Archive for March, 2016

Nw York Times reports on sanctions enforcement, at Sino-DPRK border

Thursday, March 31st, 2016

By Benjamin Katzeff Silberstein

Just as before, China’s controls over goods flowing across the border with North Korea is spotty at best. According to a New York Times dispatch from the border, Chinese customs authorities only control a small percentage of the goods (particularly relevant parts in bold):

If recent trade here is any indication, that cooperation has been spotty at best.

Cross-border trade, legal and illegal, flows pretty much as usual, and seems to be largely unhindered by the new rules, traders and local officials said.

One of the toughest components, a requirement that countries inspect all cargo entering or leaving North Korea for banned goods, is not enforced here.

On many days, Mr. Qin’s secondhand taxis cross the bridge in a convoy of more than 100 vehicles, including trucks loaded with containers draped in shabby tarpaulins and secondhand minibuses for North Korea’s rickety transportation system. Few are ever inspected by the Chinese authorities.

China accounts for about 90 percent of North Korea’s trade. Half of that business is estimated to flow through Dandong, a boom-and-bust city whose fortunes are tied to trade with North Korea.

Virtually everything that keeps the North Korean economy afloat passes through here: Coal and iron ore come in, violating the sanctions, and crude oil flows out, exempted from them.

Smuggling is rampant. The export of North Korean rare earth minerals and gold, banned under the new rule, is one of the more lucrative revenue sources for the North Korean government, traders said. That business continues on privately owned 200-ton ships belonging to Chinese smugglers based here, they said.

The United Nations rules put the onus on customs inspectors here to judge which goods may help the nuclear program or the military, which are banned, and which are intended for civilians, which are allowed.

On a recent day, the customs checkpoint, a large outdoor parking area adjacent to the bridge, held a collection of China’s castoffs: cheap four-wheel-drive Haval passenger vehicles, discount medicines for hepatitis and tuberculosis, old solar panels to brighten dark houses.

But the customs office here lacks the staff to open all the containers, a local government official said. Like most people interviewed for this article, he spoke on condition of anonymity since there are risks to speaking candidly to foreign media about trade with North Korea.

At peak times, up to 200 trucks a day cross the Yalu River to Sinuiju, North Korea. Before departing, only about 5 percent of the containers they carry are inspected, the official said.

[…]

Virtually everything that keeps the North Korean economy afloat passes through here: Coal and iron ore come in, violating the sanctions, and crude oil flows out, exempted from them.

Smuggling is rampant. The export of North Korean rare earth minerals and gold, banned under the new rule, is one of the more lucrative revenue sources for the North Korean government, traders said. That business continues on privately owned 200-ton ships belonging to Chinese smugglers based here, they said.

The United Nations rules put the onus on customs inspectors here to judge which goods may help the nuclear program or the military, which are banned, and which are intended for civilians, which are allowed.

On a recent day, the customs checkpoint, a large outdoor parking area adjacent to the bridge, held a collection of China’s castoffs: cheap four-wheel-drive Haval passenger vehicles, discount medicines for hepatitis and tuberculosis, old solar panels to brighten dark houses.

But the customs office here lacks the staff to open all the containers, a local government official said. Like most people interviewed for this article, he spoke on condition of anonymity since there are risks to speaking candidly to foreign media about trade with North Korea.

At peak times, up to 200 trucks a day cross the Yalu River to Sinuiju, North Korea. Before departing, only about 5 percent of the containers they carry are inspected, the official said.

[…]

There is, however, evidence of some enforcement in one important area: North Korea’s sale of coal and iron ore, two of its most important exports.

Port authorities here have been fairly vigilant in enforcing the new ban on North Korea’s ragged fleet of more than two dozen cargo ships, two local officials said. The coal they carry earns North Korea as much as $1 billion a year, according to the United States Treasury.

But that ban has been circumvented by smuggling ships and by the transfer of 12 North Korean ships to Chinese ownership, allowing them to dock at Chinese and other ports, a longtime trader, Mr. Yu, said.

A few traders interviewed here said the new rules had crimped their business.

Mr. Zhang, a trader who does tens of millions of dollars a year in business with North Korea, said customs officials had just impounded a big secondhand excavator he had bought from a coal mine in Shanxi Province and sold to a North Korean coal mine for more than $60,000.

Customs inspectors asked how he knew the equipment would not be transferred to the North Korean military. “We didn’t know how to answer,” he said.

But traders and officials expect that after some initial minor squeezing, whatever enforcement there is will be relaxed. Liaoning Province, where Dandong is a prominent city, ranked at the bottom of China’s 31 provinces for economic growth last year, and there was political pressure not to weaken the economy further.

