Archive for the ‘France’ Category

Unhasu Orchestra in Paris

Thursday, March 15th, 2012

 

Pictured above (Google Earth): (L) Unnhasu Theater in Pyongyang where the Unhasu Orchestra normally performs.  (R) The Salle Pleyel in Paris where the Unhasu played their first overseas concert.

You can listen to the performance here.

You can watch the performance here.

Here is KCTV coverage of the performance.

Media on the performance below.

(more…)

Share

DPRK makes discreet investor plea to French students

Thursday, November 24th, 2011

Pictured above (Google Earth): The University of Toulouse, France. See in Google Maps here.

According to AlertNet (Reuters):

Secretive and isolated North Korea is searching for economic allies in the unlikeliest of ways: showing videos of happy North Korean tourists to young French university students in a 13th century convent.

The reclusive communist state has no official diplomatic relations with France, one of only two European Union countries to cut ties with North Korea until it abandons its nuclear weapons programme and improves its human rights record.

But just weeks after Paris decided to open a cooperation office in the North Korean capital, its ambassador to Paris-based UNESCO accepted an invitation to address students from the University of Toulouse within the gothic surroundings of the Franciscan convent’s capitular chamber.

The meeting marked Ambassador Yun Yong Il’s first public appearance in France.

“They are the future,” said Yun, when asked by Reuters why he picked Toulouse to talk. “I’m here for the students who have been waiting to hear from a North Korean official for a year.”

Tensions have gradually eased on the Korean peninsula since the sinking of a South Korean warship 20 months ago and the North’s revelation of a uranium enrichment facility that opens a second route to make an atomic programme.

North Korea and the United States have also held a series of bilateral meetings geared at restarting broader regional de-nuclearisation talks, giving the North a window of opportunity to raise its diplomatic efforts around the world.

Yun, a former political director at the Foreign Ministry, faced about 100 students.

At times, the future political science graduates looked on bemused and surprised as the four-hour presentation cut from a hazy tourism video of the 1980s showing rolling mountains, happy North Koreans on holiday and copious seafood platters to a well structured monologue about the country’s woes and potential.

“Our country is open to everybody who wants to come. You just have to ask for a visa in Paris!” said Yun, who speaks fluent French, but opted to talk in his native language and let his deputy translate into English.

Pyongyang has slowly opened its doors under strict conditions to foreign tour groups, mostly Chinese as a way of earning hard currency.

Yun, who wears a lapel pin of President Kim Jong-il on his suit, said the country’s lack of hard currency as a result of tighter sanctions has made it turn to foreign investors on the “basis of mutual respect and interests”.

“We are looking forward to multilateral and multifaceted economic co-operation with other countries,” he said.

“We are definitely opposed to monopolistic investment of a single country,” said Yun, adding that the country’s natural resources provided opportunities for investors to tap.

CHINESE MODEL, CHINA TRAP

Michel-Louis Martin, director of Toulouse University’s security and globalisation research group said the event was not just propaganda.

“They are trying to go beyond what they usually have to say about North Korea. Don’t forget in France, North Korea is not very well known,” said Martin.

The country’s desire to diversify its economy has echoes of China when it began to allow foreign investment and gave permission for entrepreneurs to start up businesses in the 1970s.

Yun’s presentation attempted to steer clear of its frictions with the United States, South Korea and even its relationship with China, focusing instead on his country’s economic problems.

But by the end he stepped up the rhetoric, firmly laying the blame for Pyongyang’s “misfortune” on the United States.

Michel Dusclaud, a researcher at the University of Toulouse who convinced Yun to speak, said it was normal for ancestral hatreds to come out. Despite this, he said, it was clear the North was beginning to accept that if it did not diversify, it would be engulfed either by its souther neighbour or China, which still has territorial claims to it.

“They have to open up for international cooperation otherwise they will be eaten up by South Korea or China,” Dusclaud said. “It’s imperative, but it’s not because they like us.”

With his speech finished, Yun was quick to shuffle out of the Gothic chapel, declining to speak to Reuters, but also telling a student who attempted to pose a question on whether North Korea’s political system could last:

“I’ll see you in Paris and then we’ll talk.”

Read the full story here:
N.Korea makes discreet investor plea to French students
AlertNet (Reuters)
John Irish
2011-11-24

Share

France to open Pyongyang office (Take 2)

Tuesday, July 12th, 2011

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

Share

“Let’s speculate on North Korean debt!”

Thursday, March 11th, 2010

UPDATE 1 (2011-12-21): The Wall Street Journal (Dow Jones Newswire) points out movement on North Korean debt following the death of Kim Jong-il:

Saturday’s death of North Korean leader Kim Jong Il has given a lift to that country’s only openly traded securities, a batch of bonds that haven’t received a payment in almost three decades.

The defaulted bonds, which were created in 1997 when French bank BNP repackaged a series of non-performing syndicated bank loans that were granted to North Korea in the seventies, have suddenly sparked interest among speculators. The sporadically traded bonds, which trade at a deep discount to their face value, saw a tick up this week and were recently quoted at between 14 and 18 cents on the dollar, compared with 13 to 15 cents, according to London-based sales and brokerage house Exotix.

Those who have bought the bonds are making nothing less than a bet that the transfer of power to Kim’s son Kim Jong Eun will usher in a moment akin to that of the Berlin Wall’s collapse for the tightly controlled communist country.

“Investors are looking at this as an unlimited option trade with enormous potential gains,” said Andrew Chappell, head of European, African and Middle Eastern fixed income trading and sales at brokerage house Exotix in London, who says that inquiries into the bonds have increased in recent days.

