US trade and aid to DPRK…

April 8th, 2014

According to Yonhap:

U.S. exports to North Korea jumped nearly 20-fold in February from a year earlier, a U.S. radio report said Tuesday.

The volume of trade between the two countries reached US$1.2 million in February, compared with $62,000 a year earlier, the Voice of America (VOA) reported, citing data compiled by the U.S. Commerce Department.

The VOA said that humanitarian assistance provided by U.S. private agencies accounted for 95 percent, or $1.13 million, of the total U.S. shipment to North Korea in February.

The rest of the U.S. exports to the North included poultry, footwear and plastic products, the radio report said.

The U.S., however, imported nothing from North Korea during the cited period, it said.

Read the full story here:
U.S. exports to N. Korea jumps nearly 20-fold in Feb
Yonhap
2014-4-8

Share

China’s plans for Quanhe Customs House

April 7th, 2014

Quanhe Customs House will be the border facility for managing Chinese traffic into Rason (and further down the coast). Within the administration building on the site is a poster advertising the plans to expand the customs house to manage more traffic.

Quanhe-customs-2

The billboard offers a conceptual image of the new facility, a map of the new location, and some informative copy (in Chinese).

Here is a Google Earth image of the proposed construction site in relation to the existing border compound:

New-Quanhe-customs

Here is a translation of the Chinese on the sign text:

Introduction of Construction Project of Quanhe (Guanghe) Port

1. The Proposed Location
The proposed site is located in Quanhe Village, Jingxin-Zhen of Hunchun City, north side of Quanhe Road. The project covers an area of 180,000 square meters (map below).

2. Construction Project
The total investment of Quanhe Port Project is 299,331,500 RMB, and the total construction area is 16992m2. including Passenger Security Channel (5445m2), Cargo Inspection Channel (2000m2), House For Frontier Inspection (1680m2), Cargo Storehouse (2000m2), Inspection And Quarantine Site (2400m2), Dormitory Restaurant (2567m2), Garage And Boiler Room (900 m2).

Passenger Security Channel: Including each 6 channels for entry and exit, and another 4 vehicle channels for touring bus. Designed annual passenger capacity is 2 million.

Cargo Inspection Channel: Including each 4 channels for entry and exit of cargo and another 1 channel for passenger. The designed annual cargo capacity is 1.65 million tons.

3. Remaining
The existing inspection building will be used as channels for border trade and tourism after the new facilities getting into operation.

Thanks to Berhhard Seliger for the info!

Share

DPRK replaced Minister of Commerce

April 7th, 2014

According to Yonhap:

North Korea has replaced its commerce minister last month, according to state-run media report Saturday, amid efforts to phase out supporters of Jang Song-thaek, the executed uncle of the current leader.

North Korea’s radio broadcaster Pyongyang Broadcasting Station reported that new Commerce Minister Kim Kyong-nam was in attendance at a food festival marking the birth anniversary of the country’s founder.

It was the first time that Kim Kyong-nam was introduced as commerce minister by North Korean media, but it appears likely the replacement took last month during the nationwide election.

Kim’s predecessor Ri Song-ho, who took office in 2012, failed to be re-elected to the Supreme People’s Assembly in the parliamentary election on March 9.

The food event was held from Wednesday through Friday in commemoration of the April 15 birth anniversary of Kim Il-sung, the current leader’s grandfather.

Experts say the replacement of the minister post is likely a follow-up measure to last December’s execution of Jang, the once powerful uncle of Kim Jong-un.

The March election was seen by some as a way for young leader Kim Jong-un to fill up the Assembly with people close to him and consolidate his power in the reclusive country.

As of this posting, the new minister has not been announced on KCNA.

Read the full story here:
N. Korea ousts commerce minister
Yonhap
2014-4-5

Share

Mongolia involved in Sepho Tableland project

April 7th, 2014

Sepho-tableland

Pictured above: Sepho, Phyonggang, and Ichon Counties. These three counties are home to the Sepho Tableland Project.

According to KCNA:

DPRK, Mongolia Sign MOUs

Pyongyang, April 2 (KCNA) — A memorandum of understanding on setting up the DPRK-Mongolia friendship joint company between the DPRK and Mongolian governments was inked here on Wednesday.

