA test results. But the South Korean family appealed the decision.

The North Koreans are thought to have delegated the authority to manage the real estate and money from their father to their eldest biological sister in the South.

The North Koreans’ lawyer Bae Geum-ja confirmed that there will be no cross-border transmission of the assets.

To cope with possible property disputes between South and North Koreans, Seoul’s Justice Ministry said it plans to legislate a law restricting North Koreans from taking their share of inherited assets out of the South even if they are granted ownership.

Read previous posts on this story below:

(more…)

UPDATE 2 (2011-7-15): Adam Cathcard provides additional data in the comments.

UPDATE 1 (2011-7-12): Over a year after first making the announcement, France reiterates that it is opening an office in the DPRK.  According to the AFP:

France will open a cooperation bureau in North Korea, Le Monde newspaper said Tuesday, but underscored that Paris was not launching diplomatic relations with the reclusive Stalinist state.

A senior French diplomat is currently in Pyongyang where he “will present to the North Koreans” the future French representative, the daily said, identifying him as Olivier Vaysset, a diplomat who has worked in Singapore.

“The opening of this office does not signify that France is opening as such diplomatic relations with this totalitarian country,” it said but added that it could serve as a “diplomatic intermediary.”

The proposed office will handle cultural cooperation, it said.

The French embassy in Seoul declined comment on the report, saying any comment would have to come from Paris.

The then-French foreign minister Bernard Kouchner said in March last year his country would not establish diplomatic relations with the North but would open an office to support non-governmental groups.

“We are not going to open an embassy, certainly not,” Kouchner told a news conference in Tokyo. “Open an office, yes, in order to help the NGOs there.”

France is the only major European Union member that does not have diplomatic ties with the communist state.

Paris has argued that the human rights situation must improve and has cited concerns over nuclear proliferation.

French special envoy to Pyongyang, Jack Lang, visited the North in November 2009. He said afterwards that France had offered to forge permanent cultural links with North Korea but not full diplomatic ties.

The French move comes as ties between North and South Korea are at their lowest ebb after Seoul accused Pyongyang of torpedoing a warship in March 2010, killing 46 sailors.

Original Post (2010-3-18): According to the AFP:

France will not open diplomatic relations with North Korea but plans to establish an office there to support non-governmental groups, French Foreign Minister Bernard Kouchner said Thursday.

‘We are not going to open an embassy, certainly not,’ Kouchner said at a press conference in Tokyo. ‘Open an office, yes, in order to help the NGOs (non-governmental organisations) there.’

France is the only European Union country other than Latvia that does not have diplomatic ties with the communist state.

Paris has argued that the human rights situation in North Korea must improve and has cited concerns over nuclear proliferation.

In December the French special envoy to Pyongyang, Jack Lang, said France had offered to forge permanent cultural links with North Korea but not full diplomatic ties, hoping to pressure it on the nuclear issue.

‘Our proposal… is to open a permanent structure of cooperation with North Korea – humanitarian, cultural and linguistic cooperation,’ Lang told a hearing of members of the French parliament at the time.

Kouchner, asked to clarify the French position during his Japan visit, said that ‘we are not rewarding them at all in opening an office’ that would support French NGOs working in the isolated country.

Additional Information:

1. Kim Jong-il’s neice committed suicide in Paris.

2. The Kim family is fond of French doctors.

Read the full story here:
France rules out opening embassy in N.Korea
Associated Free Press
3/18/2010

UPDATE 6 (2011-7-11): It looks like none of the DPRK power stations have been approved by the UNFCC for the CDM program.  A reader notes:

[I] just searched through the entire CDM database with the category numbers for these projects, and as far as I can see none of these has got beyond validation phase['s] comments phase, and judging by some of the comments – “It is evident from the PDD [Project Design Document] that the values are consistent and it is definitely forged and cooked up values to show a non CDM project as a CDM project” – being one of the more polite, that I’d be amazed if they make it beyond that. [It] looks like the DPRK hasn’t got its environmental and managerial audit systems quite up to date yet.

