North Korean Economy Watch

According to Arirang News:

The income disparity between South and North Korea has widened by close to 40 times.

According to figures released by Statistics Korea on Wednesday South Korea’s Gross National Income reached 837 billion US dollars in 2009 about 37 times more than North Korea’s 22 billion dollars.

South Korea’s GNI per person posted 17,175 US dollars roughly 18 times more than North Korea’s 960 dollars while in annual trade the South saw 686 billion dollars in 2009 which is 202 times larger than the North’s 3 billion dollars.

As for economic growth that year the South saw a [0.2%] expansion in the wake of the global financial crisis whereas the North posted a contraction of 0.9.

Economists say such figures show that it is almost impossible for North Korea to catch up with South Korea anytime soon.

An official with the finance ministry in Seoul says South Korea’s overall economic strength is about 40 times that of the communist regime adding that such power provides the foundation for South Korea to stay ahead of North Korea in every field including defense.

And according to the Choson Ilbo:

South Korea’s economy is 37.4 times larger than North Korea’s, according to the latest data. Statistics Korea said Wednesday that as of 2009 South Korea’s nominal gross national income stood at US$837.2 billion as against North Korea’s GNI of $22.4 billion. The figure is slightly lower than the 37.7-fold gap seen in 2008 but marked a significant increase from the 34.7-fold difference seen in 2006.

Per-capita GNI was $17,175 in the South, 17.9 times larger than North Korea’s $960, and South Korea’s total trade volume of $686.6 billion was 201.9 times greater than North Korea’s $3.4 billion.

But North Korea has ample mineral resources. As of 2008, North Korea had W6,983.6 trillion (US$1=W1,126) worth of mineral resources, 24.1 times more than South Korea’s W289.1 trillion. The North has an estimated W2,679.7 trillion worth of magnesite (6 billion tons), W2,662.9 trillion worth of coal (20.5 billion tons), and W61.33 trillion worth of gold (2,000 tons). South Korea had no magnesite while its coal deposits amount to just W15.7 billion or 1.36 billion tons, 5.9 percent of North Korea’s.

Statistics Korea also cited media reports to describe the rising interest among North Koreans in South Korean pop culture. South Korean-made mixers, heaters, gas ranges, gas containers, lunch boxes, pressurized rice cookers, towels and gloves are sold in North Korea with the brand labels intact.

South Korean-made shampoo and conditioners are popular among high-ranking North Korean officials, with a 470 g product costing between 8,000 to 10,000 North Korean won and US$1.50 for a bar of soap. Some young North Koreans watch South Korean movies and TV dramas such as “Friend,” “My Wife is a Gangster,” and “Winter Sonata” on their Chinese laptops and listen to South Korean pop songs on their MP3 or CD players.

Read the full story here:
Income Gap Between South and North Korea Records 37 Times Differences in 2009
Arirang News
Kim Na-ri
1/5/2011

Economic Gap Between 2 Korea Remains Huge
Choson Ilbo
1/6/2011

According to Yonhap:

North Korean leader Kim Jong-il conducted the largest number of public activities last year since he inherited the communist country from his father in 1994, according to figures aggregated by the South Korean government.

The 68-year-old appeared in North Korea’s official media a total of 161 times, the Unification Ministry said Tuesday in a release that suggested Kim was trying to tamp down outside speculation over his health. About one fifth of his activities last year were joined by his third son and heir-apparent Kim Jong-un, the ministry said.

Kim Jong-il reportedly suffered a stroke in 2008, a year during which he showed up only 97 times. Kim appeared in official media 159 times in 2009, increasing his visits to factories and other economy-related facilities. Last year, he made 63 visits to economic sites and 38 to military ones, the ministry said.

“He seems to be trying to unite the regime by showing both internally and externally that he remains healthy and that he is focused on enhancing the living standards of people,” a ministry official said, asking not to be named.

North Korea is trying to revive its economy ahead of 2012, which marks the centennial of the birth of Kim Il-sung, who founded the country and later passed his power to Kim Jong-il upon his death.

Outside analysts say the heavy focus on the economy is aimed at creating a setting favorable for another hereditary power succession, this time, to Kim Jong-un, believed to be about 28.

North Korea’s media have yet to report on Kim Jong-il’s first public activity this year.

Read the full story here:
N. Korean leader most active last year despite health woes
Yonhap
Sam Kim
1/4/2011

Click image to see the Chinese, Russian, and North Korean piers

UPDATE 5: No more intra-Chinese coal shipments  through Rason have been reported following this 2011 experiment.

UPDATE 4 (2011-6-4): KCNA reports some additional details on the coal being shipped from Hunchun to Shanghai via Rason. According to the article:

It was against this backdrop that China was in the process of transporting 20,000 tons of coal to Rason Port via Hunchun from May 14 and then transporting it to Shanghai by a cargo ship.

Yanbian Ribao, conveying this news on May 18, reported that the Shanghai branches of the Hunchun Mining Group and the Chungjiang Group would transport 500,000 tons of coal to Shanghai by this method this year. This would be tantamount to more than 14,000 truck loads. An official concerned of the Mining Group said that transport of loads to various provinces of Southern China by this method would help sharply cut down the time and transport charges, etc. as compared with the inland transport.

So apparently the 20,000 tonne pilot project what supposed to pave the way for a 500,000 tonne project that never materialized.

UPDATE 3 (2011-1-25): China ships coal from North Korean port for first time. According to Michael Rank:

China has for the first time shipped coal from the North Korean port of Rajin following a deal by a Chinese company to renovate the port, a Chinese website reports.

The 20,000 tonnes of coal, mined in Hunchun, about 80 km north of Rajin, was shipped to Shanghai last month. After going through customs inspection at Hunchun, it was transported by road via the Wonjeongri border post near Dumangang, the report said.

It noted how shipping the coal from Rajin saved the cost of transporting it to the nearest suitable Chinese port of Yingkou or further afield by train and how the deal to renovate and expand Rajin’s no 1 dock would help to boost trade from northeast China more generally.

It said the Dalian-based Chuangli Group reached a deal to lease the dock in 2008 and the following year agreed to renovate it and expand its capacity to one million tonnes a year, although news was not announced until last spring.

But when this reporter visited Rajin last September there was no sign of the port being renovated and expanded, and although a couple of small North Korean vessels were moored at the port, there was little sign of any activity and the area was largely deserted.

China does have ambitious hopes for Rajin, however, and last month a Chinese company, Shangdi Guanquan Investment Co, was reported to have signed a letter of intent to invest $2 billion in an industrial zone in the region.

The Wall Street Journal quoted an assistant to the managing director to Shangdi Guangqun as saying the plan was to develop infrastructure, including docks, a power plant and roads over the next two to three years, followed by various industrial projects, including an oil refinery, over the next five to 10 years. He said the company was waiting for a response from the Pyongyang government before applying for approval from China’s Ministry of Commerce.

