Archive for the ‘International Governments’ Category

South Korea stiffens import rules on N. Korean products

Tuesday, October 27th, 2009

UPDATE: Contrary to earlier reports (below) that South Korea was set to begin importing sand from the DPRK, it turns out that they are tightening import restrictions on goods from the DPRK.  According to Yonhap:

The government has tightened rules on imports of sand, pine mushrooms and anthracite from North Korea, the Unification Ministry said Tuesday, in an apparent move to keep a close eye on cash flows into Pyongyang.

The three items have been allowed into South Korea only with a declaration to the customs office, but the toughened rules now require their importers to receive approval from the unification minister, said ministry spokeswoman Lee Jong-joo.

“Inter-Korean trade volumes of pine mushrooms, sand and anthracite have rapidly increased recently,” Lee said in a press briefing, without specifying the hike rates.

“This revision was prepared in consideration of two things — transparency of inter-Korean trade and keeping the import volume at a proper level,” she added.

Seoul has so far required approval from the unification minister, only when excessive imports of a certain item are feared to harm local producers. Those three items are not considered to fall into that category.

North Korean sand has been rumored to be linked to the country’s military. The concerns prompted Seoul to ban local sand importers from traveling to North Korea after it launched a long-range rocket in April, and such trips are not still allowed.

Last year, US$73.35 million worth of sand, $14,93 million of pine mushrooms and $25.1 million of anthracite were imported from North Korea. Sand was the largest imported item, while anthracite was 9th and pine mushrooms 18th.

With the tightened entry rules, the government can “make a judgment on the site about whether each business is appropriate and get sufficient information about them, thereby enhancing the transparency of inter-Korean trade and its soundness,” the spokeswoman said.

Read the full Story here:
South Korea stiffens import rules on N. Korean products
Yonhap
10/27/2009

ORIGINAL POST: RoK looking to import sand from DPRK (again)
According to Yonhap:

South Korea has suspended sand imports from North Korea since April, when the North test-fired a long-range rocket. Seoul had banned sand importers from traveling to the North.

South Korea first brought in North Korean sand for use at local construction sites in late 2002, as part of an inter-Korean accord signed by leaders of the two Koreas in 2000.

“The government is reviewing the resumption of imports of the North’s sand, given strong requests from businesses and the overall state of current inter-Korean relations,” an informed government official said, requesting to be unnamed.

The South Korean government is expected to decide soon whether to lift the travel ban on sand importers as well, according to officials.

Seoul reportedly placed the travel restriction on sand importers due to suspicions that payments for sand shipments were pocketed by military authorities in the North.

Read other stories about the sand trade here.

Read the full story below:
Seoul mulls resuming sand imports from N. Korea: sources
Yonhap
Tony Chang
10/22/2009

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GPI business delegation to DPRK

Thursday, October 22nd, 2009

From GPI:

PDF Brochure here.

In the current financial and economic situation, companies face many challenges. They must cut costs, develop new products and find new markets. In these fields, North-Korea might be an interesting option. Since a few years, it is opening its doors to foreign enterprises. The labor costs are the lowest of Asia, and its skilled labor is of a high quality. It established free trade zones to attract foreign investors and there are several sectors, including textile industry, shipbuilding, agro business, logistics, mining and Information Technology (computer games, animation) that can be considered for trade and investment. Heineken is an example of a  Dutch company, active in North-Korea. Its beer is now widely available (see photo).

In order to explore these business opportunities, a Dutch trade delegation visited North-Korea in September. See a report of this mission here. Are you interested as well? Then join our upcoming mission in May 2010, when we will also visit the annual Pyongyang Spring International Trade Fair. This fair can also be used by European companies to come in contact with potential buyers and suppliers in North-Korea, by using a booth. It is also possible for us to organize individual business tours, for participants from a single company.

With best regards,

Paul Tjia (director)
GPI Consultancy
P.O. Box 26151
3002 ED Rotterdam, The Netherlands
E-mail: [email protected]
tel: +31-10-4254172
fax: +31-10-4254317
Web: www.gpic.nl

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New report urges US economic engagement to induce change in the DPRK

Thursday, October 22nd, 2009

I have not read the full report yet, but here are the details:

PRESS RELEASE EXCERPT: A newly released Asia Society/U.C.-Institute on Global Conflict and Cooperation report focuses on economic engagement with North Korea as a peaceful means of inducing change in the DPRK. As the likelihood of some form of US-DPRK talks increases, this report proposes a fundamental rethinking of Washington’s approach toward the DPRK. Economic engagement, properly integrated into a system of sanctions, can transform North Korea into a country that can better provide for its people’s welfare and engage with other countries in a non-hostile manner. As the report shows, North Korea’s history of experiments with reform is limited, and domestic resistance to transition is formidable. But recent trends and tentative past efforts suggest some impulse toward reform and opening from within. North Korea should be actively engaged from the inside to encourage change in its domestic and foreign policy.

The report identifies a number of potential benefits to the U.S. and its allies of economic engagement with the DPRK.

