Taxes increase on some North Korean markets

May 3rd, 2019

By Benjamin Katzeff Silberstein

This sort of news is very interesting, particularly in context: I’ve heard from people who deal with North Korean firms that some of them have received orders to tighten up their accounting, and report their assets to the state in greater detail. Taken together, these snippets of information suggest an overall difficult economic situation, though not desperate or in crisis-mode, where the state is taking more and more measures to drive in cash from the public.

Daily NK:

Sales fees levied on private distributors have risen in some areas of North Korea. The fees are managed by North Korea’s collection agency and essentially provide a source of tax revenue for the state. Private distributors are expressing discontent over the changes as many are suffering under the country’s already poor economic conditions.

“The authorities recently began demanding outrageous and unfair selling fees from private distributors,” said a South Pyongan Province-based source on April 25. “Collection offices (i.e. tax offices) attached to local people’s committees are required to pay varying fees depending on the product, and the number of fees have been doubled.”

These de facto tax offices were established in each city and county as part of the July 1 Economic Management Improvement Measure in 2003 and are managed by the Ministry of Financial Administration. The offices collect fees for land use, market stalls, and various other reasons.

“The authorities are demanding a huge amount of fees to gain control over and restrict the activities of private business people who live in Pyongsong but bring in products from Sinuiju, Rajin-Sonbong, Nampo and Hyesan,” said a separate source in South Pyongan Province.

“Soybean oil sellers, for example, had to pay 3% of their income before, but now have to pay twice that amount.”

The skyrocketing fees are likely due to the fall in tax revenue arising from the economic difficulties the country is facing.

“The government increased the fees they were collecting just as incomes fell among private business people,” she said. “The authorities are simply taking money from the people to make it seem like the state is self-sufficient.”

North Korean authorities have made the fee system more sophisticated while raising fees as part of efforts to generate more income for the regime.

Article source:
North Korea doubles de facto sales tax levied on distributors in some areas
Mun Dong Hui
Daily NK
2019-05-03

Share

Possible North Korea five-year strategy document leaked, says Japanese newspaper

April 22nd, 2019

Benjamin Katzeff Silberstein

The following is interesting if true, and it makes a great deal of sense. One of North Korea’s main challenges is diversifying itself away from the overwhelming reliance on China for trade and economic ties. It’s easier said than done, though, and a wise (from a North Korean point of view) strategic ambition is one thing; realizing it is entirely different. I’ve written elsewhere about the age-old North Korean aim of diversifying itself economically away from reliance on China. Still, not much has happened since Kim Jong-il’s speech in the 1990s…

Hankyoreh’s re-write of Mainichi Shimbun:

A document titled “National Economic Development Strategy (2016–2020)” that North Korea adopted in the 2016 congress of the Workers’ Party of Korea (WPK) stated that the country needs to become less dependent on China, the Japanese press has reported.Japanese newspaper the Mainichi Shimbun reported on Apr. 21 that the strategy document set the goal of achieving an average annual economic growth rate of 8% and proposed “reducing our reliance on China and expanding foreign trade in a number of areas, including Russia, Southeast Asia, and the Middle East.”

While this strategy was adopted in the 7th WPK Congress, held in May 2016, after a hiatus of 36 years, the specific details and figures in the strategy had not been previously disclosed. The Mainichi explained that the strategy document had recently been acquired by Cho Yun-yeong, a Korean-Japanese researcher on North Korea.This document said that China represented 71.6% of North Korea’s trade value in 2014; Russia, 4.2%; and Germany, 0.8%. “China accounts for an overwhelming share of trade. We’ve been unable to move away from our dependence on China,” the document said.

The solution posited by the document was the diversification of foreign trade.More specifically, North Korea set the goal of increasing the amount of its trade with Russia to US$1 billion by 2020. According to the latest estimate by the South Korean government, North Korea’s trade with Russia amounted to US$77.84 million in 2017. In other words, the North was seeking to increase its trade with Russia more than tenfold in the space of just four years.The Mainichi Shimbun also said the North Korean document proposed gaining funds needed for building hydroelectric plants from Russia, as well as technical cooperation for upgrading facilities such as the Kim Chaek Iron and Steel Complex and the Musan Iron Mine.

North Korea also appears to have drawn up a plan to attract investment from Russian companies in international tourism zones in Wonsan and Mt. Kumgang and an economic development zone in Chongjin, along the the East Sea, in order to “build a cooperative network for producing medical products on consignment, processing marine products and developing natural energy.”The Japanese newspaper predicted that economic cooperation between the two countries could be on the agenda of the summit between North Korean leader Kim Jong-un and Russian President Vladimir Putin, which is likely to be held in Vladivostok on Apr. 24. But given the failure of the second North Korea-US summit, in Hanoi, to live up to its expectations, it won’t be easy for the North to massively boost its trade with Russia, as it hopes to do.

Full article:

N. Korean document reveals strategy to decrease reliance on China, Japanese press reports
Cho Ki-weon
Hankyoreh
2019-04-22

And here’s the original article:

Documents obtained by a South Korean researcher have shed light on the full breadth of North Korea’s top-secret state economic development strategy for 2016 to 2020, including an 8% economic growth target and strengthened ties with Russia and other countries to break dependence on China.

The 157 pages of strategy documents, along with a Jan. 21 paper titled “Cabinet decision No. 2,” which presents North Korea’s agenda for this year, were obtained by Cho Yun-yong, a researcher on North Korea who formerly served as a Tokyo correspondent for South Korean news agency Newsis.

According to the documents, Pyongyang aims to achieve 8% annual economic growth through technological development and trade diversification. While the state economic development strategy had been presented at the seventh convention of the Workers’ Party of Korea in May 2016, its details and numerical targets were not publicly released.

The objectives outlined in the documents likely provided motivation for Pyongyang’s strong demand that economic sanctions on the country be lifted during a February summit between North Korean leader Kim Jong Un and U.S. President Donald Trump. They also likely played a part in the planned summit between Kim and Russian President Vladimir Putin later this month.

With regard to the current status of the North Korean economy, the strategy documents point to low output levels of electricity and coal and the failure to fulfill domestic demand for food supply and daily necessities. As measures to realize the economic development strategy, the documents cite technological development, trade diversification and the full introduction of a new economic management method, which implies de-facto economic reform.

Specifically, the strategy calls for a break from the North’s exclusive devotion to China and expansion of trade to Russia and other countries in Southeast Asia and the Middle East. In particular, the initiative aims to boost the amount of trade with Russia to 1 billion dollars (about 110 billion yen) by 2020. The figure is more than 10 times the North Korea-Russia trade value of 77.84 million dollars in 2017, as reported in South Korean statistics.

The five-year strategic plan also suggests having Russia provide North Korea with the funds necessary to build hydroelectric plants and other facilities, as well as technological cooperation for revamping the Kim Chaek Iron and Steel Complex and the Musan Mine.

Furthermore, the economic strategy proposes inviting investment from Russian companies for special economic zones along the Sea of Japan. These proposals may become topics for discussion at the upcoming summit between Kim Jong Un and Russian President Putin.

Article source:
Docs shed light on scope of N. Korean development strategy through 2020
Koichi Yonemura
Mainichi Shimbun
2019-04-20

Share

Development in Sinuiju

April 22nd, 2019

Benjamin Katzeff Silberstein

NK News has a nice photo series out showing some interesting sights from Sinuiju. I’m not posting it here since it’s for their subscribers only, but Colin Zwirko’s description summarizes the general impression:

The ports along the northern coast lining the Yalu River (or Amnok River as it is called in North Korea) serve an important economic role for the city’s dozens of factories, while a large number of trucks still pour into the city daily through the cross-border bridge.

But despite the economic changes seen in the electric bicycles prominent on city streets and the ever-growing mobile phone use, infrastructure in Sinuiju is still in disrepair, ports are outdated and in need of upgrades, and even the large construction projects sometimes appear to be of questionable quality.

These issues may yet be addressed, however, as Kim Jong Un laid out grand plans for the city during a visit last November.

