North Korean Economy Watch

According to Yonnhap:

Some 4,000 North Koreans are estimated to be working at major construction sites in a suburb of the Kuwaiti capital and living in military-style camps run by the North’s government, a Seoul diplomat said Monday.

Impoverished North Korea has recruited its people to work abroad and reportedly kept most of their earnings, one of the few sources of hard currency for the isolated regime. Along with China and Russia, the Middle East is a major destination for North Korean laborers.

“We have figured out that there are around 4,000 North Koreans working at major construction sites to build homes, hospitals and other facilities in a suburb area of Kuwait City, including Jahar,” the diplomat said on the condition of anonymity.

A North Korean worker in Kuwait earns up to US$500 per month, but nearly four-fifths of the worker’s monthly salary is directly deposited into accounts controlled by the North’s government, according to the diplomat.

“A North Korean worker is believed to actually receive $100 per month, with their jobs ranging from plasterers, carpenters, welders to drivers at the construction sites,” the diplomat said.

In April this year, eight North Korean workers were arrested by Kuwaiti authorities for allegedly bootlegging alcoholic beverages, the diplomat said. Alcohol is illegal in Kuwait, making the illicit business of alcohol bootlegging highly profitable.

Additional information:

1. The North Korean company involved might very well be the Korea General Corporation for External Construction (GENCO). Learn more about GENCO here.

2. The Kuwaitis have funded some development projects in the DPRK.

3. Air Koryo has reportedly flown to Kuwait.

4. Michael Madden notes that the DPRK’s ambassador to Kuwait is Ho Jong, who served for many years at the New York (UN) embassy.

Read the full story here:
About 4,000 N. Koreans work at construction sites in Kuwait: diplomat
Yonhap
Kim Deok-hyun
2012-10-15

As is well known, North Korean embassies self-finance their operational revenue and salaries.  They also remit funds back to Pyongyang.  As far as I am aware, the DPRK may have the only foreign service that is not a drain on the treasury.

Many times, however, the operations in which DPRK officials get involved take palce in the gray and black markets.  I have previously posted about this here, here, here, here, here, here.

This weekend, news surfaced that a North Korean was involved in trading elephant ivory in Africa. According to AllAfrica.com:

The Mozambican customs service on Thursday seized 130 items of carved ivory, valued at about 36,000 US dollars, that a North Korean citizen named Jong Guk Kim was attempting to smuggle out of the country.

According to a press release from the Mozambican tax authority (AT), Jong was returning to Korea, via South Africa, and had already checked in for his flight, when customs officers intercepted him in the departure lounge of Maputo International Airport, and demanded that he open his hand baggage.

The ivory was hidden in several plastic bags. The 130 carved pieces weighed about three kilos.

Ivory can only be exported with the authorisation of the Ministry of Agriculture – if, as seems more than likely, Jong Kim has no such authorisation, the ivory will be confiscated and revert in favour of the state.

The Korean was also carrying 133,300 US dollars in banknotes in his hand baggage. Under current Mozambican exchange regulations, the maximum that anyone can take out of the country without declaring it is 10,000 dollars.

Anything above this sum must be authorised by the Bank of Mozambique.

Jong Guk Kim must now explain how he obtained this money. If he can prove that it came from a legitimate source, he will be allowed to export it – but only through normal banking channels.

The AT also revealed that it had recently seized in Maputo, seven rhinoceros horns, and about a tonne of abalone. Abalone is a genus of marine mollusks, threatened with extinction, due partly to overfishing, and partly to acidification of the oceans arising from climate change.

The abalones seized in Maputo probably came from South Africa. Abalones occur along much of the South African coast, and the South African authorities require permits for any export of this shellfish.

A tonne of abalone is valued at about five million dollars. It is believed that the ultimate destination of the Maputo abalone was Hong Kong.

I tried to locate the press release by the Mozambique Tax Authority but was unsuccessful.

Read the full story here:
Mozambique: North Korean Caught Smuggling Ivory
AllAfrica.com
2012-10-12

UPDATE: A friend sent in a link to the video of the unveiling that appeared on North Korean television:

ORIGINAL POST:

Pictured above (Google Earth:  40.971557°, 126.588980°) the old Kim Il-sung statue in Kanggye, Jagang Province.

Satellite imagery is not recent enough to show the change, but KCNA reports that Kanggye City, the capital of Jagang Province, has received new statues of the deceased Kims:

Pyongyang, October 11 (KCNA) — Statues of President Kim Il Sung and leader Kim Jong Il were erected in Kanggye City, Jagang Province.

The statue of Kim Il Sung depicts him standing in his military uniform whose coat flying in the wind, his right hand held high and left hand taking a pair of binoculars. He seems to dynamically arouse the army and people of the DPRK to provide a turning-point in the Fatherland Liberation War. The statue of Kim Jong Il imposingly standing in his padded dress conveying so many stories about the Songun revolution depicts him with one of his hands placed on his waist. His face beaming with a broad smile looks as if he were wishing the great Paektusan power a rosy future.