Present at the signing ceremony from the DPRK side were Ri Ryong Nam, minister of Foreign Trade who doubles as chairman of the DPRK side to the Inter-governmental Committee for Consultation in Economy, Trade, Science and Technology between the DPRK and Mongolia, Hwang Min, vice-minister of Agriculture who is also chairman of the Livestock Management Committee in Sepho Area, and officials concerned and from the Mongolian side were Mongolian Minister of Industry and Agriculture Khaltmaa Battulga who is chairman of the Mongolian side to the Inter-governmental Committee for Consultation in Economy, Trade, Science and Technology between the DPRK and Mongolia and his party and Manibadrakh Ganbold, Mongolian ambassador to the DPRK, and his embassy officials.

A MOU was also signed between the Ministry of Foreign Trade of the DPRK and the Ministry of Labor of Mongolia.

The Sepho Tableland Project was announced on November 9, 2012 (KCNA):

DPRK Premier Stresses Importance of Building Large-scale Stockbreeding Base

Pyongyang, November 9 (KCNA) — Premier Choe Yong Rim learned about the preparations for creating vast grass field in Sepho, Phyonggang and Ichon counties of Kangwon Province and turning it into a large-scale stockbreeding base of the country.

The creation of vast grass field in the counties covering tens of thousands of hectares and the construction of combined processing base for livestock products will bring about an epochal turn in carrying out the party’s policy of improving the standard of people’s living by massively breeding grass-eating domestic animals.

Generalissimos Kim Il Sung and Kim Jong Il gave instructions to Sepho County several times on developing stockbreeding suited to climatic, natural and topographical conditions, while making continued journey of guidance for people’s happiness.

The dear respected Marshal Kim Jong Un unfolded a plan for transformation of Sepho tableland, true to the intention of the great Generalissimos and brightly indicated the orientation and ways for realizing it.

The premier first learned about the vegetable produced in part of the reclaimed Sepho tableland, looking round the field of a sideline farm of a unit of the Korean People’s Army.

Then, he acquainted himself with the area of reclaimed grass field and soil condition in Sepho County in Songsan area of the Sepho tableland.

A consultative meeting of senior officials of party, state and army was held on the spot.

The participants were briefed on a huge map showing the panoramic view of the field. The meeting discussed the goal of reclaiming grass field in Sepho, Phyonggang and Ichon areas and building stockbreeding base and the issue of providing labor, raw materials and equipment necessary for its reclamation and construction.

The meeting called on all the units to channel efforts into achieving the goal of creating grass field and reclaiming and building stockbreeding base in Sepho, Phyonggang and Ichon areas. The goal reflects the far-reaching plan and unusual wisdom of the Marshal.

Practical issues including the work for keeping the designing ahead of the project and providing raw materials and equipment under a plan were discussed and relevant organization of work was made at the meeting.

The premier, concluding the meeting, called on officials and builders to carry out the behests of Kim Il Sung and Kim Jong Il and certainly realize the noble intention of the Marshal to create the socialist fairyland in Sepho, Phyonggang and Ichon areas.

Share

Sinuiju-Kaesong high-speed rail project (UPDATED)

April 7th, 2014

Sinuiju-Kaesong-high-speed-rail

Pictured Above (KBS):  A map of the planned high-speed rail project

UPDATE 2 (2014-4-7): KBS has a report (in Korean) on the project. See the report here. Seoul Village has translated some of the details.

Construction would last 6 years, with two waves that have not been fully detailed yet:
1st stretches: 80 km
From the North: Sinujiu Station – Tongrim Station (Sinujiu-Dongnim, 40 km)
From the South: Kaesong – Yonan (Gaesong-Yeonan, 40 km)
2nd stretches: 296 km

From the North: Tongrim – Chongju – Sinanju – Pyongyang (Dongnim-Jeongju-Sinanju-Pyongyang, 147 km)
From the South: Yonan – Haeju – Sariwon – Pyongyang (Yeonan-Haeju-Sariwon-Pyongyang, 149 km)

UPDATE 1 (2014-4-7): Korail may be involved in the high-speed rail project. According to the Hankyoreh:

News of a recent agreement between North Korea and China to build an international high-speed railroad and highway between Sinuiju (a city on the Chinese border) and Kaesong is raising questions about the fate of a scheduled North Korea visit on Apr. 24 by Korail CEO Choi Yeon-hye.

