Archive for the ‘Manufacturing’ Category

North Korea boasts of ‘world-class cosmetics’

Friday, November 13th, 2015

Institute for Far Eastern Studies (IFES)

As reports in North Korea continue to pour out boasting about the improvement in the quality of its cosmetics, it appears that Kim Jong Un’s instructions to raise the quality of cosmetics suited to the tastes of consumers have achieved some results.

On November 5, 2015, the North Korean external propaganda site ‘DPRK Today’ posted an article about the 26th National Exhibition of Consumer Products, which was held in Pyongyang from October 26-30. The website reported, “The Pyongyang Cosmetics Factory and Sinuiju Cosmetics Factory submitted more than 80 types of cosmetics and hundreds of products to the exhibition, which felt like the site of a fierce technology competition.”

‘DPRK Today’ cited products on display such as soap, beauty cream, shampoo, and conditioner. “The brands were very distinctive, and the packaging has also changed. There were also many new eye-catching products,” the website reported.

The article also referenced the cosmetic industry’s slogan, ‘World-Class Cosmetic Products—More, Better, Faster,’ and emphasized that the “goals and rate of progress of our cosmetics industry have changed. Those dreams were placed on many products displayed at the exhibit.” In order to achieve these goals, the Pyongyang Cosmetics Factory as well as the Sinuiju Cosmetics Factory are “constantly shortening the technology renewal cycle by modernizing the production process and better managing technological capabilities,” the website explained.

Back in May 2015, the Choson Sinbo, a pro-North Korean newspaper in Japan, reported that the Pyongyang Cosmetics Factory was producing functional cosmetics with ‘natural’ and ‘hypoallergenic’ qualities. It mentioned the ‘Unhasu’ brand and stated that products such as beauty cream, lotion, and foundation had already been developed.

The newspaper also claimed that the biotechnology division of the State Academy of Sciences had used stem cells to develop cosmetics with anti-aging, moisturizing, and whitening effects.

Prior to this Kim Jong Un had visited the Pyongyang Cosmetics Factory in February 2015, where he issued instructions to raise the quality of cosmetics. “We need to make it so that our people prefer Unhasu products to foreign-made cosmetics, and further, so that Unhasu cosmetics become the talk of the global market,” he exhorted factory employees.

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The recent consumer goods exhibition reveals qualitative change

Friday, November 6th, 2015

Institute for Far Eastern Studies (IFES)

According to the KCNA, the 26th National Exhibition of Consumer Goods, the National Exhibition of 206 Sundry Goods, and the National Exhibition of August 3 Consumer Goods were held in Pyongyang from October 26 to 30.

The news evaluated these exhibitions to “feature a growing number of varieties in consumer good than in the past, with noticeable qualitative change.” At the exhibition, hundreds of thousands of products were showcased that included knitted products, footwear, and food products.

Among the displayed products, Ryuwon Shoe Factory and Pyongsong Synthetic Leather Factory were acclaimed for their products with 1.25 times more shoes compared to last year’s exhibition. In recent years, factories under the guidance of the Shoes Industry Management Bureau in the Light Industry Ministry create new factories or modernized the existing factories and are reported to be producing high-quality footwear with new products under development.

In addition, the exhibition presented new technology registration review process, to shorten technology updating cycle and to speed up new product development.

Various products made by the branch academy of Light Industry and the Nonferrous Metals Research Institute under the National Academy of Sciences were newly registered under the new review process that included functional cosmetics, antibacterial wipes and other antibacterial goods, and “high-purity” silver goods, etc.

On the other hand, as the living standards of North Koreans are improving, more and more North Koreans are now seeking goods that are eco-friendly, tech-savvy, and health-conscious. Medical goods were popular items in North Korea in the past but today health foods are more in demand. This year there were more high-tech products, such as diesel engines that feature energy-saving and environment-friendly goods, than everyday items.

