North Korean Economy Watch

From the Korea Times:
Andrei Lankov
9/3/2006

In days gone by, underground mining was an important military activity, an essential part of any protracted siege campaign. Military miners, known as sappers, were discreetly digging tunnels under the walls and towers of the enemy castle, in the hope of collapsing them or, in later eras, stuffing the tunnels with explosives and blowing up the walls. The defenders were digging their own tunnels, trying to intercept the attackers and prevent them from completing their works.
Some digging operations took place during fairly recent campaigns, including even the First World War, but by and large sappers have been disappearing for the past few centuries– to be reborn in popularity, of all places, in North Korea during the 1970s.

The late 1960s was when the Pyongyang generals were serious about invading the South. I do not have proof (nobody has), but it feels that until the mid-1960s the North did not view an attack of the South as practical. The same was the situation from the mid-70s onwards. But between 1965 and 1975, the North Korean generals were probably really thinking about starting a Korean War once again.

However, the North Korean generals had to deal with one serious problem: they would have to breach the heavily fortified positions of the enemy who was likely to enjoy considerable air superiority. Hence, somebody came up with a brilliant idea: since we cannot drop our paratroopers behind the Southerners’ line, we can let our soldiers pass beneath the enemy’s position! We do not know whose idea it was – but I think that in due time the person’s name will be known to every student of Korean military history.

Thus, at some point in the late 1960s, the idea of an infiltration tunnel was born. It is believed that the large-scale construction began in 1971 when Kim Il Sung signed a special order authorizing the unusual plan. He is quoted as saying: “one tunnel can be more powerful then ten atomic bombs put together, and the tunnels are the most ideal means of penetrating the South’s fortified front line.”

According to published materials from US/ROK intelligence, each North Korean battle-line division, stationed near the DMZ was ordered to build two infiltration tunnels. As there were 11 divisions along the DMZ in the 1970s and 1980s, there should be 22 tunnels – if the intelligence is correct, that is. Only 4 tunnels have been discovered so far.

Strange noises and frequent explosions began to be heard in some parts of the DMZ from late 1973. Seismic monitoring equipment confirmed that some underground works featuring the heavy use of explosives were taking place. Finally, a North Korean engineer defected and provided information on the approximate locations of two tunnels. This led to intensive searches and, eventually, to the discovery of these impressive underground structures.

The first tunnel was discovered in November 1974, in the western part of the DMZ, some 60 km from Seoul. With an estimated total length of 3.5 kilometers, it extends one kilometer into the southern territory of the Military Demarcation Line that divides the DMZ. The tunnel is 1.2 meters high and 0.9-1.1 meters wide. This is not very large, but it still means that an entire regiment can pass through it every hour.

The next few years was a time of intensive counter-mining operations, as they used to be called in medieval times. Many methods were used to locate the tunnels, but good old ‘counter-mining’ proved to be most useful. First, bore holes were drilled in suspicious areas. Once discovered, a North Korean tunnel was counter-mined by digging an interception tunnel.

The second tunnel was discovered in March 1975. This tunnel was the most remarkable of all known structures of this kind. It is located in the central sector of the DMZ, about 13 kilometers away from Chorwon city, and about 100 km to the north-east of Seoul. The second tunnel is much larger (2.1-2.2 meters wide, 2.0 meters high), and it is the only known tunnel which would allow for the movement of armored vehicles and field artillery. An entire division can pass through it every hour. To facilitate the troop movement, a spacious troop assembly area was carved out inside the tunnel which has three exits.

The third tunnel discovered was slightly smaller, but it was also the closest to Seoul – and located merely 4 km from the truce village of Panmunjom. The tunnel was discovered thanks to a tip from a North Korean defector who had taken part in its construction. After its discovery in October 1978 for two decades no new underground structures were located, and for a while the tunnels appeared to be a thing of the past.

But a fourth tunnel was discovered in 1990, showing that tunnel building had continued into recent times. The US/ROK military insist that there are 18 undiscovered tunnels, probably now completed, along the DMZ.

There are some people who believe that some of these undiscovered tunnels have penetrated much deeper into the South, almost reaching Seoul. They even conduct searches for these tunnels, using private donations and the efforts of volunteers. Well, what should I say? Their pet idea does not appear very likely, of course, but there are always people who want to believe in something improbable. The story of the search for tigers in the DMZ is yet another confirmation of this.

