North Korean Economy Watch

The Choson Ilbo reports:

North Korea’s Workers Party has started a generational shakeup in the Supreme People’s Assembly by appointing large numbers of young delegates in their 20s and 30s. The rubber-stamp parliament consists of delegates with a five-year term from various organizations including the party and the military.

A North Korean source said the Workers Party recently ordered municipal, provincial, and county party committees to force elderly members to quit for health reasons and fill the vacancies with people under 40.

“The North Korean leadership is seeking to replace a larger number of elderly members with younger people next year,” which it has declared as the year when the country becomes a “powerful and prosperous” nation, the source said. The regime “also ordered officials to lower the educational level of the delegates, but raise the ratio of female delegates to more than 30 percent.”

The average age of the 687 SPA delegates is 57. Those with college or higher degrees account for 92.8 percent, and women for 19.3 percent, according to the source. The moves are believed to be part of the regime’s efforts to consolidate the succession of leader Kim Jong-il’s third son and heir Jong-un, who is in his late 20s.

Liberty Forward Party lawmaker Park Sun-young backed the story. “I was told by a North Korean source based in a Southeast Asian country that the regime has recently issued instructions for a generational change in the SPA,” she said. “The party is trying to strengthen Kim Jong-un’s control” at a time when the lower echelons of the party, which has a membership of 4.5 million nationwide, have become unreliable since a botched currency reform in late 2008.

“Once the SPA has more delegates in their 20s and 30s who are Kim Jong-un’s loyal cadres, the regime will probably get tough, including launching more provocations against the South,” Park added.

The 12th Supreme People’s Assembly just held their 4th session.

Read the full story here:
N.Korea Pushes Generational Change in Parliament
Choson Ilbo
2011-5-20

Pictured above (Google Earth): Pyongyang University of Science and Technology (PUST) in  December 2009

Martyn Williams offers us an update on the University:

The Pyongyang University of Science and Technology enrolled an additional 100 students at the start of the current academic semester, according to a foundation that supports the school.

The first classes at PUST began in October 2010 with 160 students enrolled, said reports at the time. The latest intake will take the student body to 260 members, assuming none of the initial students has dropped out.

You can read Martyn’s full blog post here.

If you are interested in doing some volunteer work for PUST, here is their foundation’s web page. Here is the official PUST web page.

Previous PUST posts can be found here.

According to Yonhap:

A Seoul appeals court ruled Thursday the South Korean government should pay 120 million won (US$110,000) to a North Korean defector over an identity leak case that he claimed led to the disappearance of his 22 relatives in the North.

The Seoul High Court said the government claimed media reports on defection were intended to satisfy the people’s right to know, but the need to accept the defector’s request for confidentiality takes precedence over the people’s right to know or the freedom of press.

Lee Kwang-su, 42, sailed into South Korean waters along with his wife, two children and a friend aboard a small barge in 2006. He claimed he had initially planned to go to Japan and seek political asylum at the U.S. embassy there.

Lee currently lives in California after he won asylum in the United States in 2008.

He has said South Korean investigators released his identity as well as that of four others to media despite his request for confidentiality for fear of retaliation against their relatives in North Korea.

North Korean defectors in the South claim that North Korea harshly punishes relatives of defectors and sends them to prisons.

Lee believed his relatives were sent to a political prison camp, though it is nearly impossible to independently verify the claims due to lack of free access to the isolated country.

The ruling raised the amount of compensation to Lee, who was awarded 55 million won in a lower court in October. He had demanded 1.15 billion won when he filed a suit against the South Korean government in 2008.

Lee said he will consult with his lawyer before deciding whether or not appeal the ruling.

“I cannot expect justice will be served even if I appeal to the Supreme Court,” Lee said after the ruling, adding he plans to sue the South Korean government in a U.S. court. He did not give a specific time frame.

South Korean prosecutors were not immediately available for comment.

Read the full story here:
Appeals court orders S. Korean gov’t to pay W120 mln to defector
Yonhap
2011-5-19

Pictured above (Google Earth): Growth of the Kaesong Industrial Center (Apr. 2004, Jan. 2006, Sept. 2009)

According to Yonhap:

South Korean factories in an industrial complex in North Korea produced goods worth US$34.7 million in March, setting a monthly output record since the two Koreas launched the zone in 2004, Seoul’s Unification Ministry said Wednesday.