According to Chappell’s calculations, investors’ claims extend to the principal and interest accrued from 1984 when the original loans defaulted. That amounts to anywhere between 300% to 600% in unpaid interest.

The premise that’s attracted hedge funds and pension funds is that North Korea can’t exist in isolation forever, and like other former communist countries will find a need to tap the international markets for funds.

That’s why the death of Kim Jong Il has opened a rare opportunity that bets on these bond could pay off. Although there’s no indication of what the structure of the government will look like under Kim Jong Eun, or of the direction it will take, some observers expect the U.S. and other western powers to use this opportunity to bring North Korea into the international fold.

By all accounts, North Korea is in very poor shape financially. A significant segment of the population is said to be dying of starvation. The country’s economy pulls in a meager $29 billion in annual gross domestic product, compared with $1.117 trillion in South Korea, according to IHS Global Insight estimates for 2011. That gaping shortfall in material well-being, the optimists reckon, will eventually drive North Korea to make good with the international community and seek foreign investment. But first it will have to clear its unpaid debts.

In fact, it was a similarly desperate need for funds that initially drove North Korea to borrow a total of 680 million Deutsche Marks and 455 million Swiss francs in syndicated loans from nearly 100 foreign banks in the late 1970s. By 1984, the country had defaulted on these loans and they were left dormant for more than a decade. But in the late 1990s, some of the banks wanted to capitalize on hopes at that time for a reunification between North Korea and South Korea, so they parceled some of the nonperforming loans into two tranches of DEM293 million and CHF217 million.

BNP, now called BNP Paribas, was the manager on the deal. It created a special purpose vehicle called NK Debt Corp., incorporated in the British Virgin Islands, to hold the loans and then sold rights to them to investors.

Over the years, even as North Korea has again distanced itself from the international community and toyed with nuclear ambitions, interest in the zero-coupon no-income bond has waxed and waned among a select few buyers interested in frontier markets or risky bets. As if passing the hot potato, fund managers have been buying and holding these bonds for a few years and then exchanging them for something else, Chappell said.

The holdings are now concentrated among a dozen or so blue-chip pension fund managers and hedge funds, he said, but declined to name them.

Franklin Templeton Emerging Market Debt Opportunities Fund, which is allowed to invest in defaulted debt, confirmed that it holds about $4.25 million in nominal value of the Deutsche mark-denominated bonds. It declined to comment further.

“These investors are not saying the bond has to pay off to make money,” said Tim Slaughter, head of fixed income at Auerbach Grayson, an agency brokerage in New York. “For them, if the price goes up from 14 cents to 16 cents it’s a good return on a $5 million investment. Investors are not necessarily looking for North Korea to reconcile with South Korea.”

But others say this speculative game is simply not worth the risk.

“The price on North Korean debt is too high in the sense there are so many alternatives in frontier debt that are actually paying coupons and redemptions that are trading at attractive levels,” said Morten Bugge, chief investment officer at Global Evolution A/S, a Denmark-based hedge fund that had held these North Korean bonds in the early years.

Read the full story here:
North Korea’s Leadership Transition Draws Brave Debt Buyers
Dow Jones Newswire
Prabha Natarajan and Erin McCarthy
2011-12-22

ORIGINAL POST (2010-3-11): According to Businessweek:

BNP Paribas SA, France’s biggest bank, in 1997 created bonds denominated in Deutsche marks and Swiss francs secured on non-performing loans owed by the Foreign Trade Bank of the Democratic People’s Republic of Korea. The notes mature today, and Exotix plans to issue new ones with about a 10-year tenor.

“There are very few investments left in the world like this,” Andrew Chappell, head of London emerging market fixed- income for Exotix, a broker specializing in distressed securities, said in a telephone interview. “The North Korean bonds are very cheap,” they may rise on signs of improved international relations and they are easier to trade than the underlying loans, he said.

President Kim Il Sung drove North Korea to become the first communist nation to default 34 years ago by spending almost a third of gross domestic product on its military. The United Nations toughened sanctions on son Kim Jong Il’s government after it detonated a second nuclear device in May, deepening an economic crisis that forced North Korea to revalue its currency in November by removing two zeros from the face value of the won.

“Investors have good reason to hold the notes even by extending them,” said Dong Yong Sueng, a senior fellow in the economic security team at the Samsung Economic Research Institute in Seoul. “They hope that the South Korean government may take over North Korean debts and repay them if the communist state collapses or the regime changes.”

About 320 million marks and 240 million francs ($225 million) of the zero-coupon 1997 bonds are outstanding, according to data compiled by Bloomberg. Exotix last quoted them at 12.75 percent of par value as of March 8 from 11.5 percent a month earlier and 33 percent in December 2007.

While prices that low may be attractive to investors willing to take a five- or 10-year bet, “there are just so many better opportunities for investing in high-risk assets,” Richard Segal, director of emerging markets fixed-income at Knight Libertas Ltd., said in a phone interview from London.

“I don’t see much value in the notes even at 10 or 11 percent of par because I see no willingness of North Korea to reschedule the underlying loans and no willingness of South Korea to pay them off short of unification,” he said. That’s “unlikely for a long time.”

North Korea is overhauling its legal system in a bid to attract as much as $400 billion in foreign investment over the next decade, almost 20 times current GDP, South Korea’s MBC television reported on March 4.

Read the full story here:
North Korea bonds due today spur exotix bet on political change
Businessweek
Jungmin Hong
2010-3-11

Share