Archive for the ‘China’ Category

Smuggling between China and North Korea still prevalent

Wednesday, October 22nd, 2014

Institute for Far Eastern studies (IFES)

On October 15, 2014 Chinese media reported that smuggling along the China-North Korea border, which responds sensitively to North Korea’s situation, is still prevalent and that no particular changes have been detected internally within North Korea.

According to Huanqiu, the website of the Chinese nationalistic tabloid The Global Times, smuggling along the borders of the Liaoning and Dandong provinces has continued to persist in spite of recent flurry of rumors over Kim Jong Un’s whereabouts.

A source familiar with the smuggling situation on the border was quoted as saying, “If tensions were truly rising within North Korea, the very first thing to react would be the border guards, quickly followed by the suspension of smuggling activities.” The source continued, “However, smuggling has so far been unaffected.”

The newspaper captures the scene of a smuggling operation which took place on the night of the 13th near Wollyang Island, a small island on the Yalu (Amnok) River between Dandong and the North Korean city of Sinuiju. North Korean residents send signals to the Chinese on the other side of the river with a red light, to which the Chinese fishing boat responds with a green light. After exchanging signals back and forth, the two parties meet and the deal is finished quickly.

Smuggling along the China-North Korea border has been occurring for quite some time. Besides the smuggling of drugs, which the Chinese government punishes severely, trade products such as food and other daily necessities dear to the North Korean lifestyle have been overlooked for the most part.

Previously, commonly smuggled goods consisted of cooking oil, rice, clothes, and used electronics. However, according to the Huanqiu news, products such as cellphones, PCs, washing machines and refrigerators are also being traded for.

Local sources explained that high ranking “level 1” officials at the provincial and county levels are mainly responsible for ordering these types of products, and that many of the tablet PCs used by high level executives in Pyongyang have been smuggled in through China.

Huanqiu news also introduced another source, who was quoted as saying, “Pyongyang officials are involved in all large scale trade operations along the border. We have connections to high officials in North Korea’s State Security Department, but without them, we cannot do anything.”

Despite the fact that smuggling has been occurring for quite some time, there was a brief slowdown after border security was strengthened immediately following the execution of Jang Song Thaek, former vice chairman of the National Defense Commission in late 2013.

Meanwhile, Huanqiu news also reported that the Third Annual North Korea-China Economic, Trade, Culture and Tourism Expo opened as planned from October 16 – 20 in China’s Dandong province. It was also reported that both legal trade between the two nations and Chinese tourism to North Korea are progressing normally, regardless of recent speculations.

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Sharp increase in grain imports from China in second half of 2014

Thursday, October 16th, 2014

Institute for Far Eastern Studies (IFES)

It appears that North Korea has drastically increased Chinese grain imports in the months of July and August compared to the first half of 2014. Up until June, North Korea had imported a total of 58,387 tons of grain from China at nearly 10,000 tons per month. However, in July and August, North Korea imported 19,559 tons and 25,217 tons of grain, respectively. August showed the largest amount of grains imported per month so far this year, and the combined figures of July and August are equal to an astonishing 77 percent of the total amount of grains imported in the first six months of 2014.

The large increase in grain imports beginning in July is interpreted as an early move by North Korea to secure grain supplies for the winter after a double-crop harvest in June which failed to reach expected quantities, and a lackluster fall harvest compared to the previous year.

The grains North Korea has imported so far this year consist of flour (46.6 percent), rice (42.3 percent), and corn (8.9 percent), with flour and rice being the main imports. Compared to 2013, corn imports are down, but have been replaced by an increase in rice imports. Despite the sharp increase in grain imports during recent months, it appears that the overall food situation in North Korea has actually improved. North Korea imported a total of 103,163 tons of grain from January to August of 2014, a mere 59 percent of the 174,020 tons of grain imported during the same time period last year.

Chemical fertilizer imported from China up until August of this year has also decreased by an estimated 37 percent compared to the previous year, from 183,639 tons to 115,337 tons. This decrease in imported fertilizer is thought to be due to improvements made in fertilization equipment, leading to an overall higher rate of operation. It appears that the total amount of fertilizer used by North Korea this year should not differ greatly from the amount used last year, and fertilizer shortage is not expected to cause a major decrease in grain production.