An unveiling ceremony took place on Thursday.

Present there were Kim Yong Nam, Choe Yong Rim, Choe Ryong Hae, Kim Jong Gak, Kim Ki Nam, officials concerned, service personnel, officials and employees of the units who contributed to the erection of the statues, members of the shock brigades and people and school youth and children in the province.

The statues were unveiled by senior party, state and army officials and leading officials of the province.
A floral basket sent by the dear respected Kim Jong Un was laid before the statues.

Laid there then was a floral basket in the joint name of the Central Committee of the Worker’ Party of Korea, the Presidium of the Supreme People’s Assembly and the DPRK Cabinet.

Also placed there were a floral basket in the name of Jagang Province and floral baskets in the name of the party and power organs, bodies of different levels, enterprises, factories and farms, KPA units, etc. in Jagang Province.

All the participants paid tribute in profound reverence to the statues of Kim Il Sung and Kim Jong Il.

Kim Yong Nam, member of the Presidium of the Political Bureau of the Central Committee of the WPK and president of the Presidium of the SPA, made an unveiling speech.

He said the great Generalissimos paved the way of turning the province, which had been considered as unfit for human habitation, into a good place to live in and made sure that the province took the lead in the drive for building a thriving nation.

Recalling that it was the ardent desire of the people in the province to have statues of the great Generalissimos, he said the statues were erected in a brief span of time on the highest level thanks to their loyalty.

After being briefed on the statues, the participants looked round the statues.

A valued reader pointed out to me some some peculiar language (in the English version of the story). I point it out below:

He seems to dynamically arouse the army and people of the DPRK to provide a turning-point in the Fatherland Liberation War. The statue of Kim Jong Il imposingly standing in his padded dress conveying so many stories about the Songun revolution depicts him with one of his hands placed on his waist.

I have to laugh at the phrase “dynamically arouse”. Someday I will need to work that into a conversation.  And just what would you make of a statue of Kim jong-il “imposingly standing in his padded dress”? If only I was proficient with Photoshop…

This will be the 11th Kim Jong-il statue of which I am aware. At this point we can probably expect new Kim Il-sung and Kim Jong-il statues to go up in all of the provincial capitals.

All of these statues are constructed by the Mansudae Art Studio in Phyongchon, Pyongyang.

Chocolate bust: On 2012-8-16 this chocolate bust of Kim Jong-un was on display in the Museum of the famous Chocolate supplier Ritter in Waldenbuch, Germany.

Comrade Kim goes Flying: [Official web page here] The new North Korean film got an audience at the Busan International Film festival. According to Yonhap:

The film, which cost approximately 1 million euros to produce, is a three-way collaboration between North Korea filmmaker Kim Gwang-hun, Daelemans, and British entrepreneur Nick Bonner, whose Beijing-based company, Koryo Tours, has been taking global tourists into North Korea since 1993.

…

“Where this film differs from North Korean movies, though there are North Korean romantic comedies, is that this is a film about girl power,” said Bonner. “It is a film about a young girl achieving her dream — for herself.”

…

“When we wrote the script it was never our intention to put propaganda in but to make a movie for North Korean people, that is why we had to make those lines,” conceded Daelemans. “We tried to avoid putting a Western stamp on the movie, we wanted to stay as close to North Korean culture as possible.”

The filmmakers say they suffered no censorship from Pyongyang authorities, but there were cross-cultural issues — one of which appears specially designed to sink a romantic comedy.

“In Europe, a kiss is nothing on film, but in North Korea, a kiss is not possible,” said Daelemans. “But that is not so strange — in Bollywood films they don’t kiss either.”

While no romantic comedy might be expected to focus on the North Korean issues that capture headlines — missiles, nuclear programs, human rights abuses, malnutrition — the film’s publicist is working to ensure that cynical reporters pick up the film’s positive vibe.

The Busan audience on Wednesday, largely youthful South Koreans, appeared charmed, laughing at all the right moments.

“It was a bit like South Korean soap operas and home dramas with family settings,” said audience member Hwang Yun-mi, a 32-year-old teacher of English and film studies. “It was not alien to me.”

It is too early yet to discuss commercial releases. Their North Korean partners hold the rights in North Korea, while Bonner and Daelemans have the rights for the rest of the world.

They may hope to fare commercially better than the last European-North Korean co-production: The forgettable Italian-North Korean actioner “Tenzan: The Ultimate Mission” (1988) was described by one reviewer as “truly lamentable.”

However, a key market may be tricky to enter. With South and North Korea technically at war, all Pyongyang media is blocked by Seoul authorities, making it uncertain whether “Comrade Kim” can be viewed by South Koreans outside film festivals, where censorship is lifted.

