North Korea has incorporated a key farming county into Pyongyang in what could be an attempt to provide a stable food supply for loyal residents in the capital.
The North had reduced the size of Pyongyang by relinquishing most of the capital’s south and a portion of its west to neighboring North Hwanghae Province, South Korea’s Unification Ministry said last year.
The move reduced the city’s population by about 500,000 to 2.5 million.
However, the North has now incorporated Kangnam County in North Hwanghae Province back into Pyongyang, according to a 2011 almanac map from North Korea, a copy of which was obtained by Yonhap News Agency.
“The move appears to be aimed at using Kangnam County as a supplier of food to Pyongyang residents as the rural area is a major agricultural producer,” said Kwon Tae-jin, an expert on North Korea at the Korea Rural Economic Institute in Seoul.
The North has relied on international handouts since the late 1990s when it suffered a massive famine that was estimated to have killed 2 million people.
Pyongyang is home to the ruling elite that governs the country through rations and a military-first policy. It is located in the southwest region of the country, which is believed to have a total population of 24 million.
UPDATE 1 (2012-3-20): The DPRK’s announced launch of the Kwangmyongsong-3 has brought an end to the program. According to the Associated Press:
The United States said Wednesday it is suspending efforts to recover remains of thousands of fallen service members in North Korea, the latest sign that a recent thaw in relations is over.
The U.S. was in the process of resuming the hunt for remains missing from the 1950-53 Korean War that had been on hold since 2005, the only form of cooperation between the two militaries.
But North Korea announced plans last week to launch a satellite into space by rocket — a step the U.S. says would violate a U.N. ban. That knocked back recent progress in negotiations on the North’s nuclear program, and has jeopardized a Feb. 29 agreement in which the U.S. was to provide food aid in exchange for a nuclear freeze.
The U.S. left open the door to resuming remains recovery if the situation improves.
North Korea says the rocket launch, intended to mark the centennial of the nation’s founder in mid-April, has peaceful aims. The U.S. and other countries suspect it would serve to test capabilities of a long-range missile. Pyongyang has also threatened a “sacred war” against rival South Korea, in response to recent U.S.-South Korean military drills.
The agreement on resuming the troop recovery operations was made last October, and the program was beginning this month. The U.S. had already sent equipment by ship, and an advance team had been due in the country this month. North Korea would have received millions in compensation this year for its support of the operations.
Pentagon press secretary George Little told reporters that North Korea has not acted appropriately in recent days and weeks and “it’s important for them to return to the standards of behavior that the international community has called for.”
“When there are suggestions that they might launch ballistic missiles, when they make bellicose statements about South Korea, and engage in actions that could be construed as provocative, we think that it’s not the right time to undertake this effort,” he said.
He said at some point the U.S. hopes to restart the recovery effort.
More than 7,960 U.S. servicemen are unaccounted for from the Korean War, which ended without a formal peace treaty, leaving the adversaries in a state of war. Some 5,300 of the missing are believed to be in North Korea.
Pentagon spokeswoman Tara Rigler said North Korea had refused to take agreed steps, including permitting the U.S. advance team into the country, and had politicized the remains recovery operations by linking them to the recent U.S.-South Korean military exercises.
She said no U.S. personnel are currently on the ground in North Korea.
The announcement is the latest setback for family members of veterans of the conflict who have lobbied hard for a resumption of the recovery operations. Of the nearly 8,000 missing service members, the remains of just 192 have been recovered and identified so far, based on remains handed over by North Korea or retrieved between 1996-2005.
“It’s heartbreaking to have such a humanitarian, positive mission be continually caught up in political storms,” said Richard Downes, who leads a volunteer group representing families of Korean War MIAs.
The U.S. military says an American ship has arrived in North Korea to support the hunt for the remains of soldiers missing-in-action from the Korean War.
Chief of the U.S. Pacific Command, Adm. Robert Willard, said Tuesday the ship is offloading equipment at Nampho, a port city west of the capital, Pyongyang.