If Korail does participate in the project, it would bring South Korea one step closer to the Asian continent via the North Korea-China high-speed rail project, which comes on the heels on North Korea‘s Rajin-Hasan development project with Russia.

South Korean businesspeople in China who are closely involved in the high-speed rail project said on Apr. 6 that a contract for the railway/highway construction was signed in Beijing on Feb. 24 by North Korea’s State Economic Development Commission, chaired by Kim Ki-sok, and a Chinese consortium headed by the Shangdi Guanqun investment company. The line would be 376 km in length and connect Sinuiju with Chongju, Sukchon, Pyongyang, Haeju, and Kaesong, with the five-year construction beginning in 2018 with a budget of US$21 billion, or around 22 trillion won. The method would be a Build-Operate-Transfer (BOT) arrangement, with an international North Korean-Chinese consortium providing the investment and delivering the line to North Korea once the costs are recouped. A survey team for the Chinese consortium is reportedly scheduled to visit North Korea in late April.

The chances of South Korea participating are higher in the wake of President Park Geun-hye’s speech in Dresden on Mar. 31. There, she declared that an “organic linkage between South Korean capital and technology and North Korean resources and labor could contribute to building a future economic community on the Korean Peninsula.”

She also said she planned to “achieve shared development for the Korean Peninsula and Northeast Asia both through collaborations with North Korea and Russia, as with the current Rajin-Hasan distribution project, and collaborations with North Korea and China focusing on Sinuiju.”

Further increasing the possibility of South Korean participation are guidelines handed down in January by North Korean leader Kim Jong-un, who said North Korea should work with China and South Korea on an international line through a privately funded BOT arrangement.

Meanwhile, Korail is awaiting Ministry of Unification approval on a request to allow CEO Choi Yeon-hye to travel to North Korea to attend a general directors’ conference for the Organisation for Co-Operation between Railways (OSJD), which is scheduled to take place on Apr. 24.

“Our basic position is to approve visits to North Korea in cases of international events,” said an official from the ministry on condition of anonymity, adding that a final decision would be made “after discussions with the other agencies.”

But Korail remains cautious about the possibility of future cooperation, whatever the outcome for Choi’s visit ends up being. Speaking on condition of anonymity, a source there said, “We’re preparing data on things like a plan to expand cargo transport for different continental rail zones, which is one of the topics on the agenda at the OSJD meeting.”

“We’ve never officially examined the North Korea-China high-speed rail project, and it doesn’t look like it would be economically feasible anyway unless a section is opened between Seoul and Kaesong,” the source added. “Anyway, the government has not decided on participating, and that‘s not a matter that KORAIL can weigh in on by itself.”

ORIGINAL POST (2013-12-20): High Speed Rail and Road Connecting Kaesong-Pyongyang-Sinuiju to be Built
Institute for Far Eastern Studies (IFES)
2013-12-20

On December 8, 2013, North Korea reached an agreement with a consortium of international companies to construct highways and high-speed railroad connecting Kaesong, Pyongyang, and Sinuiju.

The agreement between North Korean authorities and a consortium representing the Chinese companies was signed in both Chinese and Korean by Kim Chol Jin, Vice-Chairman of State Economic Commission of North Korea and representatives from state-owned enterprises of China’s Commerce Department.

The construction period was designated as five years and businesses will operate the rail for 30 years and return the operation rights to North Korean government in the form of a BOT (build-operate-transfer) project, worth a total of 15 trillion KRW. The high-speed rail will be a double-track system with a speed of more than 200km per hour, and the construction of four-lane highway will be built adjacent to the railway. Fence will also be built to prevent unauthorized access to the railway.

The construction zone will cover the areas of Kaesong, Haeju, Sariwon, Pyongyang, Sinanju, Jongju and Sinuiju, approximately 400 km in total length and from Sinuiju will connect to Chinese cities via railway while from Jongju will connect with the Rajin-Sonbong SEZ (special economic zone) to the Russian Khasan railway to be linked with the Eurasian railway.