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DPRK holds investor forum in Dalian

Monday, September 22nd, 2014

According to the JoongAng Ilbo:

North Korea held a rare investors relations event over the weekend and its more capitalistic and entrepreneurial manner hinted at a new openness to foreign investors and economic reform in general.

“The door is wide open. Come on in any time,” said Oh Eung-gil, president of North Korea’s Wonsan District Development General Corporation.

Oh was inviting South Koreans to invest in the North as he addressed a group of businessmen at an investors relations session at the Shangri-La Hotel in Dalian, China, on Saturday.

“We prepared all the conditions to develop Mount Kumgang and waited for the South to change its attitude,” said Oh. “But we can no longer wait, so we are trying to attract foreign investors. We have no intention to exclude the South.”

The investors relations event was arranged by the Dalian chapter of the World Federation of Overseas Korea Traders Association. About 200 Korean businessmen from around the world including Australia, China and the United States attended.

From North Korea, five delegates including Oh joined the event.

The North started its event with a presentation by Oh on the country’s laws governing foreign investments and the business environment.

“We have already simplified the investment application procedures and created regulations that meet international standards,” Oh said.

He spent a considerable amount of time to assuring businessmen that their investments, if made, will not vanish overnight.

“With Article 19 of the Foreign Investment Act, we promise that the assets of foreign investors and their companies won’t be nationalized,” he said. “If they are nationalized for an unavoidable reason, then we will make compensation for all costs.”

He also stressed that the North has abundant mineral and fisheries resources. With its 2 million educated workforce, who graduated from 300 universities, Oh said North Korea is the best place to make investments in Asia.

He said foreign companies that invest in special economic zones will only have to pay 14 percent corporate income tax and that the tax is even lower for some advanced technology industries. Making investments in the North’s infrastructure will also be tax-free, he said.

The North also held an unprecedented question and answer session. At similar events in the past, the North only made presentations without answering investors’ questions.

A businessman said he was afraid that the North Korean government could confiscate his investments, and Oh assured him that the government guarantees all legal investments by laws.

Oh even used humor to answer one businessman’s question.

“I would like to invest in hospitals,” the businessman said.

“Our [Democratic People’s] Republic of Korea offers free medical services, so it will be hard for you to make money,” Oh joked. “Please reconsider.”

Following Oh’s presentation, Ri Sing-ryol, vice president of the Wonsan District Development General Corporation, unveiled a development plan for the Wonsan-Mount Kumgang international tourism zone. He said the zone has 142 historic sites, 11 white-sand coasts and nine lakes, as well as 676 tourist venues.

The North’s Standing Committee of the Supreme People’s Assembly announced in June an ambitious plan to develop the area as an international tourism zone.

“Now that the Kim Jong-un regime is settled, the North’s top priority is resolving economic hardships and strong economic reform is being pushed forward,” said Jin Jiang, chairman of the Dalian Chapter of the World Federation of Overseas Korea Traders Association.

According to the Donga-Ilbo, the patchy subject of Hyundai Asan’s assets came up:

North Korea requested South Korea to make additional investment in Mount Kumgang and Wonsan areas, claiming that “it never confiscated the South’s property,” which it had forfeited and frozen in April 2010. Oh Eung Kil, general president of Wonsan district development company under the North’s external economy ministry, told South Korean reporters at an informational session on investment in the North in Dalian, Liaoning Province, China on Saturday.

“We did not confiscate Hyundai (Asan)’s asset. We will not confiscate and will wait (going forward). We have waited for long (thus far),” Oh said. “The South’s asset is just in our territory because it is real estate, and the property is registered in Hyundai’s name.”

Notably, citing the North’s foreign investment act providing that Pyongyang does not nationalize foreigners’ asset, Oh said, “Because we cannot afford to continue waiting, blindly trusting the South, we will form ties with investors from various countries. Still, we are not excluding the South. The door is open.”