The U.S. and North Korea agreed in October to restart the search for thousands of American service members, a sign of easing tensions between the wartime enemies.
The program is due to begin formally on March 1, with a U.S. advance team arriving in Pyongyang later in the month.
The search was suspended in 2005 during tensions over North Korea’s nuclear program. The U.S. cited misgivings about the security of its personnel.
The North Korean authorities are expediting the issuance of exit permits for people wishing to visit relatives in China but who agree to return to the country with one ton of food within 40 days. A considerable number of people have obtained permits on this basis in the last week, according to a source who spoke with Daily NK yesterday.
The source, from North Hamkyung Province, told Daily NK, “At the start of last week, my people’s unit head advised us, ‘Anyone able to return to the country with a ton of rice before April 5th should apply for a short-term exit permit to the National Security Agency now.’”
The source added, “More than 20 people per day are crossing over into China via Namyang Customs House after getting prior approval this way in Chongjin, Myongchon and Kilju. Others are finding lodgings in Onsung to wait their turn.”
The permit issuance policy is being implemented nationwide, according to information received by Daily NK. Many people are said to be departing via customs facilities both in Hyesan and further west in Shinuiju under the same deal.
Provincial branches of the Party are keen to issue the permits because they are under pressure to provide special food distribution for the 100th anniversary of Kim Il Sung’s birthday on April 15th, a responsibility Pyongyang is said to have passed on to the provinces in its entirety.
According to the source, the NSA’s provincial anti-espionage head has been telling travelers attending a briefing at the border control office there that their trips “have been made possible by the compassion of Kim Jong Eun,” and threatening that anybody minded to overstay their permit or who is unable to meet their food quota upon their return will be barred from leaving the country indefinitely.
Usually, exit permits are granted on the following basis: ▲ a maximum of 5 degrees of separation between inviter and applicant; ▲ a maximum stay of 3 months; ▲ a minimum of one year between permits. However, this time the authorities are reportedly allowing travelers who have already visited China within the last year to reapply.
Though rare, the policy shift is not unprecedented. For example, a similar pact with would-be permit recipients was offered by the authorities immediately after Kim Jong Il’s trip to China in May, 2011.
Such a loosening of border controls comes with a number of side-effects, not least that it brings down prices in the jangmadang, offering a valuable boost to individual purchasing power.
As such, kilo of decent rice was selling for 3,200 North Korean won early last week in Chongjin, a source from the city told Daily NK yesterday, but as of Monday this had fallen to 3,000 won, with 1 Chinese Yuan dropping from 605 to 600 North Korean Won.
“Given the situation, ordinary people are happy that the price of rice has fallen,” the source commented. However, he added, there is a high degree of skepticism in the market about how many of the travelers will actually return when the time comes.
Read the full story here:
NK Trading Exit Permits for Rice Daily NK
Lee Seok Young
2012-2-28
Posted in Food, International trade | Comments Off on DPRK issuing exit permits for food importers
UPDATE 2: Here is a translation of part of the paper:
2011 North Korea GDP per Capita 720 dollars
HRI Speculation Model of North Korea GDP: Hyndai Research Institute developed ‘HRI North Korea GDP Speculation Model’ to speculate North Korea’s GDP per Capita using the ‘Child Mortality Rate Report’ of 2011 August. In order to enhance the explicability of the original ‘HRI North Korea GDP Speculation Model’, in this report, the model has been modified adding annual agricultural production rate into consideration.
Speculating 2011 North Korea‘s GDP per Capita: According to the calculations of the modified ‘HRI North Korea GDP speculation model’, North Korea’s GDP per capita of 2011 was 720 dollars, 32 dollars increased from the previous year’s 688 dollars. North Korea’s GDP per capita is less than 3% that of South Korea which is $23,749. Even compared to other Communist nations such as China($5,194), Laos($1,204), Vietnam(1,362), North Korea’s economy is significantly deficient. Nations holding similar average income with North Korea is Bangladesh($690) and Nepal($644) of Asia, and Zimbabwe($735) of Africa.
