Archive for June, 2015

Wonsan’s Kalma Street Project

Tuesday, June 30th, 2015

UPDATE 4 (2017-8-6): New Google Earth imagery of the Kalma Street project dated 2017-5-19 shows signs of life, but overall stagnation. Although work continues very slowly on the right-most apartment block, it has not progressed at all for the remaining three original foundations dug in early 2016. However, sometime between 2017-2-14 and 2017-5-19, preparatory work was begun for yet another building (Outlined in red below):

 

UPDATE 3 (2017-3-7): New Google Earth imagery of the Kalma Street project dated 2016-12-8 shows very little observable progress.

The only visible progress that appears to have been made since February is that the right-most apartment block appears to have been raised to its second or third floor. Maybe some interior work has been done on the two buildings in the upper-left corner.

UPDATE 2 (2016-7-4): Google Earth imagery of Kalma Street dated 2016-5-26 has been published. There has been some modest progress on the project since 2016-2-26:

The exterior of the two buildings in the upper left is near completion. Additionally, construction on the right-most apartment building has begun.

UPDATE 1 (2016-4-3): Google Earth has new imagery from 2016-2-26 of the Kalma Street construction site. I posted material on this project in Radio Free Asia (in Korean). Here is some information in English:

Progress has been made on the Kalma Street project, but not much. So far it appears that six buildings are under construction:

Most of this construction is simply preparatory work on laying the foundation (digging ditches). The most progress has been made on the two rectangular buildings in the top-left corner. In these buildings, walls are going up on the ground-level floor.

There is also a large staging ground for workers and supplies nearby:

 

ORIGINAL POST (2015-6-30): Pictured below on Google Earth is the Kalma Street construction site in Wonsan

Kalma-street-construction

According to KCNA (2015-5-20):

Ground-breaking Ceremony of Construction in Wonsan Area Held

Wonsan, May 20 (KCNA) — The Wonsan area will turn into a world-famous tourist city under the plan of the Workers’ Party of Korea (WPK).

A ground-breaking ceremony took place in Kalma Street on Wednesday.

Present there were Vice-Premier Kim Yong Jin, officials concerned, builders and citizens of Wonsan.

A reporter and speakers said it was the lifetime wishes and behests of President Kim Il Sung and leader Kim Jong Il to spruce up Wonsan area.

Marshal Kim Jong Un launched a big operation for building Wonsan area into a world famous tourist city, model of city formation, with noble intention to bring about a fresh turn in building a highly civilized socialist nation and dynamically aroused the whole party and country to the drive for doing so, they said.

They called for launching vigorous campaigns to carry out the behests of Kim Il Sung and Kim Jong Il and defending the party’s policies to powerfully demonstrate the might of Songun Korea in construction once again.

At the end of the ceremony they started projects including dwelling houses at the entrance of Kalma Street in Wonsan City.

Here is coverage by the Institute for Far Eastern Studies (IFES):

Wonsan: Start of Construction as ‘Global Tourist City’

The state-run Korean Central News Agency (KCNA) has reported that the groundbreaking ceremony for the Wonsan region took place on May 20, 2015 on Wonsan city’s Kalma Street.

The KCNA explained that “in accordance with the plans of the Korean Workers’ Party, the Wonsan region will be vigorously transformed into a global tourist city.” It also reported that Vice Premier of the Cabinet Kim Yong Jin was in attendance at the groundbreaking ceremony.

According to attendees at the ceremony, “The proper management of the Wonsan region is the will of Comrade Kim Il Sung and Comrade Kim Jong Il as well as their earnest dying injunction.” They also stressed that “Comrade Kim Jong Un is committed to bringing about a new change in the construction of a civilized socialist state and has unfolded a magnanimous strategy for managing the Wonsan region as a model of city development and global tourist cities.”

The KCNA reported that after the ceremony ended construction was started on private homes near the entrance to Kalma Street.

The ‘Wonsan-Kumgangsan Tourist Region’ was announced as a central-level Special Economic Zone (SEZ) on June 11, 2014 by way of an ordinance by the Standing Committee of the Supreme People’s Assembly (SPA). It is part of the large-scale tourism belt that includes Wonsan district, the Masikryong Ski Resort, Ullim Falls, and the Sogwansa, Tongchon, and Kumgangsan districts.

The KCNA confirmed that the Wonsan development was the “will” and “dying injunction” of Kim Il Sung and Kim Jong Il, offering as evidence the fact that Kim Jong Il made the development of the Wonsan-Kumgangsan Tourist Region a recent priority of North Korea’s foreign economic sector.

In his 2015 New Year’s address, Kim Jong Un proclaimed to the people, “We need to multilaterally develop foreign economic relations and actively push forward the development of economic development zones like the Wonsan-Kumgangsan Tourist Region.” Also, in February 2015, the Workers’ Party of Korea (WPK) Central Committee and Central Military Commission presented ‘joint slogans’ for the 70th year anniversary of the country’s liberation and the Party’s founding. Among those presented was the slogan, “Let’s actively push forward the economic development of the Wonsan-Kumgangsan Tourist Region!”