In April 2010, the North implemented a slew of measures, including forfeiture of the South Korean government’s assets such as a separated family reunion house, freezing of private sector assets including duty-free shops, and deportation of management staff. In 2011, the North enacted the “Mount Kumgang international tourism district act,” and deprived Hyundai Asan of the exclusive right to tourism projects. Hotels and other assets that were owned by Hyundai are currently operated by the North Korean authority. Experts say, “The North’s move is aimed at denying its forfeiture of Hyundai Asan’s assets, which was negatively regarded by foreigners, and displaying situation of improved investment environment.”

Meanwhile, Oh said, “Foreign shipment of unprocessed natural resources has been designated as an additional item subject to restriction of investment into North Korea.” While banning shipment of coals and others without processing in North Korea by foreign investors, the North intends to allow processing of such resources within the Stalinist country. Since the North Korean authority singled out “sale of valuable natural resources at bargain prices as a unpatriotic act” as one of the crimes allegedly committed by Jang Song Thaek who was executed late last year, Pyongyang is believed to have strictly restricted foreign shipment of natural resources.

Here is additional coverage in the Choson Ilbo.

Other posts on the Wonsan-Mt. Kumgang International Tourist Zone here. See the category tab on the right for more.

Read the full stories here:
Pyongyang woos foreign investors
JoongAng Ilbo
Choi Hyung-Kyu
2014-9-22

N.K.: ‘We never confiscated facilities from Hyundai Asan’
Donga-Ilbo
2014-9-22

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Rason Port gets competition from Zarubino Port

Thursday, September 11th, 2014

Zarubino-port

Pictured above (Google Earth) the relative locations of Rason and Zarubino Ports

According to Port Technology International:

China and Russia are to join forces and morph Russia’s Zarubino Port into one of the biggest ports in northeast Asia, according to the Chinese People’s Daily.

Zarubino Port is at the far south-eastern tip of Russia and a stones throw from North Korea, and only 18km from China.

North-east China’s Jilin province and Russia’s Summa Group reportedly signed a joint-agreement concerning the rejuvenation of the port at the fourth Conference on Interaction and Confidence-Building Measures in Asia (CICA), in Shanghai in May, 2014.

It is planned that the Zarubino Port will have the ability to handle 60 million tonnes of cargo once construction is completed.

ECNS, an English-language Chinese news source, reported a Summa deputy president as stating the planned port will be multifunctional, and is intended to “hugely benefit China and Russia”.

The port will be used to serve as a key port in ensuring the security of food provisions.

Read more at Voice of America.

Zarubina port is only 80km (directly) north-east of Rason. It will be interesting to see what kind of effect this project will have on development at Rason.

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DPRK rice imports from China increase

Monday, August 25th, 2014

According to Yonhap:

North Korea bought US$7.02 million worth of rice from the neighboring country last month, up 115 percent from $3.27 million a year earlier, according to Chinese trade data from the Seoul-based Korea International Trade Association.

The amount also represents an on-month increase of 53 percent from $4.57 million.

The sudden increase in imports comes amid reports that the price of rice has risen sharply in the North.

According to the South Korean online newspaper DailyNK on Aug. 12, rice cost 5,800 won per kilogram in Pyongyang, up 1,550 won from the middle of July.

Read the full story here:
N. Korea’s imports of Chinese rice more than double
Yonhap
2014-8-25

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DPRK curtailing family visits to China

Monday, August 25th, 2014

According to the Daily NK:

The number of North Korean residents permitted to visit relatives in China is down significantly from last year’s statistics during the same period. Yet another attempt to regain control, this move is another attempt by the paranoid leadership to block exchanges with the outside world and the plethora of information available there.

A source in China reported to Daily NK on August 22, “In August, there are usually no large events taking place in North Korea, so it’s usually easier for people to visit family members in China then; this year though, that doesn’t seem to be happening.” He went on to explain the reasoning behind the decline, “There is testimony that the North Korean authorities are actively curtailing the number of those going to China for this purpose.”