In the past, North Korean ginseng, sea cucumber, honey and other traditional products were mainly exhibited in these exhibitions. But now, there are more companies that are displaying goods that demonstrate advancement in science and technology and locally produced products.

While commercial advertisements are rare in North Korea, the annual spring and autumn consumer good exhibitions are an exception to this. There are a great number of ads on these exhibitions and many North Koreans are seen taking a souvenir photo next to their favorite ads.

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Factory owners rent out unused space

Monday, November 2nd, 2015

According to the Daily NK:

Recently in South Pyongan Province, the practice of renting out sections of state-run factories to individual entrepreneurs is taking off. This latest development is further evidence of de facto private enterprise flourishing on the back of state facilities.

“There is a factory that manufactures coal mining equipment located in a building that is now partially rented to a donju [literally ‘money masters,’ or new affluent middle class] who is making shoes there. By renting out the building, the authorities can also make ‘a little extra’, which is a nice benefit for them,” a source in South Pyongan Province reported to Daily NK on October 27.

“‘A little extra’ refers to profits falling outside of enterprise work quotas utilizing state labor and raw materials.”

An additional source in the same province corroborated this news.

She added that the officials in charge of the factory must first make sure that they will be able to sell enough of the extra goods manufactured by the donju on the market to make it worth their while. If they calculate that it will be a profitable good to sell, they go ahead and agree to rent out part of the factory warehouse.

Winter is, without fail, a busy season for shoe markets in North Korea. Demand explodes for cotton wool and fur shoes to prevent frostbite. North Koreans put cotton wool into black or army green cloth to make shoes known as “Tong (a mispronunciation of the word Chinese-derived word in Korean meaning ‘winter’) Shoes”. Fur shoes are boots made of synthetic leather and stuffed with compressed cotton wool or sheep wool.

As North Korea’s primary shoe factories, “Pyongyang Shoe Factory” and “Sinuiju Shoe Factory” receive a quota for the number of shoes they should produce to distribute seasonally, they cannot adjust their production levels to meet actual market demand. This leaves a hole in the market the donju are keen to step in and fill.

What really determines the quality of wool or fur shoes is the sole. The donju buy rubber in the general markets and hire laborers to construct soles from it in, as might be expected, exceedingly unsafe work environments. With no access to safety masks, let alone other protective gear, workers inhale overwhelming quantities of noxious gases in the process.

Nonetheless, workers eager to do the job are never in short supply– those hired for the task are paid who wages 2-3 times that of typical day laborers working for the donju.

Although it is possible to sew the leather outer parts and midsoles of shoes at home, proper equipment is required to produce quality insoles. Rubber is pulverized, reconstituted using a machine, and then mixed with fresh rubber to fabricate insoles. However, a compressor is needed to complete this task, which is where the factories come in.

These days, although it is possible to earn a fair amount of money producing goods at home, “if you’re more ambitious and want to enter into large-scale production you’ll run into an electricity supply problem,” the source noted.

“While it can be said that utilizing the unused space of factories contributes to national production, in the end it’s really the factory’s supply of electricity that proves to be the lure.”

In fact, the first thing donju check when scouting a factory to approach is that the facility has a stable power supply. If all on this front checks out, the donju seek out the cadres in charge and set up a contract stipulating that said entrepreneur pay 30% of his or her profits from the sale of goods produced in the factory as rent.

The factories involved in these deals are typically those associated with the coal mining industry. These enterprises produce the majority of the equipment used in North Korea’s coal mines, and because iron is the most used raw material in the production of the related equipment, such factories receive a larger allotment of electricity than typical light industry factories.

There are, of course, other types of factories receiving steady streams of electricity, but for the time being, they are off limits, according to the source. By way of example, the source explained that because munitions factories harbor a litany of “national secrets, ordinary citizens cannot access them no matter how much money they spend.”

And yet, the fact that North Korea’s donju are now turning their focus towards the production of consumer goods can be interpreted as yet another sign of North Korea’s ever-expanding marketization.