In May 2015, North Korea took the ‘18th Pyongyang Spring International Product Exhibition’ as an opportunity to hold an investment briefing session regarding the development of the Wonsan-Kumgangsan Tourist Region. Another on-site investment briefing at Kumgangsan is slated for six days beginning May 25, 2015.

Regarding the upcoming briefing, O Ung Gil, general manager of the Wonsan Area Development Corporation, said, “At the investment briefing, topics such as the favorability of the development zone (which has abundant tourist attractions), the legal environment, its current state, and the overall development plan will be revealed. […] All entrepreneurs and businessmen who have an interest in development in the region are welcome to attend.”

Share

US group seeks to seize Mudu-bong

Tuesday, June 30th, 2015

According to the Jerusalem Post:

Shurat Hadin – Israel Law Center on Tuesday requested that Mexico permit it to seize an impounded North Korean ship to satisfy a $330 million it won against Pyongyang in April in a US civil damages trial for wrongful killing of a Christian priest.

Mexico impounded the 6,700-ton Mu Du Bong for illegal weapons smuggling on its way from Cuba to North Korea following notification by UN sanctions monitors that the ship belonged to a blacklisted firm. The ship ended up accidentally landing on the Mexican coast and North Korea has protested Mexico’s continuing to hold on to the ship.

The Tel Aviv-based NGO hired Mexican lawyer Alberto Mansur to request that Mexico honor and enforce the US court ruling as part of its obligations to honor foreign judgments under the Hague Convention.The April judgment, which also included findings by a US federal court in Washington that North Korea had kidnapped, tortured and killed South Korean-American Rev. Kim Dong Shik, included $15m. each to Shik’s son and brother as well as $300m. in punitive damages.

Dong Shik, a South Korean who was a permanent resident of the US and had spent seven years providing aid and proselytizing to North Korean defectors who tried to escape via China, was abducted in China in 2000. In 2005, a South Korean court convicted an ethnic Korean of his abduction in concert with North Korean intelligence.

Shurat Hadin said that it hoped that the context of the requested seizure, the North Korean outlaw regime ignoring weapons smuggling laws and flouting UN resolutions, would help its case since it tied into Pyongyang’s massive human rights violations in abducting and murdering innocent persons, which was at the heart of the Dong Shik judgment.

The judgment was a default judgment in which the defendant, North Korea, did not even appear at trial, leading most to predict that it would go unenforced since default judgments are notoriously hard to collect on, especially with a regime such as North Korea, which has few connections to the West.

After the April judgment, Shurat Hadin said the family was investigating all the possible avenues to collect the judgment against North Korean assets including seizing bank accounts, property and shares in foreign companies in the United States and abroad.

But even Shurat Hadin admitted that Mexico’s seizure of the ship was a shocking gift and unexpected opportunity to collect on the judgment. The NGO’s President Nitsana Darshan- Leitner said that “North Korea should know that we are actively tracking its assets and looking to seize them everywhere in the world. This outlaw regime must be taught that it cannot abduct and murder foreign citizens and that eventually there will be a price to pay.”

“There is no reason why this boat which clearly belongs to North Korea cannot be used to satisfy our judgment,” she said.

In the April judgment against North Korea, the court said that the two $15m.

and the $300m. damages awards were consistent with comparable cases against North Korea and Iran for other similar wrongful actions and recognized the tremendous suffering by Dong Shik’s family members.

In December 2014, Shurat Hadin convinced a US federal appeals court to grant default judgment against North Korea on liability, paving the way for April’s massive damages award by the lower district court.

The ruling by the US Appeals Court for the District of Columbia, written by Judge David S. Tatel, reversed an earlier district court ruling that had dismissed the case, despite North Korea failing to defend itself, on the grounds that the plaintiffs had failed to present any direct evidence of what happened to Dong Shik.

The appeals court based its ruling on proof that Pyongyang kidnapped Dong Shik, a wealth of information about it torturing and killing prisoners, its systematic attempts to block direct evidence from emerging and its failure to counter the plaintiffs’ claims.

The ruling was also significant because it allowed a case to go forward based on the “terrorism exception” to the US Foreign Sovereign Immunities Act, which somewhat broadens the paths and precedents open to suing foreign nations for terrorist acts.

Read the full story here:
NGO seeks to seize N. Korean ship to pay off $330 m. US judgment for killing of priest
Jerusalem Post
Yonah Jeremy Bob
2015-6-30

Share

DPRK’s mixed signals on market labor regulations under Kim Jong-un

Monday, June 29th, 2015

UPDATE 1 (2015-6-29): Men under 60 banned from market activities. According to the Daily NK:

With Kim Jong Un at the helm of North Korea, the age limit for commercial activities has been removed for women; for men, however, this limit has recently been raised, allowing only those in their 60s or over to enter market life.

This runs contrary to not long ago, when one could easily spot men in their 40s inhabiting stalls in the marketplace, often selling shoes or offering bike repair services– a common occurrence since residents took to market activities to cope with the widespread famine ravaging in the mid-1990s.

This has changed in almost an instant under the new mandate. “Actions have been taken so that men under 60 cannot run businesses in the jangmadang (market), as the Central Party demands that men should remain loyal to their workplaces,” a source from Yangkang Province informed Daily NK through a telephone conversation on June 26th.