Full article here:

A Hole in North Korean Sanctions Big Enough for Coal, Oil and Used Pianos

Jane Perlez and Yufang Huang

New York Times

03/01/2016

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9th Plenary Meeting of 13th SPA Presidium Held

Wednesday, March 30th, 2016

According to KCNA (2016-3-30):

The 9th plenary meeting of the 13th Presidium of the Supreme People’s Assembly (SPA) of the DPRK took place at the Mansudae Assembly Hall Wednesday.

The plenary meeting was attended by members of the SPA Presidium.

Officials concerned were present there as observers.

Discussed at the meeting were review of the implementation of the state budget for Juche 104 (2015) of the DPRK and the state budget for Juche 105 (2016).

A report was made at the meeting.

According to the report, the state budget for last year was correctly carried out.

The plan for state budgetary revenue was over-fulfilled 1.3 percent or an increase of 5 percent over the previous year.

The plan for local budgetary revenue was fulfilled at 113.8 percent while that for state budgetary expenditure was carried out at 99.9 percent.

15.9 percent of the total expenditure was allocated for national defence while 47.5 percent for building an economic power and the improvement of the standard of people’s living.

Investment in the fields of science and technology showed a 4.7 percent increase over that last year.

36.6 percent of the total expenditure was earmarked for cultural construction including education, public health, sports and literature and arts.

The state budgetary revenue for this year is expected to go up 4.1 percent out of which transaction revenue will hold 3.3 percent, the revenue from the profits of state enterprises 4.5 percent, the revenue from the profits of cooperative enterprises 1.5 percent, that from real estate rent 4 percent, that from social insurance 1.1 percent, that from the sale of properties and price difference 2.5 percent and other revenue 1.3 percent. The revenue from economic trade zone is expected to grow 4.1 percent.

Out of the state budgetary revenue the national budgetary revenue will account for 76.8 percent while that from local areas 23.2 percent.

The state budgetary expenditure is expected to go up 5.6 percent over last year out of which 4.8 percent will go to industries, 4.3 percent to agriculture, 6.9 percent to fisheries, 13.7 percent to capital construction and 7.5 percent to forestry.

It was decided to increase expenditure in the field of science and technology 5.2 percent, the field of education 8.1 percent, the field of public health 3.8 percent, the field of sports 4.1 percent and the field of culture 7.4 percent.

15.8 percent of the total expenditure will be spent for national defence.

A large amount of educational aid fund and stipends will be sent for the education of Korean children in Japan.

A decision of the Presidium of the SPA “On approving the review of the fulfillment of the Juche 104 (2015) state budget of the DPRK” and a decree of the Presidium of the SPA “On the Juche 105 (2016) state budget of the DPRK” were adopted at the meeting.

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More Friday Fun: Only in North Korea…

Friday, March 25th, 2016

ITEM 1: The PATENTED “Ostar Blood Purifying Health Watch”

Ostar-Blood-watch-2016-3

I don’t buy any watch that does not purify my blood. It is the second most important attribute after accurately telling the time. Who knew that wearing more gaudy jewelry would actually improve your health?!

ITEM 2:  North Korean magicians make handicapped children disappear!

The North Korean Disabled Arts Association put on an impressive performance of music, dancing, and magic. This video marks the first time I had heard of the group or seen its impressive performances. However, I did have to groan, when at the 15:51 mark the North Korean magician put a handicapped girl (in a wheelchair) into a large box only to make her disappear. This is creepy because for much of its history, North Korea has not treated the disabled well (to put it mildly). It’s as if North Korean magicians are carrying out the national policy right there on stage. By the time the “Snow White and the Seven Dwarfs” performance begins at the 37:40 mark, I thought, “Are there any little people left in Pyongyang?” We know from declassified documents and other sources that they were deported from Pyongyang, and probably sterilized, from very early in the nation’s history.

Still, perhaps the creation of this group, and the public airing of its performances, indicate that a new and more inclusive era has arrived in DPRK society. This may be one of the ways that foreign NGOs have changed North Korean social norms for the better.

ITEM 3: The more things change, the more they stay the same. Kim Jong-un’s 3-D cinema glasses immortalized for posterity.  Another great use of state resources…

KJU-3-D-Glasses

Here is the source.

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Deforestation in North Korea continues, new data shows

Thursday, March 24th, 2016

By Benjamin Katzeff Silberstein

Yesterday I stumbled upon a nice interactive World Bank data map that shows where forests have been lost and gained since the 1990s. Forestry is one of those rare areas where fairly extensive data exists for North Korea. Of course, all data has its faults and flaws, and figures on North Korea should always be taken with a grain of salt. But even if the figures aren’t fully correct to the last decimal, they show an interesting trend.

