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Business slow at JVIC Beijing office

Friday, August 23rd, 2013

According to Yonhap:

The only sign of activity at the North Korean trade promotion agency here in Beijing is the faintly lit banner in front, and it is hard to tell whether the office is open for business.

No one is seen at the reception desk of North Korea’s Investment and Development Group building, located in a northern Beijing suburb, and its front door, though appears to be open, remains stationary for most of a weekday.

“North Koreans are still working there,” said a Chinese cleaner near the building, who only gave his surname Wu.

The Beijing branch of North Korea’s Investment and Development Group was believed to have launched operations early last year, but it appears certain to be a dead duck as the North’s unpredictability continues to keep Chinese investors away.

Its website has not posted any statement since Jan. 23 this year, and there was no response to a phone call made on Aug. 16.

A South Korean diplomatic source in Beijing, who spoke on the condition of anonymity, said the North Korean branch has been dormant since the North’s defiant launch of a long-range rocket last December.

Tensions on the Korean Peninsula soared early this year, with North Korea conducting its third nuclear test and its near-daily war threats during an annual joint military drill between South Korea and the United States.

“We have figured out that operations at the Beijing office of the North’s Investment and Development Group almost ground to a halt,” the source said.

…

China, North Korea’s biggest trading partner and aid donor, has become increasingly frustrated with its wayward ally, particularly after the North’s February nuclear test. In May, the Bank of China closed accounts with North Korea’s Foreign Trade Bank, which was accused by the U.S. of helping to finance the North’s nuclear weapons program.

According to the South Korean Embassy in Beijing, North Korea’s trade volume with China fell 6 percent on-year in the first six months of this year.

The North’s trade with China stood at US$2.95 billion in the January-June period, compared with $3.14 billion a year earlier, embassy officials said.

Exports to China rose 6 percent to $1.36 billion, while imports declined 14 percent to $1.59 billion, they said, citing official data.

Read the full story here:
N. Korea appears to struggle to woo Chinese investors
Yonhap
2013-8-23

Posted in China, International trade, Joint Venture Investment Committee (JVIC), Trade Statistics | Comments Closed

3rd Rason International Trade Fair (UPDATED)

Wednesday, August 21st, 2013

UPDATE 1 (2013-8-27): Chinese auto manufacturer announces plans for Rason plant. According to Yonhap:

A major Chinese automaker has expressed its intention to invest in a project to build a car manufacturing factory in North Korea, the North’s media said Tuesday.

FAW Group Corp., a Chinese state-owned automotive manufacturing firm, signed a letter of intent last week with North Korea’s Rason regional government to invest in the construction of the factory, the North’s Korean Central News Agency (KCNA) reported.

The agreement is a preliminary step to conclude an official deal for the investment.

The deal was made during the third round of the exhibition for international goods held in the North Korean city last week, according to the KCNA.

The impoverished communist country designated Rason, located on its northeastern tip, as a special economic zone and has been actively seeking an overseas investment in the region.

During the exhibition, China’s Heilongjiang regional committee on trade promotion and Rason’s economic committee signed an agreement to boost cooperation. Heilongjiang province is located in the northeastern part of China.

Stressing Chinese firms’ investment in the Rason region, an unidentified official from the Chinese body vowed “to transport goods from its region to Shanghai via Rason ports,” according to the report.

ORIGINAL POST (2013-8-21): According to KCNA:

3rd Rason Int’l Trade Exhibition under Way

Pyongyang, August 21 (KCNA) — The 3rd Rason International Trade Exhibition is going on in the Democratic People’s Republic of Korea.

The exhibition in the Rason Economic and Trade Zone bordering China and Russia is attended by more than 120 entities from countries and regions, including the DPRK, China, Russia, Germany, the U.S., and Japan.

On display at the exhibition are some 78 000 items of exhibits in 410 kinds, covering machinery, steel, electrical, electronic and chemical products, foodstuffs, medicines, building materials, vehicles and sundries.

In this regard, KCNA met Hwang Chol Nam, vice-chairman of the Rason City People’s Committee.

Hwang said:

The Rason City has laid definite institutional guarantee and legal foundations for jointly developing the economic and trade zone and has made a big stride in building infrastructure, paving a way for foreign businesses to smoothly carry on production and trade in the zone.

During the days of the exhibition, foreign businessmen will witness the situation of the developing zone.