The photos below feature the streets and ports of Sinuiju, the city’s outskirts, and even some of the North’s own influence across the border in Dandong, all of which offer the image of a city which, while changing in subtle ways, still lags far behind its Chinese neighbor.

Check it out here.

Share

Why the market and state sectors cannot be fully separated in North Korea (and what it tells us about price stability)

April 19th, 2019

Anecdotal but highly valuable observations from inside North Korea suggest that the market economy is taking a hit from the overall decrease in economic activity in the state sector. None of this is surprising, and it makes perfect sense. As workers at factories and state enterprises either get paid less or not at all, their purchasing power drops. Fewer people can spend less money on the markets, leading to an overall depression of economic activity. Reports Daily NK:

Following news that most state-run factories in Pyongyang and other major cities have suspended operations, North Korean sources report that the number of merchants in some areas of the country have fallen drastically. This situation is reportedly due to decreased purchasing power among ordinary North Koreans on the back of the country’s economic stagnation.

“Before international sanctions, there were around 1,000 to 2,000 merchants, including those selling their wares outside the market, but now I only see around 100,” a South Pyongan Province-based source told the Daily NK on April 10. “Even those remaining merchants are just barely holding on. Some of them went to other places to do business but had to return because their efforts met with no success.”

“Only half of the market officials that once collected market fees are visible now,” said the source. “The officials face physical harm by the merchants when they try to collect the fees, so they avoid being out in the open.”

The source also reported that “Merchants have to sell 15 kilograms or more of food per day to pay the market fees. They aren’t selling even one kilogram a day” and that “Merchants are asking themselves rhetorically whether they’re just selling wares at the market to pay the fees.”

An investigation by the Daily NK has found that there has been little change to the number of active merchants in Pyongyang, Sinuiju, Hyesan, Pyongsong, Chongjin, Hamhung and other major cities. Small markets, however, appear to be facing a decrease in merchants.

The source said that economic stagnation has impacted North Korea’s poor classes, including those living in agricultural areas.

“The factories are shut down so people can’t get paid, and this means that no one is heading out to the markets,” said the source. “The international sanctions are so bad that there’s no work left. People don’t have money to buy anything.”

This all gets at a problem with analyzing North Korea’s economic situation based on price stability. Simple analysis of supply and demand holds that if overall availability of food goes down, prices go up. They haven’t in North Korea.

But what if people just don’t have money to spend on food if prices go up? Then, market suppliers couldn’t really raise prices much, because they’d already be pretty much at the highest level at which people are willing to purchase food (also known as the “reservation price”). It’s also important to remember that cash, according to a lot of anecdotal observations – and suggested by the state of the exchange rate – is generally rather scarcely available in North Korea, as the government seems to have contracted the money supply quite significantly over the past few years.

This is what I suspect is part of what’s going on the markets in North Korea, and some may have looked much too simplistically at food and currency market prices for a long time. Price stability doesn’t necessarily mean a lack of problems in the economy.

Article source here:
Drastic fall in market merchant numbers in some areas of North Korea
Mun Dong Hui
Daily NK
2019-04-18

Share

North Korea has skipped Kaesong liaison office meetings for eight weeks

April 18th, 2019

Benjamin Katzeff Silberstein

Reports Yonhap:

North Korea skipped a weekly meeting of the co-chiefs of an inter-Korean liaison office for the eighth straight week on Friday, deepening concerns about slumping cross-border exchanges amid stalled denuclearization negotiations between the U.S. and the North.

“North Korea informed us in advance that the North’s office head could not attend this week’s meeting,” unification ministry spokesman Lee Sang-min told a regular press briefing. “The meeting will not be held (this week), but the two Koreas continue to discuss necessary matters in a normal manner.”

When the two Koreas launched the liaison office last September in the North’s border town of Kaesong, they promised to hold a meeting of its co-heads — Vice Unification Minister Chun Hae-sung on the South side and his North Korean counterpart Jon Jong-su — every week, mostly on Fridays, to discuss cross-border issues.

The weekly meeting has not been held since before the Hanoi summit between North Korean leader Kim Jong-un and U.S. President Donald Trump, which ended without a deal due to differences over how to match Pyongyang’s denuclearization steps with Washington’s sanctions relief. It was last held on Feb. 22.

Full article:
N. Korea skips meeting of liaison office chiefs for 8 straight weeks
Yonhap News
2019-04-19

Share

North Korea trying to acquire South Korean seeds, RFA reports

April 15th, 2019

Benjamin Katzeff Silberstein

North Korean authorities are trying to procure higher-yield South Korean rice seeds to cope with chronic food shortages. But instead of simply asking Seoul for the seeds, which are not subject to economic sanctions, Pyongyang’s trade representatives are attempting to bring them in via China, posing difficulties with Chinese customs inspections, sources say.

“I was asked by a North Korean trade worker in China to get South Korean rice seeds, but there’s no easy way to bring seeds from Korea into China, so I am not sure what to do,” said a source in a Chinese border city.

The source said relatives living in South Korea have already procured 30 kilograms of the seeds and are ready to ship them.

“But I have to go through a very complicated process to bring the seeds here, so I am hesitant about the whole thing,” said the source, adding, “Plant seeds, especially those for agricultural products have a meticulous customs inspection that takes forever to get through.”

Other products from South Korea can be brought into China with relative ease, according to the source.

“Merchants who do the China-South Korea run by ferry can usually bring whatever they want into China but most of them avoid anything having to do with farming, because clearing customs is so difficult,” said the source.

In recent years, farming conglomerates worldwide have vigorously defended their intellectual property rights for engineered seeds. Seoul, however, doesn’t mind if merchants take the rice seeds out of the country.

“It isn’t too difficult to pass South Korean customs, but [merchants] have to report the seeds to Chinese maritime customs. Then they have to pay high tariffs and go through a strict quarantine,” the source said.

“If they try to smuggle them (into China) to avoid the hassle, they face [the possibility of] heavy fines and criminal punishment,” said the source.

“I am pretty certain that North Korean authorities are ordering their trade workers in China to find South Korean seeds. They aren’t really asking for a lot of them. I think they will conduct experiments on the seeds to see if they are suitable for North Korea’s soil and weather,” said the source.

A second source, from a Chinese border city, noted that North Korea was able to bring beech seeds from Ulleung-do, a South Korean island east of the Korean peninsula, but wondered why Pyongyang is trying to get Southern rice seeds in such a roundabout way.

“They can have these kinds of plant seeds easily if they just ask the South Korean government, especially now that North and South Korea are trying to be friendly with each other,” the source said, adding, “It is hard to understand why they are being so secretive.”

Article source:

North Korea Tries to Secretly Get South Korean Rice Seeds Using Traders in China
Joonho Kim and Jae Wan Noh
Radio Free Asia
2019-04-15

Share

Kim Jong-un’s speech at the SPA in April 2019

April 14th, 2019

Benjamin Katzeff Silberstein

Posting the speech here in full, from KCNA:

Pyongyang, April 14 (KCNA) — Supreme Leader Kim Jong Unmade the policy speech “On Socialist Construction and the Internal and External Policies of the Government of the Republic at the Present Stage” at the First Session of the 14th Supreme People’s Assembly of the Democratic People’s Republic of Korea on April 12.

Its full text is as follows:

Dear Deputies,

The First Session of the 14th Supreme People’s Assembly of the Democratic People’s Republic of Korea is convened at a time when the prestige and strength of our Republic advancing along the road of independence are being demonstrated to the full and its socialist construction has entered a very important period.

As the election to the 14th Supreme People’s Assembly was held successfully amid the high political enthusiasm of all the people and with their active participation and the government of the Republic was reorganized, our State power has been further consolidated and the revolutionary advance of our people, who, united with one mind and will around the Workers’ Party of Korea and the government of the Republic, are marching confidently towards a higher goal of socialism, will be further accelerated.

