North Korean Economy Watch

KCNA
1/11/2007

The Pyongyang Law Office, an independent corporate body, has started its operation to provide services for the solution of legal matters arising in various sectors. Ho Yong Ho, chief of the office, told KCNA that his office provides legal services upon application and assignment by foreign-invested businesses (equity or contractual joint ventures and wholly-foreign owned enterprises) and Koreans in overseas as well as by the institutions, establishments, organizations and citizens at home.

As for the categories of services, he said:

It introduces the laws and regulations of the DPRK on foreign-related matters, Kaesong Industrial Zone, Kumgangsan Tourist Zone and others.

It also holds legal consultations concerning the selection of the investment project, establishment and operation of foreign businesses, dissolution and bankruptcy of businesses, concerning documents of legal nature including feasibility study reports and memorandum of association, concerning trade, transport, finance, insurance, intellectual property, real property and concerning civil law relations between corporate bodies, corporate body and individual and so on.

Legal services are offered on the principle of fairness, promptness and legality and on the basis of the facts, laws and contracts, while the service performer is held accountable before the party concerned and the law for the service offered.

Application for the legal service may be made in person or written form, or by means of communications device. Foreign investors are well advised to consult the office prior to their investment in the DPRK, which will prove a wise choice for the guarantee of their investment security.

After spending New Year’s in the Islamic Republic of Iran, I am getting back on top of my life.  Blogging will continue shortly.

In short, I had an amazing time and I recommend it to everyone.  My travel agent, Ace Vacations, did a fantastic job securing the visas, as well as planning and executing the travel agenda.  

A more detailed description of my trip will come soon.

On an unrelated note, I also just visited Turkmenistan. My country count is now at 44.

Korea Times
Lee Jin-woo
1/11/2007

Unification Minister Lee Jae-joung said Thursday that some 40 small factories, mostly clothing manufacturers, will move into the joint industrial complex in North Korea this year.

But he said it would take more time for the ministry to fully resume the halted expansion of the Kaesong Industrial Complex.

Last September, the South Korean government decided to hold off expanding the inter-Korean business venture because of heightened tension on the Korean Peninsula after the North’s launching of ballistic missiles in July. After the Stalinist state’s first-ever nuclear test on Oct. 9, tensions increased further.

“We’ve decided not to postpone helping small South Korean manufacturers, which have been struggling with adverse domestic business conditions, especially high wages,” Lee said during a press briefing at the ministry.

The manufacturing companies will move into a new five-story building constructed by the state-run Korea Industrial Complex Corp. involved in a pilot project for the industrial complex.

Construction of the building will be completed by June. It is not related to the postponed sale of the second section of the industrial complex, the minister said.

The number of North Koreans working for the 18 South Korean firms at the industrial complex surpassed 10,000 last year.

When fully expanded by 2012, the complex is expected to house about 2,000 South Korean manufacturers employing about half a million North Koreans, according to the Ministry of Unification.

The minister, however, said more progress in the stalled six-party talks is necessary for the government to resume expansion of the project.

He said he will continue discussing the matter with the Korea Land Corp., a state-run land developer, which has been involved in the Kaesong project, and Hyundai Asan, the business arm of Hyundai Group that handles the Mt. Kumgang tourism project.

Lee said the government would not provide medical aid to the Stalinist state to help stem the spread of scarlet fever, an infectious disease.

“Scarlet fever is not a fatal infectious disease. Given the significance of the disease, we believe that North Korea itself will be able to solve the problem,” Lee said.

The ministry considered providing medical aid to the North after scarlet fever broke out in the northern part of North Korea last October.

Earlier, South Korean humanitarian aid groups shipped 36 types of medicine including penicillin and other antibiotics to Pyongyang.

Daily NK
Han Young Jin
1/10/2007

“North Korea’s Idolization – 40% of National Budget”
Enshrining Kim Il Song’s body at Kumsu Mountain Mausoleum – $890m

[edited-I shortened it a bit and corrected the author’s cinfusion of Kim Jong Il with Kim il Sung]

As Kim Jong Il made his appearance on the scene as successor in the 70’s, within 10 years the entire nation was covered with statues, and even today construction has not stopped.