Daily NK’s sources in two other provinces confirmed the news of this directive but for their safety their locations remain confidential.

“At markets in Hyesan there used to be men in their 40s running shoe repair business, cigarette stands or barbershops. But they’re all gone now, and even the stores such as bike shop or key repair shop are being run by men in their 60s,” the source added.

Men’s role in the marketplace has been rigidly controlled since the Kim Jong Un came to power, aimed at preventing workers from doing business rather than fulfilling their roles at state-run factories and enterprises. Women, however, have enjoyed relative freedom in their commercial activities.

Some men have long turned to offering up ‘8.3 money’ to escape the workplace and go out to try their hand at doing business.

The term ‘8.3 Money’ is related to a program of limited enterprise autonomy put in place by Kim Jong Il in 1984. As part of the plan, workers are encouraged to earn money outside their state-mandated workplaces and present de facto tax payments back to their employers. Such contributions are not necessarily defined in monetary terms: wild edible greens and valuable medical herbs (some of which fetch a high price in China) can also be contributions, for instance.

“Most of these men run wholesale or transportation of goods, carrying goods for retail dealers using ‘servi-cha.’ Some men under 60, who once sold goods in the jangmadang, have now turned to the transportation business,” he explained.

In the past, trains were almost the only viable means of long-distance transportation in North Korea. Then, as private business began to grow and the railways further deteriorated, vehicles such as trucks and cars belonging to military bases, state security and state enterprises were pushed into service to earn money for moving people, known as the ‘servi-cha’ industry.

“Even at the beginning of the last year there were many young men selling coal briquettes, salt and other food products [at markets in Pyongsong] but now they’re nowhere to be found,” the source said, citing a merchant from Pyongsong, South Pyongan Province.

Women’s relative freedom in doing business has created avenues for men despite to stay in the game, allowing them to team up with a female counterpart in order to evade the new directive, he said, explaining that in these cases, “men take care of transportation and wholesale of goods, while women take care of actual selling of goods. In this way, they can avoid the regulations.”

According to the source, the Kim Jong Un era has seen little control over people’s market activities. As a result, the number of stores has increased in most of the marketplaces in the whole country, vitalizing residents’ commercial activities.

The logic behind the freshest regulation is that to the extent that the regime has allowed commercial activities–an autonomous means of living for the people who have been suffering chronic shortages of food–men should devote themselves to their state-ordered workplace.

ORIGINAL POST (2015-3-23):  It appears there is an informal easing up on unauthorized street vendors near marketplaces. According to the Daily NK:

Alley merchants [also known as grasshopper merchants]– those who sell goods in alleyways to avoid crackdowns by Ministry of People’s Safety [MPS] officials–are now referred to as “tick merchants,” a term coined after their rapid proliferation, according to sources within North Korea.

Affiliated with city and county People’s Committees throughout North Korea, official marketplaces are run by a management center, charged with collecting and handling fees for vendors renting stalls from which to sell their sundry goods.

However, securing a location for their operations is not feasible for a multitude of residents. “Many don’t have enough money to afford to pay for a stall in the marketplace, so they either sell goods in the alleys of villages or by crossroads in close proximity to the jangmadang [North Korea’s system of markets],” a source in North Pyongan Province told Daily NK on February 9th.

Regulation of these “alley merchants,” of whom there are countless numbers, is carried out by the Ministry of People’s Safety and patrol units falling under its umbrella. Frequently, these officials are know to extort merchants under the pretense of regulating illegal market activity, confiscating their goods, only to turn around and return the merchandise as soon as their bribe demands have been met.

Despite the incessant threat of crackdowns and extortion by these officials, “grasshopper vendors” are determined to continue selling their items, desperate to hold onto their “lifelines,” according to the source, who noted a marked difference in this particular sector of the market economy since just last year.

Of this situation, she said, “With February 16th [Kim Jong Il’s birthday] fast approaching, the number of alley merchants has surged [to sell goods for residents preparing for the holiday], as has the number of MPS officials.” She went on to explain that last year, however, these “grasshopper merchants” largely abided orders, fleeing the premises after the MPS units arrived for fear of the repercussions. But this year most are staying put in these makeshift alleyway market areas, even saying things to the officials like, ‘If we got our rations, do you think we would be putting ourselves through this?’

This is how the newly coined term, ‘tick merchant’, came into existence: derived from a common expression in North Korea–regarding how impossible ticks are to remove and keep away before another comes along–these merchants are much the same–refusing to budge despite the consequences, determined to claim their spot in the market system.

Recently, investigations launched by the Central Party, aimed at rooting out reckless misconduct of MPS officials toward residents, are also thought to be contributing to the ease on regulation of these alley merchants. This, coupled with the bribe culture continually infiltrating the “tick merchant” realm–just as in the rest of North Korea–has seen the number of those engaged in these operations spike; nominal bribes of cash or goods ensure, at least for the time being, that they can do business in relative peace. Not unlike those with official stalls inside the market, some even reportedly pay periodic fees directly to the market management, all but guaranteeing their exemption from regulation.