I extend my heartfelt thanks to all the Deputies for having placed, on behalf of all the people, great trust in me so that I would continue to lead the overall work of the State as Chairman of the State Affairs Commission of our glorious country, the Democratic People’s Republic of Korea; and I pledge myself to work with devotion for the development and prosperity of the Republic and the happiness of our people.

Comrades,

Accomplishing the socialist cause under the unfurled banner of modelling the whole society on Kimilsungism-Kimjongilism is a great and historic task facing the government of the Republic.

Modelling the whole society on Kimilsungism-Kimjongilism is the highest programme of our Party and the government of our Republic and the general direction and general goal of the construction of a socialist State.

It is only when we thoroughly apply Kimilsungism-Kimjongilism to State building and activities that we can develop our Republic into the State of the great Comrades Kim Il Sung and Kim Jong Ilfor ever and creditably satisfy our people’s demands for and ideals of independence true to the will and wishes of the great leaders.

The government of our Republic will achieve decisive victory in implementing the socialist cause by conducting more vigorously the struggle for modelling the whole society on Kimilsungism-Kimjongilism.

1

Comrades,

The major fighting task facing us in our efforts for modelling the whole society on Kimilsungism-Kimjongilism is to accomplish the cause of building a powerful socialist country.

Building a powerful socialist country is a historic stage in the struggle for achieving the final victory of socialism, and this can be accomplished with credit only by applying the Kimilsungist-Kimjongilist ideas of State building in a thoroughgoing way.

The Kimilsungist-Kimjongilist ideas of State building contain in a concentrated way the ideas of, and exploits in, State building of the great Comrades Kim Il Sung and Kim Jong Il, who developed our Republic into the most prestigious and strong socialist State in its history; these ideas also indicate clearly the ways and means for accomplishing the socialist cause with the State government as a political weapon.

With the great Kimilsungist-Kimjongilist ideas of State building as the immutable guiding principle, the government of the Republic should raise the country’s strategic position and national strength onto a new high and bring about a fundamental turn in accomplishing the Juche-oriented socialist cause.

The revolutionary line of independence should be carried out in State building and activities.

Independence is the political philosophy of our Republic, and it constitutes the core of the Kimilsungist-Kimjongilist ideas of State building. A socialist State can defend the country’s prestige and people’s destiny and build and perfect socialism as suited to its situation and by its own efforts, only when it maintains the principle of independence and the Juche-oriented stand definitely in all its activities. The great Comrades Kim Il Sung and Kim Jong Il raised independence as the life of the Korean revolution and the fundamental cornerstone for State building and advanced the revolution and construction in our own way while categorically rejecting worship of big countries, dogmatism and the high-handedness and pressure by outside forces. Under their wise leadership our Republic has been built and developed to be a socialist State, independent in politics, self-supporting in the economy and self-reliant in national defence, and it is still demonstrating to the world its prestige and might as a powerful independent country. Its strategic position and influence is being raised day by day as it recently achieved the historic cause of developing the two fronts simultaneously amid a do-or-die confrontation with the imperialists and is leading the trend of situation towards peace. Today the imperialists’ wilful violation of the sovereignty of other countries is growing more undisguised than ever before, and not a few countries are being forced into a miserable plight as they have no strength with which to defend themselves; in this world it is hard to find a country like our Republic that is steadfast in the principle of independence and assures the security of the State and the happiness of the people by its own efforts.

Holding fast to the revolutionary line of independence in State building and activities is a consistent and immutable stand of our Republic.

Geographically, Korea is sandwiched between big countries and its territory remains divided. Our Republic is conducting socialist construction as the hostile forces are resorting to more vicious schemes in trying to contain, undermine and stifle it. On the other hand, the contradictions and confrontations among great powers in their pursuit of hegemony are worsening on a regional and worldwide scale.

Given the special circumstances of our revolution and the complexity of the present world situation, our Republic should build up its own strength from the firm standpoint of independence and seek independent development to defend its sovereignty and dignity and achieve true prosperity. In the past, too, when the world socialist camp existed and the countries concerned maintained cooperative relations to varying degrees, our Republic adhered to self-determination and independence in carrying on the revolution and construction, and promoted socialist construction on the principle of self-reliance. Building socialism by its own efforts according to the revolutionary line of independence is the basic principle our Republic must invariably maintain in State building.

Whatever wind may blow and whatever challenges and difficulties may lie ahead, our Republic will, in the future, too, make no concession or compromise over the issues concerning the fundamental interests of our State and people. It will resolve everything on the strength of self-reliance and self-development, stepping up the building of a powerful socialist country in our own way and by our own efforts.

A crucial factor in applying the revolutionary line of independence to the building and activities of our State is to strengthen the motive force of our revolution and develop all fields of social life in our own way. We should consolidate the country’s politico-ideological position rock-solid by fully equipping the people with the great Juche idea and the spirit of national independence and rallying them firmly behind the Party and the government of our Republic. The government will develop all realms of the economy, defence and culture from the steadfast Juche-oriented stand and in our own way, and it will never tolerate others’ way, others’ fashion, in the slightest.

Our Republic has a bright, promising future ahead, as it is steadily developing on the strong basis of independence, self-sufficiency and self-reliant defence, with the Party and the people achieving solid unity to form the powerful motive force of the revolution.

It is important to apply the people-first principle to the letter in all aspects of State activities and social life.

This principle is a political ideal of regarding the masses of the people as masters of the revolution and construction, relying on them and making selfless, devoted efforts for their interests. It embodies the Juche-oriented revolutionary philosophy that the people are the most precious and powerful beings in the world; it reflects the unwavering commitment of our Party and the government of our Republic to love the people dearly and satisfy their demands and interests.

The people are the roots of our socialist State and its foundation; they are responsible for developing it. All the activities of Party and government organs should be thoroughly oriented and subordinated to safeguarding and realizing the people’s demands and interests and faithfully serving them-this is just the way to promote the revolution and construction with success and bring the viability and advantages of socialism into full play.

Maintaining the viewpoint and attitude of prioritizing the people in the activities of the State presents itself as an important matter, in view of the fact that abuses of power, bureaucratism and other violations of their interests may appear among officials in the course of socialist construction. The impertinent practices of lording it over the people and abusing the authority vested by them will impair the prestige of socialism and its people-oriented character, and weaken the people’s support for and trust in the Party and the State. They may end up threatening the very existence of our socialist system.

With a view to carrying forward and holding up the ennobling ideas and intentions of the great leaders, who believed in the people as in heaven and devoted their lives to their interests, our Party defined the essence of Kimilsungism-Kimjongilism, the guiding ideology of our revolution, as the people-first principle and set it as the greatest priority to apply the Juche-oriented view on the people, a people-oriented philosophy, in the activities of the Party and the State.

The slogan “Everything for the people and everything by relying on them!” encapsulates the people-first principle maintained by our Party and the government of our Republic. In all spheres of State and social life we have given top and absolute priority to what are oriented to the people and popular among them, unsparingly investing everything for their wellbeing. Over recent years our State has implemented gigantic construction projects in a bold manner. This is not because there is a surplus of funds in the country’s coffers; those projects are aimed at providing our people, who are the best in the world, with better conditions for a happy, cultured life.

Our Party and the government of our Republic have resolutely declared a war against abuses of power, bureaucratism and corruption, which are infringing upon the people’s interests, and waged an intensive struggle against such practices, taking it as a matter with a vital bearing on the existence of our State.

In the course of the endeavour to apply the people-first principle in all the activities of the Party and the State and in all fields of social life, the Party, the State and the people have formed a community in which they share the same destiny with one another; our Republic has advanced dynamically along the orbit of its development, never flinching in the face of unprecedented trials and difficulties.

As socialist construction is progressing, we should direct closer attention to applying the people-first principle. Then we can double the dynamic for the advancement of our revolution and continue to demonstrate the advantages peculiar to our style of socialism, those which other countries cannot imitate.

The Party and the State make selfless, devoted efforts for the good of the people, and the people support their Party and State whole-heartedly, entrusting their destiny and future entirely to the latter-these are the genuine features of our State embodying the people-first principle.