The World Bank World Development Indicators figures seem to be coming from the Forest and Agriculture Organization (FAO)’s Global Forest Resource Assessment, and their latest study of global forestry assets was done just last year (2015). Using these figures, I created a graph showing North Korea’s forestry area (in blue), using South Korea as a baseline comparison.

forestry DPRK ROK smaller

Data source: World Bank World Development Indicators. Graph created by Benjamin Katzeff Silberstein.

Deforestation is far from a new problem in North Korea. What’s interesting is that it appears to continue without signs of abating.

This data stretches all the way to 2015. According to one estimate, North Korean forests shrank by about 17 percent between 1970 and 1990. By the end of 2008, the United Nations estimated that around one third of all forests had been lost in North Korea. If the World Bank data is accurate, it suggests that this trend has continued exponentially, and that the situation has continued to worsen. According to the World Bank data, North Korea lost almost 40 percent of its forests between 1990 and 2015.

As this blog has laid out before, the cycle of problems is well known: people essentially cut down trees as a form of coping behavior in the face of resource scarcity, in order to clear areas for farmland, and to use wood as an energy source. When the annual torrential rains sweep over the Korean peninsula, the lack of trees contributes to soil erosion, spoiling harvests and causing devastation. Kim Jong-un highlighted forestry as an important policy area in 2015. The priority makes a lot of sense, but so far, the solutions don’t seem all that promising.

North Korea celebrated a “Tree Planting Day” about three weeks ago, and the Russian embassy in Pyongyang participated in the celebrations. Their pictures (see this link for their Facebook album) give an interesting snapshot of how it might look across the country as the regime’s tree planting drive unfolds:

A North Korean forestry official (?) giving instructions about tree planting. Photo credits: Russian embassy in Pyongyang.

A North Korean forestry official (?) giving instructions about tree planting. Photo credits: Russian embassy in Pyongyang.

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The Russian ambassador and a young North Korean planting a tree together. Photo credits: Russian embassy in Pyongyang.

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Young North Korean men in Red Cross (적십자) vests lining up for tree planting. Photo credits: Russian embassy in Pyongyang.

 

 

 

 

 

 

 

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Young North Koreans listening to tree planting instructions. Photo credits: Russian embassy in Pyongyang.

 

 

 

 

 

 

 

 

Instructions for how to plant and tend to trees. Photo credits: Russian embassy in Pyongyang.

Instructions for how to plant and tend to trees. Photo credits: Russian embassy in Pyongyang.

 

 

 

 

 

 

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North Korean market condition since new international sanctions

Wednesday, March 23rd, 2016

Institute for Far Eastern Studies (IFES)

It has been almost two weeks since the enforcement of new sanctions imposed by the United Nations Security Council (UNSC), and so far North Korea’s domestic economy seems calm. Following the sanctions, North Korea has been preparing for the 7th Party Congress in May with its 70-day campaign (or ‘speed battle’). In order for the people to focus on the preparation, the government has reduced the business hours of markets and has begun controlling the street markets (i.e., ‘grasshopper’ markets).

In particular, it was expected that the sanctions would reduce the inflow of goods into the country which would then lead to a rapid rise in market prices and exchange rates, but so far the market prices appear to have remained relatively stable. According to the Daily NK, a South Korean online newspaper reporting on North Korea, 1kg of rice is selling for 5,100 KPW, 5,150 KPW, and 5,080 KPW in Pyongyang, Sinuiju, and Hyesan, respectively. These prices are relatively similar to the prices prior to when the sanctions were in full effect (i.e., 5,100 KPW in Pyongyang and Sinuiju, and 5,260 KPW in Hyesan).

The exchange rate appears no different. One US dollar exchanges for 8,150 KPW in Pyongyang, 8,200 KPW in Sinuiju, and 8,170 KPW in Hyesan. The rate has been only slightly reduced compared to the rate prior to when the sanctions were put in place (i.e., 8,200 KPW in Pyongyang, and 8,290 KPW in Sinuiju, and Hyesan).

The reason for the stability in the market and the exchange rate is because even though the market hours have been reduced due to the 70-day campaign, the markets actually are running better than before and in some regions the price has gone down for some goods, presumably because some of these items that were exported in large scale via China have been circulated in the North Korean domestic market.

Also, aside from the underground resources (i.e., minerals) — the sanctioned items that used to account for most of the exports — other goods are still sold accordingly, which helps in stabilizing the market. Furthermore, the improvement of the domestic market cannot be taken lightly when considering the stability of the markets. In other words, unless markets are completely closed, people in North Korea wouldn’t consider it an issue.