UPDATE 5 (2011-7-11): I just checked the UNFCC web page, and it appears that in addition to the hydro power plants mentioned below, the North Koreans also submitted the “Energy Efficiency Improvement Project in Pyongyang Textile Factory” [sic] for carbon offsets on May 23, 2011. According to the UNFCC web page, the project is in the portfolio of the Carbon-Trade Division, GBCIO, Ministry of Foreign Trade.

UPDATE 4 (2011-7-11): DPRK begins construction of Ryesonggang Power Stations 3 and 4

Pictured above (Google Earth): Ryesonggang Youth Power Stations 1, 2, and 6 (례성강청년발전소).

Back in March of this year, the DPRK registered eight potential power plants with the UNFCC which it intended to construct to obtain carbon offset credits.  These eight hydro-power plants are:

Hamhung Hydropower Plant No.1
Hamhung 20MW Hydropower Plant No. 2
Kumya Hydropower Plant
Paekdusan Songun Youth 14MW Hydropower Project No.2
Ryesonggang Hydropower Project No. 3
Ryesonggang Hydropower Project No. 4
Ryesonggang Hydropower Project No. 5
Wonsangunmin 20MW Hydropower Project No. 1

On June 25th the DPRK evening news featured footage of the construction of the Ryesonggang Youth Power Station No. 3 (례성강청년3호발전소).  I have uploaded the footage to YouTube and you can see it here.

On June 28th the DPRK evening news featured footage of the construction of the Ryesonggang Youth Power Station No. 4 (례성강청년4호발전소).  I have uploaded the footage to YouTube and you can see it here.

I have not had the time to pinpoint the exact locations of these power stations using Google Earth.  Since the imagery is older, it will take some time to match up the mountain contours.  However, we have a general idea where they are located: between the Ryesonggang Power Stations 2 and 6.  These are mapped out in the image at the top of this post.  The satellite imagery is of Thosan (토산군) and Kumchon (금천군) counties.

Since I have a job, am in graduate school, am a landlord, and running this web page, I have not had time to follow up with the UNFCC to see if they have approved these projects for the Clean Development Mechanism (CDM). If there is an enterprising journalist or reader who cares to find out the answer, please let me know.

UPDATE 3 (3/23/2011): According to the UNFCC web page (select Democratic People’s Republic of Korea in the “Host Party” box), these are the eight power stations that have been submitted for consideration:

Hamhung Hydropower Plant No.1
Hamhung 20MW Hydropower Plant No. 2
Kumya Hydropower Plant
Paekdusan Songun Youth 14MW Hydropower Project No.2
Ryesonggang Hydropower Project No. 3
Ryesonggang Hydropower Project No. 4
Ryesonggang Hydropower Project No. 5
Wonsangunmin 20MW Hydropower Project No. 1

The UNFCC web page does not mention the locations, size, or power generation capacity for most of the dams, but I am sure that information will trickle out over time. With the exception of the Kumya Power Station (See satellite image below), none of these facilities are visible on Google Earth–but related facilities are: the Paektusan Power Station 1 (See satellite image below) and Ryesonggang Power Station 1, 2, 6 (See satellite image below).  The Hamhung Power Stations are probably in or near Hamhung, and the Wonsangumin project is probably near Wonsan.

And according to an email from the UNFCC:

This list contains all the projects which have already started and for which a notification of CDM prior consideration has been submitted. This notification is necessary to prove that the incentive of the CDM was a decisive factor for taking up the project when a project has started before a project design document (PDD) has been published for global stakeholder consultation or a new methodology in connection with the project has been submitted. However, kindly note that these projects have not yet entered the CDM project cycle as lined out in the CDM rules, requirements and procedures, and to submission for registration has yet been made.

Further details on the CDM project cycle are available here: http://cdm.unfccc.int/Projects/diagram.html

More information will be added here as time passes.

UPDATE 2 (3/11/2011): The DPRK has apparently registered eight power plants with the UNFCC.  According to Reuters:

North Korea has registered eight hydroelectric plants with the United Nations, and if approved, could allow the world’s most reclusive state to sell carbon offsets to earn precious hard currency.

These hydropower projects were registered with the United Nations Framework Convention on Climate Change (UNFCCC) for prior consideration in getting carbon credits, some of which have a capacity of 20 megawatts, the UNFCCC website showed.

