Archive for December, 2006

Ryongnam Ship Repair Factory Expanded

Friday, December 29th, 2006


The Ryongnam Ship Repair Factory of the Democratic People’s Republic of Korea has been reconstructed on an expansion basis. The factory successfully constructed a large dock, three wharves to repair big cargo ships, a combined repair workshop, an acetylene generating workshop, oxygen generating workshop, a heavy oil power plant, a wind and solar power station over the last four years.

The newly built Dock No. 2 can repair several ships of tens of thousands of tons simultaneously.

The repair processes are automatized and controlled by computer. There are in the dock a horizontal jib crane, gantry crane and general control room. It is divided into the main sluice, operated by computer, and the middle one.

The combined repair workshop which covers the floor space of over 17,000 square meters specializes in making ship-body pipes while repairing propellers and power system.

The acetylene generating workshop does not produce any industrial spent water.

The wind and solar power station turns out stabilized electricity for the general control room, dwelling houses and cultural welfare facilities. Its expansion on a modern basis has consolidated the material and technical foundation for developing water transport.


Inter-Korean Projects Gasping for Air

Friday, December 29th, 2006

Korea Times
Kim Yon-se

Hyundai Group is struggling to normalize its inter-Korean businesses, including tours to Mt. Kumgang and operation of the Kaesong Industrial Complex in North Korea.

Due mainly to North Korea’s nuclear test last October, the number of South Korean tourists to Mt. Kumgang stood at less than 250,000 this year, falling short of the group’s initial goal of 400,000.

The figure is smaller than 301,822 posted in 2005 and 272,820 posted in 2004.

Furthermore, Hyundai Asan, the tourism unit of the group, had to conduct manpower restructuring and delayed monthly payments to some employees amid worsened profitability this year.

The Mt. Kumgang tours accounts for about 70 percent of the total sales of Hyundai Asan and the company expects it will manage to avoid seeing operating losses, compared with operating profits of 5.6 billion won last year.

Amid political factors, such as complaints from the United States about the inter-Korean business, company officials are concerned that Hyundai Asan is facing another deficit.

It reported operating losses of 10 billion won or more per annum over the past few years _ 29.04 billion in losses in 2001, 38.54 billion won in 2002, 57.34 billion won in 2003 and 10 billion won in 2004.

Regarding the Kaesong Industrial Complex, the U.S. had speculated that payments to North Korean employees there are flowing into military funds to produce weapons. But the allegations have been said to be groundless after the Ministry of Unification made public relevant documents.

A major difficulty is that the South’s conglomerates including Samsung have little willingness to invest in the complex amid the growing uncertainties.

Expressing anxiety over external and internal difficulties, a Hyundai Group official said, “We don’t care about interference from the U.S. The development of inter-Korean businesses and relations are assignments for Koreans in the South and North. No group except us will do that.’’

In the free trade agreement (FTA) talks between South Korea and the U.S., the latter said it will not regard goods from Kaesong as free trade deal items.


How to Grease a Palm

Friday, December 29th, 2006

Although not related directly to North Korea, The Economist has published a great article on the etiquette of bribery, which ties together low-level “rent-seeking” with big-dollar Washington lobbying.  Although the entire article is well worth reading, the excert below is the one I wanted to post for readers of NKeconWatch:

Jakob Svensson, an economist at Stockholm University, has cut through cultural stereotypes to search for hard data on corrupt economies. He has found that socialist and recently socialist economies show higher levels of corruption than others. Among the factors he has tested for correlation with corruption is the overall education level of the adult population. A second is openness to imports (measured by imports as a proportion of GDP), which is linked with opportunities for smuggling. A third is freedom of the press (as ranked by Freedom House, a civil-liberties watchdog), on the hypothesis that independent journalists will expose, and thereby curtail, corruption. The fourth is the number of days needed to start a business, a proxy for the number of permits required, and therefore red tape. Mr Svensson found clear correlations between all these variables and the overall level of corruption.

Read the entire article below:



More Stock-breeding Farms Built

Thursday, December 28th, 2006


A lot of stock-breeding bases have been built or reconstructed on an expansion basis in the Democratic People’s Republic of Korea this year,the 60th birthday of the Workers’ Party of Korea. Servicepersons constructed Duck Farm No.115 in a stony area in a little over one year. It, with a total floor space of more than 50,000 square meters, is equipped with modern facilities.

