Archive for the ‘Economic Development Zones (2013)’ Category

Naenara reports on Wonsan SEZs

Wednesday, October 7th, 2015

Naenara carried an interview with Choe Yong Dok, Director of the Economic Zone Development of Kangwon Provincial People’s Committee.

In the interview, Director Choe commented on the Wonsan-Mt. Kumgang International Tourist Zone and the Hyondong Industrial Development Zone.

I tried copying the text here, but was not successful. Here is the PDF.

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Wonsan Kalma Airport imagery (UPDATED)

Monday, August 17th, 2015

UPDATE 1 (2015-8-17): Kim Jong-un visited the Wonsan Airport (Kalma Airport) for an air force demonstration reported in Rodong Sinmun on July 30. You can see a video of that event here. A second official video claims that the demonstration took place on July 28. A satellite image of the facility was taken just the day before (July 27) and we can see some of the new facilities and preparation for Kim Jong-un’s arrival. I have already reported on most of this material at Radio Free Asia (새단장 갈마비행장…활주로에 광고도).

First, Google Earth imagery shows thousands of soldiers on the new runway practicing for Kim Jong-un’s arrival at the observation building. They can also be seen in the official images:

Wonsan-runway-soldiers-2015-7-27

wonsan-runway-soldiers-2015-7-30

We can also see the completed (on the outside) Wonsan Airport terminal building:

Wonsan-terminal-2015-7-27

Also unveiled is the new logo for the airport which reminds visitors that (despite the heavy military presence) the new airport welcomes civilian vacation travelers. We can see this design at both ends of the runway:

Wonsan-Kalma-airport-logo

We can also see what appears to be a (fifth!) runway for Kim Jong-un. This runway contains similar facilities to the new Kim Jong-il runway built in Taesong District for use of the individuals that live in the Kim Family’s Ryongsong Complex:

Kalma-kim-jong-un-runway

Pictured above: The probable Kim Jong-un light aircraft runway at the Wonsan Kalma Airport

Taesong-Kim-Jong-un-runway

Pictured above: Kim Jong-un’s runway in Taesong district of Pyongyang which bears a close resemblance to the facilities at the Wonsan Kalma Airport.

ORIGINAL POST (2015-5-1): New Google Earth imagery shows continued development of the new civilian airport in Wonsan. The airport is presumably intended to support the Wonsan-Mt. Kumgang International Tourist Zone.

2015-3-26 (Google Earth)

Wonsan-Airport-2015-3-26

2015-2-10 (Google Earth)

Wonsan-Airport-2015-2-10

2014-12-25 (Google Earth)

Wonsan-Airport-2014-12-25

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The drought that didn’t matter, North Korea says – thanks to agricultural reform?

Monday, August 10th, 2015

By Benjamin Katzeff Silberstein

During the past few months, the World Food Program (WFP) has made reoccurring pleas for increased food assistance to North Korea to alleviate the food shortages expected from a severe summer drought. The North Korean government made similar statements and claimed that the drought was the worst one to occur in 100 years. Aid to the country was subsequently increased from the originally planned level, due to the drought. But now, one North Korean official is saying that food production ended up increasing, after all, thanks to agricultural reforms.

A recent brief by the Institute for Far Eastern Studies at Kyungnam University (IFES) cites a July issue of Tongil Sinbo, a North Korean state-run weekly newspaper. There, Chi Myong Su, director of the Agricultural Research Institute of the Academy of Agricultural Sciences in the country, says that

“the effectiveness of field management system (pojon) from cooperative farm production unit system (bunjo) is noticeable and succeeded in increasing grain production despite the adverse weather conditions.”

The article cited by IFES highlights the smaller work-team structure as key to the success of the reforms. Also, it almost outright states that greater economic incentives were the main factor (although they call it “enthusiasm” and “patriotism”):

“Despite the adverse weather conditions last year, the high grain yield was possible due to implementation of scientific farming methods and field management system to increase enthusiasm of farmers,” and “based on this experience, many cooperative farms across the country will expand subworkteam management system to field management system.”

This is interesting for several reasons.

First, the agricultural reforms seem increasingly pronounced. Though other reforms were reportedly backtracked earlier this year, the government seems eager to claim success for the road travelled in agriculture.

I have written elsewhere that the data doesn’t necessarily support a claim that reforms are working. There is still reason to be skeptical – after all, a North Korean government official claiming that his government’s policies are working is not surprising – but even the claim itself is interesting.