She analyzed these trends as follows: (1) as the relative purchasing power of North Korea increases, demand is increasing as well; (2) markets are developing within North Korea, and state-operated stores are also being rented out and run as de facto private operations; (3), the number of retail outlets selling consumer goods is skyrocketing; (4) the use of ‘servi-cha’ has especially improved the distribution process; and (5) compared to goods directly imported from China, the price competitiveness of local goods has improved as well.

In the past, North Korea’s foreign-currency earning enterprises or the donju would go to Zhejiang Province in China or other regions with low labor costs and import large quantities of consumer goods at low prices to distribute within North Korea.

However, these cheap goods fall short of satisfying the market preferences of North Korean citizens today, the source concluded.

Read the full story here:
As factories rent out space, donju move in and set up shop
Daily NK
Seol Song Ah
2015-11-2

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DPRK’s domestic sales of wind turbines

Wednesday, October 28th, 2015

According to the Pyongyang Times:

New type of wind turbines go on sale

A new type of small wind turbines made by the Aeguk Magnet Factory attract an increasing number of customers.

The new turbine with its blades spiral and conical in shape proves to be more advantageous than the three-blade propeller turbine.

Its utilization rate of wind is over two times as high as that of the three-bladed turbine, so it can be set up everywhere—both seaside and inland where the wind blows above two metres per second. And it can also be installed on top of public buildings and on the balconies of multi-storey flats.

With its blades relatively short, the turbine requires only one third of the previous area for installation and generates little noise and vibration.

All parts of the turbine are domestically made including the essential permanent magnet, and the cost is at least 75 per cent lesser despite better stability, said Kim Chol Song, manager of the factory.

Just a few months after the turbines went on sale, the products find growing demands in Haeju of South Hwanghae Province, Phyongwon of South Phyongan Province and other plain areas.

The factory has established a technical process for turbines with a capacity of 100-300W, which are widely thought to cost much less than solar panels in production.

Read the full story here:
New type of wind turbines go on sale
Pyongyang Times
2015-10-28

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Kaesong output reaches US$3 billion

Monday, October 5th, 2015

According to the JoongAng Ilbo:

The Kaesong Industrial Complex’s accumulated production value is expected to have hit the $3 billion mark, more than a decade after its launch, according to government data.

As of the end of July, accumulated manufactured goods were valued at $2.99 billion, with average monthly production output hovering at around $46 million.

Accumulated production value was thought to have surpassed $3 billion sometime after July.

 

…The volume of manufactured goods at the Kaesong Industrial Complex has increased annually since its opening, except for in 2013, when it was temporarily shut down for five months amid tensions on the peninsula. In 2008, the complex surpassed the $200 million mark in production and continued to expand yearly production levels to reach $469 million in 2012.

Due to the temporary shutdown, the complex saw its annual production drop down to $223 million in 2013, though it bounced back to $469 million the following year.

The number of North Korean workers employed by South Korean firms has gone up, from 7,621 in 2005 to 53,947 in 2014, according to data by the Ministry of Unification.

Here is coverage in Yonhap.

Read the full story here:
Kaesong’s accumulated output at $3B
JoongAng Ilbo
Kang Jin-Kyu
2015-10-5

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North Korean-style venture company develops and sells PCs

Wednesday, June 24th, 2015

Institute for Far Eastern Studies (IFES)
2015-6-24

A North Korean electronics company, where engineers in their 20s play a pivotal role, is mass-producing and selling locally made computers that are enjoying popularity due to their high quality and low price.

A correspondent in Pyongyang for the Choson Sinbo reported on June 16, 2015 that North Korea’s ‘Blue Sky Electronics’ is developing, mass-producing and selling various electronic products, including domestically produced computers under the ‘Blue Sky’ brand.

According to the Choson Sinbo, Blue Sky Electronics, which was established in October 2014, is locally developing, producing and selling these computers, which are manufactured at a factory on Tongil St. in Pyongyang.