North Korean residents traversing the border to visit family members in China began in 2000, just after the period of the famine, referred to as the “Arduous March.” As the authorities could no longer provide regular food rations to the people, it resorted to dispatching them to “go abroad and seek help.” Naturally, China presented as the simplest option.

The currency reform on November 30, 2009 sought to curb inflation and monetary overhang but resulted in the inverse, hyperinflation. Residents took to seeking out their brethren in China for assistance to cope with the additional financial hardship. The outcome of the 100:1 redenomination fostered increased mistrust in the authorities by residents as well as mass panic on the ground; most watched helplessly as hard-earned savings were reduced to worthless bits of paper.

The situation this year is vastly different, the source explained. This month has seen daily averages of five North Korean travelers pass through Dandong Customs House, a sharp decline from the 50-100 individuals who moved through on a given day in past years, an indication that the North Korean authorities have drastically reduced visas permitting these visitations.

A similar dip in numbers arose shortly after events commemorating the anniversary of Kim Il Sung’s birth on April 15th, 2014; the daily average of North Koreans advancing through Dandong Customs House was approximately 10 people. This is the busiest time of year in North Korea, as rice-planting season runs from May to June and the entire population is mobilized to work on farms, explaining the decline in those headed to China.

“There are some North Koreans who are still going to China, but most of them are involved in business or trading; general residents are nowhere to be seen. Compared to the annual crowds pouring out after ‘Victory Day,’ [July 27th celebrations marking the signing of the Korean War Armistice signed in 1953, perceived as a victory in the North] this is quite unusual,” he said.

The source interpreted this not as an anomaly, but rather as a measure instigated by a regime gaining confidence in its economic status. This year did see record breaking trade activity between China and North Korea and the relative stabilization of market prices in the North. Rather than seeking help abroad, the North Korean authorities are trying to solve these matters domestically; with concurrent attempts to cultivate a better image internationally.

Most notably, residents’ exposure to outside information in China has given the authorities new pause in their willingness to send them abroad; potential economic gains in China are not worth North Koreans breaking away from state ideology.

“In the past, people only had to offer up the proper amount in bribes to the State Security Department to get them to overlook activities by Christians or others entrenched in ideas acquired on the outside, but now it’s certain they would get caught,” he explained. Now that the authorities are aware of the effects, they are ratcheting up their efforts to stem them, “There are so many who don’t return these days that the authorities fear even bigger problems will arise if they allow people to go [to China].”

“The stringent controls placed on border security and outside phone calls are so much more severe since Kim Jong Eun came to power. The latest in this series of attempts at mind control is to do away with any chance for North Koreans to meet freely with relatives in China,” he concluded.

The upcoming September 9th holiday, which marks the founding date of the state, and the day the Chosun Workers’ Party was founded, October 10th, are both expected to yield even fewer able to enter China to visit family members. While there is always the possibility for the North Korean authorities to expand permission again after the events end, the downward trend is expected to continue.

Read the full story here:
NK Authorities Slash China Visits
Daily NK
Lee Sang Yong
2014-08-25

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DPRK oil imports from China in 2014 (UPDATED)

Saturday, August 23rd, 2014

UPDATE 6 (2014-8-23): For what it is worth, China recorded zero oil exports to North Korea in July. According to Yonhap:

According to the Chinese data analyzed by the Beijing unit of the Korea Trade and Investment Promotion Agency, there were no shipments of crude oil from China to North Korea from January to July.

Diplomatic sources with knowledge of the matter cautioned against reading too much into the official trade figures because China has been providing crude oil to North Korea in the form of grant aid and such shipments have not been recorded on paper.

In the first seven months of this year, China’s exports to North Korea rose 1.8 percent from a year ago to US$1.95 billion, while imports fell 4.3 percent to $1.57 billion, according to the data.

UPDATE 5 (2014-8-4): The Hankyoreh weighs in on Chinese oil exports to the DPRK:

However, there are also other experts who counter that suspending the supply of crude oil ought not to be read as a sign of deteriorating relations between North Korea and China. They say that, while the statistics read zero, the supply of crude oil is actually continuing. In fact, the price of gasoline and other petroleum products in North Korea remains stable, reports have indicated.