Recently, historical monuments to Kim Jong Il’s great deeds have been constructed. at Jakangdo Weewon Electric Power Plant, North Pyongan Province Changsong County, Yupyong; South Hamkyong Province Yonpo; North Pyongan Province, Hyangsan County, Sangso-ri; and Yomju County Yongbok-ri, Bakchon County, Dansan-ri.

At recently constructed monuments, mosaics of Kim Chong Sok (Kim Jong Il’s birth mother) made of colored glass, tiles, and natural stone are prevalent.

North Korea’s Kim Jong Il is not wasting money worthlessly by creating this idolization propaganda. The reason that the construction of these monuments has not stopped, even during a period of economic crisis, is because his intention is to use the vulnerabilities of citizens and young people to induce a spirit of sacrifice as they gaze on the Great Leader and the General (Kim Jong Il)

Of course, although among adults there are not many who like Kim Jong Il, he is the leader of the country and is still going strong, the intention is to arm the youth with a way of thinking that tells them it is wrong to betray the General.

140,000 Idolization Propaganda Items

The most representative of all of the idolization propaganda is [Kimil sungs] resting place at the Gumsusan Masoleum.

In addition to the Masoleum, if you include the entire collection of each type of Kim il Sung idolization statues, Revolutionary Spirit Institutes, Historical Places, Battlefields, On-the-Spot Guidance Memorials, Eternal Towers, Slogan Boards and Engraved Slogans, and (the Kim) family’s idolization propaganda materials, the figure reaches about 140,000.

There are about 70 statues of [Kim il Sung] nationwide, erected on the hill at Mansudae and at each Province location. While there are [Kim il Sung] statues in the gardens of each National Security Agency building, there are Kim Father and Son plaster figures at each of the Research Institutes.

Nationwide, there are 200 Kim Father and Son Research Institutes; one large scale facility in each city and county, one each at national government and cabinet level agencies, and one at each of the city and county offices subordinate to the People’s Safety Agency, Regional Public Security Office, and the National Security Agency have been constructed. The size, furnishings, and maintenance of these institutes are better than that found in museums in the South.

Additionally, although small in size, Kim Father and Son Research Institutes can be found at each village and labor district. As there are about 30 villages and labor districts in each city-county, nationwide there are about 6,000 (200 X 30 = 6,000) of these institutes. The condition and furnishings of these buildings are the best in North Korea.

In the villages or labor districts, one of these institutes can be found at each subordinate farm, large operational team, 2nd Class and higher agricultural enterprises, and at each North Korean Army battalion and larger size unit. Taking these into account, nationwide there appear to be tens of thousands of these Kim Father and Son Institutes.

In the countryside, one can find representative idolization and propaganda figures nationwide in the construction of Eternal Towers and Jongil Peaks at Kumgang Mountain, Myohyang Mountain, etc., and slogans idolizing Kim Father and Son can be found on natural rocks.

The Eternal Tower found at the center of every province, city, county, and labor district nationwide, is commonly referred to as the “Longevity Tower.” The tower was inscribed with “We respectfully wish for our Great Leader’s longevity,” however, after Kim Il Song’s death in July of 1994, the inscription was changed to “”The Great Leader is with us forever.”

During 1996-1997, when millions starved to death, the citizens complained loudly about the importation of granite and special cement from overseas for use in the construction of these towers.

Constructing Idols with Special Materials Imported from Overseas

The statues and gypsum figures found at the Kim Father and Son Institutes, as well as other art forms are created and maintained by Art Creation Companies located in each of the Provinces, including the Mansu Dae Creative Company, and the April 15 Cultural Creative Team.

Within the Mansu Dae Creative Company is separated by categories consisting of the Arts and Crafts Creative Team, the Business Art Creative Team, the Engraving Art Creative Team, the Cinema Creative Team, the Statue and Gypsum Creative Team, and the Chosun Paintings Creative Team, and specializes in creating symbols used to idolize Kim Father and Son.

Creations in the image of Kim Father and Son are made by Creative Branch Number 1. No one other than those assigned to Creative Team Number 1 can manufacture this type of art. Those assigned to this team have received special certification that allows them to draw the images of Kim Father and Son, only after having passed a political test and receiving certification from the Party, and certification of their skill.