Working people of South Hamgyong Province automatized and computerized all the production processes of the Kwangpho Duck Farm and put the production structures on a scientific and technical basis, thus converting it into a poultry production base with a production capacity of thousands of tons. Korean Working people reconstructed the Pukchang Duck Farm and Kusong Chicken Farm on a modern line and completed the third stage of expansion project of the Kyenam Stock-breeding Farm with a firm resolve to build a great prosperous powerful nation.

The first stage projects for modernization of the Kanggye and Sinuiju Duck Farms were carried out successfully and a number of other stock-breeding centers reconstructed or built to meet the demand of the new century.

As a result, the stock-breeding of the country has been put on more solid material and technical level based on latest science and technology.


North funding pared in 2007 national budget

Thursday, December 28th, 2006

Joong ang Daily
Moon So-young

…[edited]…President Roh Moo-hyun’s Uri Party and the Grand National Party agreed to cut the budgets for inter-Korean cooperation projects…

The North-South cooperation fund, one of the latter budget items, was perhaps the hottest of the hot issues. The Assembly agreed to allocate 500 billion won for that fund, down 150 billion won from the government’s proposal.

The Grand Nationals had demanded that spending be cut by at least 300 billion won, citing North Korea’s nuclear test in October. The Uri Party refused to cut more than 100 billion won. Mainly because of that fight, the budget approval had been delayed from its mandated deadline of Dec 2. Last year, Seoul allocated 650 billion won for the North-South fund, the same amount as the 2007 request.


N. Korea marks Mozart’s 250th birthday

Thursday, December 28th, 2006


Staunchly communist North Korea has made a rare embrace of Western culture recently by staging a Mozart concert in its capital Pyongyang.

“A concert was given at the Moranbong Theatre here to mark the 250th birth anniversary of (Wolfgang Amadeus) Mozart,” said the (North) Korean Central News Agency, monitored here.

“Put on the stage were the orchestra of “The Marriage of Figaro” piano concerto No. 23 and other music pieces of Mozart, who composed dozens of operas and symphonies and many other instrumental music and vocal songs, contributing to the development of Western music in the second half of the 18th century.”

The concert was performed by the communist country’s State Symphony Orchestra, the agency said.

“The orchestra successfully presented the peculiar attraction and diverse emotion of music pieces of Mozart through exquisite rendition and truthful representation,” the agency reported.


Hidden Side of North Korea Unleashed

Thursday, December 28th, 2006


The North Korean Regime Stability Assessment by the government-run Korea Institute for National Unification has revealed many unknown parts about North Korean society. In particular, the details of in-depth interviews of 12 North Korean defectors who held a high-ranking position in the North help us understand why the North Korean society is fundamentally shaken.

All the former top North Korean officials unanimously say that nothing is possible without paying kickbacks in the bureaucratic regime of the Stalinist country.

“It is linked like a chain because lower ranking officials give bribes to their immediate superiors and the superiors give bribes to their immediate senior officers and so on,” said a North Korean defector who asked to be identified only as K.

Bribing has become such a prevalent practice in the North that sometimes there are official price tags for some bribes. “People give about $ 10,000 of congratulatory money when they come to a wedding of a high ranking official’s child. But it could be $5,000 or $ 3,000 in some cases,” a North Korean defector who asked to be identified only as J said. “ In North Korea, prices are set on certain types of bribes as bribing has become established as part of its market. For instance, there is a certain amount required either to send their children overseas or to become a college professor,” said another North Korean defector who asked to be identified only as L.

The National Security Agency (NSA) and the People`s Safety Agency (PSA), the two major national security bodies of North Korea whose role is controlling the people, reportedly have serious conflicts with each other. “The officials of the two institutions are treated differently. As the staff of the NSA has stronger influence and earns more than the staff of the PSA, the officials of the PSA are not content,”

Although people may think that military officials enjoy the greatest power under North Korea’s military first politics, in reality, party officials have a stronger power than military officials, according to former North Korean high-ranking officials. “The party has a complete control over the personnel management of the military. Even North Korean leader Kim Jong Il said that the military is supervised by the party,” North Korean defectors K an L said.

Some of the defectors said that Kim Jung Il is less popular among women compared to his late father Kim Il Sung because he is short, ugly and has a big belly.

Some also said the Korean Wave is sweeping across North Korea as well. “Those who secretly watch South Korean videos used to be punished. But it is not the case any more. Only those who distribute them are punished and even security agents secretly watch those videos they confiscate,” said a North Korean defector who asked to be identified only as C.

A North Korean defector also said that women in their 20s and 30s earn about five dollars by prostituting. “Life in North Korea is less stressful as everyone is poor. So there are less bald people,” the defector said.