Meanwhile, despite the international community’s sanctions against the country, including that of the UN Security Council, North Korea is claiming overproduction in areas such as electrical power and minerals in the run-up to the Seventh Party Congress in May. The North Korean propaganda media ‘DPRK Today’ has mentioned about production and the country’s success in confronting the imposed sanctions.

More specifically, since the initiation of the 70-day campaign last month (February 23rd), in order to boost economic success, Namhung Youth Chemical Complex has reportedly turned out 60% more fertilizer; Pyongyang Railway Bureau increased the traffic by 40%; Ryongyang Mine increased its production of magnesite by 20%; and 2.8 Jiktong Youth Coal Mine produced 7,200t beyond its quota. In addition, Kim Jong Suk Textile Mill reportedly has seen more than 40 labors complete the plan for the first half of the year, while Baekdu Hero’s Youth Power Plant has reached 37,000m2 in dam construction. Previously on March 3rd, the Korean Central Broadcasting radio reported that many of the production targets for February in the national economy have been surpassed.

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Chinese local governments formally notified of sanctions against North Korea

Monday, March 21st, 2016

By Benjamin Katzeff Silberstein

I’m not sure if this is anything out of the ordinary or if this is the formal routine every time sanctions have been passed. Nevertheless, it’s an interesting development. If sanctions against North Korea are ever to hit the economy where it hurts, Chinese local governments are perhaps the most important implementers since much (or most) of North Korea’s external trade occurs with them. Korea Herald:

China has notified its local governments on how to implement new U.N. sanctions on North Korea, including specific measures on imports from North Korea, a diplomatic source with knowledge of the matter said Monday.

Kim Hong-kyun, South Korea’s chief nuclear envoy, held talks with his Chinese counterpart, Wu Dawei, last Friday as the two nations vowed to fully implement the new U.N. sanctions against North Korea’s fourth nuclear test and rocket launch.

During the talks, Wu told Kim that China has been “in the process of implementing the new U.N. resolution on North Korea,” said the source, who attended the Friday meeting.

“The Chinese side also believes that strong sanctions are needed to show its sincerity on denuclearization,” the source said.

Earlier this month, the U.N. Security Council levied tougher sanctions against North Korea’s fourth nuclear test on Jan. 6 and the Feb. 7 launch of a long-range rocket, both of which violated previous U.N. resolutions.

The new U.N. sanctions require countries to limit or ban imports of North Korean coal, iron ore and other mineral resources if the proceeds are used for the North’s nuclear and missile programs.

One of the potential loopholes is a provision that allows North Korea to continue exports of coal and iron ore if such transactions are for “livelihood purposes.”

Full article here:
China notifies local gov’ts of new U.N. sanctions on N. Korea
Yonhap News/Korea Herald
2016-03-21

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Ryomyong Street Project (UPDATED)

Friday, March 18th, 2016

Ryomyong-street-2016-3-18

Pictured above (Google Earth): The location and approximate area of renovation of the newly announced Ryomyong Street

UPDATE 3 (2017-5-4): Here is an update from the Pyongyang Times:

Ryomyong Street demonstrates nation’s strength

Lecturers and researchers at Kim Il Sung University, former residents and other people began to move into new homes in newly built Ryomyong Street on April 17, presenting an impressive scene of people shouting cheers of hurray and dancing full of excitement and joy.

As they entered the modernly-built new flats, many of them said they are ordinary people but they received new houses for free and it is only possible in the Korean socialist system in which people are regarded as heaven.

The construction of the street is the crystallization of the love for people of Supreme Leader Kim Jong Un and a product of his great courage, outstanding leadership and infinite devotion to the people.

Last year the US and its vassal forces staged the largest-ever nuclear war games and applied tougher sanctions and pressure against the DPRK in the wake of its first hydrogen bomb test for self-defence and legitimate satellite launch.

On March 17 2016 the Supreme Leader came out to the site and declared the start of the street project. He named it Ryomyong Street in the meaning that the dawn of the Korean revolution breaks from the Kumsusan Palace of the Sun, the supreme temple of Juche, where President Kim Il Sung and Chairman Kim Jong Il lie in state, and Ryongnam Hill on which the Chairman took a historic oath to add glory to Korea. He said now the imperialists and the following forces try to tighten the noose around our neck while imposing the most vicious sanctions so far, the construction of Ryomyong Street would be a demonstration to the world of the will of the Workers’ Party of Korea that advances in the face of any enemy pressure and it would be like driving a dagger into the dirty body of the imperialists who resort to every means to do harm to the country.

The construction of the street which envisaged building many high-rise, multi-storeyed apartment houses for over 4 800 families in an area of over 90 hectares was not merely a construction project, but a campaign to defend the dignity of the DPRK and Korean socialism and to demonstrate once again its national strength and might.