The consortium working group is planning to visit North Korea to confirm the specific construction plans. It was tentatively decided that the formal contract be signed in Pyongyang based on the proposal submitted by the consortium.

The subject of agreement is a multinational consortium of international investment group, which also includes a South Korean company, which is known as a company involved in North Korean mineral resources development. Once the project is in progress, there are plans of bringing other South Korean companies into the project.

In exchange, businesses will obtain the development rights of extracting gold from Hyesan City (Ryanggang Province) and iron ore in Musan (North Hamgyong Province). North Korean officials are claiming that this project was the legacy of Kim Jong Il and welcomed the participation of South Korean companies.

In March 2011, former North Korean leader Kim Jong Il is reported to have instructed that inter-Korean exchange programs be continued. Upon the completion of the railways and highways, the Presidium of the Supreme People’s Assembly will proclaim international road operations to ensure its stable operation.

The operation rights will be given to the consortium for 30 years while the ownership rights will be shared by the North Korean government and the consortium.

China is also building new railway lines up towards the North Korean border.

Share

DPRK – China trade: What is happening?

April 4th, 2014

Previous reports indicated that the execution of Jang Song-thaek has to date had little effect on DPRK-China trade. According to the Institute for Far Eastern Studies (2014-3-12):

Trade between North Korea and China in January has increased roughly 16 percent against the previous year. After the December 2013 purge of Jang Song Thaek it was predicted that trade between the two countries would decrease; however, there is no visible sign of this yet.

According to the Korean Foreign Trade Association’s* data, trade between North Korea and China in February increased from 471 million USD to 546 million USD, up 15.9 percent compared to the previous year.

February also showed an increase in anthracite exports, North Korea’s main export to China, rising 21.3 percent to 102 million USD. Iron ore exports also showed a slight increase of 35 million USD compared to last year.

Chinese exports to North Korea, including leading export commodities such as cellular phones and other wireless radio/communication devices, increased 28 percent compared to January of last year, totaling 14.5 million USD. In February, goods exported through China to North Korea increased by 10.2 million USD, a 38.6 percent increase compared to January of last year.

The trade gains in this report are annual for the most part…comparing 2013 data with 2014 data. This reveals little about the change in trade volume from month to month.

Now a story in Yonhap offers January and February 2014 data, and journalists have reached the opposite conclusion. Jang’s execution has played a role in DPRK-China trade. According to the article:

“In January and February this year, North Korea significantly stepped up checks on its coal exports to China,” a source in Beijing said on the condition of anonymity.

“Such reinforced checks appear to be related to the execution of Jang Song-thaek,” the source said.

According to the latest data by the Korea International Trade Association* in Seoul, North Korea’s exports of coal to China in February fell 26 percent from a month ago to 920,000 tons. The North’s exports of iron ore to China also fell 23 percent in February from a month earlier to 197,000 tons.

The North’s total trade with China in February plunged 46 percent from a month earlier to US$255 million, the data showed.

In Dandong, the Chinese border city with North Korea where about 80 percent of bilateral trade is conducted, the flow of goods in and out of North Korea appears to be affected by the execution of Jang.

“In previous years, the North Korean authorities had usually set their annual targets for exports and imports, and given quotas to trading firms,” said another source in Dandong who is doing businesses with North Korea. “But, no quota has been given yet this year.

“Obviously, the mood is different than previous years,” the source said.

No progress has been made on special economic zones, including Hwanggumphyong and Wihwa, set up by the North on the border with China, according to the source.

“Under the current circumstances, Chinese investors will not invest in the North’s special economic zones,” the source said.

Does this mean anything?  Well, we don’t know enough about these numbers, or the cause for such dramatic change in trade patterns, so we will need to continue to watch the data.  Even before the February numbers came out, Scott Snyder reminded us that DPRK-China trade has taken a dip between January and February for each of the last three years!

Snyder-DPRK-China-Trade-2011-2013

Then there are the caveats: 1. This only counts legitimate trade (no illicit, secret, or military trade) 2. No aid 3. No official or unofficial transfers 4. No capital flows.

*Presumably the Korean Foreign Trade Association and the Korea International Trade Association are the same thing.