Ho Myong Ho, director of the Rason Exhibition Corporation, told KCNA that the current exhibition is the biggest in scale and he believes that it will serve as an occasion for making the trade in the zone gain momentum.

The exhibition will run until August 23.

The Rason Economic and Trade Zone is a special economic zone in the DPRK, where preferential treatment is available.

The zone has developed into a hub for transit transport, trade and investment and financial and tourism service.

2013-8-20 evening news coverage of the opening ceremony can be seen here.

Dr. Bernhard Seliger posted the application form for the trade fair:

Previous posts on the Rason International Trade Fair can be found here.

Posted in China, Foreign direct investment, Manufacturing, Rason International Trade Fair | Comments Closed

DPRK – China trade falls in Q2 2013

Monday, August 12th, 2013

According to Yonhap:

North Korea’s trade with China fell 6 percent on-year in the first six months of this year, apparently hit by Beijing’s tougher stance against Pyongyang’s nuclear program, a senior Seoul diplomat said Monday.

The North’s trade with China stood at US$2.95 billion in the January-June period, compared with $3.14 billion a year earlier, said the diplomat at the South Korean Embassy in Beijing.

Exports to China rose 6 percent to $1.36 billion, while imports declined 14 percent to $1.59 billion, the diplomat said on the condition of anonymity, citing official data.

“The drop in overall North Korea-China trade in the first six months of this year appears to be affected by tighter inspections by Chinese customs authorities,” the diplomat said.

North Korea’s imports of Chinese crude oil slipped 15 percent from a year ago to 250,000 tons during the six-month period, according to the data.

In particular, the North’s imports of food from China plunged 65 percent to 120,000 tons for the January-June period, the data showed.

Coal shipments from North Korea to China rose 18 percent to 8.33 million tons for the six-month period, despite falling coal prices, according to the data. Coal accounted for 54.8 percent of the North’s total exports to China during the period.

“With the Chinese economy expected to slow down in the second half of this year, China’s demand for North Korean coal is likely to decline,” the diplomat said.

China has become increasingly frustrated with North Korea, particularly after the North’s third nuclear test in February. Beijing voted in favor of sanctions by the U.N. Security Council to punish Pyongyang for conducting the nuclear test.

In May, the Bank of China closed accounts with North Korea’s Foreign Trade Bank, which was accused by the U.S. of helping finance the North’s nuclear weapons program.

Read the full story here:
N. Korea’s trade with China drops 6 pct in H1: diplomat
Yonahp
2013-8-12

Posted in China, Energy, Food, International trade, Oil, Statistics, Trade Statistics | Comments Closed

DPRK imports from China fall from 2012 levels

Monday, July 29th, 2013

According to Kyodo:

China’s exports to North Korea in the first half of 2013 fell for the first time in four years, customs data showed Monday, a sign that Beijing might have increased pressure on Pyongyang over its continued nuclear weapons program.

During the January-June period, China’s exports to North Korea shrank 13.6 percent from a year earlier to $1.59 billion, mainly due to a drop in crude oil shipments, according to the data released by the General Administration of Customs.

China’s exports of crude oil to North Korea in terms of volume and value declined 14.2 percent to 250,000 tons and 20.2 percent to $270 million, while North Korea’s overall exports to its main economic and diplomatic benefactor rose 5.3 percent to $1.37 billion, the data said.

The last time that China’s exports to North Korea fell in the first six months, as well as for the full year, was in 2009, when global trade slumped in the wake of the surprise collapse of U.S. investment bank Lehman Brothers Holdings Inc.

China has been urged by many countries to exercise more influence on North Korea, particularly after Pyongyang went ahead with its third nuclear test in February in violation of U.N. Security Council resolutions.

DPRK imports of Chinese grain in 2013

Monday, July 29th, 2013

UPDATE 1 (2013-7-29): DPRK imports of Chinese grain drop 8.4% in the first half of 2013. According to Yonhap:

North Korea’s imports of Chinese grain fell 8.4 percent on-year in the first half of 2013 mainly due to a better harvest last fall, a report said Monday.

The report by the Korea Rural Economic Institute (KREI) showed Pyongyang’s imports of flour, rice, corn and other grain products reaching 124,228 tons in the January-June period, compared with 135,648 tons a year earlier.

