North Korean Economy Watch

The actual headline should read “Seoul increases payments to DPRK goverment by 5% for each Kaesong worker” since it is no secret that “employees” receive little if any of their wages.

According to Yonhap:

South Korea will hike the salary of North Korean workers at an inter-Korean industrial complex by 5 percent from this month, the unification ministry said Monday.

The wage hike came after the two Koreas made the agreement about three months earlier than their usual annual wage talks for July.

The countries had annually agreed to a 5 percent wage increase in July, which starts to take effect from August, but this year’s earlier-than-usual wage hike came after the workers missed their annual hike last year due to a temporary suspension of the complex in the North Korean border town of Kaesong.

Amid worsening inter-Korean tension, Pyongyang had suspended the operations of the Kaesong Industrial Complex for five months from April.

The latest 5 percent hike in the North Korean workers’ minimum wage takes effect from their May salary, to be paid in late June, according to the Unification Ministry.

The two sides “agreed to hike the North Korean workers’ wage at the Kaesong Industrial Complex to US$70.35, an increase of 5 percent from now,” unification ministry spokesman Kim Eyi-do said in a briefing.

“So far, the minimum wage had been raised from August, but (we) decided to bring it forth by three months this year in consideration of (South Korean) companies’ opinions at the complex,” Kim said.

Citing the absence of a wage hike last year, Pyongyang had demanded a 10 percent wage hike this year.

About 52,000 North Korean laborers are employed by more than 100 South Korean companies operating in the joint factory park, a major cash cow for the communist country. Each North Korean worker receives up to $150 in monthly wages, including social benefits and overtime.

Read the full story here:
Seoul to raise salary of N.K. workers at Kaesong complex
Yonhap
2014-6-9

According to Yonhap (2014-6-7):

A Chinese university near the northern border with North Korea said Saturday it has signed an agreement to help develop a North Korean free trade zone, one of high-profile joint economic projects between Pyongyang and Beijing.

The agreement calls for Yanbian University in the Yanbian Korean Autonomous Prefecture of China’s Jilin province to train workers and provide technological and legal services to the Rason economic zone, the university said in a statement.

China reportedly agreed in late 2011 to invest about US$3 billion in developing the free trade zone in a North Korean border city of Rason, formerly known as Rajin and Sonbong. The special trade zone sits across the border from Jilin province.

North Korea and China set up a joint management committee in Rason in October 2012, but it is unclear whether Chinese projects for the economic zone have remained on track since the North’s third nuclear test in February last year.

The agreement was signed on Wednesday between Park Young-ho, president of Yanbian University, and Wang Yonggang, a director of the Rason management committee, according to the statement.

In the statement, Park said the university “will actively provide human resources, technological innovation and legal advices to build and develop the Rason economic zone.”

China has grown increasingly frustrated with the North’s wayward behavior, but many analysts believe that Beijing would not suspend all economic supports for Pyongyang because it could lead to a regime collapse in North Korea.

Read the full story here:
China university helps N. Korea develop trade zone
Yonhap
2014-6-7

Institute for Far Eastern Studies (IFES)
2014-6-5

It appears that the Kim Jong Un regime’s core slogan of “constructing a powerful knowledge economy nation” is being propelled by the development of high-tech development zones.

The need to switch to a knowledge economy is emphasized in the newest issue of the quarterly North Korean academic journal Kyongje Yongu (published April 30, 2014). According to a thesis included in this quarter’s issue (entitled “The Creation of High-Tech Development Zone is Necessary Step in the Knowledge Economy Era”), “Using high-tech development zones as a model, the establishment of a high-tech industry and the shifting of the entire economy towards a knowledge economy is both a Party initiative and legal demands to the construction of a knowledge economy.”

Alongside the national goals of becoming both an economic superpower as well as an athletically powerful nation, the Kim Jong Un regime has also established the national goal of becoming a leader among knowledge economy countries. In order to establish a foothold for building the country’s knowledge economy, the regime has proposed the construction of high-tech development zones.