Background on 2011 North Korean Economy’s growth
Domestic background: North Korean Economy is analyzed to have experienced a concentrated growth due to government’s planning and showering of its resources. According to FAO(Food and Agriculture Organization), North Korea’s agricultural production total has increased 7.2% from 4420 thousand tons in 2011 to 4740 thousand tons in 2012. Also, North Korean government focused their resources on food preservation, building 100 thousand households, and resolving electricity problem.
International Background: Internationally, DPRK-China trade expansion, Gawesung Factory, International Society’s aids were the three main backgrounds. DPRK-China trade total experienced a steep increase of 62.4% from 34.7 billion dollars in 2010 to 56.3 billion dollars in 2011. Gawesung Factory’s trade was 17 billon dollars which is a 17.7 % increase from 2010’s 14.4 billion dollars. International Society’s aid towards DPRK spiked the highest of 9, 7710 thousand dollars since 2007, which is more than three times that of 2, 1780 dollars from the pervious year.
North Korea’s per-capita gross domestic product probably expanded more than 4 percent in 2011 from a year earlier on an improved grain harvest and intensified state efforts, a report said Sunday.
The North’s per-capita GDP for last year is estimated at US$720, up 4.7 percent from $688 a year earlier, Hyundai Research Institute said in the report based on the communist country’s infant mortality rate and grain production.
The North’s 2011 per-capita GDP amounts to a mere 3 percent of that for archrival South Korea.
“The increase stemmed from better grain crops,” the think tank said. “Pyongyang also stepped up its efforts to meet its goal of building a strong and prosperous nation in 2012.”
According to data by the U.N. Food and Agriculture Organization, North Korea’s grain production reached 4.74 million tons last year, up 7.2 percent from a year earlier.
Other positive factors were North Korea’s expanded trade with China, its staunchest ally and largest benefactor, the existence of an inter-Korean industrial complex in the border city of Kaesong and aid from the international community, according to the report.
Pyongyang’s trade with China surged 62.4 percent on-year to $5.63 billion last year, the report said.
I have been unable to locate an original copy of this report. If you have a copy please send it to me.
Read the full story here:
N. Korea’s per-capita GDP grows 4.7 pct in 2011: report Yonhap
2012-2-26
A Korean Texas Baptist with a 17-year track record of relief ministry in North Korea made two trips there in recent months to deliver 50 tons of flour and 1,100 pairs of warm socks and other supplies for orphans.
Yoo Jong Yoon’s most-recent trip to North Korea ended just two weeks before the death of the nation’s supreme leader, Kim Jong-il.
Yoon—former Korean mission field consultant with the Cooperative Baptist Fellowship —delivered $28,000 worth of flour and supplies provided by CBF, Texas Baptist Men , the Korean American Sharing Movement of Dallas and several individual donors.
At their recent board of directors meeting and annual convention, TBM agreed to provide another $10,000 in 2012 to meet needs in light of North Korea’s longstanding food shortage. TBM’s ongoing involvement in hunger relief, humanitarian aid and development projects in North Korea dates back to the mid-1990s.
Yoon anticipates delivering 60 tons of corn in May and another 60 tons in September. One ton of corn provides for about 2,200 meals, he explained.
Yoon also secured memoranda of understanding from the government that could open the doors to providing support for an English-language teaching institute and medicine, supplies and equipment for a hospital in Wonsan City in Kwangwon Province.
Read the full quote here:
Baptist food deliveries continue in North Korea Baptist Standard
20120-2-24
Air Koryo of the Democratic People’s Republic of Korea will launch a charter flight route between Pyongyang and the northeastern Chinese city of Harbin on April 27, local Chinese airport authorities said Friday.
The airline will offer a round-trip flight between the cities every Monday and Friday, a spokesman with the Heilongjiang Provincial Airport Group Management Co. Ltd. said.
The new service will meet the travel demands of nationals from both countries, the spokesman said.
Harbin, known as China’s “Ice City,” is the capital of Heilongjiang Province, which borders Russia.