The state-run institute said that while the country imported more than 20,000 tons of grain on average from February onward, last year’s better harvest and overall improvements in food supply conditions led to the first-half decline.

“Overall, import numbers indicate supply and demand of grain is very stable in North Korea,” said Kwon Tae-jin, a research fellow at KREI who compiled the report.

He said besides grain, the communist country imported 139,161 tons of chemical fertilizers from China in the first half, a drop of 35 percent from 213,871 tons purchased in the same six-month period last year.

ORIGINAL POST (2013-7-29): DPRK imports of Chinese grain fall 14.2% in 2013. According to Yonhap (via Global Post):

Imports of Chinese grain by North Korea fell 14.2 percent on-year in the first five months of 2013 mainly due to a better harvest last fall, a report said Wednesday.

The findings by the Korea Rural Economic Institute (KREI) showed Pyongyang’s imports of flour, rice, corn and other grain products reaching 101,170 tons in the January-May period, down from 117,922 tons the year before.

The institute said numbers fell sharply in May when total grain imports stood at just 21,142 tons, which represents an 18 percent drop from the previous year and an 18.2 percent decrease from April. The communist country brought in 25,850 tons of grain from its neighbor in the preceding month and 25,788 tons in May of 2012.

Kwon Tae-jin, a research fellow at KREI who compiled the report, said the sizable drop in imports was probably caused by better grain output last year, which made it unnecessary for the country to buy the commodity from China.

“It can be a sign that things have improved,” he said. The researcher also speculated that the harvest of such produce as barley, wheat and potatoes, which grow in spring, may have been better than in the past.

The experts, who checked raw data provided by the Korea International Trade Association, said the North imported 42.7 percent more chemical fertilizers in the January-May period of this year vis-a-vis the same time period in 2012.

The country brought in 129,967 tons of fertilizer from China, compared to 91,096 tons the year before. Such an increase may exert a positive effect on farm output.

Kwon said that the spike in fertilizers is a sure sign that the North is giving top priority to pushing up agricultural output.

Related to the latest data, a government source hinted that North Korea’s emphasis on agriculture may be aimed at trying to strengthen the leadership of its new leader Kim Jong-un, who took power after the sudden death of his father Kim Jong-il in late 2011.

“Unlike other economic sectors that require time, agriculture is something that can generate results in a short period of time and have immediate impact on everyday lives,” the official who declined to be identified said.

Read the full story here:
N. Korea’s imports of Chinese grain fall 14.2 pct in 2013
Yonhap (via Global Post)
2013-7-3

Posted in 2013 food shortage, Agriculture statistics, China, Food, International trade, Statistics, Trade Statistics | Comments Closed

China keeps fishing boats out of North Korean waters

Monday, July 8th, 2013

According to Bloomberg:

China banned its fishing fleet from working in waters off North Korea’s east coast after the totalitarian regime demanded Chinese vessels buy fuel from North Korean suppliers.

The North decreed late last month that Chinese ships, which previously made their own fueling arrangements, had to abide by the rule, China’s Agriculture Ministry said in a June 28 announcement that was posted to its website today.

“Fishing boat owners and and businesses believe that the North Korean decision will have a serious effect on production and operations and job security, causing huge potential risks,” the ministry said.

The statement reflected Chinese concerns after North Korea seized a Chinese fishing boat and its crew on May 5 and demanded a 600,000 yuan ($97,800) ransom. The ship and crew were freed later in May after Chinese diplomats negotiated their release, the official Xinhua News Agency reported.

Here is coverage in The Guardian.

Read the full story here:
China Bans Its Fishing Fleet From Waters Off Eastern North Korea
Bloomberg
2013-7-8

Posted in Agriculture, China, International trade | 1 Comment »

DPRK – China trade drops 2.3%

Tuesday, July 2nd, 2013

According to Yonhap:

Trade between North Korea and China contracted 2.3 percent on-year in the first five months of 2013 mainly due to Pyongyang importing less from its neighbor, a report showed Tuesday.

The report by the Korea International Trade Association (KITA) showed two-way trade at US$2.45 billion in the January-May period, with North Korea’s exports to China growing 6.5 percent on-year to $1.12 billion. The North’s imports from China, however, dropped 8.5 percent to $1.33 billion.

The trade association said the North shipped $613.6 million worth of coal, making it the top export commodity for the communist country, followed by such raw materials as iron and lead ores.

