North Korean Economy Watch

Institute for Far Eastern studies (IFES)
2013-1-31

The total amount of assistance provided to North Korea by the South Korean government and private organizations in 2012 decreased by 28 percent against 2011, which marks six years of continuous decline.

The Ministry of Unification revealed on January 27 that the total amount of South Korean assistance to North Korea tallied 14.1 billion KRW (13 million USD), with 2.3 billion KRW (2.12 million USD) of government aid for vaccines and medical trainings and 11.8 billion KRW (10.89 million USD) from the private sector for medical supplies. This is a 28.1 percent drop from the previous year’s total of 1.96 billion KRW (18.09 million USD).

The South Korean government sent about 6.5 billion KRW (6 million USD) of medical supplies to North Korea via UNICEF and the private sector sent about 13.1 billion KRW (12.1 million USD) of malaria prevention supplies, powdered milk, soy milk, and flour.

Last year was the lowest record for humanitarian assistance to North Korea in sixteen years. Prior to this low was 1996, which recorded 3.6 billion KRW (3.3 million USD).

Lee Myung-bak administration’s aid to North Korea for the last five years reached a total of 257.5 billion KRW (236.2 million USD), with 102.4 billion KRW (93.94 million USD) in government funds and 155.1 billion KRW (142.3 million USD) from the private sector. This is equal to only 20 percent of the Roh Moo-hyun administration’s 1.275 trillion KRW (1.17 billion USD), and 44 percent of the Kim Dae-jung administration’s 582.9 billion KRW (534.8 million USD) of total aid to North Korea.

The highest record for South Korean humanitarian aid to North Korea was in 2006 at 298 billion KRW (273.4 million USD), in both government and private sector aid and continued to remain at a high level in 2007 with 289 billion KRW (265.1 million USD) in 2007. However, with the launch of the Lee Myung-bak government in 2008, it dropped to 116 billion KRW (106 million USD), and continued the downward slide recording 67.1 billion KRW (61.6 million USD) in 2009; 40.4 billion KRW (37.06 million USD) in 2010; 19.1 billion KRW in 2011 (17.5 million USD); and 14.1 billion KRW (12.9 million USD) in 2012.

The source of the drop in humanitarian assistance can be attributed to deadlocked inter-Korean relations followed by the shooting death of a Mount Kumgang tourist in 2008; long-range rocket launch and second nuclear test in 2009; and Cheonan and Yeonpyeong Island incidents in 2010.

From 1995 to 2012, the total amount of humanitarian aid to North Korea from the South Korean government was 1.48 trillion KRW (1.36 billion USD) and from the private sector was 871 billion KRW (799.1 million USD), equating to about 2.347 trillion KRW (2.15 billion USD) in total.

Meanwhile, international humanitarian aid to North Korea increased 30 percent in 2012 against the previous year. According to the United Nation’s Office for the Coordination of Humanitarian Affairs (OCHA), total aid to North Korea in 2012 was 113 million USD while the previous year reached 89.2 million USD. It quadrupled to the total amount, 24.4 million USD of 2010.

Nineteen countries joined in the effort to provide humanitarian aid to North Korea such as South Korea, Norway, Switzerland, Canada, Russia, Brazil, and Sweden. In 2010, there were only six countries, and it later increased to seventeen countries in 2011. The OCHA announced that the humanitarian aid provided in 2012 focused mainly on improving the food supply and nutrition, and provided agricultural support.

UPDATE: Here is a similar report in Yonhap (2013-1-27):

South Korea’s humanitarian aid to North Korea dropped 28 percent to a record 16-year low last year, the unification ministry said Sunday, as the cross-border relations remained chilled under Seoul’s outgoing government of President Lee Myung-bak.

Seoul’s humanitarian aid to the impoverished North totaled 14.1 billion won (US$13.1 million), compared with 19.6 billion won a year earlier. Last year’s amount is the lowest since 1996 when only 3.6 billion won was provided to the North in humanitarian aid.