“It’s all pending at this stage, and it’s really up to the Korean side to make the decision,” the assistant, named only as Han, said, according to the WSJ. He added that the $2 billion figure was what the North Korean side had hoped for, not necessarily what his company could deliver.

North Korea has implausible dreams of turning the city into an international freight brokerage, export processing and finance hub, and has even made a computerised promotional video about its plans to build glitzy skyscrapers along the seafront.

Photo of Rajin port here.

UPDATE 2 (2011-1-14): According to Every China:

As the first cross-border cargo ship for domestic trade in China, 10,000 tonner “Jinbo”, loaded with 21,000 tons of coal, arrived safely at Shanghai and docked steadily at the pier of Waigaoqiao Terminal at 4 p.m. on January 14. This marked the success of the maiden sail for cross-border domestic trade in our nation.

It is introduced that this 10,000 tonner Jinbo is a freight ship serving for Hunchun Chuangli Shipping Logistics Co., Ltd. of Jilin Province. There was totally 20,000 tons of coal in this cross-border transport produced by Hunchun Mining Group, departing from Hunchun Quanhe Port on December 7, 2010 to Rajin Port of North Korea and cargo concentration in port was accomplished there after one month. Special purpose vessel Jinbo ship docked at No.1 pier of Rajin Port of North Korea at 15 o clock on January 6 this year. The shipment began on 7th and the ship departed from Rajin Port at local time 10:30 on January 11 and arrived safely at the pier of Waigaoqiao Terminal, Shanghai after over 3 days voyage. Currently, related procedures for customs and inspections are in process.

Successive notices on pilot cross-border domestic trade transport in Jilin Province have been issued by General Administration of Customs, Ministry of Transport and General Administration of Quality Supervision, Inspection and Quarantine of the People s Republic of China since last year. Now, the successful arrival of the first cargo ship at the destination is an important achievement gained by Hunchun City or even Yanbian Autonomous Prefecture from implementing the forerunning policy of The Planning Outline of Cooperation in the Exploitation of Tumen River Zone, China. It is also a significant breakthrough in new international land-sea joint transport passage of Hunchun City or even Jilin Province, marking a crucial progress in the Launching out to sea through borrowed port strategy of Jilin Province.

Not only the coal resource of Hunchun City, but also that of Heilongjiang Province, closely adjacent to Yanbian area, can be transported to South China after Rajin Port exit is available. Because of the relatively low transport cost compared with that of other ports at home, this sea passage may become the Golden Passage for transporting coal from the north to the south until then.

UPDATE 1 (2011-2-22): According to the China Daily:

A city in Northeast China is aiming to import coal from the Democratic People’s Republic of Korea (DPRK) as part of its effort to establish an international coal production base in the border area.

Hunchun, a city wedged between the DPRK and Russia, has coal reserves of 1.2 billion tons, and supplies the fuel to Jilin, Liaoning, Jiangsu and Shangdong provinces. It currently produces about 6 million tons of coal annually.

“We plan to raise our production to more than 10 million tons a year by importing and exploiting coal both from the DPRK and Russia,” said a senior Hunchun city official, who declined to be named.

In January, coal was shipped for the first time from Hunchun to Shanghai via the DPRK port of Rajin, following a deal made by a Chinese company to renovate that port.

The 20,000 tons of coal mined in Hunchun reached Shanghai in three days in the transportation trial. Normally, it takes more than 10 days to transport that amount of coal by train from Hunchun to Shanghai.

“We will try to deliver coal by this new shipping route in the future, because it saved a lot of money in transportation costs,” the government officer said.

The city government also intends to transmit the electricity power generated by its coal-fired power plant to the DPRK.

China has been striving to establish an international sea route through the two countries to boost bilateral trade.

Dalian-based Chuangli Group invested 30 million yuan ($4.6 million) in improvements to Rajin last year, according to officials.

The Dalian group expanded the port’s annual shipping capacity to 1 million tons last year, after reaching a deal to lease and reconstruct it in 2009.

Hunchun officials said the city’s foreign trade volume has quadrupled in the past three years, thanks to improved international shipping.

By taking advantage of cross-border energy production and transportation, Huchun expects its coal production to rise by 22 percent during the 12th Five-Year Plan (2011-2015).

The Seoul-based Yonhap News Agency reported earlier that the DPRK plans to cooperate with Chinese enterprises on exploiting mineral resources in Hamgyeongbuk-do in the DPRK, which has about 200 million tons in coal reserves.

ORIGINAL POST (2011-1-4): Rason is being used to transport coal from Hunchun to Shanghai. According to the Choson Ilbo:

In official confirmation that closer China-North Korea business ties have come to fruition, the state-run Xinhua news agency and local media in Jilin on Monday said China has transported 20,000 tons of coal from a mine in Jilin to Shanghai and Ningbo through North Korea’s Rajin-Sonbong Port since Dec. 7.

The coal produced in Hunchun was carried by some 570 35-ton trucks across the Duman (or Tumen) River and transported to the port along a 60 km unpaved road between Hunchun and Rajin-Sonbong.

A source in Hunchun said, “Since a month ago, dozens of trucks a day have been going to the North” through Quanhe Customs Office.

The abundant coal deposits in the northeastern China are mainly used for heating homes in southern China in winter, but with no access to the East Sea, China had to transport it overland to Yingkou Port in the Bohai Bay, some 800 km to the west, incurring logistical costs.

China has long tried to get the right to use Rajin-Sonbong and Chongjin ports in North Hamgyong Province in North Korea in a bid to secure an East Sea route.

In 2009, Chuangli Group, an environmental facilities manufacturer in Dalian, obtained the right to use a pier in the Rajin-Songbong port for 10 years in collaboration with a North Korean trading company. Another Chinese firm in Tumen is also reportedly seeking the right to use Chongjin Port.

Prof. Yoon Seung-hyun of Yanbian University said Chongjin Port, has better facilities than Rajin-Sonbong. “The North is more open and aggressive” because it is groaning under international sanctions and aid from South Korea has dried up, he added.

Recent posts on Rajin (Rason) can be found here.

Read the full story here:
Chinese Shipping Through N.Korean Port in Full Swing
Choson Ilbo
2011-1-4

According to the Korea IT Times:

Eunbyul 2010 is a “Go” game, or commonly known as baduk in Korean; a software program developed by North Korea and played in North and South Korea. Winner of the third Computer Go Competition UED Cup in 2009, defeating so many outstanding programs from all over the world, Eunbyul 2010 is maintaining 3-dan at cyberoro.com and also ranks number one in sales in Japanese computer Go program market.