Read the full story here:
DPRK’s Air Koryo to open Pyongyang, Harbin charter flight
Xinhua
2012-2-24
Posted in Aviation, China, Transportation | Comments Off on DPRK’s Air Koryo to open Pyongyang, Harbin charter flight
South Korea has approved humanitarian aid to the Democratic People’s Republic of Korea ( DPRK) by civic groups here, the latest in the flow of private aid to the estranged neighbor, local media reported Thursday.
With the approval, two South Korean aid groups, Nanum International and the Eugene Bell Foundation, plan to send medical equipment including X-ray machines and diagnostic reagents for tuberculosis, according to Yonhap News Agency.
South Korea suspended almost all exchanges with the DPRK following their border incidents in 2010, but has occasionally allowed humanitarian assistance to the impoverished neighbor.
Civic groups need government permission for DPRK-bound aid.
UPDATE 1 (2012-2-24): The Choson Ilbo reports that the UN WFP is not extending its DPRK mission. According to the article:
The World Food Programme plans to end its emergency aid mission to North Korea in March as originally scheduled.
Citing officials from the WFP, Radio Free Asia reported Thursday that its emergency operation for the most vulnerable groups in the North, including children, pregnant women and the elderly, will end next month.
The organization said once the emergency program is over it will switch back to its smaller-scale assistance program, which provides food to roughly 3.5 million women and children in need of immediate nutritional support.
Meanwhile, the report added that the UN-affiliated organization had only raised about 30 percent of the funds needed to support North Koreans as of Wednesday.
ORIGINAL POST (2012-2-22): According to the Korea Herald:
The U.N. World Food Programme is planning to extend its Emergency Aid mission to North Korea beyond the original deadline of March.
The Emergency Operation, which started in April, aimed to address a dangerous and worsening food crisis in North Korea. It focused on the most vulnerable groups, women and children, of which there were 3.5 million in need of immediate support to prevent starvation.
The WFP has been able to work with North Korea in carrying out the operation, under very stringent rules.
Although the WFP has experienced some successes, a difficult 2011 has meant that the mission was unable to fully address the growing crisis, and an extension of the emergency operation is needed.
“We are currently finalizing plans for the operation beyond this point, but it will certainly continue to focus on the provision of nutritional assistance to the most vulnerable women and children,” WFP Asia spokesman Marcus Prior said.
Despite making progress in the latter stages of 2011, the WFP was unable to fulfill the goals of the original mission.
“Because of relatively slow funding at the outset, and the time taken to purchase and ship the food to the DPRK, distributions were at a very low level through the lean season months of May to August,” Prior said. DPRK stands for the Democratic People’s Republic of Korea, North Korea’s official name.
“At one point in the middle of 2011, production of specialized nutritious foods at factories supported by WFP came to an almost complete standstill,” said Prior. WFP documents say that during that time “much of the population of DPRK suffered prolonged food deprivation.”
The WFP says there is a “chronic gap” between the daily nutrients needed and the nutrients North Koreans have access to, with the situation more crucial for women and children.
Recent studies have shown that malnutrition in the first 1,000 days from conception can have permanent consequences for both physiological and intellectual development.
With a recent U.N. estimate that one-third of North Korea’s children under 5 are malnourished, the continuing crisis could have catastrophic implications on their future and not just their immediate food needs.
The WFP also reported through interviews with health officials that there was a 50 to 100 percent increase in the admissions of malnourished children into pediatric wards compared to last year.
The latest WFP DPRK report has called for more international aid that will be needed for the continued efforts, as the food from the original mission begins to reach its limits.
“We continue to have supplies available to see us through the next three to four months, but will require significant new funding to ensure these distributions can continue through the later, most difficult, lean season months of this year.”
Although the WFP does not collect data on the death toll caused by the 2011 food shortage, the latest report did say that another year of the same prolonged food deprivation will have a serious impact on the North Korean population.