The sharp drop came as relations between the two Koreas remained frozen since the North sank a South Korean warship near their Yellow Sea border in March 2010 and then shelled a border island in November that year. Pyongyang’s nuclear test and rocket launches also affected their ties.

The total amount of assistance the South provided the North during the five years of President Lee was 257.5 billion won, including 155.1 billion won of civilian aid. The total amount is only 20 percent of the aid sent during the presidency of Lee’s predecessor, the former late President Roh Moo-hyun.

The Atlantic has an article on Global Resource Services, a religious US-based NGO which has been running programs in the DPRK for years. The full article is well worth reading.

According to the GRS web page, these are the project in which they are involved:

1. “HaePo Ri Soy Farm“. I suspect that this is located in Haepho-ri (해포리)in Singye County. According to the web page:

About 500 hectares of land originally used to grow corn, has now been dedicated to growing soybeans. Initially, GRS helped by supplying soy seed and equipment to process the soybeans. The soybean products are an excellent source of protein for the local diet. Growing soybeans also helps replenish the soil after growing corn for many years. The soybean oil is used for cooking oil, and the soymilk is used in the local school lunch program.

…

The newest installation at the HaePo Ri Soy Farm is a soybean oil factory. The soybean oil is used for cooking oil, which is very important in preparing meals with locally grown corn and other grains. Soybean meal is also a byproduct of the factory that is also high in protein, and can be used in the local diet and to supplement animal feed. Approximately 30 tons of soybean oil are produced each year.

…
GRS and local farm managers at HaePo Ri have a long range plan for community development. Economic development, water resource development, medical health programs, and educational programs are being planned and implemented.

2. “Jangpoong Goat Dairy Farm”. I suspect that this is the “Jangphung (장풍읍) Goat Farm”.

According to the web page:

GRS began working with the DPRK Ministry of Agriculture and officials from the Jangpoong Goat Dairy Farm in 2002. The engineers and workers at the Jangpoong Farm constructed a building, and GRS began installing dairy processing equipment in June 2003. Dairy processing began in October 2003. Since that time, GRS staff and partners have made several visits to the farm with ongoing support. A delegation of DPRK agricultural experts visited Langston University in 2004 for discussions and training in goat care, nutrition, cheese making, and artificial insemination. GRS began a several year program in 2004 to improve the goat breed at the farm through artificial insemination. A pelletizing machine was installed at the farm in 2007 to pelletize locally grown goat feed for winter storage. Currently the farm has over 3000 goats and regularly processes cheese, yogurt, and butter. Winter production is often continued using powdered milk.

3. Global Health Program and exchanges.

According to Relief Web:

On 9 October 2012, H.E. Alexander A. Timonin, Ambassador of the Russian Federation to DPRK, visited Pyongyang Biscuit Factory to formally hand over a generous donation of Russian wheat flour to WFP’s work in the country.

The donation of 6,000 metric tons of wheat flour is valued at US$5 million. Wheat flour is an essential ingredient in the production of nutritious biscuits that are distributed to well over a million children in nurseries, kindergartens and primary schools, as part of WFP’s project to address chronic undernutrition in DPRK.

Wheat flour is also used in DPR Korea to produce Supercereal – a specialised nutritious blended food – for pregnant and nursing mothers.

During the ceremony, Ambassador Timonin confirmed Russia’s engagement in assisting the most vulnerable in DPRK through its contribution to the work of WFP.

“We are very interested in the activities of WFP in DPRK and are very satisfied with its production of fortified food for children and mothers with the wheat flour donated by Russia,” he said. “The Russian Federation will continue to provide humanitarian contributions to WFP, supporting it`s activities in DPRK.”

Previous posts about aid to the DPRK in 2012 can be found here.

Previous posts about Russia can be found here.