After attracting foreign investments to fund economic development zones (EDZ) last year, North Korea has begun pushing forward for the construction of a high-tech development zone in the city of Pyongsong, located in South Pyongan province. The high-tech development zone will be built in the same area as the Unjong Science and Technology Zone and will share a similar locale with the National Academy of Sciences, both of which are located in the South Pyongan Province.

According to the thesis, high-tech development zones will “act as regional bases that bring technology and production closer together, unifying the research-development-production-export process.” The thesis also explains the characteristics of the high-tech development zone, calling it a “new type of development region with a high concentration of information, technology, and talented individuals” and “a place where education, scientific research, and production are brought together to become one.”

Furthermore, the thesis continues, “Through the improvement of the high-tech development zone, existing businesses have begun to change to information-related businesses,” and noted that, “Just as the foundation of the high-tech development zone is important to the construction of a powerful knowledge economy, it is also important to provide support from the state and the Party.”

In November of 2013, North Korea formed an international consortium of foreign companies to initiate the building of the Kaesong High-Tech Development Zone; however, construction has reportedly been suspended.

North Korea is currently pressing for construction of a type of cooperative complex to be built in the high-tech development zone where research and development, as well as production itself can take place in order to produce technologically-intensive products with high added value. However, due to sanctions imposed by the international community, North Korea is unable to acquire the advanced machinery it needs to construct the high-tech zone, and for now has only drawn out a rough sketch of the framework.

On the other hand, North Korea has also spurred progress in light industry in other regions by rewarding exemplary factories. This is seen as an attempt to increase the standard of living for the locals living in those regions, who have taken it upon themselves to improve light industry to best suit their situations.

Companies in Hoeryong, North Hamgyong Province, Wonsan, Kangwon Province, Chinchon [?], Chagang Province, and other regions have become recognized in North Korean media for their “innovations.” In Hoeryong, a chemical commodities factory developed fuel additives for lignite that increase its burning ability and efficiency, and was commended for its contribution in solving its citizens’ fuel problems. Other factories that were chosen to receive rewards include a glass bottle factory in Wonsan, and a wooden commodities factory in Chinchon[?] for increasing the production quality of their respective goods.

In a situation where the central authorities are in a vulnerable situation financially, North Korea has been encouraging regional businesses to grow and develop on their own. This not only increases the standard of living for the people, but encourages balanced regional development as well. Another thesis appearing in the most recent issue of Kyongje Yongu argues, “The comprehensive development of the regional economies has greatly reduced the state’s burden by allowing households to take it upon themselves to meet their needs according to their own situation.

Furthermore, regarding the growth of regional light industry, the thesis says, “general consumer goods are now being mass-produced, and are able to fulfill the region’s supply and demand needs,” emphasizing the use of “small quantity batch production.” Other light industry factories are also being built across the nation as part of the efforts to revitalize North Korea’s local economies.

Recently, construction of the Haeju Unjong Beer Factory was finished. Operations have commenced in Southern Hwanghae Province, and construction of the Musanryong Spring Water Factory was completed in late 2013. While North Korea’s plan to develop its local economies is not exactly breaking news, advances are slowly being made toward achieving the Kim Jong Un regime’s national goals.

* NKeconWatch: I have no idea why this article references a place in Jagang Province called “Chinchon”. Maybe they mean Huichon?

According to KCNA:

Number of Chinese Tourists Grows in DPRK

Pyongyang, June 2 (KCNA) — The tour by Chinese was conducted in the Rason area of the DPRK from May 31 to June 2, under an agreement made between the DPRK’s Rason International Travel Company and China’s Yanbian Arirang International Travel Agency.

Involving in the tour were more than 40 Chinese, who toured Pipha Islet, the Rason Taehung Trading Company, Rajin Port and other places by private cars.

This was the eighth batch of Chinese this year to visit the DPRK by private cars.

In this regard, an official at the Tourism Bureau of the Rason City People’s Committee, told KCNA:

“The tour by private cars began in June Juche 100 (2011), with due ceremony in the Rason economic and trade zone. Since then, more than 1 300 tourists have made trips to the area by more than 300 private cars in 70-odd batches.
Other forms of tourism are expected to grow in scope.”