Read the full Yonhap story here:
N. Korea’s trade with China shaken after Jang’s execution
Yonhap
2014-4-4

Share

Two new interesting publications on the DPRK

April 3rd, 2014

The two publications deal with changing leadership dynamics and health care for the disabled. Links below…

North Korean leadership dynamics and decision-making under Kim Jong-un: A second year assessment
Ken Gause, CNS
Publiched March 2014
PDF DOWNLOAD

People with Disabilities in a Changing North Korea
Katharina Zellweger, 2011–13 Pantech Fellow, Stanford University
PDF DOWNLOAD

Share

On the business of exporting coal…

April 3rd, 2014

Taean-Port

 Pictured above (Google Earth): The coal-covered Taean Port on the Taedong River

Who knew that Rodong Sinmun was involved in the coal export business?

According to the Daily NK:

Gwangbokseongdae Co. [광복성대?], a hard currency-earning arm of the operator of the Party daily Rodong Sinmun, recently resumed coal exports through the West Sea port of Nampo, Daily NK has learned. Exports had been halted upon the orders of the Chosun Workers’ Party in October 2013.

The Kim regime is believed to have resumed exports to open up additional flows of hard currency for accounts earmarked for regime maintenance. Coal is one of North Korea’s biggest export industries, with almost all the coal produced in the country sent to China (though a percentage of it is coked and returned for use in North Korean power stations).

A source from South Pyongan Province reported the story to Daily NK on the 3rd, explaining that “Gwangboksongdae Co. has started exporting coal again; it was originally stopped by the Party last October.”

The source then went on to add, “So as to match the timing of [incoming] vessels and increase export volumes, the company is leasing its trucks to people.”

“It costs US$350 per day to lease the trucks. They travel from storage yards [owned by people who lease land from farms and use it for the storage and sale of coal] in mining areas of South Pyongan Province to Daean Port in Nampo. Vessels start coming in March, so leased trucks are again transporting coal for export.”

Companies exporting coal to China must have an export trade license from the North Korean authorities. Then they can use planned exports to China as security against the cost of leasing the trucks. From the point of view of the company, subcontracting in this manner, a practice that began in the mid-2000s, makes more sense than employing drivers directly.

There are many conditions attached to truck rental from Gwangboksongdae Co., however. According to the source, not only must lessees prove that they have $3000 with which to purchase coal; they must also have ten years of trucking experience and, of course, good connections in the Central Party.

But it is worth it. “The original price of a ton of coal is roughly $12,” he said. “This can then be sold at the storage yards in Nampo and Taean Port for $32, giving the driver a clear profit of $20 on each ton. If he carries an average load of 30t, he will earn $540. If we factor in the lease fee of $350 and cost of fuel, there is around $100 left per load.”

“Normally, drivers make around three trips per week,” he went on. “But truck repair costs are born by the lessee. If a vehicle is damaged, the lessee ends up with a significant burden as they can be held liable for compensation.”

According to trade statistics compiled by the Korean International Trade Association (KITA) in January 2014, North Korea exported 16.5 million tons of anthracite to China in 2013. This total, which marked a year-on-year increase of 39.7%, brought in approximately US$ 1.373bn, a 15.5% increase over 2012.

Read the full story here:
Trucks for Rent as Coal Exports Soar
Daily NK
Seol Song Ah
2014-4-3

Share

UN to contribute $400,000 to fight foot and mouth disease

April 3rd, 2014

UPDATE 1(2014-4-5): According to VOA and Yonhap, the DPRK has  submitted a report to the UN World Health Organization for Animal Health (OIE) on the outbreak of FMD:

The Voice of America (VOA) said that Pyongyang submitted a report to the World Organization for Animal Health (OIE), saying that the disease broke out at a cow farm in Cholwon county of Kangwon Province, near the boarder area with South Korea, on March 14.

Nine cows out of 52 were infected with FMD, and one of them died, it added.

It is the first time for North Korea to report FMD in cows. It has notified OIE of outbreak of FMD in pigs in February.

Last week, the U.N. Food and Agriculture Organization (FAO) said the foot-and-mouth disease in North Korea had spread fast, infecting four cows near the border with South Korea.