UPDATE 5 (2012-10-15): China is donating USD$1m to the UN World Food Program for use in the DPRK. Accoridng to ReliefWeb:

The Government of China has recently announced a contribution of US$1 million to WFP’s operation in DPR Korea. The donation will be used to assist children and their mothers who are most vulnerable to undernutrition.

In July 2012, WFP started a new operation in DPR Korea, focused on providing nutritional support to women and children most at risk of malnutrition. Much of the food distributed comes in the form of Super Cereal – specialised nutritious foods designed to address vital mineral and vitamin gaps in the regular north Korean diet.

The generous contribution from China will be used to buy around 1550 metric tons of maize, which will be the base ingredient for Super Cereal manufactured in DPR Korea and then distributed for one month to 400,000 children in hospitals, orphanages, and kindergartens. Pregnant and nursing mothers will also receive food rations.

WFP is in urgent need of an additional 30,000 metric tons of maize and 4,000 metric tons of cooking oil to ensure that the most vulnerable women and children in DPR Korea receive the nutritional assistance they need of the coming winter months.

China is an increasingly important donor to WFP, contributing over US$20 million to WFP operations in 2011.

UPDATE 4 (2012-10-5): According to KBS, the South Korean NGO Council for Cooperation with North Korea delivered flour to Pyongyang:

The delivered the 260 million won worth of aid to Gaeseong to help North Korean residents suffering from the natural disasters through the Inter-Korean Transit Office. It plans to deliver an additional 500 tons of flour within this month.

Eleven representatives of the council, which represents 55 domestic humanitarian aid donors to the North, crossed the border to the North to send the flour.

UPDATE 3 (2012-9-24): Radio Free Asia reports (in Korean) that Agape International will be sending 21 tons of baby food to the DPRK.  See the original article here.  See the article in English via Google Translate here.

UPDATE 2 (2012-9-24): Russia just recently forgave the DPRK’s Soviet-era debt and opened a Russian-gauge railway line to Rason, where they lease a pier. Additionally, the Russians are interested in building a gas pipeline that extends to South Korea. They are also providing Food assistance via the UN World Food Program to the DPRK. According to Itar-Tass:

Russia has delivered more than 4,000 tonnes of flour to North Korea, the Emergencies Ministry’s Information Department told Itar-Tass on Monday.

According to the Emergencies Ministry’s representative, the aid to North Korea was rendered in the format of the memorandum of mutual understanding signed between the Russian government and the United Nations’ World Food Program.

“Over 4,100 tonnes of flour were delivered to North Korea by sea. A vessel with another batch of the same weight of flour is planned to be shipped out from the Nakhodka seaport to the North Korean seaport of Chongjin on September 27,” the Information Department said.

UPDATE 1 (2012-9-19): Indonesia will also be sending food assistance through the UN World Food Program. According to the Jakarta Post:

Indonesia will send food aid worth US$2 million in hopes of improving the famine crisis in North Korea, said Coordinating Peoples Welfare Minister Agung Laksono on Wednesday.

“[We] have coordinated with the National Disaster Mitigation Agency (BNPB) to send aid to the World Food Program (WFP), which will later distribute it to citizens of the Democratic People’s Republic of Korea,” he said in Jakarta as quoted by tempo.co.

Agung also hoped that the humanitarian aid, which was initiated by President Susilo Bambang Yudhoyono, would strengthen diplomatic ties between the two countries.

North Korea is in a food crisis after its crops and food reserves were damaged by extreme weather.

After receiving news of the support, North Korean Ambassador to Indonesia Ri Jong Ryul cited a Korean proverb that says “a real friend’s quality is shown in the time of hardship.”

ORIGINAL POST (2012-9-20): The DPRK is to receive at least 1,000 tons of flour from two different donors.  These donors are were World Vision and JTS Korea, a Seoul-based Buddhist relief agency. Both gave 500 tons each via different channels. Interestingly, the World Vision assistance crossed the DMZ in trucks from South Korea.  The assistance from JTS was shipped from South Korea to Dandong where it will be exported to the DPRK.