Prior consideration is the first step for accreditation toward the U.N.’s Clean Development Mechanism that allows developing countries to earn tradeable carbon credits for emissions from clean-energy projects.

Bernhard Seliger, a messenger for North Korean officials on these projects, said the United Nations uploaded the information on Thursday after he submitted related forms on behalf of the North Korean government’s carbon trade division in late February.

“I have no idea when the U.N. makes a decision… North Korea has to finish the power plants, which up to now are only half-finished dams,” Seliger, Hanns Seidel Foundation’s representative in South Korea, told Reuters via email.

Analysts questioned the demand for carbon credits from North Korea, concerned the money might be siphoned off to nuclear arms or other military projects.

The UNFCC web page is not stranger friendly.

UPDATE 1 (3/8/2011): According to the Guardian:

North Korea hopes to earn much-needed hard currency by selling UN-backed carbon offsets from a series of hydro-power projects, as the country faces sanctions over its nuclear weapons programme.

If approved and registered by the UN, these would be the first projects for North Korea under a scheme called the Clean Development Mechanism (CDM). This allows developing countries to earn tradeable carbon credits for emissions reductions from clean-energy projects.

Some analysts questioned the demand for carbon credits from North Korea, with fears the money might be siphoned off to nuclear arms or other military projects.

The government has asked the Hanns Seidel Foundation of Germany, which focuses on humanitarian issues, to act as a go-between by working with UN-approved verification agency TUV Nord.

According to Bernhard Seliger, the foundation’s representative in South Korea, North Korea is initially looking at trying to get approval for three hydro power plants of 7-8 megawatts (MW).

Seliger visited the three hydro-plant construction sites in the north-east corner of the country in January.

In a statement, TUV Nord confirmed the foundation had engaged their services.

“In this respect, TUV Nord intends to verify hydropower dams in North Korea once pre-registered with United Nations framework conventions on climate change [UNFCCC] via the Beijing branch of its Chinese subsidiary TUV Nord Guangzhou,” it said.

If registered, the plants could yield millions of euros over several years.

Beijing-based lawyer Tom Luckock, who specialises in projects that curb greenhouse gas emissions, estimated that an 8 MW hydro plant could yield about 23,000 UN offsets a year.

The offsets, called Certified Emissions Reductions (CERs), are generated from registered CDM projects, such as wind farms, that are rewarded for reducing greenhouse gas emissions.

The offsets currently trade at nearly €12 (£10) each and are bought by governments in rich nations that need to meet UN emissions reduction targets.

Europe is the biggest buyer, with large polluting firms allowed to buy the offsets to meet a portion of their emissions reduction targets under the EU’s emissions trading scheme.

“Finding ways to secure foreign currency is the priority for North Korea, which is linked to everything from food to raw material imports to boost reduced productivity,” said Cho Myung-chul, a senior researcher at the Korea Institute for International Economic Policy.

…

Seliger said North Korea, which signed the UN’s Kyoto Protocol climate pact in 2005, was also interested in biomass power generation projects under the CDM.

The UN-approved national agency that assesses and approves CDM projects in North Korea was not available for comment.

Questions remained on demand for North Korean CERs.

“Even if they open up, who in the world wants to pay for North Korea that is blamed for its nuclear weapons programme?” said Choi Soo-young, a senior researcher at the Korea Institute for National Unification.

Cho said the UN needed to prevent outside cash going into its nuclear development activities, while Luckock, of global law firm Norton Rose, said: “Their limited access to hard currency has to be a concern for buyers – the damages clauses will carry limited weight without some security there.”

Another challenge is that North Korea would have to make public its energy consumption and generation data and disclose information on the amount of energy linked to the hydro project.

“Annual inspection, constant measurement and energy flow posting on the [UNFCC] website – all these things are new for North Korea,” Seliger said.

According to the AFP:

“We are talking about eight power plants, with the smallest size about 7.5 megawatts. These are not big projects but small or medium-sized projects,” Bernhard Seliger told AFP.

None has yet been completed, he said.

“I saw some (construction) sites in South Hamkyong province but that’s not all. There are other plants in other regions,” Seliger said, adding that some of the projects are led by the UN Development Programme.

The Hanns Seidel Foundation has been working since 2003 to build the North’s development capacity, and in 2008 organised a seminar on carbon trading for Pyongyang officials at their request.