Go was invented by Chinese emperor Yao around 2300 BC, and has been widely played in the three countries in Far East: Korea, Japan, and China. In North Korea, the game was previously considered ‘the bourgeoisie game,’ thus a taboo; however since the 1990’s, the government has promoted Go as a traditional game that dates back to the Three States era; in addition it highlights the game as a brain exerciser that helps children develop their intelligence and old people keep their brains from aging. North Korea classifies Go – also called brain combat or brain fight in the country- as a type of martial arts just like Taekwondo or Ssireum, the Korean wrestling. North Korea’s Go was controlled by Chosun Sports Association, but under the command from Kim Jeong-il in 1990s; it was transferred to Chosun Martial Arts Federation that had better training environment, and subsequently categorized as public sport; now Taekwondo Commission is in charge of the game. Cho Daewon, 22 and MunYoungsam, 33, both amateur 7-dan, are noted as the top players in the country.

The estimated number of Go players in North Korea was around 10,000 in 1994, and is currently over 30,000. North Korean government encourages children to play Go as they believe the game has a significant effect on improving many brain activities such as concentration, observation, memory, imagination, and structure perception. Go classes are organized at kindergarten and the government tries to promote the game by holding various Go competitions for children.

Along with their passion for the game, North Korea is also regarded as one of the world’s best developer of computer Go game. Since early 1990s, the university computer development group composed of Kim Ilseong University, Kim Chek Engineering College, etc. – has developed computer Go programs. In 1995, Eunbyul Computer Technology Trade Center which is now called Korea Computer Center (KCC) focused on making software programs for Go, chess, Janggi and the like. The Go software ‘Eunbyul 2010 (see the picture above)’ – was imported into South Korea and is now available to the public consumers (here).

Eunbyul 2010 is the latest version of Eunbyul 2006, which was released in 2006 drawing attention to the industry. It integrated Monte Carlo Method into the algorithm of the original 2006 version, substantially improving the level of performance. While Eunbyul 2006 was rated level 6 according to Korea Baduk Association’s system, its 2010 counterpart attained 2-dan after the battles with random user at Cyber Oro, the internet Go match website. The user won 54 and lost 46games – 31 victories and 25 defeats in 1-dan battles and 23 victories and 21 defeats in 2-dan battles -hence, with 54 percent of winning rate. The software also won the International Computer Go Tournament held last year in Japan, sweeping all the matches and, thus, proving to be the best of its kind in the world.

There are two types of engines in Go programs. Tree search system, in theory, takes more than 361 (factorial) searches for one match because it has to create a move by move searching tool to explore every path. There is Monte Carlo method engine, which randomly selects one of the undefeated moves after proceeding hundreds of thousands of simulated battles to the end. Despite the relatively higher performance (on amateur beginner’s levels), this method was difficult to be adopted for commercial use because it required computation by either supercomputer or tens of CPUs from parallel wired computers.

4OneBiz, the sales rights holder in South Korea, signed the contract with North Korea in June 2006 before beginning the sales in the South. In September the same year, the company held an 8-day workshop in which an engineer who spent over a decade on developing Go programs at KCC and a professional5-dan Go player participated in the activities. The main objective of the workshop was to decide whether they should improve the performance of the existing Eunbyul program or develop a completely new engine from the design. Ultimately, they chose the latter.

North and South Korea agreed to develop a whole new level of Go program engine that contains tactical data, which narrows down the potential moves to only a few, so as to make the next move in a simpler way. They also aim to make a program with optimal performance that is light and fast enough to be installed in a mobile device. South Korea provides an expert-levelalgorithm design whereas North Korean developers will take charge of creating a program based on the theory and basic algorithm. This new expert-level Go engine is already completed, and its automatic evaluator and situation-determination module are currently being supplied to a popular Korean Go website. Further use is currently under negotiation. One engineer who specialized in expert-level Go engine and gave up after spending more than 10 years on developing the engine once contended that “it is beyond human capability to develop an amateur-expert level of Go engine.”

However, the recent success can be largely contributed to the thoughtful collaboration between South and North Korea: i.e., the North Korean engineers spent more than a decade focused and devoted to Go engine development, and South Korea’s also has well-known competence in Go game. The incredible synergy was all thanks to the socialist system of North Korea where the engineers could stick to the Go engine development project for nearly 20 years regardless of its profitability; and also the capitalist South fostered the best Go players with its wealth and the professional Go player system. For those reasons, North Korea could have developed Eunbyul 2010, the best artificial intelligence Go program in the world.

Read the full story here:
North Korea’s Artificial Intelligence Go Software
Korea IT Times
Choi Sung, Professor of computer science at Namseoul University
1/4/2011

According to the Daily NK:

North Korean trading companies operated by several organs have been selling steel to China in exchange for food.

One Chinese trader who does business with North Korea reported to The Daily NK on Monday, “China-based North Korean workers in charge of trading with China for Cheongusan Trading Company (under the Escort Command), say that this year Chosun is expanding the volume of its steel sales with China.”

The trader said, “In November last year, the analysis table of steel quality was delivered to us, and accordingly a contract has also already been signed.” He added, “In Chosun, the company is waiting for a permit to trade from an upper organ after having loaded materials on freight trains.”

He explained further, “For the price of the steel, Chosun has asked for rice, flour, noodles and also construction materials,” adding, “Food in bulk can enter Chosun.”

He explained that since North Korea is facing a serious lack of food, cement and other construction materials due to isolation from the international community, the country is trying to barter steel for food with China, from which the North is able to import.

Another trader in China verified the story, explaining, “Recently in Dandong, workers from Kangsung General Trading Company (under the General Staff) and other companies visited China for the purpose of selling steel.”

He added, “From now on, our company is going to do only steel trade with Chosun. We have decided not to do business in other things because our experiences have shown that there is no credit there.”

He went on, “North Korean trading units may have suffered from limitations put on items by Chinese companies,” going on, “If Chosun does not make a deal with us, they will starve to death this year. Even though they emphasize independent rehabilitation, when have they ever been rehabilitated?”

North Korea’s media frequently emphasizes the glorious production of “Juche” steel at Kim Chaek Steel Mill and Gangsun Steel Mill. Indeed, the Common Editorial issued on the first day of this year stated that, “By the power of the realization of the faith and model of Kim Steel (steel from Kim Chaek Steel Mill) and Juche steel, let’s have waves of victories.”

According to KOTRA, South Korea’s trade statistics agency, from January to October, 2010, North Korea exported steel to China worth $82 million.

One potentially positive aspect to this story is the recognition by the DPRK of the benefits of comparative advantage in trade.  Rather than aiming to produce all of its own food, the DPRK can instead specialize in steel production and trade for Chinese produced food.  Through trade, China and the DPRK could both consume more steel and food than if each country practiced autarchy.  Unfortunately the DPRK’s recent history has demonstrated a callous disregard for comparative advantage and has instead focused on increasing domestic food production and aid while limiting international trade.  Lets hope to see more rational policies prevail in the future.

Read the full story here:
North Korea Bartering Steel for Food
Daily NK
Im Jeong Jin
1/3/2011

I recently came across this map of Pyongyang printed in 1946:

Click map to see full size version

According to the map, it is “For use by War and Navy Department Agencies only.  Not for sale or distribution”.