The groundbreaking ceremony took place on April 3 last year amidst the apprehension, jealousy and interest of the world.

The Supreme Leader paid constant attention to the project. He saw many construction plans and layouts, saying the street should be built as a splendid one that makes perfect combination of the Juche character, national identity and uniqueness as a model of modern architecture. He also noted that the focus of the project is to wonderfully construct houses for educators, scientists and researchers of Kim Il Sung University, nurseries, kindergartens, laundries, post offices and other public buildings and service amenities, and ensured that the convenience-first and aesthetics-first principle was applied to all of them. When he visited the construction site for the second time this year, he took the lift which was in a trial run to climb up the 200-odd-metre 70-storey apartment house and check details of it.

Greatly encouraged by his noble love for the people, soldiers and other builders created construction legends of the Mallima era one after another, completing the concrete work of the 70-storey apartment building with a total floor space of over 120 000 square metres in 74 days by reducing the construction time of one storey from 36 to 24 hours, and again to 12 hours, and finishing the external tile fixing covering over 43 000 square metres in 13 days.

Thanks to their indomitable spirit and the nationwide assistance, the street, the equivalent of a town, was successfully completed in a matter of only one year.

The inaugural ceremony took place on April 13 in Pyongyang with the Supreme Leader in attendance.

The completion of the project hit the headlines of world media. Saying that the DPRK Supreme Leader cut the ribbon to open the street, they reported that north Korea replied with the opening of Ryomyong Street contrary to the expectation of the international community that it would respond to the UN sanctions with additional nuclear test or test fire of ICBM on the occasion of the Day of the Sun; the street construction proves UN sanctions against north Korea cut no ice with it and it develops its own way and at a very stable and fast speed; and Ryomyong Street, representative of Kim Jong Un’s era, is a demonstration of the DPRK’s Mallima speed to the international community.

Ryomyong Street shines brightly as a great and proud monument of the era of the Workers’ Party epitomizing the highest civilization and as a symbol of the great leap in the great Kim Jong Un’s Korea which advances with lightning speed ushering in the dawn of final victory.

UPDATE 2 (2017-4-15): Ryomyong Street was officially opened by Kim Jong-un on April 13. Here is the video.  Here is coverage in Rodong Sinmun:

Inaugural Ceremony of Ryomyong Street Held in Presence of Kim Jong Un

Magnificent Ryomyong Street has made its appearance in the area of the Kumsusan Palace of the Sun, the sacred temple of Juche, amid the mounting festive atmosphere for celebrating the 105th birth anniversary of President Kim Il Sung as the greatest auspicious holiday of the nation.

The street, which was built as an icon of modern street architecture and a fairyland representing the era of the Workers’ Party, is a gift of loyalty presented by the army and people of the DPRK to President Kim Il Sung and leader Kim Jong Il.

Its inaugural ceremony took place with splendor on Thursday in the presence of Kim Jong Un, chairman of the Workers’ Party of Korea, chairman of the State Affairs Commission of the DPRK and supreme commander of the Korean People’s Army.

Present there were senior party, state and army officials including Hwang Pyong So, Pak Pong Ju and Choe Ryong Hae and officials of party and armed forces organs, ministries and national institutions, delegates to the celebrations of the 105th birth anniversary of the President, army and social officials, soldier-builders and shock brigade members who took part in the construction, officials of institutions and industrial establishments in Pyongyang, scientists, educators, youths and students and other Pyongyangites.

Also on hand were overseas Koreans’ congratulatory groups and delegations, overseas compatriots, the chief of the Pyongyang mission of the Anti-Imperialist National Democratic Front, representatives of foreign embassies and international bodies and military attaches and their spouses and foreign guests.

Pak Pong Ju made an inaugural speech.

The speaker said the ceremony for the successful completion of Ryomyong Street represents a report on the shining victory won by the army and people to President Kim Il Sung and leader Kim Jong Il and a great event of adding luster to the Day of the Sun, the greatest auspicious holiday of the Korean nation. He went on:

Ryomyong Street is like an ever-lasting monument to the love for the people as it reflects the intention of the motherly Party to let the people enjoy the highest level of civilization.

Respected Supreme Leader Kim Jong Un proclaimed the construction of the street and energetically led its whole course.

Ryomyong Street symbolic of the great era of Kim Jong Un is a proud edifice in the era of Mallima that sprang up thanks to the indomitable mental power of the army and people of the DPRK and their inexhaustible might of self-reliance and self-development to flatten even a mountain and empty a sea if it is a call of the Party.

Kim Jong Un cut the inaugural tape. He waved back to the enthusiastically cheering crowd.