While there are about 500 people working in the Mansu Dae Creative Company, the Art Creation Companies in each of the Provinces have about 30 in residence propaganda agitators in each of the cities and counties. The Special Finance Branch of the central government provides unlimited funding to cover the costs required to manufacture these items, and provides appropriations for purchasing high quality goods from overseas.

Covering tens of thousands of square meters in the Baekdu Mountain area, there are Grand Monuments at Bochonbo, Samjiyon, and the Hwangjae Mountain area where several thousand people manage idolization propaganda materials.

If Kim Father and Son have been to any of the Historical Revolutionary sites or battlefield sites, a museum is constructed there. For example, if Kim Father or Son has visited a farmhouse, persons at the farmhouse are no longer permitted to enter it, and personal effects are thereafter protected and managed by experts.

When Labor Party propaganda workers come up with a new competitive idolization idea, it is a happening that calls for a humorless presentation. When visiting Songjin Steelworks, Kim Il Sung used his hand to gauge the thickness of a steel plate and the very next day this several ton piece of steel was taken to the museum and placed on display. In this way, the competition among flatterers to display their loyalty has become a reason for the sharp increase in idolization propaganda.

Damaging Nature with Carved Slogans

At spots of beauty like Baekdu Mountain and Mohyang Mountain, etc., there are colossal carved slogans on the mountainsides.

▲ At Sobaeksu Valley, the professed hometown of Kim Jong Il, the six granite letters of the “Jong Il Peak” slogan placed on the mountain at Changsu Peak weighs 60 tons each and were put in place by helicopter.

▲ At Hyangno Peak on Mount Gumgang, the letters in the mountainside slogan “Chosun’s Famous Gumgang Mountain Is The World’s Famous Mountain. Kim Il Sung – September 27, 1947,” are 20 meters high, 16 meters wide with stokes of each character 3 meters, and a depth of 1 meter.

▲ On the rock at Mohyang Mountain’s Yusan Waterfall, the letters in the slogan “The Comrade Great Leader Kim Il Sung Is With Us Forever – July 8, 1994,” are 3 meters high, 2.3 meters wide and the letters “Kim Il Sung” are 3.2 meters by 2.5 meters.

▲ The letters at Gumgang Mountain Manpokdong and Bopguidong waterfalls reflecting “The Great Leader Kim Il Sung Is With Us Forever – July 8, 1994,” are 8 meters high and 5 meters wide.

▲ The engraved letters at Gumgang Mountain’s Waegum River Guryong Waterfall that reads “Chosun! Let’s Boast of our 5,000 Year History – Honored to Have Escorted the Comrade Great Leader Kim Il Sung – July 8, 1994,” are 4 meters high and 3 meters wide and the letters at Gumgang Mountain Gukji Peak saying “Hangil’s Female General Kim Chong Suk,” are 5 meters by 6 meters.

▲ Baekdu Mountain’s Hyangdo Peak’s “Baekdu Mountain – The Revolution’s Holy Mountain – Kim Jong Il February 16, 1992,” is done in embossed white lettering so that when it snow they won’t be covered.

▲ Gumgang Mountain’s Oknyo Peak lettering that reads “Gumgang Mountain is Chosun’s Driving Spirit – Kim Jong Il,” is 11 meters high and 8 meters wide.

In addition to this, Kim Father and Son idolization slogans on trees and engravings can be found in uncountable numbers at every well know place and tourist spot across the nation.

Daily NK
Kim Min Se
1/10/2007

An increasing number of North Koreans now depend on markets as international aid to North Korea sharply plummeted after nuclear test, evidence shows.

Particularly, a popular “market-friendly” mind is growing as the authorities’ control over the populace is weakening.

J, resident of Hamheung, North Korea, told the Daily NK on Monday via telephone “Though TV and newspapers boast ‘military first policy’ and ‘strong nation’ after the nuke test, people are only interested in money.”

The Daily NK was able to have a telephone interview with J, who was visiting Sinuiju, a Sino-Korean border city in which electromagnetic waves of Chinese cell phones could reach. NK businesspeople often use them for communication.

J said “Hamheung citizens are well aware of the cutoff of international aid. When they were forced into serving in the public industrial labor force, they could not go to work in markets and must then starve. Therefore, they are now asking for some money instead of compensation for the loss in work when they are serving for the public work.

