Archive for the ‘Russia’ Category

North Korean company advertisements appear in World Cup preliminary match

Friday, July 3rd, 2015

Institute for Far Eastern Studies (IFES)
2015-7-3

North Korea has attracted attention after it recently featured a number of corporate advertisements in a preliminary match of the 2018 Russian World Cup.

In the past, North Korea rejected everything related to capitalism. But since Kim Jong Un’s rise to power it appears to be actively using sports and commercial capital in order to attract foreign capital as its market economy rapidly expands.

On June 16, 2015 Korean Central Television (KCTV) broadcast the second match of the Russian World Cup Asian qualifying rounds. The match, in which North Korea and Uzbekistan played, was held at Pyongyang’s Kim Il Sung Stadium, where advertisements by North Korean companies such as Kaesong Koryo Ginseng and the Pyongyang Building Materials Factory appeared in force. Kaesong Koryo Ginseng and Choson Kumgang Group in particular appeared to have spent a lot of money sponsoring the event, as every most ads belonged to one of these companies. Conspicuous among the advertisements were those from companies that have not been well-known in the outside world, such as Malgun Achim (literally ‘clear morning’), a manufacturing company known in North Korea for producing IT products such as computers. Exhibiting numerous ads for North Korean companies at an international sports event and broadcasting the event on TV to the world is rather unprecedented behavior for North Korea.

When the 27th Mangyongdae Prize International Marathon was held in Pyongyang in 2014, not only were there no ads for North Korean companies, but there were no ads for foreign companies either. As a result British contestant Will Phillips, who qualified to participate in the marathon as a foreign amateur athlete, remarked at the time, “It feels like time just stopped in the ‘60s.” However, an article appeared in the January 2015 edition of the Kim Il Sung University Bulletin that emphasized the importance of advertisements in attracting investment and gave specific instructions to heed the publication times of major foreign newspapers and even pay attention to broadcast ratings. Since then North Korea has paid attention to foreign advertisements and has really upped its efforts to attract foreign currency.

As the market economy spreads rapidly in the Kim Jong Un era, this event is viewed as a sign of change in North Korea’s foreign economic policy. The promotion of North Korean companies in a preliminary round of the World Cup, which relatively many foreigners can view, is interpreted as an attempt to ultimately attract foreign capital. At the same time, it appears there is a dimension of inducing competition between North Korean companies to boost domestic demand. This event can also be connected to one of the characteristics of the Kim Jong Un regime, which emphasizes and encourages physical education throughout the state. Such a scene, which seamlessly joins sports with commercial capitalism, is unprecedented for North Korea.

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Russian Railways transports 420,000 t of cargo to the Port of Rajin in QI 2015

Monday, June 1st, 2015

According to Port News:

In 2014, foreign-trade cargo transportation through the border crossing Khasan (Russian border)–Tumangan (North Korean border) increased 3.2 times over 2013. At the same time, the transportation of coal increased 24 times. In the first quarter of this year, this trend continued. The volume of transported goods increased several times—up to 432 000 t.

Such data were presented by President of Russian Railways Vladimir Yakunin at the OSJD Railway Summit in Seoul.

In 2014, 280 000 t was transported, of which 238 200 t was coal. In the first quarter of 2015, 408 000 t of coal was sent to the port of Rajin.

In total, according to Mr. Yakunin, it is planned to transport 1.5 million t of coal to the port of Rajin in 2015.

Recall that Russian Railways has implemented the reconstruction of the Khasan (Russia)–Rajin (North Korea) railway section and the construction of a cargo terminal in the port of Rajin. The cost of the project amounts to 10.6 billion rubles.

“In fact, the restoration of the site is a pilot project in the reconstruction of the Trans-Korean Railway, which in the future will provide communication between North and South Korea,” said Mr. Yakunin.

Since November 2014, four experimental coal transportation runs have been carried out through the port of Rajin to South Korea.

“The main task today is to ensure the involvement of enough traffic to complete the work of the railway and the terminal and provide a return on investments,” emphasized the head of Russian Railways.