According to the China Daily:

Construction on a new bridge over a river separating China and the Democratic People’s Republic of Korea (DPRK) has started, authorities of northeast China’s Jilin Province said on Tuesday.

With a total investment of 137 million yuan (21.93 million US dollars), the 804.7-meter new Tumen River bridge is expected to open in 2015 or 2016 as a new route for bilateral trade, authorities said.

The old Tumen River bridge has not been repaired for many years and is facing safety risks. However, the old bridge will not be dismantled and will be kept as a scenic spot.

Tumen City is linked to the DPRK by both highway and railway.

According to Yonhap:

China will begin constructing a new major bridge to North Korea over the Tumen river, China’s state media reported Friday, in the latest sign that economic relations between the two nations remain stable despite the North’s nuclear ambition.

The 804-meter-long, 23-meter-wide bridge will link the Chinese border town of Tumen to North Korea’s northeastern coastal city of Chongjin, the Yanbian Daily newspaper reported, citing the city government of Tumen.

China’s central government recently gave a final approval to build the bridge, which is entirely funded by China at a cost of 137 million yuan (US$21.9 million), the report said.

The newspaper did not specify when the construction would start but that it would “soon be implemented.”

China has been building another major bridge connecting its border city of Dandong to the North Korean city of Sinuiju across the Amnok river, called as the Yalu River in China.

North Korea’s series of provocations, including last year’s third nuclear test, have strained political ties with its last-remaining ally, China. Still, many analysts believe that Beijing will not put strong pressure on Pyongyang due to the risk of aggravating the current situation.

According to AFP:

The bridge will replace an older structure, built in 1938, which will be turned into a tourist attraction, Xinhua said. There are several other rail and road bridges linking the two countries.

Chinese tourists recently started crossing into Namyang for day trips on bicycles.

Read the full stories here:
China to build new cross-border bridge to N. Korea: report
Yonhap
2014-5-23

New bridge to link China, DPRK
China Daily
2014-5-27

UPDATE 2 (2014-5-7): The exact legal status of some of the ports remains a mystery. I have attempted to clarify and point out some of the remaining areas of confusion below.

Pictured above (Google Earth): A 2013-9-14 satellite image of Rason Piers 1 and 2. Pier 1 (Top) is used by the Chinese. The Royale Star is docked at Pier 2.

When Jang Song-thaek was purged, among the laundry list of offenses he was alleged to have committed against the regime was this:

Jang made no scruple of committing such act of treachery in May last as selling off the land of the Rason economic and trade zone to a foreign country for a period of five decades under the pretext of paying those debts.

This phrase had Pyongyang watchers abuzz over whether Chinese contracts in Rason were in any danger of being violated by the North Korean government. Of course it was immediately unclear what enterprise(s) would be affected since we are all unaware of any significant deals reached in May of 2013.

A recent statement by a  North Korean official in the Hong Kong media has, however, raised the issue of contract credibility in the DPRK yet again.

According to Yonhap:

Chinese companies have not leased piers at a port of North Korea’s free trade zone, a Pyongyang official has told Hong Kong media, raising speculation that the shock execution of the North Korean leader’s uncle might have soured business ties with its key ally.

China reportedly agreed to invest about US$3 billion in developing the free trade zone in North Korea’s northern tip of Rason, formerly known as Rajin and Sonbong, in late 2011. The special trade zone sits across the border from China’s northeastern Jilin province.

There have been media reports that Chinese companies have leased two piers at the Rason port, but Kim Chun-il, a division chief of the port’s foreign business bureau, denied such reports during an interview with Hong Kong-based Phoenix TV.

Asked by a Phoenix TV journalist whether China won the right to exclusively use two piers at the port, Kim replied in Korean, “There are no piers that are specially used by the Chinese side.”

“They (Chinese people) have said so, but we have never formally rented out Pier 1 and Pier 2 to them,” Kim said.

The interview was made during a 72-minute special TV program on the Rason trade zone, which was aired on April 19. The program’s video footage can be seen on the website of Phoenix TV.