I thought it would be fun to add the map to Google Earth so I could compare the pre-Korean War city infrastructure with what we see today.  Some interesting information emerges:

1. The Omura Silk Mill is now the Kim Jong Suk Pyongyang Silk Mill. Satellite image here.

2. The Kanegajuchi Spinning Mill is now the Pyongyang Textile Mill.  Satellite image here.

3. Fuji Iron Works is now the Pyongyang Cornstarch Factory. Satellite image here.

4. What was the Pyongyang Airport is now Taedonggang-district in East Pyongyang.

5. Much of what we call the  “Forbidden City” (Korean Workers Party Offices) were military barracks.

6. The former Pyongyang Medical College is now … the Kim Il-sung University College of Medicine. Satellite image here.

7. The Supreme People’s Assembly sits on the grounds of the former Pyongyang Women’s Prison.

8. The Namsan School was torn down and is now either the Organization and Guidance Department (according to one defector) or the Democratic Women’s Union Hall. Satellite image below:

I also might have discovered several Japanese colonial-era prisons that may very well still be prisons and/or factories. According to the map, this was the shape of the Pyonysang (Heijo) Prison:

There are a handful of buildings in the DPRK which still retain this distinctive shape (or the obvious remnants of this shape)—as well as walls and guard towers.  They are in Phyongsong, Hamhung, and Sariwon:

I have made the 1946 map available as a Google Earth download. You can obtain the KMZ file by clicking here. Please let me know if you make any interesting discoveries of your own.

By coincidence, Andrei Lankov wrote an article about the history of Pyongyang last week in the Korea Times (as I was comparing the maps). According to the article:

Pyongyang enjoyed boom in colonial era
Korea Times
Andrei Lankov
12/30/2010

This city is long gone. No, it is still on the maps, and all our readers know its name ― Pyongyang, the capital of the Democratic People’s Republic of Korea.

But the Pyongyang of the Kims’ dynasty does not have much to do with the old city, wiped out in the social turmoil of the late 1940s and inferno of the American bombing of the early 1950s.

People who nowadays inhabit the North Korean capital, are overwhelmingly newcomers, and not much physical evidence is left from the city past.

It was once a capital of Goguryeo, one of the three ancient kingdoms which fought over the domination of the Korean Peninsula in the first centuries of the Christian era. Pyongyang remained important for centuries. During the Joseon Kingdom (1392-1910) it was the second or third largest city in the entire country.

The city remained surrounded by the stone walls which by the 1890s had been in a state of disrepair for a long time (they had lost any military significance since a much earlier date, one has to admit). The majestic Taedong Gate, facing the river, was seen as a masterpiece of traditional architecture.

Throughout the colonial period, the city’s population increased from 40,000 around 1910 to 285,000 in 1940. It was roughly one third of the then size of Seoul, but this still made Pyongyang one of the largest cities in the nation.

As was the case with nearly all major cities of both the to-be North and to-be South, the railway was instrumental in Pyongyang’s growth.

Pyongyang was located straight on the Busan-Seoul-Sinuiju line, built in the early 1900s. This line became a backbone of the country’s transportation network, and old cities which were bypassed by this railway, eventually went into decline. Pyongyang was lucky to avoid such a fate.

Nowadays Pyongyang Station is located close to the center of the North Korean capital. However, in the early 1900s it was located some distance away from the old walled city, so the space between the station and walls became a new part of Pyongyang, with rectangular grid of streets and the numerous houses of the Japanese settlers who comprised about 13 percent of the city population in 1945.

The army barracks and a large military area appeared near the station as well. Meanwhile, the Koreans were left within the space once occupied by the old walled city.

The fast growth of the city made public transportation necessary, and indeed in May 1923 a tram service ― or “streetcars” as Americans would say ― was introduced, to remain in operation until the autumn of 1950 (the present-day tram system was built anew in the early 1990s, and has no continuity with the old trams of the colonial era).

Since time immemorial and until the late 1920s, Pyongyang was located on the eastern (left) bank of the Taedong River, but from the late 1920s the city crossed to the opposite bank as well.

In 1921, an airfield was built there, to be used by both the Japanese air forces and civilian planes which landed there for re-fueling on their way from Japan to China and back. This airfield, located roughly where the “embassies quarter” is now, remained in operation until the late 1950s, if not longer.

Pyongyang underwent a major industrial boom in the colonial era. Huge coal deposits were discovered around the city, so by the 1920s the mines of the Pyongyang area provided about a half of all coal produced in Korea. This economy of the era was largely an economy of coal and steel, so these mines attracted heavy industry.

The Mitsubishi Group built a large steel mill in Nampo, not far away from Pyongyang. Another major consumer of high-quality coal was the Imperial Navy ― and the ship engines of the era were very demanding when it came to the coal quality.

Pyongyang itself also had a number of smaller businesses, including textile and footwear factories. Their presence also meant a presence of powerful labor unions, so Pyongyang was a place of some of the largest strikes of the period.

For the Koreans of the colonial time, Pyongyang was a city of Christianity. Indeed, Protestants constituted up to 25-30 percent of its population.

In a time when nationwide the share of Christians did not exceed 1 percent, this was a truly remarkable figure. This implied a large missionary presence but also existence of first-class educational facilities: Protestant schools played a major role in introducing modern science and technology to Korea.

The result was strength of the nationalist movement then closely associated with Christianity. Contrary to what one might expect, prior to 1945 Pyongyang was a stronghold of the nationalist Right while the Communists position appeared much stronger in Seoul.

The city also boasted a number of museums, including a large archeological museum with the findings made during the excavations of the 1920s.

Not much is left of that city. Most of Pyongyang’s population left in 1945-53, fleeing either religious persecution by the new regime or U.S. bombing raids. These raids virtually wiped the city off the face of earth, so in the mid-50s Pyongyang was built anew without any references to the then rejected past.

A few historical monuments of ancient times have been restored (or rather built), but almost nothing has survived from the colonial era Pyongyang. Only the old Taedonggyo Bridge still crosses the river, handling a large part of very heavy Pyongyang traffic.

Andrei Lankov writes in the Korea Times:

The North Korea of the old Stalinist days is gradually dying. In some regards the North is still a Stalinist society, but it is changing even if these changes do not necessarily attract much outside attention. One of the most dramatic transformations of the last year is a great relaxation of the control over movement inside North Korea.

Let’s start from how the system used to work in the past. For decades, no North Korean was allowed to leave his or her native county without special travel permit, to be issued by local authorities. The only exception was that a North Korean could visit counties which had a common border with the county where he or she had official household registration. If found outside his or her native county without a proper permit, a North Korean was arrested and then ‘extradited’ back to their native county for appropriate punishment.

There had to be valid reasons for issuing a travel permit, unless the person went somewhere on official business. In most cases one had to produce an invitation from relatives for a wedding or funeral or other sufficiently important event. Then the paperwork could begin. In most cases the application was first authorized by the party secretary in one’s work unit, then it was sent to police and, finally, to the so-called “second department” of a local government (these departments were staffed with police officers).