The capacity of the Khassan–Rajin site and the terminal is 5 million t of cargo a year. In the future, when a favorable situation is created, the terminal may be employed for the transport of containers.

“In cooperation with South Korean companies POSCO, Korail, and Hyundai Merchant Marine, a due diligence investigation was conducted and we are discussing the possibility of creating a joint venture for the operation and development of infrastructure. This project is the first practical step in the development of trilateral cooperation on the development of Trans-Korean Railway. In this venture, we count on the support of South Korean businesses, the government, and the President of the Republic of Korea,” said Vladimir Yakunin.

Read the full story here:
Russian Railways transports 420,000 t of cargo to the Port of Rajin in QI’15
Port News
2015-6-1

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Russia offers electricity for copper

Wednesday, May 6th, 2015

According to RBTH:

North Korea has offered to allow Russian participation in the development of the Onsong copper deposit, in exchange for Russia providing electricity to the entire east coast of the country.

“The Korean side proposed that Russia consider supplying electricity to the areas of Rason, Chongjin and Tanchon as well as the Wonsan-Mount Kumgang international tourism zone, with the costs of electricity supply covered with copper ore from the Onsong deposit in North Hamgyong Province,” the Ministry for the Development of the Russian Far East said in a press release.

The press note, which summed up the results of the meeting of the Russia-North Korea intergovernmental commission that was held in Pyongyang in late April, did not specify which companies would be involved in the project.

Russia and North Korea are expected to create a special working group to study the feasibility of electricity supply to the Korean peninsula. North Korea is one of the most power deficient countries in Asia with cuts in supply and load shedding being a regular occurrence even in Pyongyang.

Read the full story here:
North Korea offers Russia copper ore in exchange for electricity
RBTH
2105-5-6

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DPRK and Russia ink deal

Monday, April 27th, 2015

According to Xinhua:

The Democratic People’s Republic of Korea (DPRK) and Russia on Monday signed a protocol in Pyongyang, the official KCNA news agency reported.

The details of the protocol, which was signed after a meeting of the DPRK-Russia Inter-governmental Committee for Cooperation in Trade and Economy, Science and Technology, were not disclosed.

The two sides discussed issues of boosting cooperation in trade, economy, science and technology between the two countries, said the KCNA.

The protocol was signed by Ri Ryong Nam, the DPRK’s minister of external economic relations, and Alexandr Galushka, Russian minister of development of Far East.

Officials taking part in the meeting also included Russian ambassador to the DPRK, Alexandr Matsegora, and the Russian government economic delegation headed by Galushka.

On the same day, DPRK Vice Premier Ro Tu Chol met the Russian government economic delegation and had friendly talks with them.

Read the full story here:
DPRK, Russia ink protocol after inter-governmental meeting
Xinhua
2015-4-27

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North Korean workers in Russia

Monday, April 27th, 2015

According to NK News:

The amount of North Korean citizens officially working in the Russian Federation from the start of 2015 is now 20 percent higher year on year, information from Russian media stated.

A total 47,364 North Koreans are at present working in Russia since the year began, an April 22 report from business daily RBK stated.

By nationality, only Chinese and Turkish workers exceed them in terms of numbers, at 80,662 and 54,730 respectively, the report said.

Those three countries also comprise a total 80 percent of the foreign workers in Russia, the report noted.

While North Korean workers within Russia are known largely for working in logging camps throughout Siberia, they are also working in plastering, the RBK report stated.

Demand for North Koreans plasterers have also taken up the majority of Russian work permits in that skill, at 9,026 out of a total 14,783, the report added.

Read the full story here:
North Korean workers in Russia up 20%
NK News
Christopher Rivituso
2015-4-27

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DPRK boosts food imports from Russia

Friday, April 17th, 2015

According to the Daily NK:

Rice prices in North Korea’s North Hamkyung and Yangkang Provinces have dropped despite general stability in market prices around the country. This is largely due to an influx of rice from Russia, offsetting regular price increases that come during the spring when grains fall short in supply.