Radio Free Asia reported that gasoline was selling recently for around 10 to 11 won per kilogram at North Korea’s markets, around the same as the 11 won price from 2012. The price of diesel also remained steady at 6 to 7 won, the broadcaster said.

The South Korean government believes that while China may have reduced its crude oil exports, it is continuing to supply North Korea with oil as a form of aid. “China has been supplying North Korea with 500,000 tons in trade, along with a similar amount of free oil. It appears to be providing North Korea with enough crude oil to prevent problems from occurring in North Korean society,” said a senior Ministry of Unification official on condition of anonymity.

But many experts believe that relations between North Korea and China are not in such a bad state that China would shut off the supply of crude oil. “Relations between North Korea and China are not normal, but they should not be seen as especially bad, either. From the viewpoint of a superpower, China appears to be steadily observing North Korea’s behavior, without grief or joy,” said Lee Hui-ok, professor at Sungkyunkwan University.

Indeed, aside from interaction between senior officials, other sectors appear to be operating normally without any major disturbances. Trade between North Korea and China in the first half of the year remained at levels similar to 2013. Chinese exports to the North from January to May of this year were US$1.27 billion, down slightly from US$1.33 billion last year. But a big rebound in June brought the first half figures up to US$1.58 billion, nearly the same as the US$1.59 billion posted last year.

In the area of tourism, China also appeared to be taking a more aggressive attitude in the first half of the year than in 2013, running new tourism programs using bicycles and trains, reports said. In the area of personnel exchange, working-level contact is continuing, despite the lack of meetings between senior officials.

“There are virtually no senior political officials from North Korea visiting China. However, technical and economic officials continue to visit China for inspections and training,” said an official at the South Korean embassy in China, on condition of anonymity.

“It is dangerous to read too much into the temporary fluctuations and the sluggish mood recently affecting relations between North Korea and China. That would be a false diagnosis of their relationship,” said Lee Nam-ju, professor at Sungkonghoe University.

“Since North Korea and China understand each other, it does not appear likely that their relations will be suddenly damaged,” Lee said.

UPDATE 4 (2014-7-14): NK News reports on Chinese petrol exports to the DPRK:

China has increased deliveries of oil products to North Korea during the first five months of 2014 according to the latest Chinese customs data, which also confirms the widely reported halt in crude oil shipments.

However, data from the Chinese General Administration of Customs shows that the oil-products being delivered to North Korea only cover a fraction of the supplies of crude once shipped, with total deliveries falling by over 60 percent.

Experts were unsure over whether this constituted a warning from Beijing in response to North Korea’s regional provocations or whether the slow-down was due to the DPRK’s aging refineries. Crude oil must be refined into petroleum products such as fuel oil, diesel and aviation fuel before being used.

In total, China exported more than 88,000 tons of refined products to the DPRK between January and May 2014, with more than half of the growth caused by spikes in gasoline and kerosene shipments. Gasoline, is primarily used as a fuel for motor vehicles, while kerosene is used to power jet engines and as a heating fuel in North East Asia.

“[This] is somewhat over half of the recorded exports from China to the DPRK in 2010, and somewhat over a quarter of the net petroleum products imports that we estimated for the DPRK from all nations in 2010.  So there may be a real shift in petroleum products exports going on,” David Von Hippel a Senior Associate at the Nautilus Institute for Security and Sustainability told NK News.

Kerosene, used as an aviation fuel, saw the sharpest spike in exports increasing by 5131% when compared to the same period last year. The North Koreans imported more than a hundred thousand barrels, mostly in one bulk shipment in March, amidst news published in early July by Reuters that the DPRK was looking to restart domestic flights.

Gasoline exports also rose by 84% to approximately 280 thousand barrels when compared to the  January – May period in 2013.

DPRK imports of diesel rose to 63,000 barrels and mark the first time China has exported the petroleum product since 2011, although no data is available before this point. The exports remain at a low level however, representing only a few percent of total DPRK yearly usage.