Some coordination might be in order?

See more below.

According to the Associated Press (via Calgary Herald):

North Korea has accepted a shipment of emergency aid from relief agency World Vision to help victims of floods that killed dozens of people and submerged large amounts of farmland.

Twenty trucks carrying 500 tons of flour crossed the border into North Korea on Friday. World Vision says the aid will be sent to children in the North’s central South Phyongan (PYONG-ahn) province.

South Korean civic associations are also sending assistance. According to the Korea Times:

JTS Korea, a Seoul-based Buddhist relief agency, said a freighter carrying 500 tons of flour left the port of Incheon, west of Seoul, and will soon arrive in North Korea via the Chinese port city of Dandong on the border with the North.

The civilian aid for North Koreans was sent after the North was hit by severe floods in recent months, which left hundreds of people killed or missing.

“Our officials plan to visit North Korea in the near future to monitor the distribution of aid,” a JTS Korea official said.

The shipment came after North Korea last week rejected an offer by the South Korean government to donate 10,000 tons of flour, instant noodles and medicine as flood aid.

Officials at Seoul’s Unification Ministry in charge of North Korean affairs said Pyongyang turned down the proposal and openly displayed anger at Seoul’s refusal to give what the North said it needs most — rice and cement.

Read the full stories here:
North Korea accepts emergency aid from World Vision to help flood victims
Associated Press
2012-9-20

S. Korean civic group sends flood relief to NK
Korea Times
2012-9-20

According to the UNDP (2012-9-24):

In Hanchon, a district in Pyongwon county of South Pyongan province, the small wind energy project team visited the houses of two farmers Mr. Ri Chum Uk and Mr. Kin Yong Ki, who have had wind turbines installed inside their homes. These are small wind turbines, 5 metres high with 300 Watts of installed capacity charging individual 12 volts batteries. With it the farmer says he can operate such electric items as 2 bulbs, a TV, a DVD or a karaoke system with amplifier.

When asked, the two farmers each explained that they had paid $150 for the wind turbine, and spent $5.00 on annual maintenance cost. This info was not independently verified.To charge a full battery takes between 4 to 6 hours and can last about 7 days, depending upon the wind speed and the state of the battery. In the village, it seems that one or two neighbours can each bring their battery to get it charged at Mr. Ri or Mr. Kim’s house.

When asked “what did they like the best with this admittedly small improvement“, both replied; “to have electricity when I want it”.

In this county alone, according to the local county manager, 100 turbines were installed in people’s households and in farm offices, made in the Daily Necessities Factory in the adjacent county of Sukchon. Mr. Kim Ryong Kuk, the manager of the Factory explained that almost once every quarter, he or his colleagues were observing almost 60 turbines in order to get feedback from clients. All users receive training during installation by the manufacturer. Batteries are made locally or in China.

The role of UNDP’s small wind energy project is to promote and diffuse this green technology by improving quality standards and guidelines and demonstrating best practices for households along with social buildings to directly improve people’s energy status in concrete ways.

These types of projects aim to provide support to rural populations in concrete ways. I have no doubt that there will be many obstacles along the way but I feel that we can overcome them in time and in the process improve peoples’ lives.On another day, we went to Pyongsong city to see a larger Mast (10 Kilo Watts) and a solar panel in full use at the County Hospital. We could see how the staffs were strategic in their use of the renewable energy to conduct operations and obstetric aid in emergency cases during electricity cuts; the wind turbine is backing up the work of two operation rooms and two emergency rooms. When looking through the door of one emergency room, the surgeon, operating on a young boy’s leg, saw me and pointed at the light overhead appreciatively. The whole package of a 5 kW wind turbine and a solar panel is $30,000.

These types of projects aim to provide support to rural populations in concrete ways. I have no doubt that there will be many obstacles along the way but I feel that we can overcome them in time and in the process improve peoples’ lives.