UPDATE 1 (2012-2-21): According to the Korea Times, this store is now providing people with a legal window to exchange local for hard currency:
North Korea is apparently allowing foreign currency to be exchanged at unofficial, black market rates at a newly-renovated department store in Pyongyang, according to a diplomatic source who recently visited the country, Tuesday.
The source said people could exchange euros, dollars and yuan at kiosks at Kwangbok Area Supermarket, which recently opened after refurbishment and is said to resemble department stores in the South. The North has long kept the value of its local currency artificially high.
Euros were being exchanged at the rate of one euro for 4,420 North Korean won, while the official rate is around 130 won per euro, the source said.
“They are exchanging hard currency at a rate that seems to be an unofficial rate,” the source told The Korea Times. “People can also shop at the department store using foreign currency by taking their receipts to the booths.”
…
The source added that the exchange rates were written on a board inside the kiosks.
ORIGINAL POST (2012-1-6): See the original post below.
Pictured Above: (L) The original facade of the “Kwangbok Department Store (광복백화점)”. (R) The new facade of the “Kwangbok Area Supermarket (광복지구상업중심)”
Here is KCNA coverage of the opening of the facility (Posted to YouTube):
Astute observers will notice the American beer, Pabst Blue Ribbon, featured prominently in the beer section.
Here is coverage of the opening in KCNA (2012-1-5):
Pyongyang, January 5 (KCNA) — The Kwangbok Area Supermarket was opened with due ceremony on Thursday.
All business service at the supermarket built as a commercial service center has been put on IT and digital basis. Customers can buy varieties of goods according to their taste and requirements in the sales rooms on each floor stacked with household appliances, electronic products, foodstuff, fibre, sundries and others.
Present there were officials concerned, officials of the Korea Taesong General Trading Corporation, officials and employees of the Kwangbok Area Supermarket, members of the Feihaimengxin Trading (Beijing) Co. Ltd. staying in the DPRK and the Chinese embassy here.
O Ryong Il, general president of the Corporation, said in his speech that the work to build the supermarket was successfully completed under the energetic leadership of leader Kim Jong Iland the dear respected Kim Jong Un and the positive efforts of the peoples of the two countries.
He expressed belief that the supermarket would help towards improving the people’s living standard and promoting the well-being of the two peoples through better service and management.
Xue Rifei, executive managing director of the Feihaimengxin Trading (Beijing) Co. Ltd., said in his speech that Kim Jong Il and Kim Jong Un gave field guidance to the supermarket on December 15, 2011 and named it the Kwangbok Area Supermarket.
He expressed the expectation that an effort will be made to reenergize the supermarket to win high appreciation for its best management, service and credit.
The Korea Taesong General Trading Corporation is a sanctioned organization, and according to the US Treasury, it is a “key node” in the illicit activity of Office 39. According to NK Leadership Watch:
One of the participants at the opening ceremony was Jon Il Chun (Chon Il-chun), deputy director of the Korean Workers’ Party’s Finance and Accounting Department and section chief of Office #39. Mr. Jon accompanied Kim Jong Il on a visit to the Kwangpok store in mid-December 2011, which was KJI’s last reported public appearance before his death.
On a more casual note, the supermarket marks a point of administrative departure from the way department stores are typically managed in socialist countries. The Kwangbok Department Store (the former name) was one of Pyongyang’s premier formal retail outlets. For decades it operated in the same way as other socialist department stores: customers ended up standing in three lines before they were able to collect their merchandise (one line to order, another line to pay, and another line to pick up). The new Kwangbok Supermarket has adopted a market-style check out line. Though unnoticed by foreigners, this is the first such check out line I have seen in a North Korean department store.
The supermarket is supplied with home and foreign-made products which are in demand in the country.
Although I have not acquired data specific to this store, I believe it is reasonable (even rational) to assume that if the supermarket sells imported goods it will charge had currency for them. This opinion is based on the following assumptions: 1. The Chinese investors will not accept North Korean won under any circumstances. 2. The goal of Office 39 is to acquire hard currency for the Kim family. 3. North Korean retail outlets frequently post prices in multiple currencies so I don’t see any reason why it would be different here. Today a plurality of North Koreans can easily acquire foreign exchange.