There were various types of travel permits. For example, a trip to some special areas, like Pyongyang or districts near the DMZ, required a special travel permit which had to be confirmed by Pyongyang. There were also special types of permits for the military and some very special types for big wigs.

A trip overseas was virtually impossible. North Koreans could go abroad only on official missions and, in a very limited number of cases, they were permitted to visit relatives in China.

The system crumbled in the mid-1990s. The Great Famine made it unsustainable. Around 1996 the public distribution system collapsed, and millions of North Koreans began to move all over the country looking for food. The government turned a blind eye to their activities, and soon the restrictions ceased to be enforced.

It is not clear to what extent the travel control system was officially relaxed, and to what extent the changes resulted from benign neglect. For all practical purposes, from around 1997-98 the North Koreans enjoyed some freedom to travel without permits, with Pyongyang and some sensitive areas being an exception. This sudden relaxation (even collapse) of the domestic controls was a necessary preliminary condition for the explosive growth of private economic activities in the country. People could trade only because they could travel.

North Koreans also began to cross the border and travel to China where they looked for food and jobs. Crossing the border was illegal, but it was impossible for a country with a crumbling economy to enforce border control. Thus, once again, authorities turned a blind eye on everything which was happening in those areas.

In 2001 the system changed again. The Great Famine was over, largely due to the efforts of international relief agencies and the new policies of Seoul busily feeding its “brother/enemy.” Thus, the system of travel permits was re-introduced, but its new version, in operation from 2002, is less restrictive than earlier regulations – and still largely ignored.

Nowadays, the authorities issue travel permits for trips lasting a week or two. Often they can be bribed to speed up the process, and in such a case the permits are produced almost immediately. The amount of bribe varies, depending on the destination: from some $10 for Pyongyang to merely $2 to $3 for a humble countryside destination. Money seems to be paid usually in exchange for speed.

There is something even more remarkable: In recent years North Korean authorities began to issue certificates which allow its bearer to travel to China, crossing the border legally. The procedure is time-consuming, taking about six months. As usual, it requires special security checks by the authorities. However, the outcome of such procedures is not pre-ordained, so generous payments are helpful to steer officials in the right direction. In this case, the bribes are much larger, up to $100 (as opposed to the usual $50). For the average Korean this is a large amount of money, but a majority of the applicants are engaged in the cross-border shuttle activity, and for them $100 is not an exorbitant sum. They are quite happy to get permits. Even if they pay bribes they still feel themselves more secure and more law-abiding. Being Koreans, they obviously prefer to go about business legitimately.

So, the old system is dying, even though the authorities would much prefer to keep it in place. Nonetheless, it might take many years before these changes have meaningful political consequences.

Read the full story here:
Travel permits in N. Korea
Korea Times
Andrei Lankov
1/2/2010

According to Yonhap:

Two sailors were killed and 15 remain missing after a North Korean-registered cargo ship sank in the Yellow Sea off China, according to a news report Saturday.

The North Korean ship Kang Bong sank on Friday morning “amid strong gales” off Lianyungang Port in the eastern Chinese province of Jiangsu, China’s Xinhua News Agency reported.

Three sailors had been rescued, and rescuers recovered the bodies of two deceased sailors, the report said, citing the Rescue and Salvage Center under the Ministry of Transport.

Two helicopters and a rescue ship were searching for the missing sailors, but strong winds and high waves were hampering the search, the report said.

Read full story here:
Two dead, 15 missing as N. Korean cargo ship sinks: report
Yonhap
1/1/2010

According to Yonhap:

South Korea’s level of urbanization first exceeded that of North Korea in the 1980s, and the gap may widen to 24 percentage points by 2015, data by the South Korean statistical office and the United Nations showed Sunday.

The South’s urbanization rate reached 83 percent as of 2010 while the corresponding figure for the communist North stood at 60.2 percent, giving South Korea a 22.8 percentage point lead, reports of global urbanization forecast by Statistics Korea and the U.N. showed.

The urbanization rate calculates the proportion of a country’s total population living in city areas and indicates its level of modernization or industrialization, which encourages more movement of population to cities.

North Korea showed a higher level of urbanization in 1975 with 56.7 percent, compared with the South’s 48 percent, but the difference has started to narrow since then, the reports showed. The South eclipsed the communist country in the 1980s.

The urbanization rate is forecast to reach 84.4 percent for South Korea by 2015 while the ratio for the North may only inch up to 61 percent, expanding the difference to 23.4 percentage points five years from now, according to the reports.

The growing urbanization gap is attributable to the two separated countries’ differing fates. While the South pushed for aggressive industrialization and export-led growth, the North remained closed to the global market and stayed underdeveloped.

The U.N. report also forecast the population of the South’s two major cities — Seoul and Busan — to reach 10,007,000 and 3,322,000, respectively, while the population of Pyongyang and Nampho, two main cities of the North, are expected to stand at only 2,859,000 and 1,187,000, respectively.

The two countries have technically remained at war since their 1950-53 Korean War ended in a truce, not a peace treaty.

Read the full story here:
Two Koreas’ urbanization gap likely to widen further by 2015: reports
Yonhap
1/2/2010

Naenara has posted a summary of the DPRK’s annual joint editorial. You can read it in English here.  You can read it in Korean here.

For those of you unable or unwilling to access the Naenara web page, I created a PDF document which you may access here (English) and here (Korean)

Below I will maintain an updated list of media stories that cover the joint editorial.

Pictured above: Propaganda posters that “encourage the popular masses to carry out the militant tasks set forth in the joint New Year editorial” (KCNA)

Report 7 from IFES:

DPRK New Year’s Joint Editorial emphasizes light industry for improving the lives of the people
NK Brief No. 11-01-05-2
(1/5/2010)

In North Korea’s 2011 New Year’s Joint Editorial, the main theme was again the development of light industry in order to improve the lives of the people, just as last year, and emphasis was placed on Party leadership, self-reliance, and the principles of socialist economic management. Under the slogan, “Let’s bring about a decisive turn in the improvement of the people’s standard of living and the building of a great, prosperous and powerful country by accelerating the development of light industry once again this year,” light industry and quality of life improvements were again highlighted as part of the advance toward the 2012 goal of opening the doors to a Strong and Prosperous Country, but this issue was only lightly touched upon.

On the other hand, considerable space was allotted to the section on inter-Korean relations. Inter-Korean dialog and cooperation were emphasized, and the editorial positively evaluated its efforts toward unification, stating that “Last year our nation’s movement for the country’s reunification made dynamic progress even in the face of the vicious challenges of the separatist forces inside and outside.” In 2010, the Joint Editorial was more pessimistic, calling South-North relations “aggravated” by vicious maneuvers of “splittist forces.” This year, the editorial called for “all Koreans in the north, south and abroad join efforts and bring a new phase of independent reunification!” Under this slogan, Pyongyang appeared to take a very positive stance, citing the need to east tensions between the two Koreas, to remove the danger of war and safeguard peace, and to proactively promote dialogue and cooperation.