Kim said that Russia leased the Pier 3 at the port, adding that North Korea plans to modernize the two piers on its own.

The Chinese media did indeed claim at least once (see here) that they were “using” Piers 1 and 2. And Dr. Bernhard Seliger told us back in September 2012 that the Chinese were using the port, although no lease was signed [see below].

However, it is not true that the North Koreans have never announced an agreement on Pier 1 at Rason. I posted an article (back in March of this year) in which Choe Hyon Chol, section chief of the new State economic Development Commission, stated the following:

The Rajin Port, a transit trade port, is the hub of international cargo transit transportation and transport of exports and imports of entrepreneurs who invested in the zone.

The port has assignments to transport marine products for export from the East Sea of Korea and every kind of cargoes from and to northeast area of China and Far East Region of Russia.

The Rajin Port consists of three wharves; wharf No. 1 is designed to be renovated and operated by China Dalian Chuang Li Co., Ltd. and wharf No.3 by Rason International Container Transport J. V. Company to be set up according to the contract with Russian Rail Trade Co., Ltd.

I cannot imagine that a Chinese company is going to renovate and operate the pier without a clear contract. Of course the status of that contract is now called into question. Has the Chinese firm pulled out?  Have the North Koreans canceled the contract? Are North Korean individuals from different agencies just not on the same page? Who knows?

Still no word on Pier No. 2.

Great recent photos of Rason port by Ray Cunningham here.

You can read the Yonhap story here:
N. Korean official says no piers for China at special trade zone
Yonhap
2014-5-2

UPDATE 1 (2012-9-5): It appears the information in the original post is out-of-date now. So here is an update:

Pictured Above (Google Earth): Rajin Port

Dr. Bernhard Seliger of the Hanns Seidel Foundation writes in with an update on the Rajin Port:

The 80 year old port has three piers, of which the No. 3 pier is used by the Russians. They have a long-term lease (50 years starting in 2008) and while they are currently doing some work there, it is not being used for exports.

China is interested in using Pier No.1 (where it rents a warehouse to store coal) and Pier No. 2 (currently in use by the Koreans). Plans have also been expressed (now cancelled) to build 2 new piers (No. 4 and 5) (See here). For many years the Chinese and North Korean governments have negotiated a pier rental agreement, but for now there is no concrete result–though at numerous times it has been maintained that China already rented the port. What exactly the problems are is not known. For now China uses the port to bring coal from the northernmost Heilongang Province to southern China via a sea route, an event which took place twice this year.

Theoretically, the port as a handling capacity of 3 million sq. tons, however the maximum real handling was 800.000 tons in 1979, while last year it was 200.000 tons. The depth of the harbor is 9 m.

In a report from Xinhua (2012-8-28), the Chinese assert they are using ports 1 and 2.

China […] was using No. 1 and 2 piers, while Russia had leased No. 3 pier, said an official in charge of foreign affairs of the port.

So there is some discrepancy between the Chinese account and Dr. Seliger.

ORIGINAL POST (2010-5-23): What are the three piers at Rason used for? 

The City of Rajin (Rason) has three ports (pictured above–click for large version).  According to a 1998 UNDP report, Pier No. 1 (on the right) was known as the “Russian-Japanese Bulk Fertilizer Terminal. It has now been leased by the Chinese. Port No. 3 (left) was formerly known as the Rajin Alumina Terminal.  This is now leased by the Russians (see here). A fellow North Korea-watcher tells me that Pier No. 2 is reserved for the North Koreans.

KBS recently ran a video on recent changes in Rason. I have uploaded the segment to YouTube (Apologies to readers in China).  You can see the video here.

On a side note, if anyone in China has the time and savvy to rip videos from my YouTube account and re-post them on Youku please go for it.

In September 2013 the DPRK held its first conference on economic development zones under the just announced State Economic Development Commission. Read all about it here.

On May 2, 2014, KCNA announced a second conference:

Knowledge Sharing on SEZs in DPRK Held

Pyongyang, May 2 (KCNA) — There took place at Yanggakdo International Hotel on Friday knowledge sharing on SEZs in the DPRK hosted by the Korea Economic Development Association [AKA State Economic Development Commission/Association].