In exchange, the North bought $265 million worth of crude oil, a decrease of 5 percent from January-May of 2012. The country imported $52 million in large cargo-hauling vehicles, as well as flour and soybean oil from its neighbor.

KITA did not elaborate on the reason for the decrease in overall trade volume and the drop in crude oil imports from China.

Related to economic developments in the North, the U.S. Department of Agriculture said in a report that food conditions in the isolationist country remain one of the most precarious in all of Asia.

In its 2012-2013 food security report, which inspected 22 countries in the region, the North came in at the bottom with Afghanistan and Yemen.

The findings, which are used as reference material for food aid provisions by Washington, claimed that while the North was able to produce 7.5 million tons of grain annually up until the early 1990s, this has since plunged to around 4.3 million tons in 2012.

Read the full story here:
N. Korea-China trade drops 2.3 pct: report
Yonhap
2013-7-2

Posted in China, Coal, Energy, Korea International Trade Association (KITA), Oil, Statistics, Trade Statistics | Comments Closed

China building new railway lines to DPRK border

Thursday, June 6th, 2013

According to the Wall Street Journal:

On a vast construction site outside this northeastern Chinese city, engineers are working around the clock on a project that could transform the economic—and geopolitical—dynamics of the region: a 223-mile, high-speed rail link to the North Korean border.

The $6.3 billion project is one of three planned high-speed railways designed to bring North Korea closer into China’s economic orbit, even as Beijing supports sanctions aimed at Pyongyang. China is also sinking millions of dollars into new highways and bridges in the area, and the first cross-border power cable.

China’s vision for closer economic integration with North Korea runs counter to a U.S. strategy aimed at piling pressure on Pyongyang to abandon its nuclear-weapons program and refrain from further threats.

(more…)

Posted in China, Foreign direct investment, Railways, Transportation | Comments Closed

Growth of N. Korean trade slows in 2012

Wednesday, May 29th, 2013

According to Yonhap:

The growth of North Korea’s exports and overall trade volume slowed down significantly last year, apparently due to international sanctions condemning its nuclear test and other provocations, Seoul’s trade promotion agency said Wednesday.

According to the Korea Trade-Investment Promotion Agency, better known as KOTRA, North Korea’s overall trade reached US$6.81 billion in 2012, growing 7.1 percent from a year earlier and reaching a record high since 1990 when such data began to be compiled.

The growth, however, marked a sharp slowdown from a 51.3 percent on-year hike in 2011.

“Such a significant slowdown of growth last year appears to have been caused by the fact that North Korea has only a limited number of export products and that sanctions by the international community continued,” KOTRA said in a press release.

The North’s overall exports gained 3.3 percent on-year to $2.88 billion with imports surging 10.2 percent to $3.93 billion.

Still, the North’s trade relations with its communist ally China strengthened with the countries’ bilateral trade reaching $6.01 billion, accounting for 88.3 percent of the North’s overall trade in 2012.

Trade with China has also slowed. According to Yonhap:

North Korea’s imports from China for this year registered its first drop in three years due apparently to China’s tightened grip on transactions with its ally under United Nations sanctions, Beijing’s customs data showed Wednesday.

The North brought in US$1.01 billion worth of Chinese goods during the January-April period, down 8.68 percent from a year earlier, according to China’s online customs data analyzed by Yonhap News Agency.

It was the first annual drop for the four-month period since 2010 when Customs-info, the online customs data provider, started to provide related information.

The North’s imports from China stood at $525.8 million for the same four-month period in 2010. It had posted two successive annual increases to reach $1.1 billion in 2012 before registering a fall this year, according to the data.

The on-year reduction this year can be attributable to China’s increased efforts to strictly apply punitive U. N. sanctions adopted to punish the North for its long-range rocket launch, believed to have been a test of its ballistic missile technology, and its third nuclear test, which occurred on Feb. 12.

Taking a step back from its previous stance to keep neutral about its ally, China joined punitive international moves by tightening its customs and immigration inspections toward the North.

The data, however, showed that the North’s exports to China grew 6 percent on-year to $842.8 million during the January-April period.