At the end of the ceremony all the participants went round the street together with senior party, state and army officials.

UPDATE 1 (2016-3-29): According to the Institute for Far Eastern Studies (IFES):

North Korea to Construct ‘Ryomyong Street’ Despite Imposed Sanctions

North Korean leader Kim Jong Un has ordered for the construction of ‘Ryomyong Street’ in Pyongyang. Following the development of Mirae Scientists Street, the new street will serve as another landmark of the Kim Jong Un era, and this order of his can be interpreted as an economic move in response to the recent UN sanctions against the country.

On March 18, the state media Korean Central News Agency (KCNA) reported that Kim Jong Un declared the construction of ‘Ryomyong Street’, which is to be built between Kumsusan Palace of the Sun and the Ryonghung Crossroads in Pyongyang. The street’s name signifies a place where ‘the dawn breaks in the Korean revolution’. Kim also mentioned that the area is to be surrounded by magnificent skyscrapers and multi-level buildings that fit the geographical characteristics surrounding the palace, displaying the Party’s idea of giving importance to science and talents in socialist Korea.

The report also announced that the street will include residential apartment housing, daycare centers, laundry services, post offices and other public service buildings and amenities, including for the scholars, scientists and educators at Kim Il Sung University, and to push ahead with construction of Building No. 3 at Kim Il Sung University. In making the street, the construction is to emphasize 21st century energy conservation and eco-friendliness, hence the goal to design lighting and heating systems of the housing and public buildings so that they utilize solar panels, geothermal energy, and natural lighting, and for roof tops to “go green” with instillation of greenhouses.

Along these lines, Kim put emphasis on the policy of securing building materials in constructing the new street and to diversify the size, design and color of decorative objects on the exterior of buildings. He also instructed for the mobilization of ‘soldier-builders’ who previously worked on the construction of Mirae Scientists Street. The construction of the new street shall be carried out with “Mallima speed” during the country’s ‘70-day campaign’ in run-up to the Party Congress scheduled for this upcoming May. The news report also stated that “the party, state, and society should render positive assistance to the construction and the Cabinet, commissions, ministries and national institutions take the lead in this work.”

According to the report, Kim Jong Un also said that “The construction of the street is not merely for formation of a street but serves as a political occasion of clearly showing the spirit of the DPRK standing up and keeping up with the world, despite all sorts of sanctions and pressure by U.S. imperialists and their followers, the appearance of the country advancing to realize the great ideal of the people and truth that the DPRK is able to be well-off in its own way and nothing is impossible for it to do.” The construction of the street appears in part as a means to show off the strength of ‘Songun’ Korea, following in the footsteps of Kim Jong Il’s policy.

Despite the strong sanctions imposed upon the country by the international community, North Korea is striving to achieve some form of economic success. The 70-day campaign has been initiated in the run-up to the Seventh Congress of the Workers’ Party. North Korean media are boasting about the country’s successes on the production front since the campaign’s initiation, saying “under the Juche ideology, people are working hard especially in the fields of electricity, coal, metal, and railroad transportation that they have achieved great success in the [campaign’s] first week.”

ORIGINAL POST (2016-3-18): Here are some official photos from Rodong Sinmun:

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KCTV later published these photos:

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Ryomyong-street-KCTV-2a Ryomyong-street-KCTV-1a

According to KCNA:

Kim Jong Un, first secretary of the Workers’ Party of Korea, first chairman of the DPRK National Defence Commission and supreme commander of the Korean People’s Army, declared the construction of Ryomyong Street and set forth the tasks for it on the spot, though he was very busy with his guidance over the 70-day campaign while disciplining the enemies’ anti-DPRK moves in the Paektu attack spirit.

The street is to be built in an area between the Kumsusan Palace of the Sun and Ryonghung Crossroads in Pyongyang.

Seeing the Kumsusan Palace of the Sun, the sacred temple of Juche where President Kim Il Sung and leader Kim Jong Il lie in state, and Ryongnam Hill where the leader made a historic oath “O Korea, I Will Add Glory to Thee”, Kim Jong Un named the street to be built “Ryomyong Street” in the meaning that it is a significant place from where the dawn breaks in the Korean revolution.

He examined a layout of the street, a map showing the bird’s eye view of it and its model board and gave instructions for building the street into a monumental edifice strikingly displaying the WPK’s idea of attaching importance to science and talents and the might of socialist Korea.

The essence of its construction is to splendidly build apartment houses for scientists and researchers including educators of Kim Il Sung University, nursery, kindergarten, laundry, post office and other public buildings and public service amenities, he said, stressing the need to push forward the construction of Building No. 3 of the university at the same time.