Second, the statement raises questions about monitoring and data gathering capacities, both of the regime and relief organizations in Pyongyang. Again, just a few months ago, alarm bells were ringing about a potential food shortage, and now, a regime official claims that food production has increased. What was the basis of the WFP and regime claims that a food shortage was imminent a few months ago, and what has changed since those claims were made?

Another recent IFES brief also deals with North Korean press reports about the agricultural reforms. It quotes a Rodong Sinmun article from earlier in the summer that brings up some adjustment problems that farmers have had, such as learning how to properly use fertilizers. The most interesting part in my opinion is the following:

The newspaper stressed that “when all farmers claim ownership of their field and subworkteam, one can create innovation in the farming operations.”

Thus, it seems like Pyongyang wants to encourage experimentation and diversity in production methods. This would be a potentially important step towards more efficient agriculture. Perhaps it is part of a pattern. Provinces have reportedly gotten significant leeway in setting up their respective special economic development zones, which could also be a way to encourage experimentation in policies and management methods.

According to the Tongil Sinbo article, reforms are set to expand further in the country given the alleged success. Perhaps it won’t be too long before we can learn more about them through assessments by multilateral organizations like WFP.

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Real estate and insurance laws adopted for SEZs

Wednesday, July 22nd, 2015

According to KCNA:

Rules of Real Estate and Insurance in EDP Adopted

Rules of real estate and insurance in the economic development parks (EDP) were adopted according to the decision of the Presidium of the Supreme People’s Assembly of the DPRK.

The rule of real estate consists of seven chapters and 59 articles and the rule of insurance four chapters and 52 articles.

The rules deal with possession, registration and employment of real estates, their rent and rate, conclusion of insurance contract, formalities of insurance offices, etc. in the EDP.

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Wonsan City seeing new construction area

Tuesday, June 30th, 2015

Kalma-street-construction

Pictured above (Google Earth): Site of the new Kalma Street construction site in Wonsan

According to KCNA (2015-5-20):

Ground-breaking Ceremony of Construction in Wonsan Area Held

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

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

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

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

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

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

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

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

Wonsan: Start of Construction as ‘Global Tourist City’

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

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

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

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

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

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

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

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

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

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‘Wonsan-Mt. Kumgang Tourist Region’ investment briefing

Thursday, June 4th, 2015

UPDATE 6 (2015-7-23):  KCNA issues another report on the Wonsan – Mt. Kumgang Tourist Zone:

The DPRK’s project for developing the Wonsan-Mt. Kumgang international tourist zone (ITZ) is attracting deeper international attention as the days go by.

In this regard, O Ung Gil, vice-chairman of the Wonsan-Mt. Kumgang ITZ Development Committee, told KCNA:

After the briefing on investment in the tourist zone held in Mt. Kumgang in May, the number of foreign companies and investors, who are willing to take part in the project, is on the increase.

Many companies in Asian and European countries showed a disposition to cooperate with the DPRK in the fields of designing, IT, building materials, foodstuffs, passenger service and so on. Some of them have already made contracts.

Many businessmen are hoping for the briefing on investment in the Wonsan-Mt. Kumgang ITZ to be held on a larger scale.

The construction for turning the Wonsan area into a world famous tourist destination, a model of city formation is being pushed forward. And a large number of local and foreign tourists have continued to visit the Mt. Kumgang area.

It has been also expected to let tourists enjoy various forms of tourism like mountain marathon and cycling.

The DPRK government has taken a series of measures to offer such preferences as recommending favorable projects ahead of others and discounting land rent to investors, who will agree upon the terms of advance investment and deferred compensation or the method of comprehensive development of land not later than 2017.

UPDATE 5 (2015-6-4): Institute for Far Eastern Studies (IFES) has issued a report on the conference. ‘Wonsan-Mt. Kumgang Tourist Region’ investment briefing held

The state-run Korean Central News Agency (KCNA) reported that the ‘Wonsan-Mt. Kumgang Tourist Region’ investment briefing was held at Mt. Kumgang on May 27, 2015.

According to the news agency, various parties were in attendance at the meeting, including embassy officials, the Wonsan-Mt. Kumgang Tourist Region Development Committee Chairman Yun Yong Sok, and a number of Chinese companies including the Dalian Branch of the World Overseas Korean International Trade Association, China’s Onyongbuksadal Group, Ltd., the Liaoning Province Hubei Store, the Liaoning Northeast Asia Association for Promoting Economic Culture, and China’s Hong Kong Global Industry Investment Group.