Read the full stories here:
Growth of N. Korean trade slows in 2012
Yonhap
2013-5-29

N. Korea’s imports from China drop amid tensions
Yonhap
2013-5-29

Posted in China, International trade, Statistics, Trade Statistics | Comments Closed

DPRK frees Chinese fishing boat

Tuesday, May 21st, 2013

UPDATE 1 (2013-5-27): According to the Global Times (PR China):

Chinese agencies operating in Dandong, Northeast China’s Liaoning Province have been implicated in the seizures of Chinese fishing boats for ransom by armed North Koreans.

The Beijing Times quoted Zhang Dechang, whose boat was seized by North Koreans in May last year, as saying that he was given a cellphone number registered in Dandong and was demanded to pay a ransom to the cellphone owner. However, Zhang failed to reach the cellphone owner, and the number later was canceled.

The report said Zhang asked the boss of a Chinese agency in Dandong, which represents North Korea in handing out licenses for Chinese fishermen to fish in North Korean waters, for mediation but was turned down. He claimed a Chinese boat took part in the looting of his boat when the North Koreans seized it.

A North Korean patrol ship, which has hijacked several Chinese fishing boats, is said to be a retired Chinese ship and given to the North by a Chinese agency, the report said.

Yu Xuejun, whose boat was hijacked by North Koreans for two weeks this month, earlier told the Global Times that the kidnappers asked him to pay ransom to a bank account of a company in Dandong, but he failed to catch the name of the company.

The Guangzhou-based Nandu Daily quoted an unidentified fishing boat owner as saying that the Chinese agencies in Dandong are related to the company which is collecting the ransom.

There are three major agencies in Dandong representing North Korea. The fishing boats, which obtained licenses from the agencies, fly both Chinese and North Korean flags and can enter certain areas inside North Korean waters.

The Chinese boat owners, whose boats had been hijacked, insisted that their boats were operating in Chinese waters when they were captured.

Sun Caihui, whose boat was seized by North Koreans in May last year and released after the intervention of the Chinese government, told the Global Times Monday that local fishermen have been operating on the western side of 124 degrees east longitude for generations, which has long been regarded as the demarcation line of the sea border between China and North Korea.

“We aren’t going to take the risk of being seized by the North Koreans again,” he said, calling on the government to clarify the sea border with the North so as to address the concerns of fishermen.

However, there is no available official documentation on the sea demarcation between the two countries.

Meanwhile, Sun Chen, a professor from Shanghai Ocean University, said Monday that the Chinese fishery authority should strengthen law enforcement activities to protect the fishermen.

“Currently, we face shortages in personnel, equipment and spending of the fishery management department. The government should attach importance to the building of the law enforcement force,” she said.

ORIGINAL POST (2013-5-21): According to Bloomberg:

North Korea freed a Chinese fishing vessel and its crew after the boat’s owner posted updates on his microblog account saying that he’d been told to pay a 600,000-yuan ($97,800) ransom to win their release.

The ship and its crew, from the northern city of Dalian, were freed today, the official Xinhua News Agency reported, citing a Chinese consular officer in North Korea. The ship’s owner, Yu Xuejun, said on his Tencent Holdings Ltd. (700) microblog account today that he couldn’t come up with the cash and was “thankful to the Foreign Ministry for its diplomacy.”

…

China, which filed a formal complaint over the detention, is asking North Korea to investigate and “make a full explanation to us,” Foreign Ministry spokesman Hong Lei said today. No ransom was paid to secure the crew’s freedom, China National Radio reported today, without citing anyone.

…

“There is no territorial confrontation between China and North Korea,” the editorial said. “It’s more likely the North Korean military police are using the ambiguity of maritime borders to make a quick buck.”

Last year a North Korean ship seized three Chinese fishing and demanded 300,000 yuan to free each vessel.

Read the full story here:
North Korea Frees Chinese Fishing Boat After Ransom Report
Bloomberg
2013-5-21

Posted in China, Sea shipping | Comments Closed

North Korean Economy Watch

Archive for the ‘China’ Category

Business slow at JVIC Beijing office

3rd Rason International Trade Fair (UPDATED)

DPRK – China trade falls in Q2 2013

DPRK imports from China fall from 2012 levels

DPRK imports of Chinese grain in 2013

China keeps fishing boats out of North Korean waters

DPRK – China trade drops 2.3%

China building new railway lines to DPRK border

Growth of N. Korean trade slows in 2012

DPRK frees Chinese fishing boat

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