Here is my working assumption of the business model: Chinese partner acquires merchandise and imports it to the DPRK. Sales in hard currency go towards allowing the Chinese supplier to recover its costs. Chinese partner either earns a profit from a markup it charges Kwangbok or it divides the profit with Office 39 along some agreed percentage.
If Chinese profits are earned from a cost-plus markup that it charges Kwangbop, then the partnership is closer to an exclusive supplier deal rather than a true joint equity deal. The North Koreans could cheat on this deal by finding cheaper suppliers and decreasing its purchases from the Chinese partner. If after-sales profits are split between the Chinese and Office 39, then both partners will need auditors on hand to make sure the books are accurate. The Chinese partner will also need a good relationship with the Chinese embassy if it runs into problems with the DPRK managers should they unilaterally change the terms of the contract (the split).
UPDATE 1 (2012-2-28): The Japanese police have raided the heaquarters of Chongryun (Chosen Soren), the Pro-DPRK General Association of Korean Residents in Japan, over its alleged ties to the computer smuggling ring. According to the BBC:
Japanese police have raided the offices of a pro-North Korean organisation suspected of a role in the illegal shipment of computers to North Korea.
Japan maintains a total ban on exports to North Korea.
It is part of a range of sanctions over North Korea’s nuclear programme and its abduction of Japanese nationals in the 1970s and 80s.
Earlier this month police arrested a businessman accused of exporting PCs to North Korea through China.
On Tuesday, about 100 riot police entered the Tokyo offices of an organisation connected to the Pyongyang-affiliated General Association of Korean Residents in Japan, officials say.
Because there are no diplomatic relations between the two countries, the association has functioned as North Korea’s de facto embassy in Japan.[
The raid came after prosecutors last week indicted Lee Soon-Gi, 49, who is accused of illegally exporting 100 second-hand personal computers to North Korea through China, officials said.
The affiliate organisation may be involved in the shipments, police say.
But the association has strongly criticised the raid which it described as an “unjustified and illegal investigation”.
ORIGINAL POST (2012-2-19): According to the Yomuri Shimbun:
The president of a Tokyo-based dealer in secondhand personal computers exported more than 4,000 items to North Korea, according to investigation sources.
Many of the items are believed to have been sold on the black market to senior members of the ruling Workers’ Party of Korea, the sources said.
Lee Sungi, president of Popura-Tec, was arrested earlier this month by the Metropolitan Police Department’s Public Safety Department on suspicion of violating the Foreign Exchange and Foreign Trade Law.
The 49-year-old has been arrested on suspicion of exporting 100 notebook computers to North Korea. In addition, Lee has told police that he shipped more than 4,000 personal computers and liquid-crystal displays to that country on four occasions from 2008 to 2009.
A North Korean trading company based in Dalian, China, brokered the deals, selling the products to a computer shop in Pyongyang, the sources said.
The shop was run by a North Korean computer engineer who once worked at a Chinese company as a software developer. He reportedly contacted Lee in March 2007, saying: “There’s demand for about 1,000 personal computers a month [in North Korea]. I’m interested in buying Japanese products,” according to the sources.
E-mails he sent to Lee suggested there were hundreds of computer shops throughout North Korea, of which 20 were in the capital. However, most of the country’s computer users do not use these shops because they cannot afford to buy their products.
Instead, they usually buy their computers through the black market, the sources said.
Most of the personal computers Lee exported from Japan were secondhand products, including some that had been leased to central and local government offices, according to the sources.
The North Korean computer engineer reportedly sold about 500 products per month to the black market, setting prices at 200 dollars or less for a desktop computer, and a maximum of 300 dollars for a notebook computer, the sources said.
This was still expensive for North Korea, which meant only senior members of North Korea’s ruling party and other wealthy individuals could purchase them, according to the sources.
It is reportedly common for North Korean computer users to buy new products when their items break down because there are almost no after-sales services in the country, according to the sources.