The complex, a key symbol of rapprochement between the two Koreas, combines the South’s technology and management expertise with the North’s cheap labor.

More than 46,000 North Koreans work for about 120 South Korean firms operating in the North Korean border city of Kaesong to produce clothes, utensils, watches and other low-tech goods.

The two divided Koreas managed to maintain the zone despite a chill in their relations over the North’s two deadly attacks on the South last year that killed 50 South Koreans.

A couple of days ago I posted a story about the growth in number of North Korean workers at the complex.

UPDATE (2011-5-27): The Wall Street Journal’s Korea Real-Time offers some 2010 joint-Korean trade and aid umbers:

For the full year, general trade between the two Koreas amounted to $118 million, down 54% from $256 million in 2009.

But the joint industrial complex at Kaesong, a city just inside North Korea on the west side of the inter-Korean border, continued to flourish.

The volume of trade at the Kaesong Industrial Complex, goods moving into the approximately 120 factories there and then being shipped back south after North Korean workers added value, rose 54% to $1.44 billion last year from $941 million in 2009.

As part of the penalties following the Cheonan incident, the South Korean government limited the number of South Koreans who could stay at the Kaesong complex. The result: one-day visits to the complex soared, lifting the total number of South Koreans who visited the North.

For all of 2010, 130,119 South Koreans went to the North while just 130 North Koreans visited the South. In 2009, 120,616 South Koreans went to the North and 246 North Koreans visited the South.

South Korea’s assistance to North Korea also dropped sharply last year, to 30.1 bililon won from 77.5 billion won a year earlier. The South’s direct government assistance was 8 billion won, down from 10.4 billion won in 2009.

Private assistance from South Korea also fell to 20 billion won in 2010, from 37.7 billion won in 2009.

Read the full story here:
Production at Koreas’ industrial complex sets monthly record
Yonhap
2011-5-18

According to Daily NK:

Things are growing more difficult for many North Korean people as they pass through the spring lean season, according to a new interview with a citizen from the edge of Pyongyang, Kang Mi Soon. There has been little distribution this year, even in the capital, which has traditionally received preferential treatment, and while people are trading to try and improve matters, it’s not easy at the moment.

This is because, as a lingering after-effect of the currency redenomination, a lot of people have exhausted their reserves of cash, while prices have returned to levels commensurate with before the redenomination. In spite of relative commercial freedom in the jangmadang, the number of transactions has fallen and the class of small traders which lives day-to-day is struggling.

Kang, who hails from Gangdong County in Pyongyang, revealed this and more news from the city in an interview she gave to The Daily NK in Yanji, where she recently visited relatives,

The following is a transcript of the interview with Kang:

– What is the state of the distribution system?

In December last year and then January this year, there were eight days-worth of distribution. In February there were ten days, including the 16th (Kim Jong Il’s birthday), but in March there was no distribution. In April there were five days, including the Day of the Sun (Kim Il Sung’s birthday).

(One day of distribution ordinarily means 700g of rice or other grain for laborers, 900g for miners and workers in other strategic industries, 800g for members of state security, 400-500g for students (depending on grade) and 300g for housewives)

– Is the jangmadang operating well?

The jangmadang is working normally. However, the situation is that though the number of sellers is on the rise, people do not have money so products are not selling well.

– What things are selling the most?

Mostly, rice and corn are the mainstays of jangmadang sales. Since February of this year, there has been a drastic reduction in sales of other household items and industrial products. Though the supplies of rice and corn in the jangmadang are similar to last year, the number of buyers and the amounts being bought are both decreasing.

– What is the overall situation in terms of prices?

Overall, they have risen to a level similar to that of before the redenomination. In the case of Chinese products, prices have increased to more than before the redenomination. Socks made in China were 1,500won before, but now they are 2,000won.

– They say that the food situation during the spring lean season is hard. Can you tell us more?

Starting from last year, after the currency redenomination, the situation started getting worse, and this year it is really bad.

– Has anyone starved to death?

In Gangdong [Kangdong] County, since the beginning of February about twenty people, including two families which committed suicide, have died of hunger.

(Gangdong County had a population of 221,539 in 2008)

– What is the overall food supply situation?