From AFX News on Yahoo:
9/3/2006
NKorea opens bank accounts in Russia to dodge US sanctions – report

TOKYO (XFN-ASIA) – North Korea has opened about 10 bank accounts at Russian financial institutions in an effort to secure fund flows now blocked by US financial sanctions, the Sankei Shimbun here reported at the weekend.

The newspaper, quoting sources who it described as being close to North Korean affairs, said senior North Korean officials were transferring their funds through the accounts.

Thi is part of Pyongyang’s efforts to escape pressure from the US, which has moved to freeze North Korean funds it claims are the profits of drug trafficking, money laundering and other illegal activities.

Washington is aware of North Korea’s money flows through the Russian banks and it may step up pressure on the Russian authorities to abandon such support for North Korea, the newspaper said.

North Korea has warned the United States it will take ‘all necessary counter-measures’ against Washington for increasing the the pressure on North Korea through financial sanctions.

In November, Pyongyang walked out of six-way talks on its nuclear ambitions after Washington accused a Macau-based bank of helping Pyongyang launder earnings from fake US currency, and told US financial institutions to stop dealing with the bank.

“Military First” Politics to a Point
Ken E. Gause
Strategic Studies Institute
9/1/2006

Download PDF here:  Civil-Military.pdf

Summary
Unlike the study of other authoritarian regimes, first the Soviet Union and more recently China, which have given rise to a cottage industry of analysis on all aspects of things military, the same cannot be said of the Korean People’s Army (KPA), the armed forces of the Democratic People’s Republic of Korea (DPRK). In the small world of Pyongyang watchers, articles and books devoted to the KPA are few and in most cases deal with the armed forces themselves (order of battle) rather than the high command that oversees the machinery.

This monograph examines the role of the KPA within the power structure of North Korea. The author describes the landscape of military and security institutions that ensure the regime’s security and the perpetuation of the Kim dynasty. He also highlights the influential power brokers, both civilian and military, and describes how they fit into the leadership structure. Finally, he considers the role of the KPA in regime politics, especially as it relates to the upcoming succession and economic reform.

An understanding of the North Korean leadership does not mean only recognizing the personalities who occupy the top political positions within the regime. In his landmark book, Shield of the Great Leader, Joseph Bermudez noted that over its 50-year history, the DPRK has developed into one of the most militarized countries in the world, with the KPA existing alongside the Korean Worker’s Party (KWP) as the two cornerstones of the regime. During this time, the role of the high command and its ties to the leadership and decisionmaking have changed.

The KPA was founded on February 8, 1948, approximately 7 months before the founding of the DPRK. As Kim Il Sung struggled to consolidate his power over the regime, his old comrades-in-arms, with whom he had fought against the Japanese, helped him purge the factional groupings and their leaders. After he had secured his power, Kim Il Sung relied on the KWP to rule the country. The high command played its role within the decisionmaking bodies of the state, but it paid its loyalty to the party and the Great Leader.

When Kim Jong Il succeeded his father as the supreme leader in 1994, he faced a regime divided among numerous factions, many of which did not owe allegiance to him. As a consequence, he embarked on a campaign of reshuffling briefs, purging the more dangerous elements of the regime, and making way for a new generation of leaders who would coexist and then slowly replace their elders. At the same time, he began to move more authority from the KWP and to place it within the purview of the military. This transformation of authority culminated in 1998 at the 10th Supreme People’s Assembly, when the National Defense Commission eclipsed the Politburo as the supreme national decisionmaking body. In the years since, the term “military-first politics” (son’gun chongch’i) has been used to signify the privileged status the KPA holds throughout North Korean society and to stress that the regime’s sovereignty rests upon the military’s shoulders.

This monograph tracks the rise of the military inside the North Korean leadership and presents the backgrounds of key figures within the high command and the formal and informal connections that bind this institution to Kim Jong Il. As the first generation has passed from the scene, Kim has consolidated his grip on the military slowly by promoting loyalists to key positions throughout the apparatus. He has promoted more than 1,200 general-grade officers on 15 occasions prior to April 2006. This has not only secured Kim’s power, many have argued it has enhanced the military’s influence over him, especially when compared with its influence over his father.