The residents, and even the MPS officials themselves, are not overly preoccupied with regulations and clampdowns, because, as the source put it, “it becomes increasingly difficult for officials to crackdown on merchants selling in the surrounding areas of the markets, entirely reliant on selling goods to survive.”

Many are concerned that the leniency pervading these alley way operations may be fleeting, but the source asserted things will never return to the past. “When the investigations on the Ministry of People’s Safety officials are over, regulation of the alley markets is expected to become stringent again. Still, at this point, it’s next to impossible for these officials to make residents, largely dependent on business to maintain their livelihoods, obey them, meaning eradicating these ‘tick merchants’ is just as improbable,” she concluded.

And the DPRK has begun lifting age restrictions on market vendors. According to the Daily NK:

Amid relaxation of restrictions on market activities, the North Korean authorities began lifting age restrictions for vendors at the end of last year in some regions and, more recently, scrapping the ban nationwide.

“The authorities have been quite lax with clampdowns and regulations of official markets as of late,” a source in Yangkang Province reported to Daily NK on March 20th. “Those previously not permitted stall rights to sell their products are now being granted these privileges, greatly increasing the number of stalls. Also, women below the age of 50 are no longer prohibited from selling at the markets.”

In the absence of age restrictions, markets have seen a marked increase of women selling goods there. According to the source, the North Korean authorities previously regulated trade activities by women under 50 to deter shirking of ideological study sessions or–even more importantly– nationwide mobilization directives for agricultural or construction efforts, The authorities compromised by granting these women permission to participate in these compulsory organization activities only in the morning, freeing up the afternoon for market activities.

“Since last year, the authorities didn’t really implement clampdowns and have even showed a great deal of leniency to those selling in the alleys. As a result, women who previously idled away at home have been propelled into market life, selling everywhere they can,” she explained.

Unsurprisingly, most women are perplexed, if cautiously elated, by the leniency shown by a system that has wielded such stringent power and regulation over them for so long. “The shift in sanctions feels like hell has frozen over,” many have remarked, adding that they “finally have the opportunity to make ends meet.” Still, many are wary, noting that “you never know when the authorities will abruptly declare a new policy or revert to stringent clampdowns.”

She added that while the state did not lift the restriction to “improve people’s lives” as it claims, it has had a positive impact nevertheless. According to the source, North Korea’s motives for the lift begin and end with procuring funds. “There are thousands of stalls in Hyesan Market; this yields huge profits for the state who collect the fees vendors pay to use the space,” she pointed out.

That said, she maintained a sanguine outlook, remarking how empowering it is to see women effecting change in the markets by expanding their inroads into this sector, while making significant, if not dominant, fiscal contributions within their individual households. “Whereas there were only older women in the markets in the past, you can now easily spot women in their 20s and 30s in the industry,” she explained.

Surprisingly, the reduced regulations have increased rather than diminished participation in state mobilization efforts– such as compost collection or “loyalty singing sessions”– because women are afforded a bit more breathing room from unceasing concerns about how to secure their next meal. The positive results are already palpable, according to the source, who said that “most families are better off now due to women’s increased forays into the market domain.”

Read the full story here:
Crackdowns Ease Up on Alley Merchants
Daily NK
Seol Song Ah
2015-02-11

NK Lifts Market Age Restrictions
Daily NK
Kang Mi Jin
2015-03-23

Share

North Korean-style venture company develops and sells PCs

Wednesday, June 24th, 2015

Institute for Far Eastern Studies (IFES)
2015-6-24

A North Korean electronics company, where engineers in their 20s play a pivotal role, is mass-producing and selling locally made computers that are enjoying popularity due to their high quality and low price.

A correspondent in Pyongyang for the Choson Sinbo reported on June 16, 2015 that North Korea’s ‘Blue Sky Electronics’ is developing, mass-producing and selling various electronic products, including domestically produced computers under the ‘Blue Sky’ brand.

According to the Choson Sinbo, Blue Sky Electronics, which was established in October 2014, is locally developing, producing and selling these computers, which are manufactured at a factory on Tongil St. in Pyongyang.

It is reported that the researchers behind the computers are mostly in their 20s and graduates of Kim Il Sung University, Kim Chaek University of Technology, and the College of Natural Sciences. They are producing products such as ‘all-in-one’ computers, ‘portable’ computers, ‘desktop-type’ computers and ‘portable computers with detachable keyboards.’

The ‘all-in-one’ computers refer to computers that incorporate the desktop and monitor into one body, while ‘portable’ computers and ‘desktop-type’ computers refer to notebook computers and desktops, respectively. ‘Portable computers with detachable keyboards’ seem to refer to computers that double as both tablet computers and desktops.

The newspaper reported that among these, the ‘all-in-one’ computer and the portable computer with a detachable keyboard are especially popular, and orders for these computers are steadily coming in from a number of agencies and companies throughout the country.

The ‘all-in-one’ computer, which has a unique exterior, is said to consume little energy and can be charged using a household battery. Meanwhile, the portable computer with detachable keyboard, which can also be charged using a household battery, has reportedly enjoyed much popularity since it went on the market.

CEO Choi Jin Hyok (29 years old) explained succinctly the company’s business strategy: “Highest quality, lowest price, and product diversification.”