Even so, Bonner said that South Korean authorities last month granted special permission for the film’s cast to visit South Korea for the festival; unfortunately, there was no time to arrange their visit. And he was delighted at South Koreans’ reaction to the film’s Busan premiere.

“Showing this film here, right now, having Han Jong-shim being loved in the north of the country and for you in the south to love her too — that is more than Anja and me could ever have dreamt,” he said following the screening.

The Associated Press has also released some more footage of the film:

Korean war footage: While exploring YouTube, I found this video made from USAF archival footage.  It shows USAF pilots planning and executing an attack on railway bridges in Anju and what used to be the Nampho Smelter. Quite interesting:

Pyongyang Sinmun Advert: According to the Korea Times:

The ads in the Pyongyang Sinmun include those for flowers and flowerpots; “hanbok” or traditional Korean dress; and a water-heating device using solar power. Analysts say new leader Kim Jong-un is tinkering with the economy after pledging to improve living conditions.

Flower kiosks have gone up in several places in Pyongyang–most notably at the Pyongyang Maternity Hospital (how thoughtful). I suppose flower consumption is on the rise!

The solar powered water heaters are produced in a factory in Mangyongdae. Based on discussions with former North Koreans I assume these water heaters are valued for providing warm bathing water–a rarity for many North Koreans.

This is what wikipedia has to say about the Pyongyang Sinmun:

Pyongyang Sinmun (Pyongyang News) is a North Korean newspaper founded on 1 June 1957 by Kim Il-sung.[1] It launched an online version on 1 January 2005.[2] It is published by the Workers’ Party of Korea Pyongyang Municipal Committee[3] six times per week under the editorship of Song Rak Gyun.[4]

I am not sure where it is found online.

Date: October 18th (Thursday), 6:30pm
Location: New York: Learning Center, Unification Church, 4W 43rd Street (2 blocks from Grand Central Station)

Tickets are free but seating is limited. To RSVP, please visit us at www.hanconcert.org

There are increasing evidence of outside media trickling into the tightly locked country- South Korean dramas are a hit in the North Korean black markets. Will Korean popular culture (K-pop) be the new ping-pong diplomacy? Will the increase in informational flow have an impact in the general North Korean psyche- is a North Korean Arab Spring to be expected?

Moderator:
Celeste Headlee (NPR, Host/Correspondent)

Speakers:
L. Gordon Flake (Mansfield Foundation, Executive Director)
Nathaniel Kretchun (InterMedia, Associate Director)
Lucas Dixon (Google Ideas, Engineering Lead)

Institute for Far Eastern Studies (IFES)
2012-10-4

North Korea-China Economic, Trade, Cultural, and Trade Expo is scheduled to be held from October 12 to 16, 2012 at Dandong City, Liaoning Province. The expo will be jointly hosted by the China Council for the Promotion of International Trade, Liaoning Provincial Committee, Liaoning People’s Friendship Association, and Dandong Municipal People’s Government.

China accounts for 90 percent of North Korea’s foreign trade. Approximately 70 percent of this trade comes through Dandong. Currently, Dandong is gaining both domestic and international attention as the construction of the New Yalu River Bridge is nearing completion and progress on the Hwanggumpyong and Wihwa Islands Special Economic Zone is advancing.

North Korea-China Economic, Trade, Cultural, and Trade Expo will provide a place for not only product exhibits but will provide consultation for economic and trade cooperation, cultural exchanges and tourism. From the North Korean side, the largest trade investment company and government agency in charge of overseas labor export will be in attendance.

Over 500 booths and sections are ready for the expo and over 5,000 participants from foreign buyers are expected to attend. Over 100 companies and a 300-member economic-and-trade delegation will be coming from North Korea.

North Korea has recently held briefing sessions in Beijing for North Korean SEZs in Rajin and Hwangumpyong and Wihwa Islands from September 26 to 27. This two-day event was organized by the North Korean Committee for the Promotion of Economic Cooperation and China’s private GBD Public Diplomacy and Culture Exchange Center.

This event was an exclusive, invitation-only event, inviting major Chinese companies with investment interest in North Korea. There were over 100 officials from 30 different state-run corporations from North Korea present at the session to provide detailed information about 50 investment projects. The participants were required to pay an entrance fee and news media were prohibited from the event.

China’s Overseas Investment Federation (COIF) and North Korea Investment Office (NKIO) signed an agreementon September 22 to jointly launch the “Special Fund for Investment in North Korea.” NKIO is an overseas investment body subordinate to the Joint Venture and Investment Committee of North Korea (JVIC).

According to a Chinese media source, both states have set 3 billion RMB (476 million USD) as the goal for the fund; but in the initial stage, 1 billion RMB (159 million USD) will be utilized first to develop urgently needed urban infrastructure facilities focusing on mining, real estate, and port industries.