Originally, such work in state-run factory used to be compulsory under the industrial mobilization of workforce policy. This is the first known case of being paid in mobilized labor and evidence of spread in popular market-economy-oriented mind.

“The vulnerable died well before and those who can run are already in China or South Korea. The leftovers are hard ones; they can even plow rock mountains,” J said sarcastically.

“People don’t trust the state anymore. They live on their own.”

J, a middleman, buys TVs, radios or bicycles and sells them back in market. On lucky days, he earns up to fifty thousands NK won (equivalent to 20 US dollars). According to J, as of January 2007, rice price is ranging from 1000 won to 1100 won (less than .5 US dollar) per kilogram.

Yonhap
1/10/2007

A South Korean civic group said Wednesday that it provided medicine to North Korea to help stem the spread of scarlet fever in the communist country.

“We shipped 36 types of medicines such as penicillin and antibiotics worth some US$5 million,” said Good Neighbors International, a South Korean civic organization which provides aid to North Korea.

The group noted that scarlet fever broke out in northern Ryanggang Province in October and spread rapidly to other provinces, which resulted in school shutdowns and travel bans.

Last month, the Join Together Society, a humanitarian aid group in Seoul, shipped a total of 400,000 injectable doses of penicillin to the North.

Scarlet fever is intrinsically not a serious communicable disease, but if it is not treated properly it could become a serious one like cholera or typhoid. The impoverished North lacks medicines.

Asia Times
1/10/2007
Ting-I Tsai

North Korea’s nuclear test has been a hot topic among analysts around the world. But inside the isolated Stalinist state, getting a hold of a pair of running shoes, a bicycle or a television set is still what most excites ordinary citizens.

And Chinese businesses continue to cash in on these material desires by selling goods manufactured at home or in North Korea at prices higher than their quality justifies, sparking much criticism.

When Pyongyang publicized its intention to initiate economic reforms in July 2002, most people had doubts about how far the policy would be taken. Four years later, the regime is still struggling to implement its reforms, but it has at least partly satisfied some of the daily demands of citizens by allowing more Chinese products to be manufactured in North Korea and more Chinese goods to be imported.

Shoes, bicycles, TV sets, beverages and clothes made in China or by Chinese companies in North Korea are helping to satisfy demand, but some disreputable Chinese companies are ruining their country’s reputation by dumping factory seconds and damaged goods on the market.

Over decades of isolation, North Koreans have been suffering not just from food shortages, but from a scarcity of basic consumer goods. In past years, Pyongyang has reportedly asked the South Korean government to donate thousands of tons of soap and clothes, as well as material for the production of 60 million pairs of shoes. In a visit to Pyongyang in November, products such as Colgate toothbrushes, toothpaste and a Japanese facial cleaner were carefully displayed in glass cases bearing price tags equivalent to US$2.60-$5.90, well beyond the financial reach of all but a few North Koreans.

After years of studying China’s experiences, Pyongyang is now gearing up to solicit foreign investment and advanced technologies to modernize its decades-old manufacturing base.

Supply and demand
“Because the supply can’t satisfy the demand, prices of most of the Chinese products simply soar in the North Korean market,” said Su Xiangzhong, chairman of a Tianjin company that founded a beverage-manufacturing joint venture, Lungjin, with a North Korean.

Trade between the two countries increased by 35.4% in 2004, followed by a 35.2% increase in 2005. By the end of October 2006, bilateral trade had reached $1.38 billion, a 4% increase over 2005.

Beijing-based Winner International Industries Ltd was one of the Chinese companies that foresaw North Korea’s consumption potential in 2000. By then, the company had co-founded a joint-venture running-shoe and clothing-manufacturing presence in North Korea. With advanced machinery from Taiwan, its shoe-manufacturing division is now capable of producing 8 million pairs of running shoes, according to an official from the company, who declined to identify himself. The clothing-manufacturing division, he said, has been a supplier to South Korean and Japanese companies. However, he added that orders from the two countries had recently decreased for unknown reasons.

Leather shoes for soldiers are of high quality, but they are not available to the average person. In Pyongyang shops catering exclusively to foreigners, a pair of leather shoes could cost as much as $326. The North Korean government is still soliciting foreign investment and purchasing shoemaking equipment via Chinese companies.