It is the Party’s intention to turn Ryomyong Street into an energy-saving and green street in the 21st century, he said, adding that the designing and construction units should set it as a goal to ensure the lighting and heating systems for the houses and public buildings with solar panels, geothermal energy and natural lighting and build rooftop greenhouses to go green.

Saying that he would dispatch the solider-builders, who took part in the construction of Mirae Scientists Street, to the construction of Ryomyong Street on the order of the KPA Supreme Commander, he gave an instruction that the entire party, state and society should render positive assistance to the construction and the Cabinet, commissions, ministries and national institutions take the lead in this work.

The construction of the street is not merely for formation of a street but serves as a political occasion of clearly showing the spirit of the DPRK standing up and keeping up with the world, despite all sorts of sanctions and pressure by the U.S. imperialists and their followers, the appearance of the country advancing to realize the great ideal of the people and the truth that the DPRK is able to be well-off in its own way and nothing is impossible for it to do, he said.

Noting that the construction of Ryomyong Street is a fierce battle with the U.S. imperialists and their followers, he called for completing the construction within this year to inspire the servicepersons and people with faith in sure victory and optimism and demonstrate the might of the DPRK fighting its way out with conviction in the rosy future and the traditions of ever-victorious Juche Korea that the world has neither understood nor can do.

This is the sixth overhaul of a specific housing area in Pyongyang since the 2012  “Strong and Prosperous Nation (강성대국) Policy” was implemented. The successfully completed efforts are Mansuade Area 1, Mansudae Area 2, Unha Scientists Street (for employees at the Second Academy of Natural Sciences), Satellite Scientists Street in Unjong District (next to State Academy of Sciences and new SEZ), and finally the Mirae Scientist Street in Phyongchon District, which houses facilities for Kimchaek University, a health club, lots of shops and restaurants, and possibly the Ministry of Atomic Energy Industry (address in Haeun-2 dong). There are still many housing units that were started in 2012, but never completed, particularly in Hyongjesan and Rakrang Districts.

According to my North Korean maps, until this announcement Ryomyong Street (려명거리) was named Kumsong Street (금성거리).

As KCNA noted, the project aims to build apartment houses for scientists and researchers, nursery, kindergarten, laundry, post office and other public buildings and public service amenities–including the completion of Building No. 3 and a new stadium at Kim Il sung University. I have discussed these last two projects before.

Not mentioned in the article is what appears to be new housing for party cadres who live in high rises right next to the Worker’s Party No. 3 complex (complex 1 and 2 are in the “forbidden city” in Central District).

party-complex-3-housing-1 Complex-3-housing

Here is coverage in Yonhap.

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North Korea and taxation: some possible causes

Friday, March 18th, 2016

By Benjamin Katzeff Silberstein

As this blog noted yesterday, South Korean daily Joongang Ilbo claims that the North Korean government may formally reintroduce a tax system before May this year, when a Worker’s Party convention will be held.

The goal, according to Joongang’s source, is primarily to formalize the private economy further. The latest UNSC sanctions are forcing the government to seek out more sources of revenue, and the growing private economy is seen as a resource that can still be tapped further.

Moreover, the source says, the state is planning to expand trading permits for private merchants, both on the formal markets and in private business in general. Under the new system, the state would essentially let merchants get access to land, water and electricity in exchange for a fee, much like in other countries where the state holds a monopoly on goods that often fall into the category of natural monopolies.

This is all interesting for several reasons. First, since the notion of North Korea as a tax free society might appear puzzling to some, it is worth taking a look at why the government decided to abolish taxes in the first place.

Ironically, had Joongang waited a few weeks before publishing the news, they would have hit the 42nd anniversary of the decision to make North Korea formally tax free. For it was on March 21st in 1974, at the Third Session of the Fifth Supreme People’s Assembly that Kim Il Sung officially announced that taxes were abolished. According to a KCNA-piece published in 2009, highlighting the occasion, the decision was taken as a step towards full socialism and framed in a historical context.

Taxation was a vestige of the past: the Japanese colonial power had instituted a “predatory” tax system that Kim Il-sung had vowed already in the 1930s that he would get rid of.  (The Choson Dynasty (1392-1910), too, of course, had a tax system that could at times well be called predatory, but the KCNA piece does not mention this).

The ideological rationale, of course, is that under socialism, you don’t need taxation because private property has been abolished. In North Korea, collectivization of agriculture, for example, occurred only gradually. According to KCNA, agricultural taxes-in-kind were fully abolished by 1966. Given recent policy changes where farmers supposedly now get to keep a more significant share of their production than before, one could argue that taxation has in effect already been brought back to agriculture, and that the tax-in-kind-rate is around 70 percent.