China also upped exports of Butane by 28%, which is used primarily as fuel gas or in gasoline blending. “[Butane] is more likely used as an input to bottled gas (for example, liquefied petroleum gas, LPG), which is, we have heard, increasingly used for cooking in urban households that can afford it in the DPRK.” Von Hippel told NK News.

UPDATE 3 (2014-5-24): This Daily NK article further highlights why we should be skeptical of official reports of the DPRK’s oil imports from China:

Daily NK has confirmed that China is currently supplying oil to North Korea through a pipeline running between the two. Though there have been cases where Beijing has suspended such shipments in response to North Korean intransigence, particularly over nuclear issues, but this has not happened recently.

On April 10th, Daily NK visited an oil storage and pipeline facility in Dandong. There, our team interviewed Chinese Ministry of Public Security officials guarding the facility, which is owned by a subsidiary of China National Petroleum Corporation, or CNPC.

When asked about oil assistance to North Korea, one of the officers acknowledged, “We are continuously supplying oil (to North Korea),” but “cannot say how much we send each month or how much remains as of now.”

Oil deliveries to be transferred to North Korea are received at this facility from a larger nearby facility, Basan, and then are shipped to a partner storage facility at Baekma in Pihyun Couunty, North Pyongan Province. The pipeline is 11km long.

According to sources, these deliveries are not recorded in Chinese customs data, or in foreign trade statistics. The oil from the pipeline is rather characterized as de facto aid, either in the form of low interest loans or free of charge.

This is why, on April 24th, Korean agency KOTRA released a figure of ‘zero’ for oil exports from China to North Korea for the first quarter of 2014, basing it on Chinese customs data. The data says zero for commercial transfers; however, supplies in the form of aid and assistance may not have stopped at all.

In this regard, a diplomatic source said, “China has the ability to stop the oil supplies whenever they want, but they’ve never done so for a long period of time.” He went on, “Above all, China places as much importance on security as North Korea places on nuclearization, and it doesn’t want to see disorder in the North Korean regime. This explains why China keeps providing this assistance.”

Meanwhile, Chinese trade statistics show that 520,000 tons of oil was exported to North Korea every year from 2009 to 2012. Mostly small North Korean tankers shipped this oil.

UPDATE 2 (2014-5-26): The DPRK officially did not import any oil from China as of April 2014. According to Yonhap:

China sold no crude oil to North Korea in the first four months of this year, data compiled by South Korea’s government trade agency showed Monday, in an unusual four-month absence of oil shipments amid the North’s threats of a nuclear test.

The Beijing unit of the South’s Korea Trade and Investment Promotion Agency (KOTRA) said in a report, citing data from China’s customs authorities, that there were no oil shipments from China to North Korea from January to April this year.

A four-month absence of oil shipments from China to North Korea was also reported in 2009, when the North conducted its second nuclear test.

However, a diplomatic source in Beijing cautioned against reading too much into the official trade figures.

“The Chinese side has provided crude oil to North Korea in the form of grant aid, which is not recorded on paper,” the source said on condition of anonymity.

North Korea also appears to have been trying to diversify its source of oil imports, through countries such as Russia, the source said.

UPDATE 1 (2014-4-24): DPRK official imports from China in Q1 of 2014: zero.

According to Yonhap:

China did not export any crude oil to North Korea in the first three months of this year, data compiled by South Korea’s government trade agency showed Thursday, in an unprecedented three-month absence of oil shipments amid North Korea’s threats of a nuclear test.

Monthly shipments of crude oil from China to North Korea were absent in February, June and July last year, but it was the first time that China apparently stopped exports of crude oil to North Korea for three consecutive months.

The Beijing unit of the South’s Korea Trade and Investment Promotion Agency (KOTRA) said in a report, citing data it collected from China’s customs authorities, that there were no oil shipments from China to North Korea from January to March this year.

“To my knowledge, it is the first time that China did not export crude oil to North Korea for three consecutive months and that would impact the North Korean economy,” a diplomat at the South Korean Embassy in Beijing said on the condition of anonymity.

Also worth highlighting from the report:

China’s total trade with North Korea fell 2.83 percent to US$1.27 billion in the January-March period, compared with the same period a year ago, according to the KOTRA report.