It is reported that the researchers behind the computers are mostly in their 20s and graduates of Kim Il Sung University, Kim Chaek University of Technology, and the College of Natural Sciences. They are producing products such as ‘all-in-one’ computers, ‘portable’ computers, ‘desktop-type’ computers and ‘portable computers with detachable keyboards.’

The ‘all-in-one’ computers refer to computers that incorporate the desktop and monitor into one body, while ‘portable’ computers and ‘desktop-type’ computers refer to notebook computers and desktops, respectively. ‘Portable computers with detachable keyboards’ seem to refer to computers that double as both tablet computers and desktops.

The newspaper reported that among these, the ‘all-in-one’ computer and the portable computer with a detachable keyboard are especially popular, and orders for these computers are steadily coming in from a number of agencies and companies throughout the country.

The ‘all-in-one’ computer, which has a unique exterior, is said to consume little energy and can be charged using a household battery. Meanwhile, the portable computer with detachable keyboard, which can also be charged using a household battery, has reportedly enjoyed much popularity since it went on the market.

CEO Choi Jin Hyok (29 years old) explained succinctly the company’s business strategy: “Highest quality, lowest price, and product diversification.”

The newspaper added that the company is “developing products that are competitive internationally.” In addition, it was said that “[Blue Sky Electronics] guarantees the highest quality so that buyers can have confidence regarding its domestically made products, and everything in the company’s management is aimed at prioritizing the needs of the people in all aspects of purchasing and service.”

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Samgak Beer

Wednesday, June 24th, 2015

Choson Exchange has let the world know about a new North Korean beer: 삼각맥주

samgak-beer

The name means “triangle” beer, or more accurately “river delta” beer.

It is manufactured at the Rajin Drink Factory (라진음료공장). I do not know where this factory is located, so please let me know if you happen to learn.

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North Korea’s “donju”

Wednesday, June 3rd, 2015

According to Reuters:

Nail salons, massage parlors, cafes and other signs of consumerism were unheard of in rigidly controlled North Korea just a few years ago, but they are slowly emerging in one of the world’s last bastions of Cold War socialism.

North Korea operates a centrally-planned economy modeled on the former Soviet Union where Western-style conspicuous consumption is anathema.

But as a growing middle class of North Koreans earns more money in the unofficial economy, the demand for products such as cosmetics, smartphones, imported fruit juices and foreign clothes is on the rise, according to residents and visitors.

There are now 2.5 million North Korean mobile phone subscribers in a country of 24 million people. Even some state-owned factories are diversifying product lines from rationed daily necessities to meet the demand for non-essential goods.

“Nobody needs to drink coffee, and nobody needs to spend money on it, but people do. This is what’s happening in Pyongyang, and it’s a change,” said Nils Weisensee, a coffee roaster from Germany who works with the Singapore-based Choson Exchange NGO to train North Koreans in business skills.

While the repressive and impoverished country is still years away from becoming a consumer paradise, it is now home to a rising class of rich North Koreans known as “Donju”, meaning “masters of money”, thanks to the growing unofficial economy.

Some Donju spend their cash on private English tuition for their children, or on South Korean or Japanese clothes, according to research by the South Korean government-run Korea Institute for National Unification (KINU), in Seoul.

“People can choose between toothpaste that uses crystals or nanotechnology to make it more effective than normal toothpaste, or a special one flavored for children,” said Weisensee.

Many of the Donju have made money trading in informal markets, or by setting up small businesses. Some businesses operate as a form of public-private partnership, where staff of state enterprises are given permission to start quasi-autonomous profit-making enterprises.

Around 70 percent of that profit goes to the state, with the rest going to individuals, according to defectors from the country, including Choi Song-min, who ran a shipping service before fleeing to the South in 2011.

“For example, at a Chongjin city branch of the transport ministry, they might say to their bosses ‘how about we sell coffee to the people waiting for our buses'” said Choi, who now writes for the Daily NK, a Seoul-based website, and has regular contact with sources inside the North.