The tradeable credits, called Certified Emissions Reductions, are awarded for approved clean-energy projects such as hydropower plants or wind farms.

Big polluters elsewhere in the world can buy them as part of their efforts to cut emissions.

Seliger said his foundation is helping the North to prepare for the auditing process required to join the UN carbon credit trading system known as the Clean Development Mechanism.

“One good thing about this project is that it is very transparent, involving monitoring and auditing on an annual basis… I think it is very good for North Korea to participate in such an international regime,” said Seliger.

An official at a South Korean state agency, the Korea Energy Management Corp, said registration would take at least a year or two and it was unclear how much the North would be able to earn if approved.

The official, who declined to be identified, said a typical eight-megawatt hydropower plant could yield about 19,500 carbon credits each year, each of which was currently traded at 12 euros in global markets.

This would amount to around $327,000 a year.

But some buyers may shun the communist state, given its history of nuclear and missile development which has led to international sanctions.

“Government buyers will certainly shy away from dealing with the North,” said Koo Jung-Han, a researcher at the Korea Institute of Finance.

“But private companies have few reasons not to buy credits from the North as long as it can offer a competitively low price. However, the big question is whether the North will be able to build the plants without outside financiers.”

Koo said that countries hoping to buy carbon credits from upcoming overseas projects often encourage investment in the ventures by their own finance companies.

“But what kind of financial companies will take a plunge in projects in such a volatile, politically risky country like North Korea?”

The North suffers persistent power shortages even in the showpiece capital Pyongyang.

Many rural areas receive power only during key agricultural seasons, and must rely for the rest of the year on alternative fuels, according to a recent policy paper published by the Nautilus Institute think-tank.

Here are the web pages for the Hanns Seidel Foundation and the UNFCCC Clean Development Mechanism (CDM) Program.

I am not sure which hydro power stations the DPRK is planning to submit to the UN, but many have been been highlighted in North Korean “media” in recent years:

Kumya River Dam
A dam is being constructed in Kumya County, South Hamgyong Province, to provide electrical power. Kim Jong-il last visited in August 4, 2010. It is just one of several dams under currently under construction in the DPRK.

Here is a satellite image of the Kumya dam’s construction (Google Earth: 11/25/2008,  39.574232°, 127.104736°)

This new reservoir will flood the locations of three villages (리): Ryongnam-ri (룡남리), Ryongsang-ri (룡상리), and Ryongchon-ri (룡천리).

Estimates of the reservoir size are made by me, but it is fairly obvious where the North Korean engineers expect the reservoir to flood because they have already relocated the villages from their former locations in the flood zone.

Kumjingang River Power Stations
Beginning in 2000, the DPRK has constructed three power stations on the Kumjin River (금진강) in  South Hamgyong Province.  The first was the Kumjingang Power Station (금진강발전소).  The second was the  Kumjingang Hungbong Youth Power Station (금진강흥봉청년발전소).  The third was the Kumjingang Kuchang Youth Power Station (금진강구창청년발전소).  All three are pictured below on Google Earth:

It does not appear that these projects have resulted in dislocated villages.

Wonsan Youth Power Stations
Below is a satellite image of the Wonsan Youth Power Stations No’s. 1-4 (원산청년발전소).   These projects required the construction of both the Kuryong Reservoir (구룡저수지) and an appx 8.5 mile (13.69km) tunnel to link the hydro power stations with their power source.  The inaugural ceremony for these facilities was on January 10, 2009.

The construction of the Kuryong Reservoir resulted in the dislocation of three villages: Kuryong-ri (구룡리), Konja-ri (건자리), and Haerang-ri (해랑리).

Orangchon Power Station No. 1
Kim Jong-il offered guidance at the Orangchon Power Station (어랑천1호발전소) in February 2007.  This facility will probably not be submitted to the UN for scrutiny because it lies just outside the security perimeter of what human rights groups assert is Kwan-li-so No. 16.

Anbyon Youth Power Stations No’s 1 & 2
The Anbyon Power Stations (안변청년1-2호발전소, 38.954400°, 127.538912°) are powered by waters from the Imnam Reservoir (임남저수지) via an underground tunnel nearly 45km in length.  Much more here.