Comrade Kim Goes Flying…a film by British entrepreneur and Koryo Tours founder  Nick Bonner (who also did The Game of their Lives, A State of Mind, and Crossing the Line) and a North Korean film production team.

See the film’s official web page here (includes screening dates and cast/crew).

See the film’s Facebook Page here.

See a film clip on YouTube here.

See CCTV coverage here (in English).

BBC coverage here.

See Nick Bonner talking about the film at the Toronto International Film Festival here.

More on the Pyongyang Film Festival here,  here and here.

Also…

Love North Korea Children Charity Event in Shanghai
On September 25th, the UK-based charity Love North Korea Children will hold an event in Shanghai. Hannah Barraclough from Koryo Tours will also attend this event and will be able to answer any questions you may have.

Location: The Public
Address: Sinan Mansions Block 2 4/F, 507 Fuxing Zhong Lu, near ChongQing Lu
Date: 25th September
Starting time: 7PM (19:00)
Entrance: 150 CNY

For more information, please contact: LNKCShanghai@gmail.com

*Love the North Korean Children’s official web page is here. I have previously blogged about their bakery in Rason here. LNKC recently build a bakery in Sariwon.

UPDATE 6 (2012-9-24): The Associated Press reports that WIPO didn’t violate sanctions. According to the article:

The U.N. patent agency says it has been cleared of breaking sanctions against North Korea by sending computers to the regime in Pyongyang.

The Geneva-based World Intellectual Property Organization said Monday that a U.N. panel found it had not violated any of three U.N. Security Council resolutions by providing technical assistance to North Korea.

In July, the Foreign Affairs Committee in the U.S. House of Representatives launched an investigation into whether WIPO had violated U.N. sanctions by sending computers and other technology to Iran and North Korea.

WIPO has insisted it did nothing wrong in providing ‘‘standard IT equipment’’ to the patent and trademark offices in those two countries. The Iran review is still pending.

UPDATE 5 (2012-7-24): A preliminary assessment by the State Department has concluded that WIPO did not violate U.N. sanctions when it sent materials to the DPRK. According to a State Department briefing on July 24:

QUESTION: Two small things. One on WIPO, if that’s how it’s pronounced. WIPO. So following suggestions that WIPO allowed the transfer of banned technology to Iran and North Korea, has the United States been able to mount its own investigation of this?

MS. NULAND: Well, first and foremost, to repeat what we said here last week, we share the concerns raised here in Washington, in the media, regarding these equipment and software transfers by WIPO. We’ve been concerned since we first learned that they had transferred equipment to both North Korea and Iran. We’ve been in contact with WIPO and urged them to institute substantive safeguards.

Our own preliminary assessment, but we are still seeking more information from WIPO, is that there doesn’t appear to have been a violation of UN sanctions. However, this has now been referred to the sanctions committee for them to make their own determination, so we will await the views of the respective UN sanctions committees. We are also seeking more information from WIPO so that we can conclude our own work on whether there was any violation of U.S. law, but we don’t yet have everything that we need in order to make that assessment.

QUESTION: I understand that you don’t yet have everything you need to make a final assessment. But based on what you have, are you able to make a preliminary assessment as to whether or not any U.S. laws were broken?

MS. NULAND: I don’t have a preliminary assessment for you. We’re still seeking some more detail from WIPO.

QUESTION: And then one last thing. I believe there was supposed to have been a hearing in the House today on this that got canceled, I think because the WIPO officials were not going to be available to testify. Are you – given that you don’t yet have all the information that you want, are you satisfied that you are getting enough cooperation from them?