“Rice sold for about 5,000 KPW [0.63 USD] per kg in Onsong County at the beginning of March, but recently that has dipped to about 4,200 KPW [0.53 USD],” a source in North Hamkyung Province told Daily NK on Wednesday. A source in Yangkang province confirmed a similar trend, saying, “The price of rice has been continually dropping in Hyesan Market, recently falling to the 4,000 KPW [0.5 USD] mark.”

Public demand for rice usually surges in April, and expectations were the cost would jump due to a clampdown on border movements this month that would block smuggled supplies. However, the supply from Russia has reversed these projections, multiple sources confirmed.

“Ships that can hold over 10,000 tons are carrying in wheat or rice from Russia through the harbors of Chongjin and Rasun,” the North Hamkyung source said. “These grains go to the military first, but then are flowing into the markets through back channels.”

He added that the North has been emphasizing relations with Russia more than with China this year, spurring a surge in trade as well as the dispatch of more workers to Russia to pull in foreign currency. This same source also reported multiple sightings –not only by him but but a host of residents–of shipments of oil and grains coming into the North from Russia.

Fluctuations in rice prices have not yet been confirmed in provinces other than the two cited above. Markets in Pyongyang and North Pyongan Province’s Sinuiju have held rice prices at the 5,000 KPW [0.63 USD] level as of mid-April, according to research by Daily NK. This is likely due to the added time it takes to transport rice to the inner areas of the country from the borders.

Both sources blamed power shortages for the delay, exacerbated by state crackdowns preventing traveling peddlers selling goods out of their trucks from entering the markets to do business. While this has contributed to the sluggish supply inland in the very short-term, prices are expected to level out soon.

Read the full story here:
Russian Supply Drives Down Rice Prices
Daily NK
Lee Sang Yong
2015-4-17

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DPRK-Russia look to boost business ties

Sunday, March 22nd, 2015

According to Voice of America:

A Russian official said Moscow and Pyongyang have agreed to discuss the creation of advanced development zones in Russia’s Far East and North Korea.

The latest project to be discussed between Russia and North Korea would call for a trilateral project, with South Korea’s participation, said Alexander Galushka, Russia’s minister for the development of the Russian Far East.

In an email sent to the VOA Korean news service, Galushka said Moscow and Pyongyang agreed to “discuss the creation of advanced development zones in the Russian Far East and on the territory of the DPRK with the participation of the Russian Federation, the DPRK and South Korea.”

Economic delegation

The agreement was reached during a visit by a North Korean economic delegation to Moscow in late February. The North Korean delegation was led by Ri Ryong Nam, Pyongyang’s Minister for Foreign Economic Affairs.

Ri and Galushka co-chair a commission tasked with promoting economic ties between Moscow and Pyongyang.

The move is an example of a series of ambitious economic projects recently launched by Moscow and Pyongyang in their efforts to enhance economic ties.

In November, the two sides expanded the Khasan-Rajin project, a project connecting the railways of Russia’s border town and the North Korean port, by conducting a test shipment of Russian coal from Russia to the South Korean port city of Pohang through the Rajin.

In October, the two countries launched a rare joint project that calls for Russia to overhaul North Korea’s railway system in return for access to the North’s mineral resources. The project involves reconstruction of more than 3,000 kilometers of railroads over 20 years.

Galushka said the railway project would pave the way for a significant increase in bilateral trade between Russia and North Korea.

Some analysts are skeptical that the project can be sufficiently financed. So far, Moscow is known to have attracted one domestic investor for the project.

Read the full story here:
Russia, North Korea Boost Economic Ties
Voice of America
Yonho Kim
2015-3-22

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DPRK-Russia trade in 2014

Wednesday, March 18th, 2015

UPDATE 1 (2015-3-18): Although overall trade volume between the DPRK and Russia was down in 2014, North Korea’s exports to Russia were up. According to Yonhap:

North Korea’s exports to Russia soared nearly 32 percent in 2014 from a year earlier, a report showed Wednesday, amid Pyongyang’s efforts to bolster ties with Moscow.

According to the report by the Korea Trade Investment Promotion Agency, North Korea’s outbound shipments to Russia reached US$10.17 million in 2014, up 31.9 percent from a year earlier.