The government of the Republic will invariably hold fast to the people-first principle as the core of its mainstay, and strive to hasten the bright future of socialism aspired after by the people by relying on their strength.

Party leadership over the overall affairs of the State should be provided in every way possible.

Party leadership is the intrinsic requirement of the building of a socialist State and lifeline of its activities. Only under the leadership of a party, the incarnation of the demands and interests of the masses, can the socialist State perform its mission as their servant with credit and properly organize and undertake unified guidance over all realms of social life and all regions and the overall socialist construction. A socialist government, not led by a revolutionary party, will lose its intrinsic nature and fall prey to the reactionaries and plotters, with the result that its people cannot escape the pitiful plight of a political orphan.

Our Party is the veteran and seasoned General Staff of the revolution, which has gained rich experience and outstanding leadership skills and abilities in the course of leading the several stages of social revolution and socialist construction. What instils boundless dignity and confidence in sure victory in our people is the leadership of our Party, which is bringing about world-startling, miraculous achievements one after another while leading the gigantic campaign of creation for building a powerful socialist country amid acute confrontation with the hostile forces.

Party leadership over State activities should be consistently based on political guidance, policy-oriented guidance. The Party is the guiding force that provides guidelines to be followed by the socialist government and guides all State activities so that they are properly conducted; the State is the executor and performer of the Party’s lines and policies. Proceeding from these interrelations between the Party and the government, our Party has shown close concern over encouraging its organizations to exercise unified control over the affairs of their sectors and units and give political and policy-oriented guidance over them in the efforts to materialize its leadership over State activities. If the Party, a political leadership body, is involved in the administrative work and resorts to technical methods, it will not only deviate from its main principle but paralyse the functions of administrative organs and impair its authority, ending up making a mess of the revolution and construction.

At present, the government of our Republic is satisfactorily effecting unified leadership over the State and society by relying on the revolutionary guiding ideology and scientific strategy and tactics advanced by the Workers’ Party of Korea. In the future, too, it should remain faithful to the Party’s ideas and leadership, so as to perform its missions of representing the rights of the masses of the people to independence, organizing their creative abilities and activities, taking care of their lives and protecting their interests.

When it strictly adheres to the ideas and principles of building a socialist State elucidated by Kimilsungism-Kimjongilism, our Republic will be built more splendidly as an independent powerful State that no one can dare provoke, a people’s State in which the people’s ideals are fully realized and a great State that leads the world by giving full scope to its unlimited potential for development, and the victory of the socialist cause will be brought closer.

2

Comrades,

The central task facing our Republic at the present stage of the struggle to build a powerful socialist country is to solidify the material foundations of socialism by concentrating all national resources on economic construction.

Economic self-sufficiency is a material guarantee and prerequisite for building an independent State. Only by relying on independent and strong economic capability, it is possible to defend the dignity of a State and increase its political and military might on a steady basis.

The present political situation demands that our State hold higher the banner of self-sufficiency and self-reliance.

Recently, the United States has grown fearful of the threats posed by our rapidly-developing nuclear armed force to the security of its mainland. At the negotiating table, it has made much ado about improved relations and peace; on the other hand, it is resorting to all conceivable schemes in trying to prolong the economic sanctions, with the aim of preventing us from following the path of our own choice and disarming us first to create conditions for realizing its ambition of overthrowing our social system. Now that it is raising demands that run counter to the fundamental interests of our State, as a prerequisite for lifting the above sanctions, the confrontation between our country and the United States is bound to be drawn out and the hostile forces’ sanctions will persist. We have built socialism in the face of their constant sanctions, but we must neither become accustomed to this nor slacken the speed of advance of our revolution. To the forces who cannot thwart us by force, sanctions are a last resort. However, these are an intolerable challenge to us; we must never connive at or remain indifferent to them, but act resolutely to frustrate them. As we put an end to the prolonged nuclear threat by dint of nukes, we must frustrate the hostile forces’ sanctions on the strength of self-sufficiency and self-reliance.

We have the capabilities and foundations for independent development to revitalize the national economy and raise it to the advanced international level in the shortest possible period. The foundations of our self-supporting economy that have been laid for several decades, able scientific and technical personnel, and the creative strength of the heroic people who have made self-reliance part of their mental qualities and are brimming with patriotic enthusiasm-these constitute our valuable strategic resources. By making the most of these enormous and unlimited potentialities, we must create another legendary tale of world-startling, miraculous successes and go ahead of others by making a greater leap forward.

When we adhere to the line of building an independent national economy and give full play to the revolutionary spirit of self-reliance, we can achieve remarkable development with a strength that others can neither fathom nor imagine.

The strategic policy pursued by our Party and the government of our Republic in promoting socialist economic construction is to make the national economy Juche-oriented, modern, IT-based and scientific.

The independence and Juche character of the national economy should be consolidated in every way possible.

We must strive hard to achieve self-sufficiency in power, fuel and raw materials, which constitute the basic guarantee for independent economic development.

The electric-power industry should maintain and strengthen the existing bases to maximize the production of electricity, put power supply on a scientific and rational basis, and actively develop the hydraulic, tidal, atomic and other promising sources of energy so as to create greater generating capacity.

Coal and other mines, which are in charge of the primary front for economic development, should give precedence to prospecting and tunnelling, and concentrate their efforts on realizing mechanization of extracting and transport, thus extensively increasing the production of coal, the food of industry, and minerals.

The metallurgical industry should establish a new modern yet large-scale iron production system that suits our actual situation by solving the scientific and technological problems arising at the Juche-oriented iron production bases and operating them properly. The chemical industry should turn itself into a Juche-oriented, energy- and labour-saving industry that totally relies on locally available raw and other materials. By doing so, it should meet the domestic demands for fertilizer, chemical fibre, synthetic plastics and various other chemical goods.

The problems of food and consumer goods, which are of decisive importance in the improvement of the people’s living, should be solved in the earliest period.

The agricultural sector should pay special attention to solving the problems of seed, fertilizer and water and securing the land under cultivation, introduce scientific farming methods and raise the rate of mechanization of farm work, and thus attain without fail the grain production target set by the Party. The stockbreeding bases such as chicken and pig farms should be modernly built or renovated, domestic animals be raised in a scientific way, and a mass movement be launched to raise grass-eating animals perseveringly. Also, a turn should be made in the production and processing of seafood by consolidating the material and technical foundations of the fishing industry.

The light industry establishments should hold fast to recycling as one of their strategies, along with the strategy of relying on locally-available raw and other materials, step up modernization of their production lines and invest great efforts in developing new products. In this way, it should ensure that larger amounts and various kinds of quality consumer goods are supplied to the people.

We should carry on grand construction projects more vigorously to provide the people with more affluent and cultured living conditions. The construction sector should make innovations in architectural designing and construction method and improve the level of technical equipment of construction units to build world-class architectural structures in a larger number. The building-materials industry should build up the capacity of cement production and decisively raise the proportion of domestically-produced finishing materials.

The transport sector should adopt revolutionary measures for improving rail and water transport in conformity with the actual conditions in our country and resolve the problem of passenger transport in the capital city and provincial seats in our own way.

We should improve the structure of the national economy still further, develop all its branches in a harmonious way and secure the international competitive edge in the magnesia and graphite industries and other promising economic sectors.

We should make proactive efforts to put the national economy on a modern and IT footing so as to transform the country’s economy definitely into one that is knowledge-based.

We should work out strategies and targets for developing hi-tech industries including the machine-building, electronics, information, nanotechnology and biological industries, and concentrate investment on them. Every sector should build a parent, standard factory in which science and technology are integrated with production and all production lines are made remote-controlled, intelligent and fully automated and generalize its experiences, so as to raise the overall economy to the advanced level of the world.

We should develop the local economy and reenergize the external economic work.

Provinces, cities and counties should build and develop the economy with their own distinctiveness by giving full scope to their natural and geographical advantages and properly sustaining their economic, technical and traditional characteristics. The State should empower the local authorities to stand on their own feet and develop by themselves, and adopt relevant practical measures.