Under the banner of ‘national prosperity’, the article emphasized creating an atmosphere of dialog and cooperation between the two Koreas, and highlighted the need to diffuse the situation that the Lee Myung-bak government drove “to the brink of war.” Despite the Cheonan and Yeonpyeong Island incidents, the North maintained a consistent effort to reopen Keumgang Mountain tourist resort and other steps to repair inter-Korean relations. For North Korea, a tense military atmosphere between the two Koreas is not helpful in its bid to successfully reach its goal of a Strong and Prosperous Country by 2012 by building an economically strong state. Pyongyang also needs to manage relations with Seoul in order to improve relations with the United States and others.

The editorial calls for bringing about “a decisive turn in the improvement of the people’s standard of living and the building of a great, prosperous and powerful country,” and launching “an all-out, vigorous offensive for a breakthrough to realize the wish of the President to build a prosperous country, and thus greet the centenary of his birth as the greatest holiday of Kim Il Sung’s nation and a great event of humankind,” setting 2012 as the goal for opening the doors to a Strong and Prosperous Country. The editorial emphasized that “this year’s general offensive is a continuation of the grand onward march for improving the people’s standard of living, and its new, higher stage,” and is Party policy that “the improvement of the people’s standard of living should be regarded as the most important issue, the highest goal of its struggle, and carried through to the end.”

In the 2010 New Year’s Joint Editorial, Party policy was described as it’s “steadfast determination and resolve to have our people, who have weathered difficult hardships following the party, enjoy being blessed with socialism to their hearts’ content by having the achievements of the great upswing actually be allotted to the people, and to blossom into reality, without fail, the sublime intent and desires of the fatherly leader, who dedicated his entire life to the people.” This year, “light industry is the major front in the general offensive,” while “light industry and agriculture [were] the main fronts of the struggle” in 2010.

Regarding light industry, the editorial emphasized, “The sector of light industry should pay first and foremost attention to making the factories and enterprise . . . keep their production running at a high level,” and that they “should focus on the production of primary consumer goods and other necessities widely used in life, and expand and augment the overall production of other consumer goods.”

The economic section mentioned coal, electricity, iron and steel, as well as transportation as four vanguard industries, emphasized improvements in light and chemical industry, and said that “the agricultural front is the lifeline for solving the problem of people’s living.” The editorial also states, “Breaking through the cutting edge that all sectors should surpass in the shortest time the scientific and technical standards the world has reached,” on the basis of self-reliance and the principles of socialist economic management. The section would lead one to believe that North Korea needs Chinese-style reforms in order to develop its economy, yet it bases these campaigns on self-reliance and the socialist principles of “strict discipline . . . in planning, finance and labour administration.”

This year, North Korea’s New Year’s Joint Editorial continues to push for light industrial development in order to improve the lives of the people and open the doors to a Strong and Prosperous Country in 2012. However, now, after hammering out public financing during last year’s Party conference, the Party is reaffirming that development will be on the basis of “our-style” of reform.

Report 6 from KCNA: The Pyongyang rally has been posted to YouTube.

Report 5 in Yonhap:

About 100,000 North Koreans gathered Monday in Pyongyang to show support for their country’s economic push outlined in a New Year’s message, holding high the portraits of their leader Kim Jong-il and his late father, the communist state’s official media said.

The scene marks the latest in a series of mass rallies the North has organized nationwide since a joint press editorial on Jan 1. called for the revival of light industries ahead of a landmark year.

North Korea has designated 2012 as a moment in its history to rise as a “powerful, great and prosperous country.” The year marks the centennial birthday of Kim Jong-il’s father, Kim Il-sung, and analysts say the regime appears to be trying to improve people’s living standards in a bid to create a mood favorable for its second hereditary power succession underway in Pyongyang.

“Slogan boards were set up at the site of the rally, saying hurray to the revolutionary ideas of Great President Kim Il-sung and Dear Leader Kim Jong-il,” the Korean Central TV said.

Since his death in 1994, Kim Il-sung, who founded the country, has assumed the post of “Eternal President.” The impoverished North runs a massive cult of personality around the Kim family. Kim Jong-il is now grooming his third son, Kim Jong-un, as his successor.

The rally, which brought together a wide collection of propaganda flags, began with a hymn to Kim Jong-il, the television said, while the participants pledged to fervently carry out the New Year goals.

North Koreans are said to be forced to memorize joint press editorials released every New Year’s Day. The editorials are scrutinized by outside officials and analysts for hints into the isolated country’s political and economic plans.

North Korea this year also called for dialogue with South Korea despite tensions that arose when it shelled a South Korean border island and killed four people on Nov. 23. South Korean President Lee Myung-bak said in his New Year speech on Monday that his country would retaliate harshly if North Korea provoked it again, even though he left room for dialogue open.

Analysts believe the North, one of the poorest countries in the world, will have difficulties reviving its economy unless it opens up for outside resources. The North, which fears outside influence may undermine its grip on the 24-million population, made little mention of a need to open up economically in its New Year editorial.

Report 4 in the Daily NK:

North Korea has asserted as its goals for 2011, “improvement of the people’s lives and constant pursuit of construction of the strong and prosperous state” through its annual “Common Editorial” carried by the three major publications of state; Rodong Shinmun, Chosun People’s Army and Youths’ Advance Guard.

The publications, which carry the propaganda of the Party, military and Kim Il Sung Socialist Youth League respectively, released the editorial this morning under the heading, “This year let us realize a decisive change in improving the people’s lives and constructing the strong and prosperous state by once more accelerating light industry.”

Without mentioning nuclear issues or improving relations with the U.S., and only scant mention of the succession, the editorial mostly reiterated the contents of last year’s editorial; “improving the people’s lives through development of light industry and agriculture.”

This year’s piece started with an evaluation of the last ten years, calling it a “victorious decade” and asserting, “Juche 99 (2010) was the year when phenomenal issues which showed the strong and prosperous future happened in consecutive order.”

Specifically, it pointed to the Delegates’ Conference of the Chosun Workers’ Party as the biggest achievement of the last year.

Regarding the Delegates’ Conference, it went on, “It was a significant chance to raise the authority of the Party in all possible ways and reinforce and develop our Party into an eternal Comrade Kim Il Sung Party,” adding that the Conference was “the fundamental background for the succession and completion of the achievements of the Party and Juche revolution.”

In terms of Kim Jong Il’s activities, it defined the last year as “a historical year when the excellent leadership of comrade Kim Jong Il was displayed at the highest level,” and emphasized, “The General’s leadership work, which led the whole military and people into a brave, aggressive war, was truly extraordinary and intelligent.”

The editorial praised Kim Jong Il’s diplomatic activities, stating, “Two visits to China by the respectful General were historic trips to raise the conventional friendly relations between China and Chosun onto a new level which have prepared the advantageous surroundings for our revolution.”