By item, textile exports came to $4.7 million, or 46.2 percent of the total, followed by machinery with $1.6 million, musical instruments with $1.37 million and electrical equipment with $670,000.

Pyongyang also sold $250,000 worth of cars to Russia last year, 2.3 times more than the previous year, with shipments of optical devices soaring more than 60 times to $190,000.

Bilateral trade volume, however, fell 11.4 percent on-year to $92.34 million last year as Pyongyang’s imports from Russia shrank 14.9 percent to $82.17 million.

Crude imports dropped 7.9 percent on-year to $33.98 million last year, taking up the largest 41.7 percent share of the total imports.

“North Korea has been striving to strengthen economic cooperation with Moscow, though it will take time for the North to diversify its trade markets due to its heavy dependence on China in the past,” said Cho Bong-hyun, a senior research fellow at the state-run Industrial Bank of Korea (IBK) in Seoul.

Last year, more than 90 percent of its exports were bound for China. Bilateral trade between North Korea and China, however, fell 2.4 percent from 2013 to $6.39 billion in 2014, marking the first annual decline since 2009, according to Seoul data.

The 2014 figure is seen as signaling that the strained political ties between the two nations, particularly after the North’s third nuclear test in February 2013, have affected their economic relations.

Amid such languid ties with Beijing, North Korea has been ramping up efforts to forge a closer relationship with Russia, with the two nations declaring 2015 as a year of friendship.

ORIGINAL POST (2014-12-4): According to Yonhap, trade between North Korea and Russia (imports and exports)dropped significantly in the first three quarters of 2014:

Trade between North Korea and Russia dropped significantly this year, despite Pyongyang’s efforts to step up economic cooperation with Moscow, data showed Thursday.

Russia’s exports to North Korea reached US$59.01 million in the first nine months of this year, down 10.1 percent from the same period last year, according to the data by the Vladivostok office of the state-run Korea Trade-Investment Promotion Agency (KOTRA).

In particular, Russia’s exports of flour to North Korea plunged 72.2 percent on-year to $770,000.

Russia’s imports from its neighbor also fell 7.9 percent on-year to $6.46 million during the January-September period.

North Korea’s imports of electronics and coal from Russia also tumbled 61 percent and 44.6 percent, respectively, according to the data.

Russia’s imports of North Korean nuclear reactors, boilers and other machinery, meanwhile, shrank 57.1 percent on-year to reach $451,000,

Bucking the overall decline, Russia’s imports of North Korea-made clothes soared 35.5 percent on-year to $3.61 million, maintaining an uptrend of recent years.

North Korea has been intensifying efforts to expand economic cooperation with Russia, recently deciding to use the Russian ruble as a trade currency as well as launching a fledgling logistics project to link Russia’s border city of Khasan to the North’s port of Rajin.

Read the full story here:
N. Korea-Russia trade shrinks this year
Yonhap
2014-12-4

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DPRK, Russia declare 2015 as “friendship year”

Wednesday, March 11th, 2015

According to KCNA:

The Democratic People’s Republic of Korea and the Russian Federation decided to make 2015 in which fall the 70th anniversaries of Korea’s liberation and the victory in the great Patriotic War in Russia as a year of friendship between the two countries, prompted by the purpose to develop the bilateral relations onto a new higher stage in various fields including politics, economy and culture under a mutual agreement.

During the year of friendship the two countries are to invigorate exchanges of delegations and contacts between national institutions and regions and hold joint cultural events in Pyongyang and Moscow and other cities of the two countries.

Here is coverage in Yonhap:

North Korea and Russia will mark 2015 as a year of friendship and step up bilateral exchanges in political, economic and cultural sectors, the North’s official news agency said Wednesday.

“The Democratic People’s Republic of Korea and the Russian Federation decided to make 2015, in which falls the 70th anniversaries of Korea’s liberation and the victory in the great Patriotic War in Russia, as a year of friendship between the two countries,” the North’s Korean Central News Agency (KCNA) said in a brief dispatch.

The countries will “develop the bilateral relations onto a new higher stage in various fields, including politics, economy and culture under a mutual agreement,” the KCNA said.