To get around in a country with underdeveloped public transportation, getting a pair of shoes is not enough. Taking advantage of that situation, Tianjin’s Digital Co started making bicycles in Pyongyang in October 2005, after the North Koreans agreed to let the Chinese take a 51% controlling share in the joint venture, virtually a monopoly, for 20 years.

It is estimated that the nation’s demand for bicycles is about 7 million, according to the Chinese media. The company now manufactures some 40 models and 60,000 bicycles annually, with the most popular model costing $26. In coming years, it plans to produce 300,000 bicycles annually and construct another three bicycle plants.

Aside from daily necessities, there are few entertainment options for North Koreans, which means there is a high demand for TV sets. Nanjing Panda, a TV maker, appeared to be the only Chinese company to foresee the emergence of the North Korean market when it invested $1.3 million there in 2002. After four years of operation, its 17-inch black-and-white and 21-inch color TV sets are reportedly the hottest items available in Pyongyang. With Panda products beginning to dominate the local market, it is becoming increasingly difficult for others to import TV sets into North Korea, according to Chinese business people.

The Panda joint venture is now digging up another potential gold mine by manufacturing personal computers (PCs) in North Korea.

In 2003, Chinese non-financial investments in North Korea amounted to just $1.12 million. That total, however, soared to $14.13 million in 2004, and reportedly reached $53.69 million in 2005. According to the Chinese media, there are now about 200 Chinese investment projects operating in North Korea. A Pyongyang-based foreign businessman described the Chinese investors as “by far the largest group by country doing business there, in all kinds of fields – plus they are from one of the few countries with the protection and representation of a big embassy”.

In March 2005, Chinese Premier Wen Jiabao signed an investment-protection agreement with his North Korean counterpart, and the two nations inked five bilateral economic-cooperation agreements between 2002 and 2005.

During North Korean leader Kim Jong-il’s visit to China last January, Wen introduced new economic-cooperation guidelines.

Despite these positive moves, controversy over the role of Chinese businesses has emerged. A Pyongyang-based Western businessman suggested that quite a few disreputable companies “go there with the intention of getting rid of old or damaged goods they can’t sell in China, and rip off North Koreans, who have no way to get their money back”.

“Also, a lot of fake goods come from China,” he added.

Still, more and more Chinese business people are rushing to Pyongyang. Su Xiangzhong, chairman of a Tianjin-based company, noted that his firm is creating a new beverage brand, like China’s Wahaha, in Pyongyang. North Koreans are also very interested in cooperating with Chinese enterprises in manufacturing and mining.

Chinese-made clothes for women and children, low-end and generic-brand household products and sundries, color TVs and PCs are popular products in North Korea.

Li Jingke, a Dandong-based Chinese businessman who runs the China-DPR Korea Small Investor Association, suggested that natural-resource exploitation and manufacturing are the best industries for foreigners to invest in, adding that more investment-friendly policies would likely be introduced in April. By then, he said, Chinese business people might need to become more concerned about unprofessional conduct.

“When North Korea introduces more liberalized policies, competent companies from everywhere will enter the market, which would likely eliminate the existence of those Chinese businessmen who don’t have modern commercial ideas in mind,” Li said.

Asia Times
Ting-I Tsai
1/10/2007

North Korea’s nuclear test has been a hot topic among analysts around the world. But inside the isolated Stalinist state, getting a hold of a pair of running shoes, a bicycle or a television set is still what most excites ordinary citizens.

And Chinese businesses continue to cash in on these material desires by selling goods manufactured at home or in North Korea at prices higher than their quality justifies, sparking much criticism.

When Pyongyang publicized its intention to initiate economic reforms in July 2002, most people had doubts about how far the policy would be taken. Four years later, the regime is still struggling to implement its reforms, but it has at least partly satisfied some of the daily demands of citizens by allowing more Chinese products to be manufactured in North Korea and more Chinese goods to be imported.

Shoes, bicycles, TV sets, beverages and clothes made in China or by Chinese companies in North Korea are helping to satisfy demand, but some disreputable Chinese companies are ruining their country’s reputation by dumping factory seconds and damaged goods on the market.