60% of people in the county are living off three meals a day of corn porridge or corn flour noodles, 30% on corn rice and the remaining 10% are eating three meals of rice a day. In March and April of last year, the number of people eating three meals of rice was 30 or 40%, and less than 5% were living on corn porridge or noodles; the rest are corn rice.

– What about other regions?

With the exception of central Pyongyang and other big cities (Sinuiju, Pyongsung, Chongjin etc), it seems to me that other rural regions are in the same situation as Gangdong. The price of rice looks likely to stay the same or rise, and so, until around June 10th when the potatoes are gathered, the numbers of starving people is likely to rise.

Read the full story here:
Gangdong County Hit by Spring Shortages
Daily NK
Choi Cheong Ho
2011-5-17

I have now been notified by four individuals about recent hacking attempts.  I have posted the emails these individuals received below.  There are four different messages.  I am happy to post these types of attacks, but if you receive one, please consult with an IT professional about obtaining the “email header”. This is what is most valuable to IT security professionals.  Please send me the “email header” to post (see below for an example).

Below are the four malicious emails of which I am aware:

Email 4: Targeted at one known individual

From: Suzan Park
Date: Fri, May 27, 2011 at 7:02 AM
Subject: interview questions
To:

Hi, this is Park of NCN News.
We are producing a documentary on “International Status of Northeast Asian Countries in Perspective of Soft Power”.
I was informed you are professional in this field.
It would be grateful if you could answer the interview questions about this documentary.

Documentary & Questions Link is here : Focusing on Current Situations of North Korea

Best regards!
Park

The phrase “Focusing on Current Situations of North Korea”  links to “ncnbroadcasting.reportinside.net/producer/2011FocusingOnDPRK.hta”.

The header for this email can be found below

Email 3: Targeted at one known individual

From: Pam Benson <pbenson261@yahoo.com>

Date: Tue, May 17, 2011 at 8:08 AM

Subject: FW: Kim Il Sung:the Great Hero of Mankind(ask your comments)

To: [DELETED]

I am forwarding the feature column : “Kim Il Sung: the Great Hero of Mankind”.

This writing concerns his great achievements.

The column is very realistic and beautiful.

I guess everyone who reads this column is impressed with his history.

I wonder what you think about this writing.

Thanks.

Sincerely Yours.

Attached to this email is a MS Word document titled, “Great Leader Kim Il Sung.doc”.  Do not open this attachment.

Email 2: Targeted at two known individuals

From: David L <l_david19@yahoo.com>

To:

Date: Thu, 12 May 2011 00:58:07 -0700 (PDT)

Subject: final draft

It’s been a long time since I last corresponded with you.

How have you been? I hope everything is well with you, your family.

Finally, The final draft was complete yesterday.

It will be announced next Month after collecting more opinions from experts in the field.

The Current Situation and Future Prospects in Northeast Asia : JAPAN, NORTH KOREA, SOUTH KOREA, CHINA

I look forward to sharing my insights with you once I receive your assessment.

I hope to hear from you soon .

Sincerely Yours,

David in Japan

The title underlined above was actually a link to the following: http://reportinside.net/draft/fainaldraft_201105.htaXX ( I added the XX at the end to prevent anyone from accidentally linking to the server).

Email 1: Targeted at one known individual

From:

Date: 2011/4/13

Subject: contact list

To:

Prof.

attach contact list

교수님

학회 명단 첨부합니다.

The email contained an attached MS Word document which contained the virus.

Keep your eyes open folks.  This has happened before.

Here is the header information from Email #4:

Delivered-To: XXXXX
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Date: Thu, 26 May 2011 23:02:12 -0700 (PDT)
From: Suzan Park <suzan.park7@yahoo.com>
Reply-To: Suzan Park <suzan.park7@yahoo.com>
Subject: interview questions
To: XXX
MIME-Version: 1.0
Content-Type: multipart/alternative; boundary=”0-1266752663-1306476132=:55224″

–0-1266752663-1306476132=:55224
Content-Type: text/plain; charset=us-ascii

Hi, this is Park of NCN News.
We are producing a documentary on “International Status of Northeast Asian Countries in Perspective of Soft Power”.
I was informed you are professional in this field.
It would be grateful if you could answer the interview questions about this documentary.