At the meeting Chairman Yun Yong Sok revealed, “In order to develop the Wonsan-Mt. Kumgang Tourist Region in a short period of time, the government is creating a prospective overall plan and completing detailed plans by district accordingly.” He also explained, “Before long this region will be transformed into a world-wide tourist hub and a sphere of economic cultural exchange.”

Regarding the briefing, Hong Kong Global Industry Investment Group, Ltd. manager Ho Tung remarked, “We found out about the impressive results they are achieving in economic growth and improving the people’s quality of life […] By cooperating with world-renowned investors, Mt. Kumgang will become a global tourist destination in the future.”

A video introducing the Wonsan-Mt. Kumgang Tourist Region was screened at the briefing, and various topics were discussed including ‘Regarding the Wonsan-Mt. Kumgang Tourist Region Development Prospects,’ ‘Regarding the Mt. Kumgang International Special Tourist Zone Prospects,’ ‘Regarding the Legal Environment of the Wonsan-Mt. Kumgang Tourist Region,’ and ‘Regarding the Lake Sijung Area Development Prospects.’

According to the KCNA, “The briefing, which captured the interest of overseas Korean businessmen and investors and professionals from various countries, served as an important opportunity to provide investment opportunities and deepen understanding regarding the development prospects of the Wonsan-Mt. Kumgang Tourist Region.”

The briefing session started on May 25, 2015 and lasted for six days on-site at Mt. Kumgang. Throughout the event participants toured the areas of Haegumgang, Kuryongyon, and Samilpo and also attended a business conference. Authorities used the ‘18th Pyongyang Spring International Product Exhibition’ on May 11, 2015 as an opportunity to also hold this investment briefing on the development of the Wonsan-Mt. Kumgang Tourist Region.

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

This tourist region was announced as a central-level ‘economic development zone’ (EDZ) on June 11, 2014 by ordinance of the Standing Committee of the Supreme People’s Assembly. It is part of the large-scale tourism belt that includes Wonsan district, the Masikryong Ski Resort, Ullim Falls, and the Sogwansa, Tongchon and Mt. Kumgang districts. In his 2015 New Year’s address, Kim Jong Un proclaimed to the people, “We need to multilaterally develop foreign economic relations and actively push forward the development of economic development zones like the Wonsan-Mt. Kumgang Tourist Region.”

UPDATE 4 (2015-6-3): The North Koreans produced this video of the event.

UPDATE 3 (2015-5-30): KCNA reports on some of the other participants leaving the event:

Foreign delegations left here on Saturday after taking part in the 2015 seminar on investment in Wonsan-Mt. Kumgang international tourist zone.

They included a delegation of the Dalian Branch of the World Trade Association of Overseas Koreans, a delegation of the Chinese Liaoning Beisida Group Co. Ltd., a delegation of the Chinese Liaoning Provincial Hubei Commerce Chamber and a delegation of the Liaoning Northeast Asia Society for Promoting Economy and Culture.

UPDATE 2 (2015-5-27): KCNA reports (again) on the briefing:

The 2015 Seminar on Investment in Wonsan-Mt. Kumgang International Tourist Zone took place in the Mt. Kumgang, on Wednesday.

Present at the briefing were members of the Committee for the Promotion of Development of Wonsan-Mt. Kumgang International Tourist Zone including its Chairman Yun Yong Sok, a delegation of the Dalian Branch of the World Trade Association of Overseas Koreans, a delegation of the Chinese Liaoning Beisida Group Co. Ltd., a delegation of the Chinese Liaoning Provincial Hubei Commerce Chamber, a delegation of the Liaoning Northeast Asia Society for Promoting Economy and Culture and a delegation of the Global Businessmen’s Group Co. Ltd. for Investment of Hong Kong, China, Swedish and other foreign guests and foreign embassy officials here.

Congratulatory speeches were made there.

Yun Yong Sok said that the DPRK government worked out a long-term master plan for developing the tourist zone in a brief span of time and is in the process of rounding off detailed plans for different areas. This zone will turn into a world tourist destination and a hub for economic and cultural exchanges before long, he added.

The general manager of the Global Businessmen’s Group Co. Ltd. for Investment of Hong Kong, China said that staying in the DPRK, he clearly learned that the Korean people have achieved successes in developing economy and improving the people’s living standard.