The newspaper added that the company is “developing products that are competitive internationally.” In addition, it was said that “[Blue Sky Electronics] guarantees the highest quality so that buyers can have confidence regarding its domestically made products, and everything in the company’s management is aimed at prioritizing the needs of the people in all aspects of purchasing and service.”

Share

Samgak Beer

Wednesday, June 24th, 2015

Choson Exchange has let the world know about a new North Korean beer: 삼각맥주

samgak-beer

The name means “triangle” beer, or more accurately “river delta” beer.

It is manufactured at the Rajin Drink Factory (라진음료공장). I do not know where this factory is located, so please let me know if you happen to learn.

Share

KKG in Pyongyang

Wednesday, June 24th, 2015

UPDATE 4 (2015-7-6): Stephan Haggard provides some additional information on Queensway Group/KKG.

UPDATE 3 (2015-6-24): Writing in the Financial Times, Tom Burgis links Queensway Group/KKG with Office 39.

UPDATE 2 (2015-5-1): J.R. Mailey has much more information on the Queensway Group/KKG.

UPDATE 1 (2014-7-17): Over at 38 North, J.R. Mailey has uncovered much more information on KKG (Queensway Group) and linked it with the Kaesong High Tech Industrial Park.

ORIGINAL POST (2012-9-11): “Kumgang Street/KKG Avenue Project in Pyongyang”: Aggressive construction and re-development projects have taken place on Pyongyang’s Mansudae Street over the last few years as part of the DPRK’s “Strong and Prosperous Nation (강성대국)” policies. See Mansudae renovation no. 1 here and Mansudae renovation no. 2 here.

Residential construction projects, however, have been limited neither to Mansudae Street (See here, here, here, here, hereherehere, here) nor to Pyongyang. In the interest of [my] time, I will offer only the most recent example: There are reports of an ambitions real-estate project in Chongjin, though satellite imagery in the area is too old to confirm the project or evaluate its size/scope.

However, a recent tourist photo taken in Pyongyang near the Tongil Market reveals yet another ambitious plan for residential development in Rakrang-guyok (락랑구역). It is unclear how long this project has been planned or if/why it appears to be on hold. Here is the photo of the billboard:

Click here to see a larger version of this photo on flickr.

According to the billboard, this project bears the name “Kumgang Street” in Korean (금강거리) and “KKG Avenue” in English. The operation appears to be run by 금강경제개발총회사 (The Kumgang Economic Development Corporation). A quick Google search for “금강경제개발총회사” yields pleanty of results, but all of them are in Korean–meaning it will be excruciatingly painful for me to do any research on this organization. If you can determine anything else about this project, please let me know.

From what I can tell, this effort is set to take place just north of the Tongil Market (conspicuously absent from the billboard, though enhanced with a wide avenue and bridge to Yanggak Island). Here is the approximate location as seen on Google Earth (I have added the position of the proposed Yanggak Bridge to make the comparison easier):

According to the billboard, the Mullet Soup Restaurant on the bank of the Taedong River will be part of the finished project.  The remainder of the land looks like it has been cleared and prepared for the development project, although historical imagery on Google Earth indicates that this land has been largely unused for decades. The image below dates from 2000-6-12:

 According to “The Skyscraper Center” the tallest building(s) in the new development will be 274m/899 feet.

I have been able to find out little more about this project. Again, if you can find additional information, please let me know.

Share

Yanji – DPRK charter flight resumes

Sunday, June 21st, 2015

According to Xinhua:

An oft-suspended tourist route between China and North Korea has been reopened after its latest closure.

A charter flight carrying 73 tourists left from Yanji, in the Korean autonomous prefecture of Yanbian in northeast China’s Jilin province, for Pyongyang in North Korea on Thursday.

The route will be open until early October, with a planned 32 charter flights on Thursdays and Sundays. All seats on the flights in June have been booked, according to Yanbian Tianyu Travel Agency, which runs the route with North Korea’s Air Koryo.

A four-day trip costs 3,980 yuan (US$650) per person while a five-day trip costs 4,480 yuan (US$720) per person, according to the agency.

The route between Yanji and Pyongyang was first opened in July 2012, but it was closed for the whole of 2013 due to tensions in North Korea. It resumed on June 29 last year and was suspended again in October. A total of 90 flights had been completed on the route by October.

Read the full story here:
Yanbian-Pyongyang tourist route reopens
Xinhua
2015-6-21

Share

Mongolian mining firm to export coal from Rason

Friday, June 19th, 2015

According to the Reuters:

A Mongolian coal miner has signed a deal with a shipping company to deliver its coal via Russia to North Korea’s Rason port, part of the landlocked north Asian nation’s efforts to find new ways to reach overseas markets such as Japan and South Korea.

Miner Sharyn Gol signed a binding agreement on Friday with Mongol Sammok Logistics to ship its coal to Rason, where Mongolia already has an agreement with North Korea that gives its exporters preferential treatment at the port.

Mongolia currently ships the bulk of its mostly resource-based exports to China, leaving its economy dependent on its powerful southern neighbour and putting it at a disadvantage when it comes to negotiating prices.