It was attended by Ri Chol Sok, vice-chairman of the association, and its other officials and experts and teachers and researchers at scientific and educational institutions and officials concerned.

Also present there were Kyung-Ae Park, professor at University of British Columbia, Canada, prestigious experts on special economic zones from China, India, Canada, Philippines and the U.S. and foreign diplomatic envoys and representatives of international bodies here and foreign embassy officials.

Ri Chol Sok and Kyung-Ae Park made speeches.

The speakers congratulated those participants on the successful holding of the event and mentioned the importance of the exchange of each other’s experience and cooperation in developing special economic zones and managing and operating them.

They said that the event would help to broaden experts’ vision and expand the development work and also contribute to promoting the international exchange and cooperation.

Then followed speeches.

Introduced at the event were the present situation in some economic development zones of the DPRK and their prospect and policies of preferential treatment and the master plan for Wonsan-Kumgangsan area.

The results of researches and opinions were exchanged and the BOT widely applied to investment and cooperation and the experience gained by various countries in doing so were discussed.

The event marked an occasion in contributing to turning economic development zones of the DPRK into world-level economic cooperation zones by introducing the advanced experience gained in special economic zones according to the specific conditions of the country.

Uriminzokkiri posted this video of Kyung-Ae Park and Yun Yong-sok:

Here is a loose translation of the video:

Q) What were your initial thoughts on the SEZ’s?
A) It is important to differentiate the North’s SEZ’s from those of other countries to make them attractive to investors. For tourism SEZ’s, many experts have recommended minimizing environmental degradation to promote sustainability. 신평 관광개발구 (신평 tourism SEZ) is a good example where sustainable development can help attract tourists who wish to relax and enjoy the environment.

Q) You teach Poli Sci at UBC, how did you get interested in SEZ’s?
A) Faculty exchanges among economics and management experts are often more profitable than academic discussions on political science. Naturally, those who participated in the exchange programs were talking about SEZ’s more often than any other topics.

Q) What are your thoughts on the prospects of the North’s SEZ’s ?
A) I was impressed how the entire country is putting an effort into SEZ projects. This is a very positive aspect, but we need to think about making these SEZ’s more attractive than SEZ’s of other countries.

Here is another translation:

Dr. Park: The key issue of establishing economic development zones (EDZs) is how to make ‘our’ zones distinctive from other countries. In the tourism industry, for example, it has been suggested that simply constructing new buildings, hotels, and condominiums does not offer any competitive advantage because others have been doing the same way. Instead, a better way is to ask ourselves what makes our zones unique so that they could attract people and investment. For North Korea, it is indeed the beauty of the wilderness and untouched nature that makes the country remarkable.

While teaching political science in University of British Columbia, I’ve come to realize that the South-North exchange should first take place in the area where both have mutual interests and the outcome can be mutually beneficial. Exchanges among the political scientists will unlikely be productive; so instead, we have been inviting numerous North Korean professors of economics and business, including those from Kim Il-Sung University, Wonsan University of Economics, and Pyongyang University of Foreign Studies. And this year we are extending our invitation for the fourth time.

Yet, compared to the number of North Korean experts coming to Canada, not many scholars have visited the North from our end as part of an exchange program. While we were considering ways to facilitate an academic exchange at a greater level, we were lucky to get in touch with Korea Economic Development Association (KEDA; aka Chosun Economic Development Committee). We had a meeting on special economic zones last October […] and this was a follow-up meeting after the successful outcome of the first one. Canada-DPRK Knowledge Partnership Program (KPP) organized the event, and KEDA co-hosted the meeting.

Many experts have suggested that more study is needed to make North Korean economic zones distinctive, unique, and attractive. The critical issue remains as to how to attract foreign capital and investment. Despite many challenges North Korea may confront, we believe that passion and diligence of North Koreans will prove fruitful.

Institute for Far Eastern Studies (IFES)
2014-4-30

A large increase in the number of new companies that registered for the 17th Spring International Trade Fair has been reported in a recent Choson Sinbo article. The fair will run from May 12-15, 2014 and be held at the New Technology & Innovation Hall at Pyongyang’s Three Revolution Exhibition.
 