This appears to suggest that the biggest of Kim Jong Il’s achievements was obtaining Chinese support for the Kim Jong Eun succession.

After the evaluation of the previous year, strategies, goals and major slogans for the New Year followed as normal, and as normal all is led by a quotation from Kim Jong Il; this year, “We have to bring forth the bright future of the strong and prosperous state through constant innovation and advancement, while harboring a deep faith in our victory.”

Regarding the economy, it stated, “This year’s all-out battle is the constant, enormous march for an enhancement to people’s live,” and “light industry is the primary frontier of the all-out battle.”

Among the most interesting points may turn out to be, “The movement of August 3rd people’s consumer good production has to be carried out actively,” which may suggest that the authorities are set to partially allow autonomy of production, an idea which stands apart from recent strong-armed attempts to return to the socialist economy of yesteryear.

August 3rd people’s consumer goods refer to all the necessities made independently with by-products or recycled materials from each factory, enterprise or collective farm to help them generate revenue.

The editorial also demanded indirectly loyalty to Kim Jong Eun, who became the Vice Chairman of the Central Military Commission under the Central Committee of the Party through the Party Delegates’ Conference in September, asserting, “Holding aloft the slogan, ‘Let’s defend the Central Committee of the Party surrounded by great comrade Kim Jong Il with our lives,’ we have to inherit solidly the precious tradition of believing absolutely and following the Party and Suryeong.”

It additionally implied that the North may take a hard-line towards South Korea this year, stating that, “The spirit of the People’s Army, which resembles its great supreme commander, is the fighting spirit of the Mt. Baekdu, and its way of reacting is through urgent and merciless annihilation.”

It also explained that the major reason for the latest confrontation between North and South is the South’s policy towards the North.

It asserted, “South Chosun authorities must come to the path of withdrawing their policy of anti-reunification, confrontation with the same nation and respect and implement the June 15 Joint Declaration and the October 4 Inter-Korean Summit Agreement.”

Saying, “If the flame of war bursts to life on this soil, there will be nothing but a nuclear disaster,” the editorial threatened, “The whole nation should never forgive the criminal maneuvers of pro-American and belligerent elements, which have dragged the situation into a war in collision with foreign forces.”

In conclusion, the editorial finished, “While unifying strongly around the Central Committee of the Party led by great comrade Kim Jong Il, let’s create decisive change in the construction of the strong and prosperous state with deep faith.”

Report 3 in  the Wall Street Journal:

The annual New Year’s message from North Korea’s authoritarian regime urged the country’s 24 million citizens as usual to work together for a stronger country, but it was more militant toward South Korea than last year’s statement was.

The message issued Saturday contained no signs of a new direction in overall economic and diplomatic strategy. It warned the South’s government to stop what it called “north-targeted war moves” and a “smear campaign” against it.

The New Year’s message is one of the few regular statements from Pyongyang that offer an opportunity to gauge the tone and direction of the regime, and is always a curiosity to outsiders because of its totalitarian language.

Running nearly 6,000 words in English, the message followed the usual pattern by first recalling the past year’s accomplishments. It then turned to focus on 2011 with a one-sentence declaration of purpose for the nation, which was immediately underlined by a quotation from dictator Kim Jong Il.

This year, Mr. Kim was quoted as saying, “We should bring earlier the bright future of a thriving nation by making continuous innovations and advance, full of confidence in victory.”

Most of the message focused on a long-promoted drive by the North’s government to build a “prosperous nation” by 2012, the 100-year anniversary of the birth of Kim Il Sung, who is Kim Jong Il’s father. The elder Mr. Kim founded North Korea and was its absolute ruler from 1948 until his death in 1994. Kim Jong Il in September 2010 tapped his youngest son, Kim Jong Eun, as heir apparent, in a sign the family will attempt a third generation of control over the nation of 24 million.

As in previous New Year’s statements, the last 1,500 words or so of the 2011 message were devoted to the tension between North and South Korea, which has spanned decades.

The message indirectly referred to North Korea’s Nov. 23 attack of a South Korea-controlled island, the first attack by the North on South Korean land since the war of the 1950s. The North in Saturday’s message again blamed South Korea’s government and “outside forces,” a reference to the South’s allies, the U.S. and Japan, for inciting the attack with “north-targeted war moves.”

“The danger of war should be removed and peace safeguarded in the Korean peninsula,” the message said. That was stronger language than it used in the 2010 New Year’s message, when it said, “The way for improving north-south relations should be opened.”

By contrast, the 2010 statement didn’t use the word “war” in describing the tension with the South. Instead, it called the South’s government “vicious” and urged Seoul to “refrain from committing acts that may aggravate the confrontation and tension.”

Both the 2010 and 2011 statements outlined a number of steps the South’s government should take to avoid trouble with Pyongyang. It urged Seoul to halt weapons purchases and end its military alliance with the U.S.

“Collaboration with outside forces leads to war and national ruin,” the 2011 message said. “The entire nation should never tolerate the criminal moves of pro-U.S. war hawks who stake their fate on foreign forces and drive the situation to the brink of war in collusion with them.”

The message also reiterated the North Korean regime’s oft-stated themes of independent development, which it puts into practice by limiting freedoms of its citizens, including their ability to travel and obtain information about the outside world while telling them there is no life better that the North Korean one.

“There are no party and people in the world as great as ours, which have an ever-victorious history and a highly promising future,” it said.

The New Year’s statement is printed in every major North Korean newspaper and read on state-run broadcasts. Its state news agency also distributed the entire message Saturday, along with seven separate news stories about it on that day and several more on Sunday.

Report 2 in the  Wall Street Journal:

North Korea’s authoritarian regime, in its annual New Year’s message, on Saturday underlined its desire to take over South Korea and warned the South’s government to stop what it called “north-targeted war moves” and a “smear campaign” against it.

Much of the nearly 6,000-word message repeated statements it made last year and in previous years. Most of it focused on a long-promoted drive by the North’s government to build a “prosperous nation” by 2012, the 100-year anniversary of the birth of Kim Il Sung, who founded North Korea and was its absolute ruler from 1948 until his death in 1994.

Mr. Kim’s son, Kim Jong Il, has led North Korea since then and, in late September 2010, tapped his youngest son Kim Jong Eun as his heir apparent, in a sign the family will attempt a third generation of control over the nation of 24 million.

As in the 2010 statement, the last 1,500 words or so of the 2011 message was devoted to the decades-long tension between North and South Korea. The Korean peninsula was divided by other countries in the aftermath of World War II. Since then, North Korea’s regime has spoken of “reunification” under its totalitarian leadership.

South Korea’s government, meanwhile, envisions a united Korea with its democratic government in control. The North’s government calls that vision “antireunification” and “treachery.”

“Today there is no more vital task than national reunification for the Korean people,” the North’s message on Saturday said. “The stand of attaching importance to the nation, the stand toward independent reunification, is the touchstone by which to distinguish patriotism from treachery.”