“This is a pretty historic deal,” said James Passin, who controls Mongolian Stock Exchange-listed Sharyn Gol through the New York-based Firebird Mongolia Fund.

“This deal has to be viewed in the context of international relations and diplomacy,” he told Reuters on the sidelines of a signing ceremony.

Sharyn Gol currently has no sales agreements in place with any potential overseas buyers, Mr. Passin said, adding that he could not disclose any further details.

Mr. Passin declined to reveal any estimated delivery cost for shipments from the Sharyn Gol mine to Rason, but pointed to the preferential treatment at the port and the Russia exports that already go through there to South Korea.

South Korea has at least twice in the past year taken deliveries of Russian coal from Rason, with steelmaker POSCO one of the regular buyers, according to a company spokesman.

Namgar Algaa, executive director of the Mongolian Mining Association, said opening up new markets would allow Mongolian miners to manage the risk of slowing Chinese growth.

China’s weakening growth this year has meant its coal imports from Mongolia fell 6.9 percent across the first four months of the year to 5.2 million tonnes.

 

Read the full story here:
Mongolian miner signs deal to ship coal to North Korea
Reuters
2015-6-19

Share

Samjiyon Railway Line

Wednesday, June 17th, 2015

New-Samjiyon-Line-2015

Pictured Above (Google Earth): The new Samjiyon railway line route (in blue) and the original narrow gauge line (in white)

UPDATE (2015-11-18): According to the Pyongyang Times:

Broad-gauge railroad construction makes good headway

The project for building a broad-gauge railway between Hyesan and Samjiyon is being pushed briskly.

According to information available, the work for roadbed has been carried out by 80 per cent and that for small structures by over 70 per cent as of mid-November.

The field construction headquarters set a goal to speed up the construction of roadbed, railway bridge, tunnel and retaining wall for the first-stage assignment and complete the building of small structures by the end of this year, and is concentrating all efforts and means on its implementation.

To wind up wet project before the soil is frozen it is organizing the guidance over the execution of construction scrupulously while seeking the ways to carry on construction uninterruptedly even in winter.

Every construction group ensures that the flames of creating a new Korean speed flare up in all construction sites by arousing the enthusiasm of members of the shock brigade.

In the wake of having cut two tunnels through, the members of the South Hwanghae provincial construction group are pushing the projects for roadbed, retaining walls and small structures in a three-dimensional way.

Ministries and national agencies, the Pyongyang municipal construction group and the northern railway construction youth shock brigade have completed the construction of three railway bridges.

The flames of innovation for rounding off the projects as soon as possible are also blazing up at the workplaces of the North and South Hamgyong provincial construction groups.

Though working at the section with the most unfavourable working conditions, the members of the Jagang provincial construction group overfulfil their assignments two or three times every day.

Builders are making collective innovations in every workplace while putting the main stress on ensuring the speed and quality of construction.

UPDATE 3 (2015-10-7): Naenara announces that work has begun on the new line. You can read the PDF here.

UPDATE 2 (2015-6-17): I discuss this new railway project on Radio Free Asia.

UPDATE 1 (2015-6-4): KCNA announces work on Samjiyon railway line. According to the article:

A broad-gauge railroad from Hyesan to Samjiyon will be constructed.

A ground-breaking ceremony took place before the Samjiyon Grand Monument on Thursday.

Present there were O Su Yong, secretary of the C.C., the Workers’ Party of Korea, officials concerned, builders and working people in Samjiyon County.

The participants laid bunches of flowers before the statue of President Kim Il Sung at the Samjiyon Grand Monument and paid tribute to him.

O Su Yong made a report to be followed by speeches.

The reporter and speakers said the construction of the new railroad is a sacred work for glorifying forever the immortal exploits performed by Kim Il Sung and leader Kim Jong Il in the area of Paektu and their revolutionary careers.

They called on all builders to wind up the project as scheduled by overcoming hardships and difficulties.

ORIGINAL POST (2008-10-19): According to the Daily NK:

North Korean authorities have started construction for expanding the railway connecting Hyesan, Yangkang Province and Samjiyeon from a narrow to a broad railroad.

An inside source from Yangkang Province relayed in a phone conversation with the Daily NK on October 16th, that “Since the 1st of this month, the ‘Shock Brigade for the Propagation of Party Ideology (the June 18th Shock Brigade)’ came and started preparing for expanding the railway between Hyesan and Samjiyeon. Now, they are building housing for brigade members who will begin construction in early November.”

According to the source, the Hyesan-Samjiyeon railway was a “narrow gauge (railroad)” which connected the rail between Hyesan and Bocheonbo to Samjiyeon Lake in the mid-1980s and only small cars which fit 38 people could travel on it. Not only was it a railroad on which small trains could travel, it suffered significant damage in the 1994 mass flood and ceased operations until recently.

The North Korean authorities believed that Samjiyeon played an important role to propagandize Kim Il Sung and Kim Jong Il’s revolutionary ideology, so they attempted to build a “broad gauge” between Hyesan and Samjiyeon when Kim Il Sung was alive. However, the project is still under construction due to the nation’s weak financial predicament and rough construction environment.