The question facing many North Korea watchers is the extent to which the military figures into decisionmaking. This report argues that, while the military has grown in stature and influence over the last decade, it remains one of many players within the North Korean policymaking process. The lines of authority and information within the regime are complex, consisting of formal and informal channels. The military has numerous avenues into the Kim apparatus, and on many issues have what amounts to a veto authority. This apparently was made clear recently by North Korea’s decision to cancel the test run for train services between North and South. But this does not mean that the military is the primary decisionmaker; that role still belongs to Kim Jong Il, even though he must weigh seriously military thinking on issues that reach far beyond the national security realm.

This monograph also argues that the KPA is not a monolith, but is made up of a range of views, some more hard line than others. Some senior figures within the high command are rumored to have pushed for reforms both internally and in terms of foreign policy, while many younger field commanders are believed to hold some of the hardest of the hard line views. But one area where there seems to be wide agreement throughout the military leadership is the need to fund the armed forces adequately because it is on their back that the nation’s security depends.

In the next few years, the North Korean leadership will face the implications of the “military-first policy” in very stark terms. If Kim Jong Il is to begin to bring the civilian economy out of the dark ages, the military will have to share some of the burden. But whether the high command will be willing to trade some of its “weapons for ploughshares” is not certain, given the current tensions on the peninsula. In the mix of what is already a contentious argument over guns versus butter is an unfolding succession struggle as Kim seeks to name his heir apparent. As in any totalitarian regime, the succession issue is huge and impacts decisionmaking across the board.

There is a note of caution when reading this report. The subject matter deals with information that is unfolding and will continue to shift in the coming months and years. The author has made every effort to validate through numerous sources the information contained on the various personalities, but in some cases it is still opaque. The reason for this is simple. Information on North Korean leadership issues is a closely held secret inside the Hermit Kingdom. The actions and activity of individual leaders are more often rumor than subject to check and verification.

Bloomberg
Bradley K. Martin

Koryo Asia Ltd., a London-based financial adviser, said it will buy North Korea’s Daedong Credit Bank for an undisclosed amount and lobby the U.S. to lift sanctions on the foreign-run bank.

Daedong Credit is among North Korean banks whose accounts in Macau’s Banco Delta Asia SARL have been frozen since September 2005 after the U.S. Treasury Department alleged Banco Delta laundered money from North Korea and worked with front companies trafficking drugs for the communist state. The Macau government has taken control of the bank.

The value of Daedong Credit “would be enhanced if we can resolve the sanctions issue with the U.S.,” Koryo Asia chairman Colin McAskill said in an e-mail interview. Koryo Asia is adviser to London-based Chosun Development & Investment Fund LP, which aims to raise $50 million for investments in North Korea.

North Korea has demanded removal of the financial sanctions before it will return to six-nation talks to prevent the country from developing nuclear weapons. The U.S. and China urged North Korea to resume the talks that include South Korea, Russia and Japan, after the country in July tested a missile that may have the capability to reach the U.S.

Daedong Credit’s general manager Nigel Cowie confirmed the sale and that he would stay on. He declined further comment. Cowie said in an interview last year that the bank’s assets –including those frozen in Macau — totaled around $10 million.

A former HSBC Holding Plc banker, Cowie was hired in the mid- 1990s by Peregrine Investment Holdings Ltd. to start the bank. Following Peregrine’s 1998 collapse, Cowie and three other investors bought the 70 percent foreign stake from the liquidator in 2000.

Transparent

Koryo Asia signed an agreement to buy the majority share in Daedong through a wholly owned subsidiary that McAskill, 65, did not name. The majority shareholders had approached Koryo Asia to propose the sale, he said.

McAskill said he won’t take a direct management role in the bank, instead serving as a consultant to persuade U.S. officials to release as much as $7 million of Daedong’s and its customers’ assets in Macau. The total of frozen North Korean bank assets in Macau is about $24 million.

McAskill’s argument that Daedong Credit Bank serves only foreign, not North Korean, customers and that its transactions are legal and transparent may not win an audience at the U.S. Treasury Department.

“Given the regime’s counterfeiting of U.S. currency, narcotics trafficking and use of accounts worldwide to conduct proliferation-related transactions, the line between illicit and licit North Korean money is nearly invisible,” Stuart Levey, Treasury’s undersecretary for terrorism and financial intelligence, said last month.

Asked if the purchase of Daedong Credit Bank is a big gamble, McAskill said, “Not a gamble — a gambit.”

He said his strategy is to demonstrate that Levey’s blanket condemnation of all North Korea-related finance is counter to U.S. interests.