The Imnam Reservoir flooded Chondo County’s capital city as well as appx 14 villages. The South Korean government was so worried about the Imnam Reservoir being used as a weapon that they built a dam downstream to prevent flooding should the DPRK release a large volume of water (38.209539°, 127.848760°).

Ryesonggang Youth Power Stations 1-6
Some of the Ryesonggang Youth Power Stations (례성강청년1-6호발전소, 38.367696°, 126.781096°) appear to be under construction in North Hwanghae Province.  The North Korean “media” has only broadcast images of the Ryesonggang Power Stations 1, 2, and 6 (all completed), so I presume that power stations 3, 4, and 5 are too new to show up on available Google Earth Satellite imagery. Below I post images of the distance between power stations 1 and 6 as well as close-ups of both facilities.

Power Station No. 1 was completed in 2007 and most recently received media attention in South Korea in September 2009 when the DPRK released a massive amount of water from its dam (Hwanggang Dam), causing floods in South Korea that killed six people. An estimated 40,000,000 short tons (36,000,000 t) of water was dumped during the flood, causing the water level at the border of Gyeonggi-do to leap from 7.5 feet (2.3 m) to 15.1 feet (4.6 m).

Power Station No. 2 (38.324008°, 126.673366°) has been completed, but it is too new to appear on Google Earth satellite imagery.  I have drawn it on Google Earth below:

Construction of Power Station No. 2 resulted in the dislocation of approximately 27 houses, but I have not been able to determine if any other villages were relocated due to construction of the other facilities.

Paektusan Songun Youth Power Stations
The North Korean media has also done a lot of advertising for the Paektusan Songun Youth Power Stations (백두산선군청년발전소) in Paekam County, Ryanggang Province (41.716931°, 128.786163°).

These dams have resulted in the dislocation of  two small communities as well as the severing of the old railway lines that connected Unhung, Kilju and Paekam with Musan.  Maybe the railway lines have been moved to accommodate the new dams, but it is also unclear if these line were in use to begin with.

Pukchang Ryongsan Power Station
Up until recently I believed the Pukchang Ryongsan Power Station (북창룡산발전소, 39.596238°, 126.266478°) was a large-scale river-straightening project, but according to recent KCTV footage (which I posted to Youtube here) it is in fact a hydro power station.  Work on this project began sometime around the spring 2002 (as best I can tell).

Huichon Youth Power Stations
The Huichon Youth Power Stations No. 1 & 2 have received the most attention in the North Korean media.  I recently located them and will post something soon.

Since the DPRK will likely be subjecting several of these (or other) power plants to international scrutiny, I look forward to seeing that data published.  KCNA is short on details and the disclosed information would facilitate more accurate assessments of the DPRK’s domestic hydro-power generating capacities.

A reader writes in with the following comments:

I would like to share some comments on the potential CDM projects in north Korea as i have been working on this field for many years now.

Concerning existing hydropower plants:
To be eligible to a CDM project, one of the first criteria is the additionality of the project. You have to prove (the rules are very stricts) that the project would not have been launched without the consideration of the revenues from the reselling of the CERs.
So the Dams that have already been buit are not eligible.

Concerning hydropower plants that are being implemented:
The first step of a CDM project is to notify to the UNFCCC secretariat and to Designated National Authority (in this case the Secretariat of the National Coordinating Committee of Democratic People’s Republic of Korea for Environment) that you are seeking to establish your project as a CDM project.
Up to now, no such notification has been received by UNFCCC so it would be quiet difficult for projects being implemented to ask for the CDM status (i mean nearly impossible).

Some facts concerning future hydropower projects:
From the day you send the notification that you are seeking the CDM status to the day you are actually given the status, it takes in average 2 to 3 years (they would have to build the plants during this period)
Then it can be at least another year before you receive the CERs.
The price of 12 euro for a CER is for secondary market. The price for primary CER (directly sold by the producer) would be much less than 8 euro.
The figure of 20 000 CERs/year is completely unpredictable for the moment, here is a simplification of the calculation:
One CER is equal to one tonne of CO2 equivalent that would be avoided by producing clean electricity. For example when you produce 1 MW electricity from coal, the process releases X tonnes of CO2 in the atmosphere but when you produce 1 MW from a hydropower plant, you do not release CO2.
In order to calculate what the CDM project would be able to claim, we would have to know the CO2 emission factor of the North Korean grid and then multiply it by the amount of MWh produced by the CDM project.
If most of the electricity produced these days in North Korea already comes from hydropower plants, then the national emission factor will be low and the CDM project will not avoid a lot of CO2 emission (and so not earn a lot of €)
Without the capacity of the future project and the national emission factor, it is impossible to estimate the amount of CERs the project could generate.

