Archive for August, 2011

DPRK-China launch minerals – for – fertilizer program

Friday, August 19th, 2011

Pictured above (Google Earth): The Musan Mine, the DPRK’s largest.  See in Google Maps here.

According to the JoongAng Daily:

During his surprise May visit to China, North Korean leader Kim Jong-il secured free fertilizer and discounted food to help alleviate the impoverished country’s chronic food shortages.

A source in Beijing who monitors North Korea-China relations told the JoongAng Ilbo on Monday that Chinese officials agreed to provide 200,000 tons of fertilizer free of charge as well as 500,000 tons of corn at a discount in exchange for rights to North Korea’s abundant natural resources.

“When 200,000 tons of fertilizer is planted on North Korean soil, it can bring about a three-fold increase in the harvest,” the source said. “This can be the equivalent of giving 600,000 tons of food.”

The source added that China agreed to sell the 500,000 tons of corn for half of the international rate, which would be $30 per ton.

The corn, the source said, had already crossed the border into North Korea from northeastern China.

In exchange, Kim will allow China access to his country’s natural resources.

“The two parties agreed to participate in the extraction of buried rare earth minerals in Musan in Hamgyong Province,” the source said. “It’s quite a profit for China as it is thirsty for materials.”

North Korea is estimated to have around 20 million tons of rare earth minerals, which are vital in the production of high-tech goods.

The Beijing-based source said the agreement gives China the responsibility for the cost of building roads to transport the natural resources as well as lending equipment.

In exchange, North Korea will hand over 50 percent of the extracted rare earth minerals free of charge to China, with the rest to be sold to China at international market rates.

Meanwhile, other sources said that Kim also received a health checkup during his stay in China.

“When Kim Jong-il was visiting Yangzhou, he received a special examination from an oriental medicine doctor that the highest Chinese elite have gone to over the years,” a source familiar with North Korean issues said

The source added: “Kim Jong-il has never trusted China’s Western medicine. I heard from a Chinese official that Kim received an oriental medicine diagnosis by taking his pulse and that it did not involve drawing blood.”

Additional Information:

1. Here is a post linking to all the major DPRK food stories this year.

2. The media has reported on other DPRK food barter deals with Cambodia and Myanmar.

3. The role of the Musan Mine in DPRK-PRC relations has been quite interesting.  Here are previous posts on the mine.

Read the full story here:
North got fertilizer on Kim’s trip to China
JoongAng Daily
Chang Se-jeong


DPRK running appx 200 foreign trade companies

Thursday, August 18th, 2011

According to Yonhap:

North Korea is running about 200 trading companies and entities to earn foreign currency, an official said Wednesday, citing a North Korean quarterly magazine.

The list was compiled after an analysis of the past five-year issues of Foreign Trade, which publicizes North Korean companies and entities in connection with the country’s foreign trade and its bid to attract foreign investment, the official said.

Still, the actual number may be smaller as North Korea could have used different names for the same companies. The North frequently changes names of its trading companies and entities to try to avoid sanctions imposed over its two nuclear tests in 2006 and 2009, according to the South Korean government.

The list includes Korea Taesong Trading, which was blacklisted last year by the United States for its involvement in the trade of weapons of mass destruction and other activities banned by U.N. resolutions.

South Korean officials said the North Korean trading companies and entities are believed to be engaged in a competition to show their allegiance to leader Kim Jong-il and his heir apparent son Kim Jong-un.

In return, the North Korean leader showers his top aides and other elites with luxury goods to win their loyalty.

I had started work on a similar project, but other things got in the way. So here is a link to my initial spreadsheet (Excel) containing a list of North Korean companies that I pulled from the pages of Foreign Trade magazine (before Naenara switched to the new servers and deleted the archive material).  The list contains company names, contact information, and descriptions. There are duplicates in the list, but since the list is alphabetized, they are easy to spot.