The external economic sector should conduct external economic cooperation, technical exchanges and trading activities in a multifarious, proactive and tactical way on the principle of strictly abiding by the line of building an independent national economy and in the direction of reinforcing the fields and links essential in strengthening the country’s economic foundations.

In order to give full play to the potentials of the self-supporting socialist economy, comprehensive measures should be taken to enlist all the human and material resources and potentialities of the country in a coordinated way and utilize the new elements and driving force for economic development.

The economic work of the country should be conducted under the State’s unified control and supervision, and in accordance with its strategic plan and command.

We should adopt a scientific and practical strategy and phased plans for the economic development of the State and execute them without fail. The structural and work system should be adjusted so that enterprises can arrange and conduct production and management activities smoothly while fully satisfying the needs of the State’s unified guidance over and strategic management of the economic work.

The State’s institutional and legal conditions and environment concerning economic affairs should be improved and an iron discipline be established so that the economic organs and enterprises give priority to the national interests and the promotion of the people’s wellbeing and observe the law and order strictly.

We should further improve planning in compliance with the essential requirements of the socialist economy and deal with pricing, monetary and financial matters-the important links in the whole chain of economic management-in accordance with the economic principles and laws and in such a way as to reap profit in reality. By so doing we can encourage the enterprises and producers to work with great interest and high enthusiasm. Measures should be taken to conduct the economic management on the basis of scientific calculation so that optimum results can be obtained. Raw and other materials, funds and manpower should be economized as much as possible and the expenditure be made cost-effective so that all the resources of the country may contribute to the development of the State to the maximum.

The main force that propels a self-supporting economy is the talented personnel and science and technology.

We should make it part of the national social practices to attach importance to the talented personnel and science and technology, identify and appoint the talented personnel to the appropriate posts so that they may lead production and the development of technology; and we should steadily increase State investment in the field of science and technology.

We should make proper decisions on major scientific and technological tasks and projects, strategic, pivotal, profitable and economically important, and concentrate our forces and funds on them to ensure that science and technology may render decisive services to reenergizing the overall economy and developing the hi-tech industry.

We should build up the political and military might of our Republic.

Our political and ideological might is based on the advantages and stability of the political system of our socialist State. We should substantially provide all the people with genuine political rights and dignity and give full play to the political and ideological advantages of our system, in which the whole country, united in ideology, purpose and moral obligation, makes uninterrupted progress.

The government of the Republic should regard the people’s interests as the absolute standard and give the first consideration to their will and desire in formulating and carrying out its policies; in this way, we can encourage the broad sections of the working masses including workers, farmers and intellectuals to take active part in the management of the State and society as befits the genuine masters of State administration.

The government should give definite precedence to the political and ideological work as required by the intrinsic nature of the socialist society, so as to train all members of society as true advocates of Kimilsungism-Kimjongilism and further consolidate the political and ideological unity and cohesion of our State.

The government of the Republic should perfect the legal system of the State and intensify the role of law in State and social life.

The laws of the Republic are powerful weapons for defending the gains of the revolution, consolidating and developing the socialist system and championing and guaranteeing the people’s rights and interests. In keeping with the intensification of the revolution and construction, the laws and regulations should be subdivided and specified on the basis of the requirements of the Party’s policies and in reflection of the prevailing realities so as to legislate and perfect them in a scientific way; they should be modified and supplemented in good time, so that they can reliably guarantee the administration of the people-oriented politics of the socialist State. It is necessary to thoroughly establish a habit of observing the socialist laws throughout society so that all the people respect the State laws with a noble sense of law observance and abide by them on a voluntary and obligatory basis; law-enforcement organs should enhance their role, never allow double standards of discipline in enforcing laws and strictly adhere to scientific accuracy, objectivity, impartiality and prudence in applying laws; in this way, we should turn ours into the most advantageous socialist law-governed State in which laws safeguard the people and the latter observe the former.

The self-reliant defence capability is a powerful and valuable weapon for defending the sovereignty of our Republic.

The peace-oriented atmosphere that has begun to be created on the Korean peninsula is not stable, and the hostile forces have not given up their attempt to invade our Republic. Always keeping in mind the iron truth that peace can be guaranteed only by powerful military strength, we should hold fast to the principle of self-reliant defence and keep building up the country’s defence capability.

The government of the Republic will provide, on a preferential basis and in full, the human and material resources necessary for strengthening the People’s Army, arming all the people and fortifying the whole country, and steadily raise the national defence capability by putting the defence industry on a highly Juche-oriented and modern footing.

Socialist culture should be developed in our own way.

It is important to create a climate of giving top priority to education throughout the country and bring about a radical improvement in education in our own way so as to overtake the developed countries in the educational level. The educational sector should strengthen the ranks of teachers, improve the quality of education as demanded by the trend of developing modern education, and thus train larger numbers of talented personnel who will shoulder the scientific and technological development of the country and socialist construction.

Upholding the slogan of making all the people well versed in science and technology, we should enrol all the working people in the study-while-you-work system and prepare them as intelligent workers.

The government of the Republic should give special attention to the socialist health service. It should further improve medical service, raise medical science and technology to the cutting-edge standard and consolidate the material and technical foundations of the health service sector, thereby bringing greater benefits of our country’s socialist healthcare system to the people.

The sector of culture and arts should create larger numbers of masterpieces that represent the demands of the times and aspirations of the people, and the sector of cinematic art, in particular, should kindle the flames of effecting an upsurge in film-making in the new century, thus playing the role of pacesetter in opening up a new heyday of the development of socialist culture.

Sports play a very important role in consolidating a nation’s strength and exalting its resourcefulness and prestige. A nationwide effort should be directed to developing sports science and specialized sporting techniques and organizing the mass-based sports activities on a wide scale. At the same time, sports facilities should be increased in number and the existing ones renovated with an eye to satisfactorily hosting even international games.

Establishing a socialist way of life and moral discipline is a severe political struggle and an acute class struggle to safeguard and add lustre to our ideology and system.

We should encourage all the members of society, with a high sense of pride and self-confidence that our culture, our way of life and our morality are the best, to give full play to the collectivist way of life and moral traits and actively create and fully enjoy the revolutionary and optimistic cultured way of life of our style as suited to the aesthetic sensibilities of today that aspire after cultural development. We should firmly defend the ideological and cultural position of our State by strictly guarding against any slightest expression of immoral and alien phenomena that poison the people spiritually and degenerate and debase society, improving ideological education and struggle and intensifying legal sanctions against them.

In order to successfully carry out the enormous revolutionary tasks facing the government of the Republic, people’s government organs should enhance their functions and roles.

They should further intensify their unified guidance over the whole society as required by the developing revolution.

They should consolidate and develop the socialist political system and carry on the work of accelerating economic and cultural construction. In particular, they should give precedence to economic work and concentrate their efforts on improving the people’s living standards. They should put every realm of social life and every region under their supervision and provide unified guidance over them while giving free rein to the creativity of individual sectors and units.

People’s government organs should establish the trait of making selfless, devoted efforts for the good of the people as appropriate to their basic duty.

They should always pay heed to the people’s opinions, plan and organize their work in reflection of their demands, find what can be done for them and carry it through to completion, and enlist them in carrying out the Party’s lines and policies. They should give top priority to the people’s interests and comfort and take responsible care of their living.

They should properly enforce the advantageous people-oriented policies including free compulsory education and free medical care, which General

Kim Jong Il pursued invariably even in the most trying days, so that the people can feel keenly the gratefulness of the socialist country in their daily life and turn out in the efforts for achieving its prosperity.

People’s government organs should maintain it as the iron rule to work only under the Party’s leadership.

They should organize and carry on all work with the Party’s ideas and policies as the yardstick, proactively defend the Party’s policies and implement with credit the revolutionary tasks advanced by the Party, thereby giving full play to the validity of our Party’s policies. Party organizations at all levels should intensify collective guidance over the activities of government organs in conformity with the demands of the developing revolution and actively encourage all their officials to perform their responsibilities and basic duties for the revolution.