Additional information:

1. DPRK – China trade statistics following the Jang Song-thaek purge.

2. DPRK – China trade at all time high in 2013.

3. DPRK diversifying energy sources.

4. DPRK does not import any oil from China in January 2014.

Read the full Yonhap story here:
China didn’t export crude oil to N. Korea in Q1
Yonhap
2014-4-24

ORIGINAL POST (2014-3-10): DPRK oil imports from China in January 2014: Zero!

According to Yonhap:

North Korea did not import any crude oil from China in January, marking the first absence of monthly deliveries from China in five months, a Seoul government report showed Monday.

It was not immediately clear whether the January absence of crude shipments to North Korea from China was linked to Beijing’s growing frustration with Pyongyang over its nuclear program, but it followed the execution of the once-powerful uncle of North Korean leader Kim Jong-un last December.

Last year, monthly shipments of crude oil from China to North Korea were absent in the months of February, June and July. However, annual shipments of crude oil to North Korea from China rose 11.2 percent on-year to 578,000 tons in 2013.

Read the full story here:
No crude import from China to N. Korea in Jan.: report
Yonhap
2014-3-10

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Yanji-Rason tour project launched

Monday, August 4th, 2014

According to Xinhua:

The Chinese border city of Yanji in northeastern Jilin Province has opened a direct bus tour service to the neighboring Democratic People’s Republic of Korea (DPRK), tourism authorities said Monday.

A total of 48 Chinese tourists and two Chinese guides ended their two-day tour to the city of Rason on Sunday completing the first batch of bus tours in Yanji, said Wang Yanbo, deputy chief of Yanji tourism bureau.

The group visited Rajin Port, greenhouses housing Kimilsungia and Kimjongilia, both flower species named after the late DPRK leaders Kim Il Sung and Kim Jong Il, the Korean Ethnic Cultural Park and the beachside of Pipa Island, said Lian Qinghua, general manager of Yanbian Northeast Asia Passenger Transport Group Co,. Ltd travel agency, operator of the tour.

The journey to the DPRK takes around four hours and will operate from Tuesday to Saturday, Lian said.P Compared with other travel methods to Rason, the nonstop trip avoids transfer processing at the China-DPRK border, he said.

Travel figures show about 10,000 Chinese tourists visit the DPRK annually.

Yonhap report here.

Read the full story here:
Chinese border city opens bus tour to DPRK
Xinhua
2014-8-4

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DPRK -china trade dips slightly in H1 2014

Monday, August 4th, 2014

According to the Institute for Far Eastern Studies (IFES):

Grain Imports Decrease, Rare-Earth Mineral Exports Increase in the First Half of 2014

It has been reported that Chinese grain imports in North Korea have fallen drastically in the first half of 2014. According to the Korean Foreign Trade Association (KFTA), Chinese exports of grain to North Korea totaled 58,387 tons in the first half of 2014, totaling a mere 47 percent of the grain exported in the first half of the previous year (124,228 tons).

China’s most heavily exported grain product to North Korea is flour, which made up 68.8 percent (40,142 tons) of all total grain exports for the first half of 2014. China also exported 13,831 tons of rice and 3,420 tons of corn to North Korea. Corn exports did not even reach twenty percent of the amount exported at the same time last year (17,655 tons).

It is postulated that China’s sharp decrease in grain exports to North Korea is due to the souring relations between the two nations in 2014. Another theory is that the decrease in exports could be due to North Korea’s recent increase in agricultural productivity over previous years.

In the first half of 2014 China exported 109,531 tons of fertilizer to North Korea, 21.3 percent less than the amount exported during the same timeframe last year (139,161 tons). In the first three months of 2014, North Korea aggressively imported Chinese fertilizer at a rate of twenty thousand tons over its monthly average. However, this decreased markedly in the months of April, May and June.

Meanwhile, North Korea has been exporting large quantities of rare-earth resources (which are used in manufacturing high-tech products) to China over the last few months. Reportedly, in May of 2014, North Korea exported 550,000 dollars’ worth of rare-earth ore to China. This figure more than doubled the following month, reaching 1.33 million USD in June.