At the food section of the Kwangbok Department Store in central Pyongyang, moneyed shoppers can choose between a wide variety of consumer foods like fruit juices, chocolates and soda, according to Troy Collings of Young Pioneer Tours.

“People weren’t just buying basic foods. They were considering factors other than price, by buying the imported orange juice instead of the local one, for example,” said Collings, who leads regular tourist trips to North Korea.

Even leader Kim Jong Un was quoted as saying North Korean-made cosmetics should compete in quality with foreign luxury brands like Chanel and Christian Dior, according to the Choson Sinbo, a pro-North Korean newspaper in Japan.

“These nouveau-riche who make money in the markets need a channel for consumption,” said Ahn Chan-il, 63, a North Korean defector and former South Korean intelligence official who receives information from contacts inside North Korea.

“Things like cars, massages, raffles, pet dogs. North Korean people are already riding on the back of the tiger that is the market economy, not the regime,” said Ahn.

PYONGHATTAN

North Korean consumer capitalism is very much in its early days, residents of Pyongyang said. A chronic energy shortage, brutally repressive government and deeply ingrained corruption ensure that the pace of change is sluggish, and limited.

“What use are these new, kitschily-decorated places that mostly imitate Chinese nouveau-riche life if there is no electricity to cook the food?” a diplomatic source in Pyongyang told Reuters.

One area of downtown Pyongyang, jokingly known by foreign residents as “Pyonghattan” or “Dubai”, is home to expensive department stores, a sushi restaurant and a 24-hour coffee shop.

“Oftentimes you will be turned away, not because you are a foreigner, but because there is just no energy to operate the kitchen. Good luck trying to get a proper meal in Pyongyang after 10 p.m.,” said the source.

Defectors said the consumer boom extends to cities beyond Pyongyang, where bustling markets or train stations are now home to small coffee stalls, and wearing jewelry is an outward and accepted sign of status.

Ahn said the nearby city of Pyongsong is where many well-off North Koreans live, thanks to wholesale businesses importing products from China.

Choi said the coffee drinking trend for moneyed North Koreans began to appear last year: “To look cool, the Donju, party officials and young people like college students go to coffee shops to meet people”.

Read the full story here:
Pyongyang Bling: The rise of North Korea’s consumer comrades
Reuters
James Pearson and Ju-min Park
2015-6-3

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Development of stem cell cosmetics in North Korea

Thursday, May 14th, 2015

Institute for Far Eastern Studies (IFES)
2015-5-14

The Chosun Sinbo, mouthpiece of the General Association of Korean Residents in Japan, reported that North Korea has developed and is now producing cosmetic products that utilize new natural materials and cutting-edge technology, including stem cell technology.

“At the Pyongyang Cosmetic Factory, they are concentrating on developing functional cosmetic products that are natural and low stimulating,” the Chosun Sinbo revealed on April 28.

The biotechnology and light industry divisions of the State Academy of Sciences, as well as scientists, teachers and researchers at the Han Duk Su Pyongyang Light Industry University, are assisting in this work.

According to researchers within the biotechnology division, the product utilizes stem cell technology in regenerating skin, and it is effective in preventing aging, moisturizing skin, and lightening skin.

They said that they developed the cosmetic additive (which has a pine tree scent) at the Pyongyang Natural Perfume Research Center, and that this product matches the characteristics of one’s skin by age and is effective in things like skin lightening and removing wrinkles.

They added that they have also developed a beauty cream that has a moisturizing and whitening effect due to its natural hydrating materials derived from kelp.

In March 2015, First Secretary Kim Jong Un inspected the Pyongyang Cosmetics Factory. During his inspection he cited world-renowned cosmetics brands like Lancome, Chanel, Christian Dior and Shiseido and encouraged the factory to “continually raise the quality of its products so that we can compete with such foreign cosmetic products.”