Officials of people’s government organs at all levels should enhance their sense of responsibility and roles.

The present stirring realities urgently demand that our officials take the lead in the general offensive and wage a vigorous struggle in order to discharge their duties as befits the leading personnel of the revolution.

Officials of people’s government organs should possess a high degree of Party spirit and revolutionary principle and conduct their work in a daring and active manner with the attitude that they are fully responsible for it. Courage and activeness arise out of trust in the Party, whereas timidity and acts of basing their actions on how people look at them result from lack of trust in the Party. Officials of people’s government organs should definitely root out passive approaches of expediting their work only when the Party throws its full weight behind them, and cherish an unyielding revolutionary work style of carrying through the task set by the Party even though their bodies are torn to pieces. They should constantly cultivate abilities for conceiving, organizing, supervising, guiding and developing their work to become versatile workers who are capable of implementing any tasks with credit. They should acquire our Party’s methods of mass work, set personal examples in all undertakings and make tireless efforts for the good of the people. Cherishing deep in their hearts the true meaning of our Party’s affection for the people, they should be infinitely courteous to them and become their faithful servants, always sharing weal and woe with them and working with devotion for them.

3

Comrades,

At present, our historic struggle for national reunification, a long-cherished desire of the nation, has entered a new phase.

We have taken momentous measures in succession to improve inter-Korean relations and ensure peace on the Korean peninsula with a firm resolve to achieve without fail the cause of national reunification, into which the great Comrades Kim Il Sung and Kim Jong Il put their heart and soul all their life.

Last year we held three rounds of historic north-south summit meetings and talks and adopted inter-Korean declarations to bring about a dramatic turn in the relationship. They were events of great significance which turned around the grave situation that was teetering on the brink of war every moment and which heralded the start of a new journey to national reunification.

Now the entire nation ardently hopes that the historic Panmunjom Declaration and the September Pyongyang Joint Declaration will thoroughly be implemented so that the peaceful atmosphere on the Korean peninsula will continue and inter-Korean relations will improve uninterruptedly.

The south Korean conservative forces, however, are responding to the aspirations of the nation and the unanimous expectations of the international community with too perfidious words and behaviours, and are struggling to bring inter-Korean relations back to those in the period before the publication of the Panmunjom Declaration.

The United States openly forces “speed adjustment” on the south Korean authorities and tries in every way to subordinate the implementation of inter-Korean agreements to its anti-DPRK policy marked by sanctions and pressure.

As a result, a grave situation has been created for us to decide whether to ease the tension on the Korean peninsula and continuously carry on the atmosphere of inter-Korean rapprochement or to return to the past when the tension spiralled up towards a catastrophe with the danger of war looming larger.

We cannot look on with folded arms the current situation which causes serious concern over the destiny and future of the nation and peace and security in the region, but we have to take proactive measures without delay to straighten it out in line with the unanimous aspirations of all the fellow countrymen.

To this end, it is needed above all to take a proper stand and attitude with which to invariably adhere to and implement the inter-Korean declarations encapsulating the unanimous will of the nation, whatever difficulties and obstacles in the way.

I would like to make it clear once again that as I already declared, it is my firm determination to turn, together with the south Korean authorities, inter-Korean relations into a lasting and durable relationship of reconciliation and cooperation and write a new history of the nation that achieves peace and co-prosperity as desired by all the countrymen.

In order to untangle the prevailing unsavoury situation, heighten the good atmosphere for improved relations north and south created with much effort and make it bear meaningful fruit of peace and reunification, it is important to put an end to big-power worship marring the spirit of independence and to the policy of dependence on foreign forces encroaching upon the common interests of the nation, and subordinate everything to the improvement of the relations.

I think that if the south Korean authorities truly want improved relations, peace and reunification, they should come back to the original intention they had at the time of the Panmunjom summit and the September Pyongyang summit and fulfil the responsibility they have assumed before the nation through the sincere implementation of the north-south declarations.

They should not waver in their attitude as they see the tide nor pose as a meddlesome “mediator” and “facilitator” as they busy themselves with foreign trips, but be a responsible party that defends the interests of the nation speaking what they have to say squarely with the mind of their own as members of the nation.

It is our consistent assertion that it is imperative to smash the underhand schemes of the hostile anti-reunification and anti-peace forces within and without in order to sustain the atmosphere of improved inter-Korean relations.

It is needed to realize before it is too late that neither progress in inter-Korean relations nor any fruit of peace and prosperity can be expected if the hawkish forces in the south Korean military, who persist in veiled hostility as they resume the military exercises, which were agreed before to be discontinued, jointly with the United States by changing their names, continue to be allowed to make reckless moves, and unless the anachronistic arrogance and hostile policy of the United States, which is creating artificial obstacles in the way of improved relationship as it presents its arbitrary outrageous demand, are eradicated.

All the fellow countrymen in north and south and abroad should, staking the destiny and future of the nation, resolutely check and foil the moves of the United States and south Korean conservative forces that go against the historic current towards improved inter-Korean relations and peaceful reunification.

If they are truly willing to opt for the improvement of north-south relations, peace and reunification, the south Korean authorities should sympathize with our stand and will, keep pace with us and make a courageous decision to show their sincerity by practical action, not by words.

Our Party and the government of our Republic will continue to make sincere and persevering efforts to achieve the sustained development of north-south relations and peaceful reunification of the country, solemnly cherishing the aspirations and desires of the nation in the future, too.

Comrades,

The first-ever DPRK-US summit meeting and talks, which were held in Singapore in June last year under the world’s spotlight, were a momentous occasion that brought the hope of settlement of peace to the Korean peninsula where fire had been exchanged; and the June 12 DPRK-US Joint Statement was a historic declaration announcing to the world that the two countries which had been hostile to each other from one century into the next would write a new history of relationship, and therefore it won full support and approval of the international community aspiring to peace.

The DPRK voluntarily took crucial and significant measures including the discontinuation of nuclear test and test-fire of intercontinental ballistic missile, thereby taking the first step towards confidence-building which is the main key to the removal of bilateral hostile relations, and it also took the broadminded measure of realizing the repatriation of the remains of US soldiers, which had been requested by the US President, as a show of its will to sincerely implement the June 12 DPRK-US Joint Statement which serves as a milestone in the establishment of a new bilateral relationship.

However, the second DPRK-US summit talks held in Hanoi last February raised strong questions about whether the steps we took under our strategic, courageous decision were right, and they were an occasion that gave us a sense of caution about whether the United States is genuinely interested in improving the bilateral relations.

At the talks we expressed our resolve to set the essential stages and course to be followed without fail for the implementation of the June 12 DPRK-US Joint Statement in the interests of both sides and to take more prudent and trustworthy steps, and looked forward to a positive response of the United States.

But the United States came to the negotiating table after thinking only about completely unrealizable methods.

In other words, they were unprepared to solve problems with us at the table and they had no definite orientation or methodology.

By that sort of thinking, the United States will not be able to move us one iota nor get what it wants at all, even if it sits with us a hundred times, a thousand times.

It has recently conducted a test for simulated interception of our intercontinental ballistic missile and resumed military exercises the US President committed himself to suspending, while making other hostile moves contrary to the spirit of the June 12 Joint Statement in a more undisguised way. These seriously get on our nerves.

I am very displeased with such a trend.

As waves rise when wind blows, the more pronounced the US policy hostile towards the DPRK becomes, the tougher our counteraction will become.

Although it strongly hints at the settlement of issues through dialogue as it thinks about the third round of DPRK-US summit talks, the United States still looks away from the withdrawal of its hostile policy, the basic way for establishing a new bilateral relationship; rather it mistakenly believes that if it pressures us to the maximum, it can subdue us.

We, of course, attach importance to the settlement of issues through dialogue and negotiations, but the US-style dialogue of unilaterally pushing its demands does not fit us, nor are we interested in it.