The message indirectly referred to North Korea’s Nov. 23 attack of a South Korea-controlled island, the first attack by the North on South Korean land since the war of the 1950s. The North in Saturday’s message again blamed South Korea’s government and “outside forces,” a reference to the South’s allies the U.S. and Japan, for inciting the attack with “north-targeted war moves.”

“The danger of war should be removed and peace safeguarded in the Korean peninsula,” the message said. That was stronger language than it used in the 2010 New Year’s message, when it said, “The way for improving north-south relations should be opened.”

The 2011 statement went on to outline a number of steps the South’s government should take to avoid confrontation, including a halt to weapons purchases and its military alliance with the U.S. “Collaboration with outside forces leads to war and national ruin,” the message said. “The entire nation should never tolerate the criminal moves of pro-U.S. war hawks who stake their fate on foreign forces and drive the situation to the brink of war in collusion with them.”

It called for “active efforts” to “create an atmosphere of dialogue and cooperation” between the two Koreas and said “free travel of and exchanges between people from all walks of life should be ensured.”

The message also reiterated the North Korean regime’s oft-stated themes of independent development, which it puts into practice by limiting freedoms of its citizens, including their ability to travel and obtain information about the outside world while telling them there is no life better that the one they are leading.

“There are no party and people in the world as great as ours, which have an ever-victorious history and a highly promising future,” it said.

The New Year’s statement is one of the main messages of the year by the North’s leadership to its people. It is printed in every major North Korean newspaper and read on state-run broadcasts. Its state news agency distributed the entire message, along with seven separate news stories about it early Saturday.

Report 1 in Yonhap:

North Korea called Saturday for defusing tension with South Korea, warning of a “nuclear holocaust” should another war break out on the peninsula, as the impoverished communist state made its last annual pitch for economic revival ahead of a landmark year.

A joint New Year’s editorial by the North Korean press did not make clear allusions to the country’s ongoing hereditary succession nor did it repeat the 2010 call for ending the state of enmity with the United States even though it did renew a pledge for denuclearization.

The editorial, considered a blueprint for Pyongyang’s policy goals, came amid the highest level of animosity between the Koreas in decades after the North bombarded a South Korean island on Nov. 23, killing four people in one of the worst attacks since the 1950-53 Korean War.

South Korean President Lee Myung-bak has vowed retaliation while Seoul and Washington have teamed up to conduct joint military drills in a show of force to the North and a warning against provocation.

“Confrontation between north and south should be defused as early as possible,” the North said in the editorial jointly released by Rodong Sinmun, Joson Inmingun and Chongnyon Jonwi.

“If a war breaks out on this land, it will bring nothing but a nuclear holocaust,” it said, arguing that war was averted last year because of “our persevering efforts” and calling for the creation of “an atmosphere of dialogue and cooperation” this year.

North Korea typically makes calls for dialogue with the South in an effort to extract politically motivated aid, which Seoul has suspended since President Lee took office in early 2008.

The North also demanded that the South end its series of military exercises, accusing Seoul of aligning with “U.S. war hawks” and driving the situation to the brink of war.

The New Year’s message came after Lee expressed his hope earlier this week for the resumption of multilateral denuclearization-for-aid talks on the North. New Mexico Governor Bill Richardson of the U.S. visited North Korea last month and won a pledge from the North to allow the return of international nuclear monitors on its soil.

The series of developments signaled a growing mood for the resumption of the stalled talks that include the two Koreas, the U.S., Russia, Japan and China. The so-called six-party negotiations have not been held since late 2008.

“The DPRK is consistent in its stand and will to achieve peace in Northeast Asia and denuclearization of the whole of the Korean peninsula,” the North’s joint editorial said, using the country’s official title, the Democratic People’s Republic of Korea.

North Korea alarmed the world in November when it revealed through U.S. scholars that it was operating thousands of centrifuges to enrich uranium, a second track to building nuclear bombs.

The country, which has conducted two nuclear tests since 2006, claims the uranium enrichment, coupled with the construction of a light-water reactor, is for peaceful energy use. The U.S. sees the argument as a thin cover for advanced nuclear arms development.

Stressing that light industries are the “major front,” the North said standards of living for its people should be improved ahead of 2012, the year the leadership has designated as a moment in its history to rise as “a great, prosperous and powerful country.”

“Next year we will be greeting the centenary of the birth of President Kim Il-sung,” the country’s founder who passed his power to his son Kim Jong-il upon his death in 1994, the editorial said.

“We should launch an all-out, vigorous offensive for a breakthrough to realize the wish of the President to build a prosperous country,” it said, calling for a “full-scale offensive” to revive the moribund economy.

The North suffered extreme inflation and social unrest in some regions after a botched currency reform in late 2009 sent the prices of staples soaring high. The failure to reassert control on the market economy reportedly led authorities to make a public apology.

“Improving the economic management becomes more urgent at the moment, when the national economy is put on the trajectory of revitalization,” the editorial said, calling for a boost in the production of “primary consumer goods and other necessities widely used in life.”

“The sector of light industry should turn out commodities that would be favored by people,” it said.

Analysts have said the North will step up its efforts to address the economic plight of its people as it moves to justify its second hereditary power succession.

“Despite the attack on Yeonpyeong Island, North Korea is seen demonstrating an open-minded stance on inter-Korean dialogue and cooperation to tackle the current status of isolation,” said Chung Seong-chang, a senior analyst at the Sejong Institute in Seoul.

“However, I think military tensions would remain for the time being as the North also emphasized combat preparedness of its military,” Chung said.

The North unveiled the third son of its aging leader Kim Jong-il as a four-star general last year, anointing him as throne successor even though Kim Jong-un was no older than 28.

The editorial said the ruling party conference in September — in which Kim Jong-un rose to high political posts — marked a “a spirit of single-hearted unity to invariably defend the centre of unity and leadership despite the passage of time.” But it did not make comments that could be seen as directly related to succession.

Kim Jong-un has been touted by North Korean media as someone most capable of further developing the songun, or military-first, policy chartered by his father, who reportedly suffered a stroke in 2008.

The editorial said the 1.2 million-strong military should “conduct intense combat training in an atmosphere of actual battle as required by the tense situation,” warning the North will not pardon an act of invasion “even an inch.”

“We should further strengthen the militant might of the People’s Army,” it said, suggesting Pyongyang will continue to invest large resources in arms development despite economic difficulties.

The North claims it has developed nuclear arms to deter an invasion by the U.S., which signed a truce with the North at the end of the Korean War. The peninsula remains technically at war because no peace treaty has been signed.

Read the full stories here:
North Korea Issues New Year Warning
Wall Street Journal
Evan Ramstad
1/2/2010

North Korea Warns South in Annual Message
Wall Street Journal
Evan Ramstad
1/1/2011

N. Korea calls for ending tension with S. Korea, reviving economy
Yonhap
Sam Kim
1/1/2011