The CDM status seems quiet unrealistic to obtain for North Korean projects but other international agreements are discussed these days and their outcome may be more adapted.

ORIGINAL POST (2011-1-31): According to Radio Free Asia:

Nuclear-armed but cash-starved North Korea has expressed interest in joining the world carbon market in an apparent bid to earn precious hard currency and avoid international sanctions, an expert told RFA.

But the secretive Kim Jong Il regime has to disclose critical information, such as energy consumption data as well as methods by which it derives energy, to be eligible for funding under the United Nations’ Clean Development Mechanism (CDM), said the North Korea expert, speaking on condition of anonymity.

The CDM is aimed at encouraging companies or organizations in the developed world to invest in carbon dioxide emissions-saving projects in developing countries.

In return for funding and technology transfer, investors receive carbon credits, which can then either be traded on carbon markets or used to reduce their own emissions tally if they are subject to a domestic cap.

The Kyoto Protocol set emission caps for 38 countries through 2012, establishing the CDM as a worldwide carbon market. It is a cornerstone of the group’s efforts to tackle global warming.

The North Korea expert told RFA on Jan. 13 that Pyongyang intended to apply for funding via the CDM and that the regime might list its proposed hydro-electricity power projects under the U.N. mechanism.

UN refrains from comment

When contacted on the North Korea move, the U.N. Framework Convention on Climate Change (UNFCC), the secretariat charged with implementing the global environmental treaty to stabilize greenhouse gas concentrations, said it would refrain from commenting on individual country projects.

The North Korea expert estimated that one ton of carbon dioxide would trade for about U.S. $26 dollars and if a hydro-electric power project was registered under the CDM, depending on the carbon credit bid price, about U.S. $1 million dollars could be earned annually.

A hydro project registered under the CDM would need to be evaluated by U.N. inspectors for it to qualify for carbon credits. Usually, it would be evaluated continuously for about 14 years.

Details, including the amount of energy linked to the hydro project and potential reduction of greenhouse gas emissions, would have to be submitted.

North Korea has been mostly reluctant to share information about its energy generation activities.

According to the expert, North Korea has recently displayed “great interest” in the possibility of operating hydro-electric power stations to alleviate its domestic energy shortages and to acquire “carbon credits” that it could, in turn, sell on the international carbon market.

Hard currency

As North Korea’s economic crisis worsens, Pyongyang is seeking ways to earn hard currency following a failed currency reform and due to sanctions imposed by the international community over its nuclear and missile developments and provocations targeting South Korea.

The interest in the CDM is likely to be part of this search.

The North Korea expert also said that earning hard currency through “carbon credits” would not be subject to sanctions imposed on Pyongyang under UN Security Council resolutions, and that any North Korea’s application for participation under the CDM “may stand a chance.”

“For North Korea, this could be an opportunity to earn hard currency without engaging in illegal armament sales, while operating an electric power station in transparent fashion, and accepting strict monitoring by the UN, and abiding by applicable international standards.”

The United States has been pressing China to use its influence to persuade North Korea regime to end recent provocations and return to disarmament talks involving the three countries and South Korea, Russia and Japan.

The six-party nuclear talks were last held in 2008. The impoverished North has been seeking a restart to the nuclear negotiations, which propose to reward its gradual nuclear disarmament with phased infusions of economic aid.

In a bid to renew dialogue and ease chances of conflict, South Korea recently proposed holding a preliminary meeting with North Korea on Feb. 11 to prepare for high-level defense talks. On Friday, the North suggested parliamentary talks between the two sides.

Read the full story here:
North Korea Eyes Carbon Market
Radio Free Asia
1/29/2011