Light Industrial Factories Updated

Wednesday, December 27th, 2006


Efforts have been made to renovate light industrial factories for the betterment of the people’s living standard in the Democratic People’s Republic of Korea. Investment and scientific and technical forces have been concentrated on these projects, with the result that many successes have been scored in this field this year.

A new modern knitting yarn workshop with production capacity 4 times that of the existing one was commissioned at the Pyongyang Textile Mill. And the Songyo Knitting Factory had its production processes reinforced with more than 200 knitting machines. It makes it possible to mass-produce quality knitting yarn and fabrics with colorful patterns.

The Pyongyang Textile Machine Factory has renovated the flexible loom production base, thus opening a prospect to manufacture flexible looms on an assembly-line.

The Pyongyang Korean Clothes Factory has built an embroidering process controlled by computer to beautifully decorate silk fabrics woven by the Pakchon and Nyongbyon Silk Mills to meet women’s taste.

Renovation projects have been carried out in the local industrial field. Essential foodstuff factories including the Kaechon and Rason Essential Foodstuff Factories were built or reconstructed on a modern basis in over 30 cities and counties. They are producing tasty soy and bean paste and other nutritious essential foodstuffs.

Bean-milk production bases with a production capacity of several thousand tons have been built in all provinces to supply bean milk and bean sour milk regularly to the children. Among the newly built factories and workshops are the Sinuiju Bean-milk Factory and the bean milk workshop of the Hamhung Essential Foodstuff Factory.


Graphite mine in North open in ’07

Wednesday, December 27th, 2006

Joong Ang Daily
Jung Ha-won

In early 2007 South Korea is expected to begin its first graphite shipments from a new mine in North Korea that has been co-developed by the two countries since 2003.

The mine development project in Jeongchon, which cost $10.2 million, was completed in April, but electricity shortages and diplomatic tension over North Korea’s nuclear test delayed testing operations for months.

According to Korea Resources Corp., South Korea’s state-run mineral developer that took part in the project, the new mine, located near the western part of the border with South Korea, recently began test operations, and graphite shipments will begin early next year.

“North Korea authorities recently guaranteed a stable supply of electricity,” said an official with Korea Resources.

The mine is expected to produce about 3,000 tons of graphite a year, and Korea Resources Corp. plans to bring about 1,830 tons of graphite, or 20 percent of annual production, to South Korea each year for next the 15 years. The firm is also involved in an iron ore mine development project in the North’s Deokhyun, North Pyeongan province.

North Korea is known to have more than 200 varieties of minerals worth about 2.2 quadrillion won ($2.4 trillion) still unexplored in its mountainous areas. Chinese companies have wasted no time exploring those resources, with the North Korean government thirsty for cash and outside investment. China’s state-run steelmaker, Tonghua Iron and Steel Group, last year was granted rights to develop the Musan iron ore deposit in North Korea, the largest open-air iron mine in Asia, for the next 50 years. North Korea also granted exploration rights for more than 10 mines to China’s Wookwang Group and other Chinese developers.

South Korea has been sluggish by comparison, due to political issues and a lack of infrastructure, such as roads and electricity. There remain untapped resources in the reclusive North.

“There is a wealth of magnesite buried in the Dancheon area,” said the Korea Resources Corp. official. “We will carefully review the plan to explore the area.”


N.K. leader calls for more imports

Wednesday, December 27th, 2006

Wow…if this is true it means that Kim Jong Il has learned the failure of import substitution policies and the value of comparative advantage.  Now if we could just convince the rest of the world’sleaders…

Korea Herald
Kim Ji-hyun

North Korea’s reclusive leader, Kim Jong-il, has ordered his communist government to open up to more imported goods that cannot be produced domestically, sources said yesterday.

Kim said that for the sake of economic efficiency, it is “necessary to import more of the goods that are too costly to be manufactured domestically.” The comments were included in this year’s fall issue of a scholastic gazette published by Kim Il-sung University, the only comprehensive university in the country.

Underscoring Kim’s words, the gazette said “reforming the light-industry market is essential to stay in sync with changing internal and external conditions.” The products the North hopes to import consist mostly of those manufactured by the light-industry sector.

Underwear was cited as an example of a commodity that should be imported.

The paper also said North Korea must try to manufacture and export more value-added products such as silk and ginseng goods.

To finance the higher import demand, the paper kept in line with Kim’s logic calling for North Korea to exchange its natural resources for raw materials needed to manufacture value-added goods it would sell.

The proceeds can then be used to purchase foreign goods, the paper said.