Over decades of isolation, North Koreans have been suffering not just from food shortages, but from a scarcity of basic consumer goods. In past years, Pyongyang has reportedly asked the South Korean government to donate thousands of tons of soap and clothes, as well as material for the production of 60 million pairs of shoes. In a visit to Pyongyang in November, products such as Colgate toothbrushes, toothpaste and a Japanese facial cleaner were carefully displayed in glass cases bearing price tags equivalent to US$2.60-$5.90, well beyond the financial reach of all but a few North Koreans.

After years of studying China’s experiences, Pyongyang is now gearing up to solicit foreign investment and advanced technologies to modernize its decades-old manufacturing base.

Supply and demand
“Because the supply can’t satisfy the demand, prices of most of the Chinese products simply soar in the North Korean market,” said Su Xiangzhong, chairman of a Tianjin company that founded a beverage-manufacturing joint venture, Lungjin, with a North Korean.

Trade between the two countries increased by 35.4% in 2004, followed by a 35.2% increase in 2005. By the end of October 2006, bilateral trade had reached $1.38 billion, a 4% increase over 2005.

Beijing-based Winner International Industries Ltd was one of the Chinese companies that foresaw North Korea’s consumption potential in 2000. By then, the company had co-founded a joint-venture running-shoe and clothing-manufacturing presence in North Korea. With advanced machinery from Taiwan, its shoe-manufacturing division is now capable of producing 8 million pairs of running shoes, according to an official from the company, who declined to identify himself. The clothing-manufacturing division, he said, has been a supplier to South Korean and Japanese companies. However, he added that orders from the two countries had recently decreased for unknown reasons.

Leather shoes for soldiers are of high quality, but they are not available to the average person. In Pyongyang shops catering exclusively to foreigners, a pair of leather shoes could cost as much as $326. The North Korean government is still soliciting foreign investment and purchasing shoemaking equipment via Chinese companies.

To get around in a country with underdeveloped public transportation, getting a pair of shoes is not enough. Taking advantage of that situation, Tianjin’s Digital Co started making bicycles in Pyongyang in October 2005, after the North Koreans agreed to let the Chinese take a 51% controlling share in the joint venture, virtually a monopoly, for 20 years.

It is estimated that the nation’s demand for bicycles is about 7 million, according to the Chinese media. The company now manufactures some 40 models and 60,000 bicycles annually, with the most popular model costing $26. In coming years, it plans to produce 300,000 bicycles annually and construct another three bicycle plants.

Aside from daily necessities, there are few entertainment options for North Koreans, which means there is a high demand for TV sets. Nanjing Panda, a TV maker, appeared to be the only Chinese company to foresee the emergence of the North Korean market when it invested $1.3 million there in 2002. After four years of operation, its 17-inch black-and-white and 21-inch color TV sets are reportedly the hottest items available in Pyongyang. With Panda products beginning to dominate the local market, it is becoming increasingly difficult for others to import TV sets into North Korea, according to Chinese business people.

The Panda joint venture is now digging up another potential gold mine by manufacturing personal computers (PCs) in North Korea.

In 2003, Chinese non-financial investments in North Korea amounted to just $1.12 million. That total, however, soared to $14.13 million in 2004, and reportedly reached $53.69 million in 2005. According to the Chinese media, there are now about 200 Chinese investment projects operating in North Korea. A Pyongyang-based foreign businessman described the Chinese investors as “by far the largest group by country doing business there, in all kinds of fields – plus they are from one of the few countries with the protection and representation of a big embassy”.

In March 2005, Chinese Premier Wen Jiabao signed an investment-protection agreement with his North Korean counterpart, and the two nations inked five bilateral economic-cooperation agreements between 2002 and 2005.

During North Korean leader Kim Jong-il’s visit to China last January, Wen introduced new economic-cooperation guidelines.

Despite these positive moves, controversy over the role of Chinese businesses has emerged. A Pyongyang-based Western businessman suggested that quite a few disreputable companies “go there with the intention of getting rid of old or damaged goods they can’t sell in China, and rip off North Koreans, who have no way to get their money back”.

“Also, a lot of fake goods come from China,” he added.

Still, more and more Chinese business people are rushing to Pyongyang. Su Xiangzhong, chairman of a Tianjin-based company, noted that his firm is creating a new beverage brand, like China’s Wahaha, in Pyongyang. North Koreans are also very interested in cooperating with Chinese enterprises in manufacturing and mining.