According to the VOA, the United States, Canada and Mexico will consider providing vaccination to help North Korea upon its request.

ORIGINAL POST (2014-4-3): According to Yonhap:

The U.N. Food and Agriculture Organization (FAO) plans to provide US$400,000 to North Korea to help eradicate the rapidly spreading foot-and-mouth disease there, a U.S. radio report said.

The FAO also plans to send quarantine officials to North Korea after finalizing its aid program there, the VOA said.

Foot-and-mouth disease is an infectious and sometimes fatal disease that affects cloven-hoofed animals such as pigs, cattle, deer and sheep.

In February, the North’s state media reported that the country had culled 2,900 pigs as a preventive measure to stop the spread of the disease and buried about 360 others that had died from the disease.

Last week, the FAO said the foot-and-mouth disease in North Korea has spread fast, infecting four cows near the border with South Korea, according to the VOA.

Still, North Korea remained mum for over a month on South Korea’s offer of assistance to contain foot-and-mouth disease.

The North’s silence comes amid tensions on the Korean Peninsula over the exchange of fire by the rival Koreas across their disputed western maritime border, as well as Pyongyang’s threat of a nuclear test.

Pyongyang has also threatened to carry out a “new form” of nuclear test in anger over a United Nations condemnation of its recent ballistic missile launches. North Korea conducted nuclear tests in 2006, 2009 and 2013, drawing international condemnation and U.N. sanctions.

South Korea has vowed to continue humanitarian assistance to the North regardless of political tensions.

Read the full story here:
U.N. to provide US$400,000 to N. Korea over FMD: report
Yonhap
2014-4-3

Share

North Korea to utilize science and technology to overcome its energy crisis

April 3rd, 2014

Institute for Far Eastern Studies (IFES)
2014-4-3

In order to solve the nation’s chronic energy shortage, North Korea has been focusing on the development and utilization of science and technology as much as possible. Recent technological advancements are being reported one after another, and further development of alternative energy sources has resulted in technology that will reduce the nation’s oil and fossil fuel consumption.

The Choson Sinbo, a news outlet published by the pro-North Korean General Association of Korean Residents in Japan, reported on March 22 that the research staff of North Korea’s National Academy of Sciences contributed to a reduction in coal consumption by successfully developing and implementing the use of compressed biomass fuel in several factories in Pyongyang. The article also reported the invention of a new navigation program at Pyongyang Machinery College that searches for and displays the shortest possible routes between destinations. Transportation facilities in Pyongyang are said to have seen a 5 to 10 percent savings in fuel consumption since the introduction of the program.

Earlier this month, the Choson Sinbo also reported that the urban management division at the Central Heating Research Institute developed a new, more efficient solar heating system that has already been installed in homes along Pyongyang’s Kwangbok Street. The new system utilizes the leftover water heated during the day to provide warmth for homes at night, and, unlike the previously used system, can do so without consuming electricity.

Such efforts to mobilize domestic natural resources can be interpreted as an earnest attempt at solving the nation’s chronic energy shortage. In his new year’s address, Kim Jong Un emphasized the need to more effectively utilize domestic natural resources such as wind, geothermal, solar, and especially hydro power to remedy the nation’s electricity shortage.

He also stressed the need to endure the struggle to save energy with strength and resolve, calling on all sectors of the economy to conserve each and every watt of electricity, gram of coal, and drop of water where possible. Although North Korean efforts to solve the nation’s energy shortage have been ongoing for some time, the regime seems to be putting additional weight on the role of science and technology.

This call for technological development, with particular regard to alternative energy, is directly connected to Kim Jong Un’s preferential policy toward scientists and technicians. The best example of this can be seen in the construction of Unha Scientists’ Street, a housing complex built in September of last year specifically for personnel who have contributed to missile and nuclear tests and additional construction has begun for Satellite Scientists’ Street which will serve as a residential and research complex for the scientists of North Korea’s national satellite program. The construction of these sites shows that the regime understands the importance of science and technology in raising the efficiency of not only the energy sector, but also the North Korean economy. Furthermore, this move stems not only from the preferential policy toward scientists and technicians, but from the larger context of reforming the nation’s educational system.

Share