Though the United States calls for a negotiated settlement of issues, it is stirring up hostility to us day after day, which is an act that is as foolish and risky as an attempt to put out fire with oil.

Given the deep-rooted animosity between the DPRK and the United States, in order to implement the June 12 Joint Statement both sides should give up their unilateral terms and seek a constructive solution that meets each other’s interests.

To this end, it is needed above all for the United States to approach us with a new way of calculation after putting aside the current one.

The United States is talking much about holding the third round of bilateral summit talks, but we are neither pleased nor willing to see summit talks like the Hanoi summit talks re-enacted.

However, as President Trump continuously observes, personal relations between he and I are not hostile like the relationship between the two countries, and we still maintain good relations, and if we want, we can send and receive letters asking for each other’s regards any time.

If the United States proposed holding the third round of summit talks after finding out with a proper attitude a methodology that can be shared with us, we would be willing to try one more time.

But in my opinion at this moment, it comes to my mind that there is no need for me to obsess over the summit talks with the United States out of thirst for the lifting of sanctions.

Anyway, we will be patient and wait till the end of this year to see whether the United States makes a courageous decision or not, but it will obviously be hard to get a good opportunity like the last time again.

In future, I will put my signature on an agreement without hesitation only when it contains fair clauses which conform to the interests of both sides and which are acceptable to them, and this depends entirely on the stand the United States takes and the way of calculation it comes up with.

What is obvious is that if it sticks to its current political way of calculation, the prospects for problem solving will be bleak and very dangerous.

At this crucial time, I hope that the United States will make a well-advised judgment and the second hand of the clock of the DPRK-US showdown which they stopped with so much difficulty will not move again for all ages.

The government of the Republic will strengthen and develop the bonds of friendship and cooperation with all the countries of the world that respect the sovereignty of our country and are friendly to it, and will advance hand in hand with all the peace-loving forces of the world to establish a lasting and durable peace mechanism on the Korean peninsula.

Comrades,

As I have just said, I will no longer set my heart on such a trivial issue as lifting sanctions by the hostile forces, but open up the way to prosperity by our own efforts.

Although the goal of our struggle is demanding and challenges and difficulties stand in the way of our socialist construction as ever, our Party and the government of our Republic are steadfast in their will to open a new phase of prosperity and achieve the ideal and goal of building a powerful country by their own efforts under the unfurled banner of Kimilsungism-Kimjongilism.

The road of independence leads to prosperity and victory. Nothing can reverse or stop the dynamic advance of our State and people that have unshakable faith and will to pave their own way by themselves with confidence in their own strength.

Let us all make a general advance to successfully accomplish the cause of building a powerful socialist country, holding higher the banner of the great Kimilsungism-Kimjongilism and firmly rallied behind the Party and the government of the Republic. -0-

Their website is being a little difficult at the moment — will add the Korean version as well when possible.

Share

New bridge crossing open between Jian and Manpo

April 8th, 2019

Benjamin Katzeff Silberstein

Bloomberg:

China and North Korea opened a new border crossing over the Yalu River, signaling aspirations for deeper economic ties between the neighbors even as Pyongyang’s trade remains crimped by international sanctions.

The border checkpoint at the foot of a new bridge opened Monday, connecting the northeastern Chinese city of Jian with North Korea’s Manpo, Chinese state media reported. The China-DPRK Jian-Manpo highway connection is for passenger and cargo transport and hosts an advanced customs facility, the China News Service said.

The opening was marked by several tour buses crossing from the Chinese side and then returning from North Korea, the Yonhap News Agency of South Korea reported, citing a person familiar with the matter. The ceremony appeared to show that local Chinese officials were ready to step up trade and exchanges with North Korea in response to its call for economic development, according to Yonhap.

China provides a lifeline to North Korean leader Kim Jong Un and his state has long been dependent on Beijing’s help to keep its meager economy afloat. Kim’s summit with U.S. President Donald Trump in Hanoi broke down on Feb. 28 over sanctions that have cut Pyongyang off from global commerce and were imposed on North Korea for its pursuit of a nuclear arsenal.

It was unclear how the new border checkpoint — the fourth between China and North Korea — would operate under the sanctions, which ban or limit a broad range of goods from moving in or out of the country. The South Korean Unification Ministry declined to comment.

The economic penalties are expected to be a main topic of discussion when South Korean President Moon Jae-in meets Trump at the White House on Thursday. Moon, a long-time advocate of reconciliation with North Korea, has repeatedly played the role of mediator since he took office in May 2017 amid escalating threats of war between Trump and Kim.

The Manpo border area has drawn the attention of North Korea for years, with Kim’s father and former leader, Kim Jong Il, crossing there in 2010 in one of his rare trips outside the country, the Chosun newspaper of South Korea reported at the time. In the 2010 trip, Kim Jong Il visited the school his father and North Korean state founder Kim Il Sung attended on the Chinese side when he was a child.

China and North Korea agreed to embark on the bridge project in 2012 and completed construction in 2016, Yonhap reported. The opening was delayed by UN Security Council sanctions imposed on North Korea.

In 2017, China’s overall trade with North Korea declined by more than 10 percent to about $5 billion, as Trump secured Beijing’s backing for four escalating rounds of sanctions in response to North Korea nuclear weapons program testing.

Article source:

China, North Korea Open New Border Crossing Despite Sanctions

Jon Herskovitz and Dandan Li
Bloomberg News
2019-04-08

Yonhap:

China and North Korea on Monday officially opened a new cross-border bridge halfway along the Yalu River, offering clues to their possible expansion of bilateral economic exchanges amid ongoing international sanctions.

The new bridge connects Jian in the northeastern Chinese province of Jilin with North Korea’s northern border city of Manpo.

The two countries agreed to the Jian-Manpo bridge project in May 2012 and completed its construction in 2016. But they have since delayed its official opening, apparently affected by United Nations Security Council sanctions on the North over its missile and nuclear programs.

Jian, located about halfway along the Yalu River, is considered a representative base of trade between North Korea and China, along with Liaoning Province’s Dandong on the Yalu River estuary and Jilin Province’s Hunchun on the Tumen River estuary.

Four tourist buses arrived in China from North Korea via the new bridge at 8:20 a.m. Monday before returning to the North about one hour later carrying about 120 passengers.

According to a local tour company, the tourists are planning to return to Jian around 5 p.m. after visiting attractions in and around Manpo.

A source in the border area told Yonhap News Agency that China’s provincial governments appear to be boldly trying to cooperate with North Korea in response to their demand for economic development.

“North Korea’s denuclearization has not been implemented, but the environment surrounding North Korea and China appears to be partially changing,” the source said.

“China may not expand its economic cooperation with North Korea considerably in consideration of its relations with the United States. But the opening of a new bridge may signal expansion of bilateral economic exchanges,” said the source.

Article source:
China, N. Korea open new cross-border bridge
Yonhap News
2019-04-08

Share

North Korea’s harvest numbers: what “food production” really means

March 11th, 2019

By Benjamin Katzeff Silberstein

I wrote about the confusing harvest numbers this past Friday, and I’ve been able to find little new information to make things clearer. Basically, the problem is that talking about “food production” is too vague, since that can mean a lot of different things. In the standard World Food Program/FAO crop assessments, there are usually two numbers quoted: one estimate for total production of food,  and one for “milled cereal equivalent”, a standardized measurement used to translate the varying nutritional contents of different crops into a standardized weight measure.* (See below for a more detailed explanation.) Basically, the “milled cereal equivalent” figure tends to be significantly smaller, by about 20 percent or so, than the original, total food production figure.

Since we don’t actually know exactly which number is being thrown around in analyses of the current harvest, I’ve calculated a possible milled-equivalent harvest figure, using the average difference between milled and unmilled for the years where I have the two different numbers from the WFP/FAO crop assessments. None of the historical estimates I’ve found correspond with the harvest numbers for previous years in the 2019 UN Needs and Priorities Plan. Crop production figures are usually given in terms of “marketing years”, not in calendar years. For simplicity’s sake, I denote each year by the second half of the marketing year, when most consumption will occur. So “2019” is the 2018/2019 marketing year, “2018” is the 2017/2018 marketing year, et cetera.