Exempting Daedong on its merits from the sanctions would bring a potentially big payoff, he said, “an atmosphere in which Kim Jong-il can consider a return to the six-party talks.”

Anselmo Teng, chairman of the Macau Monetary Authority, didn’t immediately return a phone call and e-mail to his office seeking comment on the sale and any impact the ownership change may have on the status of Daedong’s Banco Delta Asia accounts.

Korean Investment

McAskill said the Chosun Development & Investment Fund LP aims to raise funds for “transaction-based” investments, such as procuring mining equipment and receiving mine output in return.

“We believe we will fully subscribe the fund from investors in Europe, Asia, the People’s Republic of China and possibly South Korea,” he said. “Global investor interest in this potential emerging market was not affected by the missile launches in July,” he said, without giving details.

Taking over the bank “gives us a legitimate foothold and provides a conduit for investment in the country, whether through Chosun Fund or other sources,” McAskill said. “In the long term, the goal is to facilitate the resuscitation of the legitimate economy.”

Chosun Fund, managed by London-based Anglo-Sino Capital Partners Limited, is denominated in U.S. dollars. If the sanctions issue cannot be resolved, the fund has the option to switch to denomination in euros or pounds sterling, McAskill said.

“There’s no point in taking in U.S. funds if the United States is going to try and block them,” he said.

Room 39

The minority owner of Daedong Credit is Korea Daesong Bank, a unit of North Korea’s Daesong Group.

A 1995 U.S. government study cited close ties between Daesong and Room 39, an office of the ruling North Korean Workers’ Party said to handle foreign exchange-gathering projects for the country’s leader.

McAskill said the minority owner does not run the bank. Daedong is “not only majority foreign-owned and foreign- controlled but also foreign-managed,” he said, adding he was given access to all of Daedong’s activities and concluded it’s a legitimate business.

Only North Korean-owned banks can do business with state enterprises and North Korean individuals, Cowie said last year, so Daedong’s customers are all foreign — mostly Chinese, Japanese and Western individuals and institutions.

As of Aug. 17, that had not convinced Levey at the U.S. Treasury.

“The U.S. continues to encourage financial institutions to carefully assess the risk of holding any North Korea-related accounts,” he said.

The undersecretary traveled in Asia in July to push that line, which resulted in the closure of some North Korean banks’ accounts in Vietnam.

From the Korea Times:
Ship Carries 1st Flood Relief to North
8/30/2006
Lee Jin-woo

The South Korean government has shipped its first batch of flood relief to North Korea via the Red Cross, the Ministry of Unification said yesterday.

The shipment included some rice, the supply of which had been halted since the North’s test-firing of missiles on July 5. The government has made it clear that the humanitarian aid is unrelated to the government’s halted periodic aid provided annually to the communist state.

The shipment comprising 300 tons of rice and 20,000 blankets as well as other emergency relief supplies was made through the Korean National Red Cross (KNRC) and set out from Inchon port, west of Seoul, the ministry said.

The ship, Trade Fortune, is expected to arrive at the North Korean port of Nampo in a day or two. Four Red Cross officials are on board to supervise the delivery, a KNRC official said.

The total aid, comprising 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and more than 200 construction vehicles, will be delivered in 40 installments by mid-October.

“The torrential rain also left damage in South Korea, but we decided to send the flood relief to North Koreans, who face a much more dire situation,’’ said Han Wan-sang, president of the KNRC during a ceremony before the shipment. “I hope the two Koreas can find a breakthrough in the chilly inter-Korean relations through the aid program.’’

Also speaking at the ceremony, Vice Unification Minister Shin Un-sang said the humanitarian flood relief has great symbolic meaning as it was based on bipartisan support from the governing and opposition parties as well as the public.

After a meeting of Red Cross officials from the two sides at Mt. Kumgang in the North on Aug. 19, the government announced its humanitarian aid plan for the North to help repair the damage from recent flooding.

The ministry estimates the rice aid will cost some 195 billion won ($203 million); and the construction supplies and equipment, 26 billion won.

The ministry plans to use the Inter-Korean Cooperation Fund to match the contribution made by local private relief organizations. A 10 billion won subsidy will be given to those organizations next month.

The exact number of flood victims in the North has not been confirmed yet due to a lack of information on the reclusive state.

The National Intelligence Service (NIS) has reported to the National Assembly that some 900 North Koreans are dead or missing because of flooding, sources said. The number greatly differs from claims by South Korean humanitarian aid groups who say casualties have reached 10,000.