The source relayed, “The number of construction workers totals approximately 50,000 people, including 30,000 ‘June 18 Shock Brigade members and 20,000 others mobilized from rural areas, enterprise officials, and farms. The area of construction is approximately 70km, but it is a rough, mountainous terrain, so the construction will not be easy.”

He also stated, “Currently, a part of the Shock Brigade have come in to build housing, but at the end of October, all members will come. The Shock Brigade is in charge of doing construction far from the city and in some places near the city, and the enterprise officials or farmers will take charge and lead the construction.”

At the news of the beginning of the railroad construction, citizens showed a welcoming and a concerned response.

The source said, “The merchants are glad at the opportunity to make money, but the farmers are all concerned that the number of thieves will increase on the farms. The place where construction will take place is near the border region, so smugglers are concerned that the border patrol will become toughened.”

The source added that, “The Shock Brigade mobilized for the construction has said that the construction has to be completed before the 100th anniversary of the Supreme Leader’s (Kim Il Sung) birthday in 2012. That is why people have been rushing to begin construction despite the coming of winter.”

The Los Angeles Times reported on the 27th of last month that the construction of high buildings has been rapidly taking place in Pyongyang and hotels and theaters have also been refurbished. The construction of the 107-story Ryukyung Hotel, which has been left under construction for a long time, also has resumed.

The LA Times pointed out the fact that such construction is taking place when the World Food Programme (WFP) has warned of an economic crisis as serious as in the mid-1990s, during which 2,000,000 starvation deaths resulted in North Korea, is simply miraculous and outrageous.

Read the full story here:
Railway Construction by Kim Il Sung’s 100th Birthday Takes Precedence
Daily NK
Lee Sung Jin
2008-10-19

Share

North Korea’s trade volume in 2014: $7.6 billion USD

Wednesday, June 17th, 2015

Institute for Far Eastern Studies (IFES)
2015-6-17

Last year North Korea’s foreign trade volume (excluding economic exchanges with South Korea) totaled 7.6 billion USD, a 3.7 percent increase over the previous year. According to a report recently put out by KOTRA (Korea Trade-Investment Promotion Agency) entitled “North Korea’s International Trade Patterns in 2014,” last year North Korean exports totaled 3.16 billion USD, while imports totaled 4.45 billion USD. This represents a 1.7 percent decrease in exports and 7.8 percent growth in imports over the previous year. As a result North Korea’s trade deficit in 2014 leaped to 1.29 billion USD, a 41 percent increase over 2013. This expansion of trade appears to be a product of growth in the import of goods such as plastics, machinery and electricity, as well as growth in the export of clothing.

Among North Korea’s main exports, mineral fuels such as coal, at 1.18 billion USD, represented 37.2 percent of total exports and was the country’s main export product. Meanwhile, exports of clothing and components saw the biggest growth rate, at 23.7 percent, and amounted to 640 million USD. In regards to other exports, iron ore totaled 330 million USD (18.3 percent decrease over 2013), fish and crustaceans totaled 140 million USD (21.9 percent increase), and steel amounted to 130 million USD (22 percent increase).

North Korea’s main imports were as follows: mineral fuels (750 million USD – 4.7 percent decrease), electric equipment (430 million USD – 54.8 percent increase), furnaces and machinery (330 million USD – 3.3 percent increase), motor vehicles and parts (230 million USD – 9.6 percent decrease), and plastic (200 million USD – 31.8 percent increase).

It appears North Korea’s main trading partner is still China. Last year its trade volume with China reached 6.86 billion USD (exports – 2.84 billion USD, imports – 4.02 billion USD), a 4.9 percent increase over 2013. This contributed to a slight increase in North Korea’s reliance on trade with China. Its proportion of trade with China went from 89.1 percent in 2013 to 90.1 percent in 2014. After China, the countries that North Korea traded most with were Russia, India, Thailand, and Bangladesh, in that order. Hong Kong and Ukraine dropped off the list of North Korea’s top ten trading partners, and Pakistan and Germany newly appeared on the list at 8th and 10th place, respectively. Trade with Japan has been nonexistent since 2009. Due to its economic sanctions against North Korea, the United States also had no economic exchanges with North Korea in 2014 outside of relief aid, mostly in the form of medical supplies and equipment.

As North Korea’s over-reliance on trade with China continued, its trade deficit widened due to the decrease in exports and surge in imports. Considering factors such as the complementary trade structure (including contract processing and natural resource trade), the protraction of North Korea’s political and economic isolation, and their highly interdependent relationship, it seems likely that North Korea’s strong reliance on trade with China will continue in the future.

[NOTE: KOTRA data excludes inter-Korean trade. If South Korean trade were included, it would be North Korea’s second largest trading partner, and the composition of trade allotted to China would fall.]

Here is coverage in Yonhap:

North Korea’s global trade expanded in 2014 from a year earlier, but its trade deficit also widened due to a drop in exports, a report showed Friday.

According to the report by the Korea Trade-Investment Promotion Agency, North Korea’s trade came to US$7.61 billion last year, up 3.7 percent from a year earlier. The figures did not count its trade with South Korea.

North Korea’s exports shrank 1.7 percent on-year to $3.16 billion last year, while imports grew 7.8 percent to $4.45 billion over the same period, the report showed.