In particular, Kim noted that “the eyeliner and mascara made by foreign countries retain their shape when exposed to water, whereas the mascara and eyeliner produced domestically create ‘raccoon eyes’ when the wearer only yawns.”

The Pyongyang Cosmetics Factory was established in April 1962 and is North Korea’s representative cosmetics factory, producing all sorts of cosmetic goods such as the ‘Unhasu’ brand. It also produces over 60 types of functional cosmetics including soap, shampoo, beauty cream and skin lotion.

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Increase in sales volume of domestic goods in North Korean stores

Friday, April 3rd, 2015

Institute for Far Eastern Studies (IFES)

North Korea’s official news agency, Korean Central News Agency (KCNA) reported on March 25, 2015 that the volume of domestic goods sold at North Korean stores is increasing.

“Every display is filled with all kinds of inexpensive, high-quality domestic goods. Numerous shoppers are purchasing these goods, all of which are produced at domestic light industry factories. This is a sight that is commonly seen today at Choson’s [North Korea’s] department stores,” KCNA reported.

The news agency also quoted the manager of Pyongyang’s Department Store No. 1: “In recent years there have been remarkable improvements in every indicator, from the amount and quality of light industry goods produced domestically to the brands and packaging. As this has occurred, demand for these goods has increased,” he explained.

While he says that stores are mainly selling domestically produced goods like food and cosmetics, he also said, “Because furniture and building materials, shoes and clothing, medicine and other goods are also low-priced and suited to the tastes and health of our people, they are gradually overwhelming imports.”

The manager of Sinuiju Cosmetics Factory commented as well: “Previously, our ‘Pomhyanggi’ (or ‘Spring Scent’) brand was the only product that people could point to as a cosmetics product […] But the popularity of Pyongyang Cosmetics Factory’s ‘Unhasu’ (or ‘Milky Way’) is rising, and when you include the units produced at Myohyang Cosmetics Factory, its units actually surpass ours and are putting up a strong challenge. We had better get ourselves together.”

At light industry factories across the country, production of food products is rapidly increasing, and quality is improving as well. But it has reportedly not been easy to meet the people’s demand. Thus, manufacturers are working to improve product design and manufacturing technology and pledge to actively help improve the lives of the people.

In addition to this, KCNA reported that at places like the Namhung Youth Chemical Complex and the Hamhung Automated Equipment Factory, they are also spurring on production of domestic products through means such as domestically producing raw materials and equipment.

Meanwhile, North Korea is building one modern foodstuff factory after another in Pyongyang. The Rodong Sinmun, mouthpiece of the Workers’ Party of Korea, reported on March 18, 2015 that in the Nakrang district, construction of the ‘corn processing plant’ entered its final stages. There are plans for this factory to produce around 10 different food items out of corn (corn is the most common food ingredient in North Korea), including corn noodles and snacks.

On February 10, 2015, in Pyongyang’s Mangyongdae district, ‘Mangyongdae Kyonghung Foodstuff Factory’ was completed and went into operation. KCNA emphasized that this foodstuff factory is “a modern and comprehensive food manufacturing center” and will supply residents with “tasty and nutritious food.”

Similarly, in June 2014, the Unha Taesong Foodstuff Factory in Pyongyang’s Potonggang district finished construction and began production. North Korea’s official web portal,  ‘Naenara’ explained that the factory produces approximately 100 kinds of food such as bread, snacks, candy, beer, ham and sundae (or Korean sausage).

The fact that in a relatively short period of time modern foodstuff factories are continually being built in Pyongyang is consistent with the most important task of North Korea in the Kim Jong Un era: improving the food situation of the North Korean people. On February 18, 2015, First Chairman Kim Jong Un spoke at the enlarged meeting of the Political Bureau of the Workers’ Party. There, he asserted that the improvement of people’s lives was the nation’s first priority, and he specifically emphasized the importance of solving the food issue. Unlike the past, recent efforts extend beyond solving the food shortage problem and aim to raise the quality of food for the people.

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An affiliate of 38 North