This is a joint-post with Tad Farrell (NKNews.org).

Although North Korean television has yet to profile the recent changes made to the appearance of Kim Il-sung square, we have put the pieces together from a mix of recent tourist photos.

To begin with, the large painting of an austere-looking Kim Il-sung which overlooked the square for decades has been taken down. In addition, the banners featuring the symbol of the Korean Workers’ Party (which flanked the painting of Kim) have been replaced with DPRK national flags.

Top: Removal of Kim Il-sung painting [Before (R), After (L)]
Bottom: Korean Workers Party drape replaced with DPRK flag [Before (R), After(L)]

Kim Il-sung’s image is not absent from the square, however. Newly mounted to the base of the square’s official observation platform are paintings of a now jovial Kim Il-sung joined by a new painting of Kim Jong-il.

Two new portraits replace the previously austere profile of Kim Il-sung

More interestingly, it appears that the square’s paintings of Marx and Lenin have been permanently removed, as first tweeted about by AP’s Jean Lee earlier this summer.

Marx and Lenin no longer adorn the square

Just how long the paintings would remain in the square has been a subject of speculation for years. Beginning in the 1970s Marxism-Leninism was deemphasized in favor of Juche, Kim Il-sung ideology, and Kimilsungism. In 1980 the Workers’ Party’s Sixth Convention formally struck “Marxim-Leninism” from the party charter and amended it to read “The Korean Workers’ Party struggles to practice Kim Il-sung’s ideology”. Finally, as part of the constitutional changes that were announced in 2009, Articles 29 and 40 were amended so they no longer referred to “공산주의” (Communism). The paintings of Marx and Lenin remained through all of this.  It is unclear why now they are no longer appropriate.

UPDATE: Andrei Lankov has written more extensive comments on the DPRK’s treatment of Marxism in  in the Asia Times.

According to Yonhap (via Korea Herald):

North Korea’s trade with China nearly tripled over the past five years, South Korean government data showed Sunday, underscoring the isolated North’s growing economic reliance on its major ally.

Trade between North Korea and China stood at US$5.63 billion last year, up 284 percent from $1.98 billion in 2007, Seoul’s unification ministry said in a report to the National Assembly.

North Korea’s exports to China almost quadrupled to $2.46 billion in 2011, compared with $580 million in 2007, the data showed. Imports rose to $3.17 billion last year, from $1.39 billion in 2007.

The North’s main export items were coal and iron ore, while primary imports from China were crude oil, gasoline and cargo trucks, it said.

A separate story on the report which also appeared in the Korea Herald featured these additional stats:

China accounted for only 67 percent of the North’s total trading with foreign countries, also including Russia, Thailand and Japan in 2007. But the dependency rate grew to 72.9 percent in 2008 and 82.9 percent in 2010 before hitting 89.1 percent last year, the report showed.

…

Annual food imports from China stood at 155,000 tons in 2008 and they have steadily grown to reach 380,000 tons for the whole of 2011, it said.

The same story had data on wages in the Kaesong Industrial Zone:

Another ministry audit report also showed that since 2004, South Korea has so far paid a total of $245.7 million in salary to North Korean laborers working in the Kaesong Industrial Complex, a joint inter-Korean industrial project in the North Korean village of Kaesong.

…

The report showed that a North Korean worker in the industrial zone earns an average $128.3 every month as of the first half of this year.

The average monthly pay stood at $68.1 in 2006 before steadily growing to $109.3 for last year.

Read the full story here:
N. Korea’s trade with China nearly tripled over past 5 years
Yonhap (via Korea Herald)
2012-10-7

N. Korea’s trade with China surges due to U.N. sanctions
Korea Herald
2012-10-8

UPDATE 2: The park is for roller-blading not skateboarding. Kim Jong-un’s visit was reported on KCTV on 2012-11-4. You can see it here.

UPDATE 1 : A reader tells me it could also be for roller-blade use. Admittedly I know less about roller-blading than skateboarding so I cannot judge.  We will just have to wait until tourist pictures or KCNA show us otherwise…

ORIGINAL POST: Radio Free Asia’s Korean Service has a story on the construction of Pyongyang’s first skateboard and/or bike park:

Image by “axelivarsson“. See the original photo in Flickr here. See the extra-large photo here.

According to the photographer, this picture was taken on September 9, 2012.

The new park is in East Pyongyang near the Monument to the Party Founding and across the street from the Youth Hall and Golden Lanes Bowling Alley:

I have spent thousands of hours looking at pictures of the DPRK and watching DPRK television.  I have never seen a picture of a North Korean using a skateboard or doing bike tricks…so this is rather surprising.

Earlier this year, some tourists tried to skateboard in Pyongyang with limited success.

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