Read the Yonhap story here:
N. Korea runs about 200 trading entities to earn foreign currency
Kim Kwang-tae


Appx 3,000 DPRK laborers in Vladivostok

Thursday, August 18th, 2011

According ot the Choson Ilbo:

In the scorching afternoon heat last Thursday, two Asian laborers sat in front of a grocery store near a building site in Vladivostok, Russia, cooling themselves with mugs of draft beer. When asked if they were North Koreans, the men asked, “Are you from South Korea?”

One of the laborers, who was in his 40s, then said there were around 50 workers from all over North Korea, including Pyongyang and Nampo, at this particular site alone, and they can be seen at practically every construction site in Vladivostok.

The entire Siberian city has turned into a building site in preparation for the 2012 APEC Summit as roads are being widened and hotels and apartments built. The projects have created booming conditions for North Korean laborers. They can easily be spotted at practically any construction site, cheap restaurant or near housing projects. One North Korean laborer in his 50s said, “We earn US$500 a month if we work from 7 a.m. until 10 p.m. Aside from missing our families, things are not that difficult.”

There are an estimated 3,000 North Korean laborers in Vladivostok. One source there said, “In the past, most of the North Korean laborers worked at logging sites near Khabarovsk, but now most of them work at building sites here.” City officials expect around 3,000 more North Koreans to arrive.

But they are getting stripped of their hard-earned money by the regime. They are sent to Vladivostok by North Korean companies tasked with raising foreign currency and must send a set portion of their earnings back to the North. When their three- to five-year contracts expire, they return home.

One South Korean resident in Russia said, “Even in winter, when there is no work, North Korean workers are threatened by their government minders, who extort money by telling them it is up to them whether they want to stay in Russia or go back to the North and starve.”

For these laborers, money comes before loyalty to the regime. Some with more experience working abroad earn extra cash on the side by working as handymen in Russian homes after they make their payments to North Korean officials.

Recently, there have been rumors that North Korean workers are having to be especially careful. Seven North Koreans working in Vladivostok were apparently sent back to the North after they were caught watching South Korean movies on DVD. One South Korean resident in the city said, “North Korean laborers are allowed to watch porn, but they get in big trouble if they watch South Korean movies.” The resident said North Korean laborers refused to watch South Korean movies even if they are free.

“North Korean laborers send back up to $1,000 a month,” an ethnic Korean merchant in China said. “Things must be better than living in North Korea, but they don’t seem to make enough money compared to the hard work they do.” He said North Korean workers are notorious for never buying anything.

Read the full story here:
Vladivostok Teeming with N.Korean Laborers
Choson Ilbo


Inter-Korean trade volume for the first half of 2011 reached US$830 million

Wednesday, August 17th, 2011

Institute for Far Eastern Studies (IFES)

Despite the current impasse in inter-Korean relations, the trade volume in the Kaesong Industrial Complex (KIC) continues to rise, up about 20 percent against last year.

According to the ROK Ministry of Unification, the inter-Korean trade via Kaesong totaled 825.88 million USD in the first six months of 2011. In comparison to last year’s 691.09 million USD, this is a 19.5 percent increase (134.795 million USD) and a whopping 135.8 percent climb (475.64 million USD) from 2009.

The total import reached 444.98 million USD, up 36.4 percent from last year. The total export recorded 389 million USD, a slight increase of 4.3 percent.

As of June 2011, there are about 123 companies reported to be in Kaesong. A total of 560 South Korean staffs work in the KIC, 155 of which joined since June of last year. There was also a boost in the number of North Korean workers; 3,161 new workers joined the complex from the year before, making the current number of North Korean employees 47,172.

In comparison, both commercial trade including general trade (mineral and agricultural products) and noncommercial trade such as humanitarian assistance and socio-cultural exchanges dwindled 16.2 percent (161.34 million USD) from the previous year.

The figure suggests the plunge was triggered by the sanctions imposed by the South Korean government on North Korea since May 24 of last year — a response to North Korea’s deadly provocation in March 2010 — cutting off most of the humanitarian assistance and exchanges. According to the ministry of unification, before the sanctions went into effect, general trade that comprised 30 percent fell below 1 percent and humanitarian assistance became nonexistent.