Based on the figures, North Korea posted a trade deficit of $1.29 billion last year, with its shortfall jumping 41 percent from the year before.

Minerals and fossil fuels, including coal, were among the country’s major export items as its overseas sales stood at $1.18 billion, which accounted for 37.2 percent of its total annual exports.

The report showed that North Korea continues to depend heavily on China for its trade.

Last year, bilateral trade between the two countries reached $6.86 billion, up 4.9 percent from a year earlier. North Korea’s dependence on China in trade increased slightly from 89.1 percent in 2013 to 90.1 percent last year, according to the report.

Read the full story here:
N. Korea’s global trade expands but trade gap widens: report
Yonhap
2015-6-5

Here is coverage in UPI:

South Korea’s trade promotion agency KOTRA stated North Korea’s trade with the outside world rose to $7.61 billion in 2014, a marginal increase from the previous fiscal year.

In its annual report on North Korea trade trends released Friday, KOTRA noted North Korean exports scaled down while demand for outside materials was up between 2013 and 2014, Yonhap reported.

Numbers indicated North Korea’s exports decreased by 1.7 percent to $3.16 billion in 2014, while imports rose by 7.8 percent to $4.45 billion.

North Korea’s trade deficit jumped to $1.29 billion, up 41 percent from 2013.

In 2014 North Korea imported more electrical equipment, machinery and plastics than it did a year earlier, while exporting more clothing and accessories, according to KOTRA.

The country’s primary export is coal, a trade valued at $1.18 billion and comprises 37.2 percent of North Korea exports.

Clothing and accessories inched up in its share of total exports, rising to $640 million – up 23.7 percent from 2013.

The country’s primary import was fossil fuels at $750 million, followed by electrical equipment at $430 million and boilers, machinery at $330 million.

China remained North Korea’s No. 1 trading partner, reported South Korean newspaper Kyunghyang Sinmun.

In 2014 China-North Korea trade inched up 4.9 percent to $6.87 billion. North Korea imported more than it exported from China. Exports were estimated at $2.84 billion while imports totaled $4.03 billion.

A KOTRA official told Yonhap North Korea’s protracted political and economic isolation has led to a high dependence on trade with China, facilitated by a complementary trade structure between the two countries.

South Korea’s report stated North Korea’s trade dependence on China was as high as 90.1 percent, dwarfing Pyongyang’s next major trading partner, Russia, as well as India, Thailand and Bangladesh.

Read the full story here:
North Korea’s trade deficit continued to grow, says SKorea
UPI
Elizabeth Shim
2015-6-4

Here is coverage in the Joong Ang Ilbo:

North Korea’s international trade volume reached $7.6 billion in 2014, rising by 3.7 percent year-on-year, according to a report on Friday by the Korea Trade-Investment Promotion Agency (Kotra).

The growth was backed by Pyongyang’s increased import of electronic devices and machinery and its rising export of clothing, according to the agency.

Kotra said North Korea’s export volume was worth $3.2 billion last year, a 1.7 percent decline from the previous year.

On the other hand, the reclusive state imported $4.5 billion worth of goods, up 7.8 percent. The widening disparity between imports and exports extended the North’s trade deficit by 41 percent to $1.3 billion.

China remained Pyongyang’s biggest trading partner in 2014, the report said, followed by Russia, India, Thailand and Bangladesh. Its trading volume with China increased to $6.9 billion, with imports from that nation accounting for $4 billion and exports $2.9 billion. The overall figure is a 4.9 percent increase from 2013, nudging up the North’s overall degree of dependence on foreign trade with China to 90.1 percent from 89.1 percent.

Hong Kong and Ukraine were no longer in the North’s top 10 trading partners, but Pakistan and Germany made their way onto the list. By contrast, Japan has not traded with the North since 2009, while the United States only provided it with aid and medical equipment.

Kotra noted that the North’s key export products include mineral resources such as coal and brown coal, which account for 37.2 percent of all its exports. Clothing and fisheries products were also among its major exports, with garment shipments recently seeing rapid growth.

The country’s other major export products consist of crude oil, refined oil, machinery, electronic devices, cars and auto parts. The value of resource imports decreased by 4.7 percent last year, while those of electronic machines surged by 54.8 percent.

Kotra expects that the North will continue to rely on its neighboring key ally going forward.

“2014 saw increasing dependence on China, while North Korea extended trade deficits due to the increase in imports and the decline in exports,” Kotra said in a statement. “When considering geopolitical factors and mutually beneficial trade structure, the North is expected to show further reliance on China.”

The Korea Development Institute, a state-run think tank, released its own report that paints dim prospects for the North’s exports.

The institute said the North’s exports of anthracite coal to China are expected to fall in the years to come due to China’s dwindling steel industry and stronger environmental regulations. Its exports of the coal to its ally have been considered the backbone of its economy, accounting for about 40 percent of its overall exports.

The report called on the North to reorganize its trade structure in order to avoid being seriously affected.

“The time has come for North Korea to reshape its external trade structure,” it noted.

Read the full story here:
North’s trade volume rises
Joong Ang Ilbo
2015-6-6

Share