He expressed the belief that Mt. Kumgang will be developed into a world famous tourist destination thanks to the cooperation of famous investors of the world.

The participants watched a video introducing the Wonsan-Mt. Kumgang International Tourist Zone and listened to speeches introducing it.

UPDATE 1 (2015-5-27): KCNA reports on the briefing:

The 2015 Seminar on Investment in Wonsan-Mt. Kumgang International Tourist Zone took place at the Mt. Kumgang on May 27.

The seminar briefed on a plan for the development of tourist zone, its geographical conditions and legal guarantee for investment.

Ho Ji Hwan, head of the Yantai Branch of the World Trade Association of Overseas Koreans, told KCNA:

The scenery of the Wonsan-Mt. Kumgang international tourist zone is very beautiful. The investment in this zone will bring about good results. And it is expected to be a promising tourist destination. I know that there are some projects for its development and, therefore, will make a positive cooperation in materializing them.

Michael P. Spavor, consultant of the Paektu Culture Exchange in Britain, said:

The environment and conditions in the zone are great to be one of international tourist destinations. I looked round the Masikryong Ski Resort and Songdowon beach which are very excellent.

I am willing to take part in the work for attracting investment.

The Paektu Cultural Exchange website is here. Here is the Facebook Page.

ORIGINAL POST (2015-5-26): KCNA reports that foreign delegations have arrived to participate in the Wonsan-Kumgangsan Tourist Region investment briefing:

Foreign delegations arrived here on Monday to take part in the 2015 briefing on investment in Wonsan-Mt. Kumgang international tourist zone.

They included a delegation of the Dalian Branch of the World Trade Association of Overseas Koreans, a delegation of the Chinese Liaoning Beisida Group Co. Ltd., a delegation of the Chinese Liaoning Provincial Hubei Commerce Chamber, a delegation of the Liaoning Northeast Asia Society for Promoting Economy and Culture and a delegation of the Global Businessmen’s Group Co. Ltd. for Investment of Hong Kong, China.

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18th Pyongyang Spring Internaitonal Trade Fair

Wednesday, May 13th, 2015

KCNA reports that the 18th Pyongyang Spring International Trade Fair has opened (2015-5-11):

The 18th Pyongyang Spring International Trade Fair opened with due ceremony at the Three-Revolution Exhibition House Monday.

Displayed at the venue of the fair are products presented by companies of the DPRK, New Zealand, Germany, Russia, Malaysia, Mongolia, Switzerland, Singapore, China, Cambodia, France, Poland, Australia, Italy, Indonesia, Viet Nam and Taipei of China.

Present at the ceremony were Vice-Premier Ro Tu Chol, Ri Ryong Nam, minister of External Economic Relations, officials concerned, delegations of different countries and regions, diplomatic envoys of different countries and embassy officials here.

An opening address was made by Pak Ung Sik, director of the Korean International Exhibition Corporation, to be followed by a congratulatory speech by O Ryong Chol, vice-minister of External Economic Relations.

The speakers said the fair is developing as an international economic event for boosting the economic and trade relations among different countries of the world and regions and promoting economic development.

They noted that during the fair the participants would witness for themselves achievements made by the Korean people in building a economic power and conduct multilateral scientific and technical exchange in various fields.

The participants will steadily boost cooperation in economy and trade on the principle of equality and mutual benefit in the days ahead, they noted.

The fair will last till May 14.

There was a side conference on the Wonsan – Mt. Kumgang Tourist Zone.

“Paekok”-trademarked Koryo Medicines were also on display.

KCNA also played up Russian involvement:

The 18th Pyongyang Spring International Trade Fair goes on in the Democratic People’s Republic of Korea with attendance of many home and foreign businesses.

Businessmen from various countries, including Russia, New Zealand, Germany and Malaysia, have expressed their will to strengthen the economic cooperation with the DPRK.

Boris Stupnitsky, president of the Primorsky Chamber of Commerce and Industry, Zaytsev Dmitry of the Export Development Center of Primorsky Territory and Igor Agafonov, deputy representative of the Ministry of Foreign Affairs of Russia, told KCNA at the fair:

We attach weight significance to the international trade fair in Pyongyang.

That’s why we are here at this fair with an unprecedentedly big delegation. Among the delegation are firms engaged in meat processing, construction and bean production.