According to a recent survey conducted in the complex, economic loss engendered by the May 24 sanctions are estimated to be 3.875 billion USD. Out of the 154 total economic cooperation and trade firms in Kaesong, 104 claimed to have suffered economically, totaling over 430 million USD in losses.

The survey was conducted from January 24 to March 25 with 154 firms: 79.2 percent indicated the recent sanctions have significantly impacted their businesses; 3.2 percent answered “a little” effect; none answered “no effect at all.”

Moreover, 78.6 percent responded that the sanctions led to interruption in business operations and 12.3 percent replied that the sanctions resulted in complete shutdown.

In addition, reduction of staffs was also linked to the sanctions, in which 34.4 percent reported to have downsized by 20 percent, while 26.7 percent reported 30 to 40 percent cut backs in the number of staff.


On the de-facto privatization of industry in the DPRK…

Wednesday, August 17th, 2011

Pictured above (Google Earth): A bus depot in Rakrang-guyok, Pyongyang.  See in Google Maps here.

According to the Daily NK:

Growth and improvement is evident in some areas of the private sector in North Korea, Ishimaru Jiro of ASIAPRESS revealed on the 16th, pointing to the growth of bigger, better private transit concerns and relatively productive coal mining operations as evidence of this trend.

In the past, trains were almost the only viable means of long-distance transportation in North Korea. Then, as private business began to grow and the railways fell into a deep malaise, vehicles such as trucks and cars belonging to military bases, state security and state enterprises were pushed into service to earn money for moving people; this, the so-called ‘servi-cha’ industry.

The servi-cha industry has long been fragmented and small scale; but now transportation companies run by rich individuals (‘donju’) which purchase several buses and hire drivers, guides and mechanics, are acting just as a transit company in a capitalist state would do.

With profit-sharing and bribery as the backbone, a large number of North Korean organs and enterprises have decided to lend their name to these individuals, fuelling the growth and development of a network of sorts.

“From the early 2000s, a high-speed bus network mostly between major cities began to emerge,” Ishimaru, revealing the latest research by ASIAPRESS internal North Korean sources, commented. “The companies are packaged as an enterprise affiliated to some state authority outwardly, but they are actually operated by individuals who pay kickbacks to that authority.”

The People’s Safety Ministry affiliated 116 Task Force Team is one such transportation company, Ishimaru says. It operates buses connecting Shinuiju, South Pyongan Province and Pyongyang. Ordinarily, the bus parks at a station or major public location, and then departs when it is full of passengers going to the next destination.

Here are previous posts on the servi-cha industry.

Read the full sotry here:
Green Shoots of Private Enterprise Growth
Daily NK


Charity aims to feed DPRK children

Wednesday, August 17th, 2011

Pictured Above: Love North Korean Children Bakery (Sonbong, DPRK)

According to the Korea Herald:

When Seoul votes on whether to provide free lunches for school kids here on Aug. 24, many of the 50,000 children living in the North Korean city of Sariwon will likely be skipping their midday meal.

That’s what they are obliged to do most days, says George Rhee, the South Korean minister trying to raise 500 million won ($466,500) to feed them. Rhee, whose father fled the North during the Korean War, already runs three bakeries in the impoverished country, feeding 10,000 children a day through his charity Love for North Korean Children (LINK).

“I have thought of my family in North Korea so many times,” said Rhee, who is now a minister for a South Korean church in London.

“When I got British citizenship in 2002, I visited North Korea for the first time. It was very shocking. There were many children around me begging uncle, uncle give me some food. I am so hungry. I was thinking ‘how can I help such poor children?’

“First of all I was thinking of building an orphanage in North Korea but they said that there are no orphans there because Kim Il-sung is the father of all the children. They disagreed with an orphanage but they suggested a bakery.”

The traditional steamed wheat flour rolls now made at Rhee’s three successful bread factories, located in Pyongyang, Ranjin and Hyangsan, are a perfect product to feed children in a country where even food aid is often suspected to be misappropriated.

“The bread has a very short shelf life compared to baked rolls so they have to be eaten straight away. They cannot be stored and sold on,” he said.

“I have been to North Korea many times and I know that the bread in my bakeries is going straight to the children’s mouths at lunchtimes. I am very proud of that fact.”