Documentary & Questions Link is here :Focusing on Current Situations of North Korea

Best regards!
Park
–0-1266752663-1306476132=:55224
Content-Type: text/html; charset=us-ascii

<html><body><div style=”color:#000; background-color:#fff; font-family:times new roman, new york, times, serif;font-size:12pt”><div>Hi, this is Park of NCN News.<BR>We are producing a documentary on “International Status of Northeast Asian Countries in Perspective of Soft Power”. <BR>I was informed you are professional in this field. <BR>It would be grateful if you could answer the interview questions about this documentary. <BR><BR>Documentary &amp; Questions Link is here :<A href=htXtp://ncnbroadcasting.reportinside.net/producer/2011FocusingOnDPRK.hta> Focusing on Current Situations of North Korea</A> <BR><BR>Best regards! <BR>Park <IMG src=”hXttp://ncnbroadcasting.reportinside.net/producer/pga/page.php?no=010″ width=1 height=1> </div></div></body></html>
–0-1266752663-1306476132=:55224–

And here is some header information from Email #3:

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Date: Tue, 17 May 2011 00:08:43 -0700 (PDT)

From: Pam Benson

Reply-To: Pam Benson

Subject: FW:Kim Il Sung:the Great Hero of Mankind(ask your comments)

To: “[DELETED]

MIME-Version: 1.0

Content-Type: multipart/mixed; boundary=”0-1151318799-1305616123=:82736″

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–0-1420268040-1305616123=:82736

Content-Type: text/plain; charset=us-ascii

I am forwarding the feature column : “Kim Il Sung: the Great Hero of Mankind”.

This writing concerns his great achievements.

The column is very realistic and beautiful.

I guess everyone who reads this column is impressed with his history.

I wonder what you think about this writing.

Thanks.

Sincerely Yours.

–0-1420268040-1305616123=:82736

Content-Type: text/html; charset=us-ascii

According ot the Choson Ilbo:

The number of North Korean workers at the Kaesong Industrial Complex has been growing even as Seoul halted all other trade with the North after deadly attacks on the Navy corvette Cheonan and Yeonpyeong Island last year.

There were 46,420 North Korean workers at the industrial park at the end of February, up 11 percent from 42,415 a year ago, according to the Unification Ministry on Sunday. This represents a monthly increase of 334. The industrial park’s output rose from $256.47 million in 2009 to US$323.32 million last year.

Why the increase?

Since all other inter-Korean trade has been suspended, the Kaesong Industrial Complex is the sole window for the North to obtain a steady legal supply of hard cash. The monthly wage of workers at the complex averages at around $100, but they only see between 30 and 50 percent while the rest goes to the regime.

“The workers get their wages in North Korean won or daily necessity coupons, and the North Korean authorities take all the dollars,” said a North Korean source. That amounts to some $4.6 million every month.

If the number of workers keeps increasing at the same rate, the North is expected to earn nearly $60 million this year. With the sources of hard currency exhausted, the North finds it profitable to assign even one more workers to the complex, but that also benefits the South Korean firms there. “North Korean worker wages are far more competitive than those in China and Southeast Asia,” said a staffer with an apparel firm at the complex. “At present we employ 1,200 North Korean workers, and the more we employ, the more profit we can make.”

And Lee Im-dong, a former secretary-general of the businesses association at the complex, said, “We have asked the North Korean authorities for additional manpower of 20,000. As far as the Kaesong Industrial Complex is concerned, our interests completely coincide with those of North Korea.”

The supply of additional workers is not easy. The available labor force in Kaesong and vicinity was already exhausted several years ago, so there is even a joke that “all the healthy in Kaesong now work at the industrial park.” The authorities have turned old buildings in Kaesong into boarding houses for workers recruited from Pyongyang, Pyongan and Hamgyong provinces, said the source.

“The fact that the North is going extra mile to bring more workers to Kaesong shows how desperately it needs dollars,” opined the Unification Ministry official.

Read the full article here:
N.Korea Keeps Sending More Workers to Kaesong Complex
Choson Ilbo
2011-5-17

According to the Choson Ilbo:

North Korean Embassy officials in India are being investigated for involvement in a luxury car smuggling case worth W100 billion (US$1=W1,091).

Senior officials of the North Korean and Vietnamese embassies are suspected of smuggling luxury sedans and motorcycles, evading customs duties estimated at 5 billion rupees (approximately W120 billion) over the past years, the Indian Express reported Monday.