Their intention is to develop Russia’s commercial relations with the DPRK through detailed survey of its trade situation.

We realized, through the autumn trade fair held here last year, that the DPRK has great potentials.

We have a long-term plan for economic cooperation with the DPRK and this vast plan will be carried into practice without fail. Next year more businessmen will come here from Russia.

The city of Pyongyang has undergone a radical change. The development speed of Pyongyang, beautiful and covered with green foliage, took us by surprise. This would have been unthinkable without the guidance of the leader of the DPRK, we dare say.

Here are two videos of the trade fair.

Here is coverage in NK News.

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North Korea Spurring Development of Various Special Tourist Zones

Thursday, April 30th, 2015

Institute for Far Eastern Studies (IFES)
2015-4-30

North Korea is expediting the development of various ‘Special Tourist Zones’. North Korea is diversifying its tour packages, and have designated Mt. Kumgang (Kumgangsan) and Mt. Paektu (Paektusan) as International Special Tourist Zones. A Special Tourist Zone on the riverside near the Amrok (Yalu) River Bridge is also under construction. This zone is designed to attract foreign tourists including Chinese tourists.

In addition, North Korea and China are pushing forward with the ‘Onsong-Tumen Border Culture and Tourism Cooperation Zone.’ This is intended to be a cooperation zone that integrates tourism, cultural performances, duty-free shopping and serves as a distribution center of tourism products for both countries.

North Korea has also revealed outlines of its plans for the Wonsan-Mt. Kumgang Tourist Region and is pushing ahead with an on-site briefing session scheduled for May 2015. While North Korea repairs and expands the existing road network connecting each tourist site (focusing first on Wonsan), authorities have decided to construct a transportation network by establishing a high-speed railroad between Pyongyang and Wonsan, as well as opening passenger routes between Wonsan Harbor and Rason, and Wonsan Harbor and Vladivostok. They also plan to introduce a series of measures for attracting tourists, including a no-visa system, currently under consideration.

In addition, the Korean Central News Agency (KCNA) has announced an era of full-fledged international tourism in Mt. Paektu. On April 23, 2015, KCNA revealed that the Mubong International Special Tourist Zone will be built in part of Samjiyon County’s Mubong Workers’ District near Mt. Paektu. The Mubong Workers’ District is 35km away from Mt. Paektu, 60km away from Samjiyon, and 70km away from Taehongdan. Thus, it is considered eligible for designation as a special district.

This location is considered to be relatively well-equipped with tourism infrastructure compared to other regions, and expected to perform favorably in attracting outside investment. KCNA reported that this region has a number of amenities and attractions as a Special Tourist Zone.

For example, two decades ago North Korea prepared to host the 1995 Asian Winter Games in Samjiyon until those preparations came to a halt. However, construction resumed in the 2000s, and since then North Korea has constructed a large-scale winter athlete’s village equipped with facilities such as a ski resort and ice rink. Also, Mubong lies in the middle of Samjiyon, Mt. Paektu, and Taehongdan. From Mubong one can go climb Mt. Paektu and view the entire Samjiyon area, or go to Taehongdan and see the large potato-growing districts.

Since the Kim Jong Il era, potato fields were planted in Taehongdan as a tourist attraction. In Mubong, North Korea built large-scale blueberry production complexes, which have become well-known for their blueberry wine. There are also customs offices in Ssangdubong, making the entry process for foreigners presumably less difficult.

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Outline for development of Wonsan-Kumgangsan Tourist Region revealed

Thursday, March 26th, 2015

Institute for Far Eastern Studies (IFES)

North Korea has recently revealed an outline of its plans for the Wonsan-Kumgangsan Tourist Region. In May an information session regarding the development of this project will be held on-site in Kumgangsan.

The Chinese newspaper Liaoning Daily reported on March 21, 2015: “North Korea recently held a briefing session regarding its development plans for the Wonsan-Kumgangsan Region at the Grand Metropark Hotel in Shenyang. The meeting was attended by professionals, scholars and businesspeople from several neighboring Northeast Asian countries.”

According to the newspaper, at the event North Korea revealed development plans for a tourist region of approximately 430 square km in area. It also revealed that there will be six major scenic spots throughout the Wonsan-Kumgangsan Tourist Region, namely, Wonsan, Tongchon, Mount Kumgang, Sogwangsa, Masikryong Ski Resort and Ullim Falls.