On his last trip to the North in June, Rhee visited Sariwon city, around 100 kilometers south of Pyongyang, to view a disused building he wants to turn into his next bread-making project.

The communist country’s Korea Education Fund, called a “non-profit non-governmental funding association” by officials there, has asked Rhee to open the bakery in the city of 200,000 people in Hwanghaebuk Province, requesting a facility big enough to feed all 50,000 children living there.

While he cannot foresee producing so much bread in the near future, he does think he could supply materials for a 250 million won project to transform the derelict site. His charity would then raise 250 million won a year to provide flour to make the 5,000 rolls a day, providing a school meal for all children aged four to seven there.

“We are trying to help them develop the food infrastructure in these small communities. They don’t have anything to feed their ordinary children. We are trying to help them,” said Rhee.

“We can use this 60-year-old building that was used to provide some sweets and milk for children until about 10 years ago, but that work has been stopped now. They are using old buildings for a lot of different purposes, for example they are trying to extract sugar from seaweed they are doing a lot of different things.

“They wanted our ministry to be able to establish a bakery providing their own people with work and help their economy.”

As with the other bakeries LINK has already established in the country, the facility would have flour delivered from China and employ around 15 local staff.

International sponsorship manager Dr. Shirley Vander Schaaf said: “In a lot of ways it is very good because they are trying to decentralize the distribution of food, bringing it down to a community level.

“This would be a change from having it administered from Pyongyang. They seem to be putting the ownership and responsibility back into the communities, which makes sense. They are utilizing the funding and their resources from the NGOS to help them do this.”

The charity which has been registered in the U.K. since 2003 and in Korea since 2006 already has many regular international donors, but is far short of its 500 million won fundraising target to get Rhee’s Sariwon project off the ground and running for one year.

The charity is hoping to hold an 80 km bikeathon from Seoul to the DMZ in October and is asking anyone who is interested in taking part and raising sponsorship to get in touch.

“I think there are a lot of foreigners here who want to do something to help North Korea but don’t know what to do. If they come to us with ideas for fund raising we can work with them to get their ideas off the ground,” Vander Schaaf said.

She is looking to create a fundraising team to help the charity meet its goal to eventually open a bakery in every province in North Korea, making sure fewer children there will have to go without lunch each day.

Michael Rank wrote a story about the Love North Korean Children Bakery in Rason.  See it here.


DPRK art merchant arrested in ROK

Wednesday, August 17th, 2011

Pictured above (Google Earth): The Mansudae Art Studio in Pyongyang. The blue roofs indicate that most of the buildings have recently been renovated. See the studio in Google Maps here.

According to Yonhap:

Seoul police said Wednesday that they have booked an ethnic Korean woman from China for allegedly smuggling North Korean paintings into South Korea, selling them to local consumers and sending some of the profits to the North.

The 46-year-old woman, surnamed Kim, was accused of bringing in about 1,300 paintings by some well-known North Korean artists in violation of a law regulating the flow of goods between the two Koreas, the Seoul Metropolitan Police Agency said.

Police also booked three others for allegedly helping Kim peddle the smuggled artworks.

Kim is suspected of smuggling in 1,308 artworks, mostly landscape paintings created by North Korean artists, between May last year and July this year, and pocketing 30 million won (US$27,943) after selling 1,139 of them to local galleries and over the Internet, police said.

Police said the North Korean artists include some famous names who were authorized by the Pyongyang regime and affiliated with the communist country’s top-notch Mansudae art community widely known to be peddling artwork overseas as a means of earning foreign currency.

Kim is believed to have obtained those paintings through her North Korean husband living in China who uses his membership in an expatriates’ support committee in North Korea to secure his supply, police said.

Kim’s husband is believed to have clinched the supply of artwork on the condition that he pays $8,000 won annually on top of half the sales proceeds to the art community, according to the police.

“It is the first case ever to confirm that North Korea is selling (artwork) abroad through the committee,” a police official said.