Yonhap
8/30/2006
Sam Kim

Thousands of used but clean shirts, pants and other clothes are stacked in big heaps in warehouses outside Seoul to be sent to poverty-stricken North Korea.  But they can’t be sent as they are, because North Korean officials want to get them their way: all without English writing on them and their size no bigger than “large.”

“In addition, we have color restrictions,” Ahn Jeong-hui, director of the Korean Council for Reconciliation and Cooperation, the donor of the clothes and other relief goods. “Strong colors could easily repulse North Koreans.”

Whenever impoverished North Korea suffers from flood and other natural or man-made disasters, sympathetic South Korean civic organizations usually respond to their appeal for emergency aid with warm hearts.

The shipment-in-waiting is for thousands, perhaps tens of thousands of North Koreans who were made homeless in massive floods in mid-July.

There were no official North Korean announcement on the extent of the flood damage but its media said “hundreds” of people were killed or missing. One South Korean relief group said “thousands” were killed.

The South Korean civilian aid is in addition to more than US$200 million worth of relief goods scheduled to be sent by the Seoul government, which include 100,000 tons each of rice and cement, 50,000 tons of reinforced steel bars and a number of trucks and other construction equipment.

With its economy in shambles, impoverished North Korea turned to international handouts in 1995 to help feed its 23 million people. U.N. relief workers said the largest floods in the country are expected to result in 100,000 tons of crop damage this year.

After years of dealing with North Korea, South Korean donors have learned that helping the communist country is not just about sending large quantities of supplies. It requires certain “customization,”

“The maximum size of clothes we send to North Korea is ‘large,'” said Hyun Il-hyun, secretary at Join Together Society, another South Korean relief agency, “We know anything bigger, like ‘extra large’ or ‘extra extra large,’ won’t fit North Koreans.”

“What will fit elementary school kids in South Korea will usually fit North Korean middle-schoolers,” she said. “Most North Korean adults will fit well into what South Korean teenagers wear.”

Chronic food shortages and malnutrition have stunted many North Koreans, making some look like dwarfs. Television footage broadcast in South Korea showed gaunt North Koreans scouring winter fields for grains left by reapers.

Nearly 8,700 North Koreans have defected to South Korea since the Korean War ended in 1953, including 1,139 in 2002, 1,281 in 2003, 1,894 in 2004, 1,383 in 2005 and 1,054 in the first seven months of this year. Many complained of hunger in their communist homeland.

A 2004 survey of 2,300 North Korean defectors showed that average North Korean men and women are 5.9 centimeter and 4.1 centimeters shorter than their South Korean counterparts, respectively. An average 14-year-old boy from North Korea is up to 15.8 centimeters shorter than the same-aged South Korean.

English-embellished clothes are not welcome, either, in North Korea, relief workers said.

“We pick out any clothing that has English writing on it,” Hyun of Join Together Society said. “North Korean authorities apparently don’t want their people to think the clothes are coming from their sworn enemy, the U.S. We also restrict clothes that have the names of South Korean organizations.”

North Korea has asked them to increase shipments of rice and flour instead of instant noodles, according to South Korean relief workers.

“We will comply with the North Korean request and no longer send instant noodles,” said Ahn of the Korean Council for Reconciliation and Cooperation. “I think the North’s request has do to with the South Korean marks and logos on the packings.”

According to South Korean government officials, North Korea tightly controls the flow of information among its people. All radio sets are pre-set to monitor only state broadcasts.

From Yonhap:
8/30/2006

North Korean exports to Japan dropped by nearly 50 percent last month from June amid Tokyo’s economic sanctions against the communist state for its test-firing of missiles early last month, a report by Japan’s Finance Ministry released on Wednesday showed.

The total amount of North Korea’s exports to Japan last month dropped to some 440 million yen (US$3.75 million), a 44.2 percent decrease from that of June, the report said. The amount is also down 42.2 percent from that of the same period in 2005.

The report failed to provide specific reasons for the drop, but observers believed it was mainly due to the country’s economic sanctions against the impoverished North, which followed Pyongyang’s test-firing of seven ballistic missiles on July 5.

The observers also said trade between the two is likely to further shrink amid Tokyo’s strong reaction to North Korea’s missile tests and the communist state’s alleged preparations to test a nuclear bomb.