According to India’s Directorate of Revenue Intelligence, Sumit Walia, alias Sunny (32) imported stolen or second-hand foreign cars using the embassy officials as frontmen to evade customs duties and sold them as brand-new.

In India, second-hand foreign cars are subject to tariffs of 160 percent and new cars to 109 percent. But diplomats are exempt.

Walia bought stolen cars chiefly from the U.K, and forged their registration documents to disguise them as new cars. He imported them in the name of the diplomats and allegedly sold them to businessmen, politicians, and celebrities.

Indian authorities have confiscated 41 cars. Most of them are top brand cars such as BMW, Ferrari, Lexus, and Porsche.

The DRI estimated the amount of customs duties Walia and his gang have evaded at 5 billion rupees. The agency has asked the Indian Foreign Ministry for cooperation with the investigation to find out what role the North Korean and Vietnamese embassy officials played.

The more things change, the more they stay the same.  As regular readers are aware, North Korean embassies self-finance their operations through business opportunities in their host countries.  Sometimes these are legitimate business ventures…sometimes not.  Plenty of similar stories are archived on this web page.

Read the full story here:
N.Korean Diplomats in India Investigated for Car Smuggling
Choson Ilbo
2011-5-17

According to Reuters:

Pororo, who first debuted in 2003, is ubiquitous in South Korea, featured on everything from stick-on bandages to coffee mugs. Stamps with his image have sold more than those bearing the image of Olympic figure-skating champion Kim Yu-na, according to local media.

But few knew that North Korean cartoonists worked with their Southern counterparts to jointly produce part of the first two seasons of the television series that launched the bird to fame.

“This isn’t something that needs to be secret but by accident people found out that Pororo was partly produced in the North,” said Kim Jong-se, a senior official at Iconix Entertainment, the South Korean production company that developed Pororo.

“They gave us many responses, from very negative to very positive — we are a collaborator of the North or, it is great that both Koreas made the show together.”

After the leaders of North and South Korea signed a landmark peace pact in 2000 pledging new cooperative steps, Pororo was one of the inter-Korean businesses that developed, Kim said.

South Korean technicians went to the North to train their colleagues there. Production hit a snag when the North suddenly replaced its staff for the second season, forcing Kim’s company to repeat the teaching process, Kim said.

The North Korean participation took place between 2002 and 2005, ending when ties deteriorated between the two nations and the North could no longer join the project.

Pororo was probably developed at the Scientific and Educational Film Studio (SEK) or its affiliated April 26th Children’s Film Studio in Central District.  Guy Delisle worked there on an animation contract as well.  You can read about his experience here.

Read the full story here:
Iconic South Korean penguin character actually half-North Korean
Reuters
Ju-min Park
2011-5-6

Pictured above (Google Earth): The location of the Trade Fair
in the Three Revolutions Museum compound, Pyongyang

According to KCNA:

Pyongyang Spring Int’l Trade Fair Opens

Pyongyang, May 16 (KCNA) — The 14th Pyongyang Spring International Trade Fair opened at the Three-Revolution Exhibition Monday with due ceremony.

Present there were Vice-Premier Kang Sok Ju, Minister of Foreign Trade Ri Ryong Nam, officials in the field of foreign trade and delegations from several countries and regions.

Diplomatic envoys of several countries and officials of foreign embassies here were also present.

Kim Mun Jong, director of the Korean International Exhibition Corporation, made an opening address to be followed by a congratulatory speech by O Ryong Chol, vice-minister of Foreign Trade.

The speakers said that the fair will provide multi-lateral economic and trade activities and scientific and technological exchanges among several countries and regions, expressing hope that the entrants would gain good success through broad contacts.

The DPRK will further economic and cooperative relations with other countries on the principles of equality and mutual benefits, they said.

After the opening ceremony the attendants looked round exhibits from companies of the DPRK, China, Germany, Malaysia, Mongolia, Syria, Switzerland, Singapore, Britain, Australia, Austria, Italy, Indonesia, France, Poland and Taipei of China.

A reception as regards the opening of the fair was given at Pyongyang Koryo Hotel the same day.

Uriminzokkiri posted a video of the trade fair on You Tube. Watch it here.