Police said that the artwork, smuggled personally or through international mail, was mostly sold to art galleries in Incheon, Daejeon and Gwangju for prices ranging from 30,000 won to 1 million won per unit.

Police said they plan to expand the investigation as more North Korean goods could be smuggled into the country.

The Atlantic also has a good blog post on the whole saga.


Canada tightens sanctions on DPRK

Tuesday, August 16th, 2011

According to the Vancouver Sun:

Canada has tightened sanctions against North Korea to punish the secretive Asian nation for “aggressive actions” such as the sinking of a South Korean corvette, the foreign ministry said on Monday.

Canada will ban all exports, imports and new investment as well as outlawing the provision of financial services and technical data to North Korea. Humanitarian efforts and the supply of food and medical supplies are not included.

The sanctions are largely symbolic since bilateral trade last year was just C$12.4 million ($12.7 million), according to Statistics Canada data.

No doubt CanKor will have more to say on this in the near future.

Read the full story here:
Canada tightens sanctions against North Korea
Vancouver Sun


Dutch stamp dealer back home after arrest in North Korea

Tuesday, August 16th, 2011

By Michael Rank

No money was paid for the freeing of a Dutch stamp dealer who went missing in North Korea and is now back home after signing a confession, a local radio and television station reports (in Dutch).

RTV Utrecht said Willem van der Bijl had spent two weeks in solitary confinement in North Korea and that officials had closely examined his laptop and had detailed records of his previous visits to the country.

According to a purported interview van der Bijl gave to the Pyongyang Times before his arrest, this was his 24th visit to North Korea. He visited a polling station during last month’s elections and was quoted as saying, “Looking round the poll, I have been greatly impressed by the free and democratic elections and I have had a better understanding of the DPRK’s reality.

“In the DPRK every citizen is eligible to vote and to be elected. Those who have worked a lot for the people are elected as deputies.

“The popular election system of the DPRK is really excellent.”

Surprisingly, van der Bijl is shown wearing a Kim badge in a photograph of him on the Pyongyang Times website. It’s rare for foreigners to be given a Kim badge and still rarer for them to be shown wearing one in the official North Korean media. It’s not clear where the photo was taken.

It isn’t entirely clear why he was arrested but part of the problem at least was that some of the photographs he had taken were deemed “dangerous and inappropriate,” Coen de Keuster, a friend of van der Bijl, told RTV Utrecht.

Two North Korean contacts of van der Bijl remain missing and are believed to remain in custody. The two North Koreans are said to have worked for him from an office in the city of Pyongsong [Pyeongseong], which is about 30 km northeast of Pyongyang, and has, or had, the country’s largest wholesale market. The market is reported to have been closed in 2009 but the closure could have been only partial. It is possible van der Bijl bought, or hoped to buy, stamps or other items in the market. He apparently also collects North Korean propaganda posters. Markets are highly sensitive in North Korea and foreigners are generally banned from visiting them.

On his website van der Bijl, who is from Utrecht, says he is “#1 in the World for North Korean stamps. Proofs, Postal stationary,Artwork and anything else you might think of !!”

RTV Utrecht said van der Bijl, 59, was not speaking to the media for fear of further jeopardising his North Korean contacts. There was no reply when NKEW tried to phone him, and a Dutch foreign ministry spokesman declined to answer questions about the case, confirming only that the stamp dealer had returned home.

The Dutchman was supposed to return home on July 30 and his family and friends raised the alarm when he did not arrive. He finally arrived back in Utrecht last Saturday.

In his Pyongyang Times interview he was quoted as saying, “I will come to the DPRK in 2012 to join the Korean people commemorating the hundredth anniversary of the birth of President Kim Il Sung”, but it’s not clear whether he still wants to go back or whether he would still be welcome in North Korea.


Moran Market video footage

Monday, August 15th, 2011

Stephan Haggard posted a link to (and translation of) some clandestine video footage shot in Pyongyang’s Moran Market (모란시장) and broadcast on KBS. I don’t have much to add except a satellite image of the area where the video was shot.  It matches the video!

Pictured Above (Google Earth: 39.043922°, 125.747335°) is the Moran Market. See it in Google Maps here.