According to the April 22nd article by the Japan-based pro-North Korean news outlet, the number of countries expected to participate rose from 12 to 14, and the total number of registered companies more than doubled compared to the previous exhibition, from 140 to 290.
 
A large variety of new products and technology are expected to be revealed at the upcoming exhibition, such as new machinery and developments in metalworking, electricity, mining, construction, farming and food processing. Other products and technological innovations in energy conservation, environmental protection, transportation and communication are also expected to be revealed at the exhibition.
 
The North Korean media reported that contrary to the negative assessments reported in the western media, foreign economists are actually highly anticipating the rapid growth of the North Korean economy. In an interview, a representative for the Korean International Exhibition Corporation was quoted as saying, “Even amidst economic sanctions imposed by America and its followers, our nation’s economic construction is moving forward with speed.” It was also reported that foreign participants and observers of past exhibitions are relaying this fact to the outside world, which steered the expanding size of the fair.

In addition, North Korean state media boasted the reason for the exhibition’s rise in popularity was due to the increase in domestic product quality, which has led to an expected increase in not only the number of participating countries and companies but also the number of expected visitors to the fair.
 
The Pyongyang International Trade Fair was held for the first time in 1989 with the hopes of establishing friendly economic relations with other countries, and to specifically promote the exchange of goods and technology. In addition, North Korea opened the fair in order to break into new international markets and attract foreign investment. The second International Trade Fair was held three years later in 1992, and has been held annually since the year 2000.
 
The host of the exhibition, the Korean International Exhibition Corporation, oversees the introduction of new companies and products; offers consultation on trade, commerce, investments and joint-venture policies; promotes the exchange of goods and technology, new market openings and foreign investments; and works together with participating companies to facilitate international trade.
 
The Pyongyang International Trade Fair is North Korea’s largest trade exhibition, and is held twice a year in the spring and fall with the goals of attracting foreign capital and finding new export opportunities. In relation to this event, the 10th Pyongyang Fall International Trade Fair will run from September 22-25, and will be accepting applications until August 5.

According to Yonhap:

More than 40 European businessmen in South Korea traveled across the heavily fortified border into North Korea on Tuesday for a rare trip to an inter-Korean factory park amid tensions on the Korean Peninsula, a unification ministry official said.

A 42-member delegation of the Korean-German Chamber of Commerce and Industry in Seoul plan to tour facilities and South Korean factories in the North’s western border city of Kaesong before returning home later in the day, the official said.

The delegation includes officials of the German engineering giant Siemens AG and BMW, a premium German automaker. It also includes Swiss nationals and Austrians, according to the official.

…

Separately, about 40 South Korean business leaders from around the world also plan to visit the factory park in Kaesong on Friday, according to the unification ministry official.

In December, about two dozen officials from the world’s G-20 economies toured the Kaesong complex on the sidelines of their global financial meeting in Seoul.

The sprawling enclave in Kaesong is home to 120 small South Korean plants producing garments and other labor-intensive goods. More than 44,000 North Koreans work in the complex.

Read the full story here:
European businessmen visit inter-Korean factory park in N. Korea
Yonhap
2014-4-29

Not much specific information is available, but the DPRK has signed economic agreements with Russia’s Amur and Sakhalin Regions.

According to RIA Novosti:

North Korea’s Foreign Trade Ministry and the authorities of Russia’s Amur region in the country’s southeast have signed an economic cooperation agreement, the Yonhap news agency reports.

“An agreement on trade and economic cooperation was signed between the DPRK ministry of Foreign Trade and the Amur Regional Government of the Russian Federation,” Yonhap cited Pyongyang’s KCNA state news agency as saying Monday.

According to the Korean Central News Agency, the accord was signed Monday during the visit of Yuri Trutnev, a Russian Deputy Prime Minister and Putin’s official envoy to Russia’s Far Eastern Region.

As part of his North Korea trip, Yuri Trutnev met with the Cabinet’s Vice President Ro Tu-chol and reportedly shared his views on a broader economic cooperation between the two nations, among other issues.