This comes as a bit of a surprise, as North Korean rare-earth resource exports to China had come to a standstill after the first round of exports (totaling 24.7 thousand USD) in January 2013. Suddenly, after fifteen months, North Korea has exported 1.88 million USD worth of rare-earth ore (approx. 1.93 billion KRW, 62.66 thousand kilograms) over the last two months.

Since 2011, North Korea has in fact been exporting rare-earth carbonate mixtures to China; however total exports of these products have only reached 170 thousand USD over the last three and a half years.

North Korea has been placing attention on these underground rare-earth resources, of which the nation reportedly has ample quantities of in various deposits around the country. Recently, much effort has been put into surveying for deposits of these so-called “vitamins of the 21st century’s high-tech industry.” In 2013 a company for the development of rare-earth materials in North Pyongan Province was established with the cooperation of the international private equity firm “SRE Minerals.”

In July 2011, the Choson Sinbo, a news affiliate of the General Association of Korean Residents in Japan, reported in an interview with top executives from the National Resources Development Council that rare-earth resource deposits in North Korea total approximately 20 million tons. The drastic increase seen in rare-earth resource exports can be attributed to North Korea’s attempt to diversify its resource exports. In other words, the DPRK is investing in rare-earth material exports in order to reduce its dependency on other leading mineral exports such as anthracite, iron ore, and lead.

Exports of anthracite to China decreased by 23 percent in the first half of 2014 (compared to last year), totaling approximately 571 million USD. Iron ore exports, North Korea’s second leading resource export, reached approximately 121 million USD in the same time period – a drop of 5 percent when compared to the same time period last year.

According to the Korea Herald (Yonhap):

North Korea’s trade with its economic lifeline China fell 2.1 percent on year to US$2.89 billion in the first six months of this year, data compiled by South Korea’s government trade agency showed Monday, in another sign that strained political ties between the two nations have affected their economic relations.

During the six-month period, North Korea’s exports to China declined 3.9 percent to $1.31 billion and imports slipped 0.6 percent to $1.58 billion, according to the data provided by the Beijing unit of South’s Korea Trade and Investment Promotion Agency (KOTRA).

There were no shipments of crude oil from China to North Korea from January to June, the data showed.

“Despite the six-month absence of oil shipments, the scale of North Korea’s decline in imports is minimal,” the source said on condition of anonymity.

Meanwhile, North Korea’s exports of rare earth to China jumped 153.7 percent on year during the January-June period, the data showed, without providing the value of the exports.

Read the full story here:
N. Korea’s trade with China falls 2.1 pct in H1
Korea Herald (Yonhap)
2014-08-04

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Food imports from China fall in 2014

Wednesday, July 30th, 2014

According to Yonhap:

North Korea’s grain imports from China tumbled more than 50 percent on-year in the first half of this year, data showed Wednesday, amid speculation that relations between the communist allies are not like before.

North Korea imported 58,387 tons of cereal crops from China in the January-June period, down 53 percent from 124,228 tons recorded a year earlier, according to the data by the Korea International Trade Association (KITA).

By type, flour topped the list with 40,142 tons, or 68.8 percent, followed by rice and corn with 13,831 tons and 3,420 tons, respectively, added the Seoul-based agency.

Analysts say the remarkable decrease may be attributable to reportedly strained ties between the two sides in recent months.

“Of late, North Korea has appeared to move to reduce its economic dependence on China and diversify its foreign economic partners,” said Lim Eul-chul, professor at the Institute for Far Eastern Studies at Kyungnam University.

Kwon Tae-jin, researcher at private think tank GS&J, said it might have been more affected by Pyongyang’s increased crop yield.

“North Korea’s stockpile of crops seems to have grown due to a good harvest last year.

Meanwhile, China’s fertilizer exports to North Korea also plunged 21.3 percent to 109,531 tons during the January-June period this year from a year earlier, said KITA.

Read the full story here:
N. Korea’s grain imports from China halve in H1
Yonhap
2014-7-30

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