North Korean authorities explained, “This year the Wonsan-Kumgangsan Tourist Region development project is considered the most important element of our country’s international economic development efforts. The region is being designed at the government level as a world scenic spot that combines the beauty of the ocean, lake, and city.”

The authorities went on to explain that “Geographically, the Wonsan-Kumgangsan Tourist Region is situated on the eastern part of the Asian continent and the central part of the Choson [Korean] Peninsula. Within a 3-hour flight of that region there are a total of 40 cities with populations exceeding 1 million people […] The region contains a total of approximately 670 tourist sites, 140 historical sites, 10 sand beaches, 4 mineral springs, 10 natural lakes, and 3 million tons of muds that are highly effective in the treatment of neuralgia and enteritis of the small and large intestines.”

While North Korea repairs and expands the existing road network connecting each tourist site (focusing first on Wonsan), North Korean authorities have decided to construct a transportation network by establishing a high-speed railroad between Pyongyang and Wonsan, as well as opening passenger routes between Wonsan Harbor and Rason and Wonsan Harbor and Vladivostok. They will also introduce a series of measures for attracting tourists, including a no-visa system, which is currently being studied.

The authorities also explained that North Korea “guarantees the free economic activity of investors and will offer fixed, regular benefits in areas such as land use, labor employment, and taxes.”

“Tourism, manufacturing, and service businesses will be exempt from corporate income taxes for four years, three years, and one year respectively. Meanwhile, real estate businesses that invest in infrastructure will be exempted from land use taxes for ten years, and those that invest in other areas will be exempt for five years.”

The Liaoning Daily reported that at the information session, O Ung Gil, president of North Korea’s Wonsan District Development General Corporation, said, “I hope that by participating this May at Mount Kumgang in the international seminar regarding the development of the Wonsan-Kumgangsan Tourist Region, everyone will have the opportunity to witness and experience Mount Kumgang first-hand. […] North Korea’s door is always open and investors are welcome any time.”

Various Chinese companies and private organizations hosted the information session. Approximately 50 Chinese professionals and business people, who were invited beforehand, attended the program. Only a few Chinese and Japanese media outlets that were chosen by the organizers were permitted to cover the event.

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Total development plans completed for economic development zones: Tenant companies to be put under selection process

Friday, February 27th, 2015

Institute for Far Eastern Studies (IFES)
2015-2-27

According to the Choson Sinbo, a pro-North Korean newspaper in Japan, North Korea is promoting “diversification in foreign economy,” and has recently signed “bilateral agreements on promotion and protection of foreign investment” with 28 countries and “double taxation avoidance agreements” with 13 countries.

The newspaper cited an interview with Kim Chon Il, the director of (North) Korea Economic Development Association: “multilateral foreign economic development signifies developing foreign economic relations with many countries around the world in various economic sectors and units, unlike in the past where foreign economic activities were concentrated around only a few countries.”

In addition, he said, “the form of exchange and cooperation is also orienting toward diversification” and “We are promoting businesses in various sectors in trade, investment, joint venture, and science and technology cooperation based on new products and achievements made with the state-of-the-art science and technology.”

The Choson Sinbo article emphasized that, “Currently foreign economic business projects are not delegated to only a specific unit,” and that “Choson [North Korea] is promoting various business establishments and management of domestic institutions, corporations, and organizations as well as encouraging various overseas companies and individuals in joint venture projects and establishing independent foreign companies in special economic zones.”

The news also elaborated on the amendment of recent foreign investment laws and explained that new regulations and bylaws are being developed to incorporate various investment strategies including internationally recognized BOT (build-operate-transfer) method.

Moreover, the article confirmed that “the core of the DPRK’s foreign economic development lies with the economic development zones,” and the development plans for economic development zones and investment attraction projects are well underway since last year.

Director Kim Chon Il confirmed that “Currently, the total development plans of 13 provincial-level economic development zones were completed and the total plans for the rest of the economic development zones are in the closing stages.”

He added that the Wonsan District Development General Corporation was launched last year and disclosed that the development plans for the Wonsan-Mt. Kumgang International Tourist Zone was completed.

Furthermore, Kim estimated the preparatory period for the business to take about two years and that the substantial business plans must begin now, starting with the selection process for tenant companies. He stressed, “It is timely to vigorously attract investment from around the world on a large scale in accordance with the total development plans of the economic development zones.”

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An affiliate of 38 North