So why could the government want to bring back taxation? Aside from the reasons given by the Joongang article, one could speculate about a possible connection with the remarks cited by KCNA earlier this year about party officials “seeking privileges, misuse of authority, abuse of power and bureaucratism manifested in the party” (February 4th, 2016).

Corruption is often an integral part of everyday life for anyone involved in business in a country that lacks a functioning rule of law. Corruption is known to be strongly institutionalized in North Korea, and when news of discontent come out of North Korea, it often has to do with arbitrary rule changes and regulations regarding market trading and business. A formalized tax system doesn’t itself guarantee a transparent set of rules and regulations, or that these rules are followed. But it is an almost necessary prerequisite.

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DPRK to officially reintroduce taxation?

Tuesday, March 15th, 2016

Choson Exchange points out this article in the Joongang Ilbo which makes an interesting claim (if true):

North Korean leader Kim Jong-un is pushing for a plan to officially introduce a tax system for the first time in 42 years. The Communist state has not had a such a system since 1974, when it was abolished by the Supreme People’s Assembly.

According to a source familiar with the situation inside North Korea, Pyongyang is preparing to revive the tax system ahead of the ruling Workers’ Party convention in May in response to decreasing national finances, squeezed by sanctions from the international community.

After North Korea conducted its fourth nuclear test on Jan. 6 and subsequent long-range missile launch on Feb. 7, the United Nations Security Council unanimously adopted the toughest sanctions to date in an attempt to curb cash from flowing into North Korea.

“The central government will grant economic autonomy to local merchants, in exchange for collecting bills for utilizing land, water and electricity,” the source said.

He added that the North will expand the number of private merchants and the North’s private markets, jangmadang, and officially levy taxes on usage for factories and companies.

Under the new tax system, North Korea will collect individual income tax from the emerging donju, a term assigned to the country’s nouveau riche that literally means “master of money,” who have amassed sizable wealth through the private market.

The individual income tax rate has not yet been decided, though it is likely that it will be higher than the last 1.8 percent tax rate from 1974, particularly considering the rise in merchants.

The push for a tax system was Kim Jong-un’s idea, according to experts on North Korea, who said the young leader felt uneasy about the fact that his country didn’t have a tax system when he took power.

North Korea’s abolishment of taxes in 1974 was largely a propaganda move, intended to demonstrate the country’s superiority over other nations. However, although the country did not officially have a tax system, the impoverished state still collected a number of fees from its people in place of corporate and value-added taxes.

“North Korean professors at Kim Il-sung University and other experts have recently been studying the state’s tax system,” said Lim Eul-chul, a professor of North Korean studies at Kyungnam University. “North Korea will use the term ‘usage fee’ rather than ‘tax’ as it sees the tax system as a vestige of capitalism.”

Read the full story here:
Pyongyang considers reinstating its tax system
Joongang Ilbo
Ko Soo-suk
2016-3-16

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Japan bans reentry of Chongryon leadership after DPRK visit

Tuesday, March 15th, 2016

According to the Donga Ilbo:

In response to North Korea’s nuclear tests and long-range missile firing early this year, the Japanese government sharply increased the number of people banned from reentry into Japan after visiting North Korea to 22 people including the chairman and vice chairman of the General Association of Korean Residents in Japan (Chongryon).

According to Tokyo Shimbun and Kyodo News on Monday, people banned from reentry include 17 people from Chongryon, such as Chairman Heo Jong-man, Vice Chairman Nam Seung-woo, and those in Chosun University run by Chongryon. The advisor and five other members of the Science and Technology Association under Chongryon will also be banned. The Japanese government has also included scientists in the banned list aimed at blocking the transfer of nuclear and missile technology.

Japan had banned reentry of eight Chongryon leadership including Chairman Heo since 2006, but the sanctions were lifted in May 2014 at an agreement made in Stockholm when North Korea promised reexamination of kidnapped Japanese victims. Helped by the lift, Chongryon executives were able to visit North Korea in September that year in eight years to meet Kim Young Nam, North Korean Chairman of the Presidium of the Supreme People’s Assembly, among others.

When sanctions resume, however, Chongryon leadership cannot participate the seventh Labor Party convention to be held for the first time in 36 years in early May. North Korea is expected to strongly protest against the recent sanction that includes Heo, who serves as its ambassador in Japan, and others in Chongryon.

In response to little progress on reexamination of kidnapped victims last year, the Japanese government has tightened pressure on the federation by arresting Heo’s second son Heo Jeong for allegedly importing pine mushroom from North Korea illegally. The North had harshly criticized Japan calling it a hostile provocative act.

Read the full story here:
Japan bans reentry of Chongryon leadership after N. Korea visit
Donga Ilbo
2016-3-15

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