The agreement between Moscow and Pyongyang is another step towards closer economic partnership in the Far Eastern region, after the Amur territory on China’s northern border signed a fraternity and trade deal with Korea’s South Pyongan province in 2011.

A similar economic cooperation agreement was signed last week between Pyongyang and the local government of Russia’s Sakhalin region.

Voice of Russia reports the following:

North Korean’s Foreign Trade Ministry and the government of Russia’s far-eastern Amur region have signed an agreement on trade and economic cooperation, the Yonhap news agency reports with reference to the Korea Central News Agency (KCNA).

The agreement was signed on Monday during a visit to Pyongyang of a Russian delegation led by Deputy Prime Minister and Presidential Plenipotentiary in the Far-Eastern Federal District Yuri Trutnev.

No further details have been immediately available.

A wide range of matters, connected with the development of political, trade-and-economic cooperation will be discussed in the Democratic People’s Republic of Korea (DPRK) by Yuri Trutnev, Russia’s Vice-Premier and Russia’s plenipotentiary presidential representative in the Far Eastern Federal District.

An official at the Russian Embassy to the DPRK said that Trutnev would arrive here by air on Monday by a special flight at the head of a Russian delegation for a three-day visit, TASS reports.

Apart from talks with DPRK officials, the Vice-Premier will attend a ceremony marking the handover of a large consignment of fire-engines to the Korean side.

The delegation will also lay flowers to the Liberation Monument here. The Monument bears an inscription “Eternal glory to the Great Soviet Army that liberated the Korean People from the yoke of Japanese militarists and opened up the road for the Korean people to freedom and independence!”.

The delegation leader will be accompanied by Primorsky Territory Governor Vladimir Miklushevsky, Khabarovsk Territory Governor Vyacheslav Shport, and Amur Region Governor Oleg Kozhemyako.

In March this year, the DPRK was visited by President Rustam Minnikhanov of the Republic of Tatarstan, as well as by Alexander Galushka, Russian Minister for the Development of the Far East. The latter attended a meeting of the Co-Chairmen of the Intergovernmental Commission for Trade-and-Economic, Scientific and Technical Cooperation between the Russian Federation and the DPRK as head of the Russian part of the Commission.

Moscow and Pyongyang actively strengthen economic contacts of late. The delegations of Russia and the DPRK attended a meeting the international “Organization for Cooperation of Railways. It is reckoned that the Organization’s main goals are to develop international freight and passenger transportation, and establish a Common Railway Transportation Space in Eurasia. This year the Organization’s conference is being attended for the first time by South Korea as well.

Tense relations between Pyongyang and Seoul are keeping on at the political level. Nevertheless, Russia is calling on the two countries to reach agreement between each other and take part in implementing the project for linking up the inter-Korean Railway and the Trans-Siberian Mainline Railway (Trans-Sib).

Railway transport is one of important areas of cooperation between Russia and the DPRK. A ceremony marking the completion of the upgrading of the railway section running from the Russian station of Khasan to the North Korean city of Rajin was held in the Republic in September last year. Work has been also completed to bring into being a general-purpose trans-shipment terminal in Rajin the principal port in the Rason trade-and-economic zone.

The upgrading of the infrastructure of the Khasan-Rajin railway leg is viewed as the pilot segment of the reconstruction of the entire Trans-Korea Railway. In prospect, when railway communication from the South Korean port of Pusan via the DPRK to Russia is established in full, an opportunity will open up to reorient to Russia’s Trans-Sib a considerable part of goods, which are currently shipped now via a trans-oceanic seaway from South Korea to Europe.

The possibility is being explored for inviting South Korean businessmen to participate in developing the railway transportation infrastructure o the DPRK, including port facilities.

Here is some comprehensive analysis by 38 North.

Here is some more analysis at the Hankoyreh.

Read the full stories here:
Russia, North Korea Strike Economic Cooperation Deal
RIA Novosti
2014-4-29

N Korea, Russia’s Amur region seal regional cooperation deal
Voice of Russia
2014-4-29