MS. NULAND: Well, we are continuing to work with them, and that is a conversation that is ongoing. I think we are – we have seen a number of positive steps from WIPO with regard to their procedures going forward that are important. For example, they have agreed to a commission that will have an external and independent auditing ability with regard to their projects to try to prevent this kind of thing from happening in the future. As I said, they’re going to seek a retroactive opinion from the sanctions committee, which wasn’t evident at the beginning of this. And they’re also going to ensure that any future projects are reviewed by their legal counsel. But we are still working with them on some of this U.S. stuff that we need.

QUESTION: But you don’t feel like they’re stonewalling you on this?

MS. NULAND: We do not. No.

Here is what the Chicago Tribune had to say about the canceled House committee hearing:

On Tuesday, the ranking Republican and Democrats on the U.S. House Foreign Affairs Committee accused Gurry of preventing two senior WIPO staff members from testifying before a planned committee hearing, forcing its cancellation.

The staff members asked to testify were James Pooley and Miranda Brown, a source familiar with the matter said.

“Director-General Gurry is obstructing this committee’s investigation of WIPO’s transfer of U.S.-origin technology to rogue regimes under international sanctions — a transfer that occurred on his watch,” Republican chairwoman Ileana Ros-Lehtinen and ranking Democrat Howard Berman said in a statement.

A WIPO spokeswoman was not immediately available to comment on the statement. Gurry told Reuters late last week that he would allow “a properly competent person” to testify.

…

Lawmakers have suggested that the United States freeze contributions to WIPO until they are satisfied it is cooperating, although this would likely have a limited impact on the U.N. agency, which relies on member state contributions for only 10 percent of its budget.

UPDATE 4 (2012-7-19): WIPO has issued this statement on their web page:

Information and Clarifications Concerning WIPO’s Technical Assistance Programs
Geneva, July 19, 2012
PR/2012/717

Following some recent media attention and requests for information from certain member states relating to WIPO’s technical assistance programs, WIPO Director General Francis Gurry provided the following information and clarifications concerning the actions that have been undertaken, or are being undertaken, by the Organization in relation to the provision of technical assistance to countries that are the subject of United Nations (UN) sanctions.

The Director General reiterated that the Secretariat is treating concerns relating to the Organization’s technical assistance programs to countries that are the subject of UN sanctions with the utmost seriousness.

The actions undertaken include:

1. Following the expression of initial concerns over the provision of standard IT equipment to patent and trademark offices for the processing of intellectual property (IP) applications, new internal procedures were established and made operational on May 1, 2012. Under these procedures, all managers must refer any activity proposed in a country subject to UN sanctions to WIPO’s Legal Counsel for guidance and clearance. The Legal Counsel will, wherever necessary, consult the appropriate UN Sanctions Committee. Additionally, any work plan for a country subject to UN sanctions will be submitted at the commencement of each calendar year for guidance by the appropriate Sanctions Committee.

2. The provision of standard IT equipment to the IP offices of the Democratic People’s Republic of Korea (DPRK) and the Islamic Republic of Iran that occurred in the preceding years, within the context of the Organization’s business modernization program for IP Offices in developing countries, is being referred to the relevant UN Sanctions Committees for their information and guidance.

3. The initial steps are being undertaken for a full external and independent review of the technical assistance provided to countries subject to UN sanctions.

4. A new internal instruction has been issued ending any provision of IT hardware in any of WIPO’s technical assistance programs.

The Director General reiterates his commitment to transparency and re-affirms the readiness of the Secretariat to continue to provide any information requested by any of the member states of the Organization.

While the legal advice received with respect to the technical assistance provided to DPRK and Iran was that the technical assistance was not in breach of UN Sanctions, it is hoped that the measures outlined above will provide assurance that the Organization is treating this matter with the seriousness that it warrants.

For further information, please contact the Media Relations Section at WIPO:

Tel: (+41 22) – 338 81 61
Fax: (+41 22) – 338 81 40
E-mail

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Institute for Far Eastern Studies (IFES)
2012-6-22

China began to provide large-scale food assistance to North Korea from late February, reported KOTRA (Korea Trade-Investment Promotion Agency) in its recent report.