Chinese-made clothes for women and children, low-end and generic-brand household products and sundries, color TVs and PCs are popular products in North Korea.

Li Jingke, a Dandong-based Chinese businessman who runs the China-DPR Korea Small Investor Association, suggested that natural-resource exploitation and manufacturing are the best industries for foreigners to invest in, adding that more investment-friendly policies would likely be introduced in April. By then, he said, Chinese business people might need to become more concerned about unprofessional conduct.

“When North Korea introduces more liberalized policies, competent companies from everywhere will enter the market, which would likely eliminate the existence of those Chinese businessmen who don’t have modern commercial ideas in mind,” Li said.

KCNA
1/9/2007

The people of the Democratic People’s Republic of Korea have turned out with a great ambition and confidence in the efforts to make a higher leap, in response to the joint editorial issued by Rodong Sinmun, Josoninmingun and Chongnyonjonwi on the occasion of the New Year Juche 95 (2006). Surging is the enthusiasm of the officials and working people in the field of agriculture to thoroughly implement the tasks set forth by the joint editorial that put forward agriculture as the main front of the economic construction this year, too, and called for mobilizing and concentrating all the forces on farming once again.

Minister of Agriculture Ri Kyong Sik said in an interview with KCNA that the ministry has worked out a plan of making a fresh progress in implementing the Workers’ Party of Korea’s policies of bringing about innovations in seed production, potato and soya bean cultivation and two-crop-a-year farming and is striving hard to implement them.

The ministry, he added, is focusing efforts on taking steps to decisively increase the grain-cultivation area, acquire new land, reclaim wasteland and raise the fertility of soil. It also pushes ahead with full preparation for finishing the construction of setups of the Taegye Island reclaimed tideland before the start of sowing while carrying on land-rezoning projects.

Steps are being taken beforehand to plant more high yielding varieties suitable for potato producers in highlands and to protect them against blights and harmful inspects.

Preparations are being made for making the Kaechon-Lake Thaesong and Paekma-Cholsan Waterways, the gravity-fed ones, pay off and for carrying on in earnest similar waterway projects in the Miru Plain and other parts of the country.

The officials and working people in the agricultural domain are engaged in farming preparation for reaping a bumper crop this year with a high sense of responsibility for the country’s rice granaries.

Officials and working people of ministries, national institutions and various organs and enterprises at all levels and even housewives are coming out to the countryside, bringing with them large quantities of farming materials and compost, to inspire agricultural working people.

Thanks to the burning patriotic zeal of the agricultural working people to support the Songun fatherland with rice and the nation-wide sincere assistance, the agricultural front is sure to yield a rich harvest this year, the minister said with emphasis.

Joong Ang Daily
Lee Jung-min
1/9/2007

One of North Korea’s capitalist experiments may be awakening from hibernation. “The North’s National Economic Cooperation Federation and Tumen River Development Limited Company of South Korea have reached an agreement to build a heavy and chemical industry complex in Rajin-Sonbong district,” Oh Myoung-hwan, the president of the South Korean company, said yesterday. “We also agreed to carry out jointly a Mount Paektu tour project.” A letter of intent will be signed in Vladivostok, Russia, today, Mr. Oh said.

Mr. Oh, whose company is headquartered in Vladivostok, said Russian natural resources would be processed by North Korean workers in plants built with South Korean capital and technology. He added that he has informed the Unification Ministry in Seoul of his plans.

The National Economic Cooperation Federation is a North Korean foreign economic agency. Mr. Oh said Ryo So-hyon, the federation’s Vladivostok office head, will sign the letter of intent for the North Koreans.

A government official in Seoul speculated that North Korea is looking for new projects because its nuclear test in October triggered a drop in the number of South Korean tourists visiting Mount Kumgang and U.S. criticism of the Kaesong Industrial Complex has grown.

Mr. Oh said that when the new complex is running, train tours to Mount Paektu would be the next step. Tourists would travel by ship from Sokcho on South Korea’s east coast to Hoiryong and Musan, two harbors in the Rajin-Sonbong area of North Korea’s far northeast.

North Korea established the Rajin-Sonbong Free Economic and Trade Zone in 1991 on the western side of the Tumen River to attract foreign investment. It has been a near-total failure in attracting foreign investment. Mr. Oh said work on the new project would begin in 2-3 months.