The two countries will also invigorate exchanges of delegations and contacts between their national institutions and regions, the report said, adding that joint cultural events will take place in Pyongyang and Moscow as well as other cities.

The designation came as the two countries are scurrying to tighten bilateral ties amid languid North-China relations.

Choe Ryong-hae, a governing party secretary, visited Russia in November as a special envoy of North Korean leader Kim Jong-un as part of efforts to improve relations.

In May, the North Korean leader is expected to attend a Russian ceremony in Moscow marking the 70th anniversary of the Soviet victory over Nazi Germany in World War II. It would be the reclusive leader’s first foreign visit since taking power in December 2011.

Here are some recent Russia-DPRK engagement stories:

1. Russia-Korea pipeline development
2. DPRK and Russia set up business and exchange council
3. DPRK-Russia trade down in 2014
4. Russian investment in DPRK railway line and coal exports
5. Port No. 3 in Rason and coal shipments to South Korea
6. Russia forgives DPRK debt 

You can read the full Yonhap story here:
N. Korea, Russia declare 2015 as friendship year: KCNA
Yonhap
2015-3-11

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DPRK and Russia set up business and exchange council

Friday, February 13th, 2015

According to the Moscow Times (2015-2-4):

Russia and North Korea will establish a business council to facilitate trade, news agency TASS reported Wednesday, following a slew of measures last year that saw the two countries boost economic ties.

“This is certainly a new stage in business cooperation between Russian and North Korea, and it will certainly strengthen our economic and trade ties,” said Vladimir Strashko, vice president of Russia’s Chamber of Commerce and Industry, TASS reported.

The new council will assist Russian companies and organizations find North Korean partners to engage in joint ventures.

The council’s creation follows in the wake of last year’s meeting of the Russia-North Korea intergovernmental commission in Vladivostok, chaired by Alexander Galushka, Russia’s Far East development minister.

In Vladivostok, the two sides took concrete steps toward realizing an ambitious goal to boost interstate trade to $1 billion annually by 2020.

Moscow agreed to let North Korean firms open accounts in Russian banks, while Pyongyang promised to ease up on the visa process. North Korea also agreed to grant Russian businessmen access to the Internet and allow them to use their mobile phones while visiting North Korea — hardly trivial concessions from the so-called “Hermit Kingdom.”

Galushka said that these breakthroughs would allow Russian companies to gain access to North Korean gold and metal mines, claiming to have discussed specific resource exploration projects with his North Korean counterparts.

Russia under President Vladimir Putin has sporadically courted North Korea, a former Soviet client state, in the hopes of gaining direct access to South Korean markets via a proposed railway and natural gas pipeline project.

Vitaly Survillo, the chairman of Russia’s Business Council for Cooperation with North Korea, gave an interview with Voice of America (2015-2-13):

“It seems to me the most promising areas of cooperation between our countries are infrastructure projects – roads, utility networks, [and] tourism.”

Moscow established the council last week to increase trade between Pyongyang and Moscow.

The council plans to work on the first stage through the support of government agencies in both countries, according to Survillo. The main goal is to find new channels of communication with the North Korean partners.

The council is currently focusing its efforts on working with Russian organizations to ensure their interests in the structure of state bodies of both countries.

Russia is also eyeing North Korea’s resources, including minerals, for new business opportunities.

“North Korea has significant reserves of natural and labor resources,” Survillo said.

In October 2014, the two sides began a rare joint project that would overhaul the North’s railway system. The project calls for Russia to upgrade North Korea’s railway network in return for access to the North’s mineral resources.

“If someone needs our support, we will be glad to assist in facing the challenges of successful development of the project,” Survillo said in reference to the railway project.

When asked about the biggest challenge his team faces, Survillo answered, “the loss of the habit of mutual economic cooperation.”

“Much needs to be recovered from scratch,” he added.

Read the full stories here:
Building on Trade Ties, North Korea and Russia to Launch Business Council
Moscow Times
2015-2-4

Russia Eyes Ailing N. Korean Infrastructure
Voice of America
Yonho Kim
2015-2-13

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