The United Nations Security Council unanimously adopted a resolution on July 15, condemning the North Korean missile tests and prohibiting any missile-related dealings with the North. But Tokyo has been taking additional steps to cut off any cash inflow to North Korea from its country.

The country has banned a major North Korean ferry, Mankyongbong-ho, from its ports at least for the next six months, cutting off the largest and almost the only direct means of transportation between the two for North Koreans and some 200,000 pro-Pyongyang Korean residents in Japan.

From the Daily NK:
Park Hyun Min
8/30/2006

North Korean authorities are nervous about South Korean missionaries sending the Bibles via balloons to the North.

Recently, a South Korean missionary organization obtained a (North) Korean Workers’ Party document under a title of ‘Countermeasure Against Enemy’s Evil Activities of Infiltration of the Bibles to Our Country via Balloons.’

The document, which is suggested to be distributed by the Central KWP to the provincial party organization bureau and municipal party guidance bureau, is started with a phrase ‘Here is the Party’s decision, signed by the Dear Leader Comrade Kim Jong Il on June 30, 2004.’

It is stated in the document that ‘the enemies are planning to disseminate the Bibles to brainwash our people with religious idea by means of balloons.’ Also, the document orders every party organization, as soon as it receives the document, to educate party members and workers about the text.

According to the document, ‘activities such as keeping the bible found in balloons or disseminating it are acts of treason,’ and ‘education of the people not to participate in treacherous activities is to be carried out aggressively.’

The document proves North Korea’s anti-religious policy that has been continued since Kim Il Sung’s instruction of criticism on religion for being ‘reactionary and unscientific one that paralyzes class consciousness.’

Moreover, the document articulates “every Party cell must do interim assessment on its activity follow our Great General (Kim Jong Il)’s June 30 instruction against the enemy’s vile plan to distribute small radios and July 17 instruction against the enemy’s plot to disseminate religion to our country via balloons.”

This is the third document containing anti-religious message from North Korea since Kim Il Sung Socialist Youth League Central Committee’s anti-religious education material reported by DailyNK last October, and the lecture document on ‘fight against the enemy’s plot to spread religion inside’ released by Good Friends, a Buddhist human rights organization in Seoul, this April.

Even though it is revealed through a series of such inside documents that North Korean regime is violating religious freedom, the country has been advertising its religious freedom to the outside. Last year when the Untied States pointed out North Korea’s suppression of religion, Pyongyang promptly responded with a statement, criticizing rather the United States is the worst violator of religious freedom.

Despite North Korea’s harsh policy against religion, ‘bible distribution movement’ and ‘radio distribution movement’ by South Korean human rights organizations and missionaries are effective to some extent and North Korean regime seems on alert over those activities.

From the Joong Ang Daily:

Four South Korean Red Cross officials are expected to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said yesterday.

The Red Cross officials will depart from the port of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles in early July, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear program.

The government, however, pledged to give 241 billion won ($251 million) worth of aid through the country’s Red Cross as one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds of people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later asked Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civic groups’ efforts to help the country recover from devastating torrential rains and flooding.

The Unification Ministry has also agreed to provide funds matching amounts raised by each civic organization, expected to total some 10 billion won.

The government’s aid through the Red Cross will include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

From Yonhap:
Byun Duk-kun
8/29/2006

Four South Korean Red Cross officials are to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said Tuesday.

The Red Cross officials are to depart from a port in the country’s western city of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

“The trip is to supervise the first shipment of the Red Cross’ flood aid to North Korea,” the official said.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear ambitions.

The government, however, pledged to give 241 billion won (US$251 million) worth of aid through the country’s Red Cross in one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later requested Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civilian efforts to help the country recover from the flooding.

The Unification Ministry has also agreed to provide funds matching those raised by each civilian organization, expected to total some 10 billion won.

The government’s aid through the Red Cross is to include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

South Korea provided hundreds of thousands of tons of rice and fertilizer to the impoverished North annually since heavy rains and a nationwide famine in the mid-1990s left over 2 million North Koreans dead and millions of others displaced.

North Korea requested the South to give half a million tons of rice for the year before it launched the seven missiles into the East Sea on July 5.

Government officials say the country will not consider accepting the North’s request until the North agrees to return to the international nuclear negotiations, which have stalled since November due to Pyongyang’s boycott, as well as resumes its self-imposed moratorium on missile tests.

The Koreas remain divided along a heavily-fortified border since the end of the 1950-53 Korean War, which ended with a cease-fire.