The Korea Business Center (KBC) in Canton, KOTRA’s overseas branch, released a report about the details of China’s food assistance to North Korea. “China is the largest supplier of material goods to North Korea but even the major North Korean experts in China do not have the exact figures of aid provided to North Korea.” Based on the information gained from local media and interviews with experts, “North Korea requested food assistance of at least 200,000 tons, as well as assistance in construction materials. The amount is estimated at more than 600 million yuan RMB.”

According to Chian Grain Reserves Corporation and Dalian Commodity Exchange, 6,600 million yuan RMB is equivalent to 150,000 tons of rice or 26.5 million tons of corn, calculated with the wholesale price in the Northeast China region. 600 million yuan RMB of rice exported to Shinuiju from Dandong can purchase about 17.1 million tons of rice.

Old rice and flour is being gathered in Dandong from all over China, and is being sold to North Korea at a very low cost without ever entering the Chinese domestic market. The KBC report evaluates that this is a welcomed change because North Koreans are not selective about their food, since they do not have enough money to buy food. It reports, “Cheap food is considered the best food,” and “North Korean customs automatically allows the food to enter the country and small amounts of a few tons of food is not even tariffed,” said an unnamed North Korean trader.

China’s recent food aid to North Korea was conducted largely in two ways: First, it was provided quietly without the public being notified; second, it went via the World Food Programme (WFP) and other international organizations. According to the WFP China Office, the recent 600 million yuan food aid to North Korea was not related to WFP aid to North Korea.

China is careful about releasing information related to its food aid to North Korea. However, what is known is that the aid consists of selling food at a low-cost and through nongovernmental exchanges. There are several trading companies in Dandong that ships food and other materials to North Korea when charitable organizations in Beijing make the request for shipment.

On the other hand, the May 24 (2010) Measures (of South Korea) has suspended all trade between North and South Korea. This has propelled North Korea-China trade to expand and the trade volume between the two nations increased 32 percent or 1.9 billion USD from January to April, compared to the same period of the previous year, according to the Korea International Trade Association.

During this period, North Korea’s export to China recorded 793 million USD, which also jumped 33 percent against last year and the revenues from import also increased 32.8 percent equalling 1.16 billion USD.

According to the Jakarta Globe:

President Susilo Bambang Yudhoyono has agreed to send $2 million in aid to North Korea, a move that is expected to create closer ties with the reclusive country but which has already drawn criticism from rights activists.

Foreign Minister Marty Natalegawa said the decision was driven purely by humanitarian motives, but analysts quickly suggested that the aid could be seen as an attempt by Jakarta to cozy up to Pyongyang after Kim Yong-nam, chairman of the Presidium of the Supreme People’s Assembly, visited earlier this month.

“We have considered the decision for a long time,” Marty said on Wednesday at a hearing with lawmakers in Jakarta.

“However, we’re still facing technical obstacles on how to ensure this humanitarian aid ends up in the hands of those who need it, not for other purposes.”

He said the government was considering working with the United Nations World Food Program or Unicef to ensure the funds reached the North Korean people.

Read the full story here:
Activists Criticize Jakarta’s $2m Gift To North Korea
Jakarta Globe
Ismira Lutfia
2012-6-1

According to the Hankyoreh:

South Korean businesses have suffered losses of up to ten trillion won (US$8.3 billion) from the cutbacks in inter-Korean economic cooperation under the Lee Myung-bak administration, figures show.

The losses taken by South Korean firms are fives times the 1.8 trillion won (US$1.7 billion) North Korea’s estimated losses. The results show an unintended effect of Seoul’s May 24 sanctions, which were meant to punish North Korea economically for the shooting death of a tourist at the Mt. Kumkang resort, the sinking of the Cheonan warship, and the shelling of Yeonpyeong Island. North Korea has offset these losses with increased cooperation with China.

Read more below…

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