The following shows the scenario where the 4.95 million tonnes production figure is the “unmilled” cereal equivalent measure. Based on the average difference between milled and unmilled for the years where I’ve had data available from UN institutions (0.85 million tonnes), I’ve added and subtracted to complete the figures where necessary. This is not an exact, scientific way of looking at the harvest numbers. For exact accuracy, I’d need to calculate the milled cereal equivalent of each crop, something I don’t have time to do right now. This may well make the figure even lower. (Hazel Smith’s figure, for reference, is 3.2 million tonnes.) But the following does, at the very least, give a sense of the proportions at hand. And it makes the numbers look different from my initial assessment.

Food production, million tonnes (unmilled) Food production, million tonnes (milled)
2009.00 4.20 3.30
2010.00 5.17 4.32
2011.00 5.33 4.50
2012.00 5.50 4.66
2013.00 5.80 4.90
2014.00 5.98 5.03
2015.00 5.93 5.08
2016.00 5.92 5.07
2017.00 6.03 5.23
2018.00 5.75 5.00
2019.00 4.95 4.10

Table 1. Figures are sourced from various assessments by the WFP and FAO; contact me for exact sourcing on specific figures. 

Graphically, the trend in food production in milled terms, i.e. the lower-end, more realistic figure of how much food is available for consumption, using the above assumption for the 2019-figure, looks like this:

Graph 1. Estimate food production in North Korea, million tonnes, in milled cereal equivalent terms.

In short, this does give a rather grim and highly problematic food situation, putting the quantity of the harvest at 4.10 million tonnes. It puts North Korea back to a state of food production prior to 2010–2011, when harvest started to climb. And now, North Korea receives far less aid than it did a decade ago. Plus, its imports will only amount to 200,000 tons, the government seems to be saying, a similar amount to what it procured in imports and humanitarian aid in 2016/2017, when the harvest was much larger.

For long, this is how low North Korean harvests were. Only a few years ago, this would have looked like a rather solid harvest. Looking back in the future, it might turn out that the past few years of food production growth, since around 2011, was an abnormally good period of time. None of this means that this food situation is anything but poor.

To me, among the figures I’ve been able to find, it’s the only one that make sense in the context of the statement from UN representatives that this harvest was the worst “in a decade”. Hopefully things will become clearer over the coming days and weeks, as more information may be published, in which case I’ll update this post.

In sum, the actual food available in North Korea is, in all likelihood, much lower than the 4.95 million tonnes-figure quoted by the UN and the North Korean government. As the following graph shows, even using the North Korean government’s figures, the drop from last year doesn’t appear all that massive. But on closer inspection, the actual quantity of food available may be significantly lower than the figure the North Korean government states, as I’ve tried to show in this post.

Graph 2. Food production in North Korea, from the UN’s “2019 Needs and Priorities” report on North Korea.

Finally, a note on the issue of the markets and the public distribution system. I maintain that it’s impossible to get a sense of total food availability and circulation in North Korea as a whole, without taking the markets into account. According to most studies we have, the majority of North Korea’s population rely on these markets, rather than the public distribution system, for their sustenance.

But one has to acknowledge that just like the UN and North Korean government figures may not reflect the whole situation accurately, there may be a fair bit of bias in the data on the prevalence of the markets too. Most of this data comes from surveys done with defectors in South Korea. They overwhelmingly tend to come from the northern provinces of the country, closer to China, where market trade has traditionally been more prolific. Most sources for news from inside North Korea are based in the northern parts of the country, where one can get access to Chinese cell phone network coverage.

There’s likely another form of bias present in these surveys, too. Most people who are reliant on the PDS for their sustenance are likely underrepresented among defectors. People in state administration and security organs, for example, are less likely to leave North Korea, though that of course happens too. And in any case, we’re talking about a quite large demographic of people, whose livelihoods would be significantly impacted by cut rations. Such cuts are already happening, Daily NK reports, with some professional groups receiving only 60 percent of  what they otherwise would. The PDS may have changed shape and function quite drastically since the early 2000s, but it may also be more important to the North Korean public than the currently available survey data and reports from inside the country tells us.

Conclusion

North Korea’s food situation, though not at famine-time levels, does appear to be dire. The figures, in combination with reports from inside the country, gives serious cause for concern. Government numbers may not tell the full story since they likely underestimate the role of the markets. Nonetheless, things do look serious. The government could easily alleviate the situation by changing its spending priorities and policies. Chances are that it won’t.

Footnote:

*I’m borrowing here a footnote from a 38 North piece by the late scholar Randall Ireson, whose archive of articles remain one of the best sources for information on North Korean agriculture:

The FAO has consistently used grain equivalent (GE) values for the major crops to compensate for varying moisture and energy content. Thus, husked rice (GE) is .66 of the paddy weight, potatoes (GE) are .25 of the fresh weight, and soybean (GE) is 1.2 times the dry weight because of the high oil and thus calorie content.

Share

A few thoughts on North Korea’s harvest numbers

March 8th, 2019

By Benjamin Katzeff Silberstein

I unfortunately don’t have time to do as deep of a dive into the different numbers going around on North Korea’s harvest as I’d like, but a few short thoughts:

  • The numbers are confusing, because there’s a whole bunch of different ones being cited. The UN (citing North Korean government figures) puts the harvest at 4.95 million tonnes, while Hazel Smith cites 3.2 million tonnes. I suspect that part of what’s going on is that some figures refer to total food production estimates, while others refer to the milled cereal equivalent, the most common measurement for actual food availability by international humanitarian organizations. But that can’t explain the full difference at play here since it’s simply too large. (For reference, see this WFP-report from 2010.)
  • The vast differences in numbers cited is a big impediment to really getting a grasp of how bad the situation seems to be. If the 4.95 million tonnes-figure refers to unmilled cereal production, it represents a significant drop from the past few years, but not one that would necessarily indicate a return to the famine-level supplies of the 1990s. If it refers to milled cereal equivalent numbers, which I don’t believe it does, it’s not that bad (milled equivalent production was reported at 4.48 million tonnes for 2011).
  • The reason that many may be suspicious about the claims of a bad harvest being exaggerated, is that it is an historical pattern on the part of the DPRK government. That doesn’t mean that this time isn’t different. The past may be a good indicator for the future, but it’s never proof.
  • No serious assessment can be fully trusted as long as it fails to take the market system into account. That the UN is unable to survey and study food supply from the markets, and their contribution to resiliency in food supply, is a massive problem. That’s surely not for a lack of attempts on the part of the WFP and other organs to get to visit markets. I’m sure they repeatedly press the North Korean government on this, thus far, to my knowledge, to little avail. Still, the magnitude of the drop in the production estimate still likely says something about the magnitude and direction of the dynamics of change on the markets as well.
  • Lastly, regardless of how things stand, North Korea’s humanitarian situation is precarious and very bad. While Kim Jong-un has spent much of his tenure cutting ribbons at avenue renovations in Pyongyang, the population in almost half of the country’s provinces are estimated to lack access safe drinking water. This is a matter of priorities on the part of the government. In any case, for the purposes of humanitarian aid, in the immediate term, it doesn’t really matter whose fault the situation is. My skepticism of the numbers should not be taken as arguing that North Korean civilians shouldn’t receive aid; the humanitarian situation in the country, particularly in the souther provinces, is almost certainly more or less constantly bad enough to warrant it. This paragraph from Hazel Smith’s recent PacNet piece is particularly chilling, if these numbers are accurate:

The starkest confirmation of a catastrophic harvest in 2018 is the precipitous drop in output from the big food producing provinces. Between 2016 and 2018, South Hwanghae, the ‘granary’ of North Korea, had a 5 percent reduction in area planted but an enormous 30 percent decrease in output – with a 19 percent drop in agricultural output between 2017 and 2018.

 

Share