* Economic engagement would encourage the transformation of the DPRK’s political economy and foreign policy, with direct benefits to international peace.
* It would open space for the Korean people to have greater contact with outsiders, and vice versa.
* It would reinforce changes that are already taking place from the ground up.
* An active economic engagement policy would bring the long-term strategic approach of the U.S. into alignment with those of its allies and partners.

The report recommends a combination of the following avenues to initiate the new policy approach: official contacts, Track Two dialogues, academic exchanges, and non-governmental organizations’ (NGOs) development programs. The report further recommends that the U.S. government adopt a new visa policy to increase contacts significantly. Finally, the report suggests how the U.S. could help enable international financial institutions to begin to interact with North Korea.

Download the full report here (PDF).

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DPRK-RoK trade increases in September

Monday, October 19th, 2009

According to Yonhap:

Inter-Korean trade grew for the first time in 13 months in September amid improving global economic conditions and eased cross-border tensions, customs data showed Monday.

According to data compiled by the Korea Customs Service, trade between South and North Korea amounted to US$173.17 million last month, up 2.6 percent from a year earlier when the global financial turbulence first began following the collapse of Lehman Brothers.

Also according to Yonhap however, the DPRK and RoK failed to agree on an aid-for-family reunions deal:

The two Koreas on Friday ended their day-long negotiations over further cross-border family reunions and other humanitarian issues without reaching any concrete agreement, with Pyongyang asking for resumption of aid by Seoul, officials said.

In the meeting arranged by Red Cross offices from both sides, South Korea proposed holding new rounds of reunions for families separated by the 1950-53 Korean War next month in both Seoul and Pyongyang, and again around February at the North’s Mount Kumgang resort.

But aid is not off the table.  According to the Korea Times today:

The government has been reviewing whether to subsidize non-government organizations through the inter-Korean cooperation fund in order to provide aid to North Korea, according to the Ministry of Unification, Monday.

“The government is mainly checking plans to offer health and medical care,” ministry spokesman Chun Hae-sung told reporters. “But details have yet to be determined.”

Chun reiterated that Seoul is sticking to its existing stance that it will provide North Korea with humanitarian assistance regardless of the political climate.

According to government sources, the subsidy would total less than 1 billion won (about $853,000).

The plan, however, is not related to North Korea’s request for humanitarian aid made during the inter-Korean Red Cross talks last Friday, the sources said.

Seoul has also been reviewing whether to provide the reclusive state with government-level support such as food and fertilizer aid, according to ministry officials.

The inter-Korean cooperation fund has served as a lifeline for cross-border business projects, including the Gaeseong Industrial Complex and the Mt. Geumgang tourism program, which has been suspended.

It is also a main source of South Korea’s economic aid to the impoverished North.

The cash pot was introduced in 1990 in order to boost personal exchanges, economic cooperation and trust-building between the two Koreas.

In August, the ministry approved a plan to subsidize 10 civic groups with approximately 3.6 billion won ($3 million) from the fund for relief activities involving North Korean babies, pregnant women and other social minorities.

The government originally planned to distribute the money starting from April but North Korea’s provocations postponed the plan.

As reported before, the South Korean government has spent just 5% of the funds it budgeted for inter-Korean projects this year.

At the same time North Korea is soliciting aid from South Korean and Western religious origanizations.  See here, here, and here in just the last few days.

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Kenya-DPRK relations established

Thursday, October 15th, 2009

BBC Monitoring Service
October 13, 2009
Source: The Standard website, Nairobi, in English 13 Oct 09

Text of report by Ally Jamah entitled ” Kenya gets into ties with North Korean republic” published by Kenyan privately-owned daily newspaper The Standard website on 13 October

Kenya has established diplomatic relations with North Korea.

North Korean Ambassador Pak Hyon Jae presented his diplomatic credentials yesterday to President Kibaki at State House, Nairobi, before proceeding to a luncheon hosted by Foreign Affairs Minister Moses Wetang’ula at the Intercontinental Hotel. He, however, declined to speak to the media during and after the ceremony.

Also feted in the same luncheon were diplomatic representatives from Trinidad and Tobago, Niger, Qatar and Sierra Leone.

North Korean leader Kim Jong II never travels outside the country and maintains a strict centralized military state.  In the past 60 years, the country has been technically at war with the USA over its nuclear and military capabilities.

In his speech, Mr Wetang’ula expressed support for North Korea’s nuclear programme if peaceful and non-military, adding Kenya was also seeking nuclear technology to generate energy for its expanding economy.

“We welcome North Korea to Kenya, just as we welcome any other nations, because we have so much to exchange and  share,” he said. But Wetang’ula was quick to dismiss suggestions that Kenya could borrow nuclear technology from North Korea to generate energy for the country.

“If we need nuclear power we don’t have to go to North Korea alone, we are in friendly terms with many nuclear states, who are too happy to share with us,” he said. He said the University of Nairobi was doing good work in preparations to introduce nuclear energy into mass use in the country.

The North Korean mission will be managed from Kampala, Uganda, where the country maintains a full diplomatic presence. The USA, one of Kenya’s key allies in military and economic fronts, has no diplomatic relations with North Korea.

Here is the location of the North Korean Embassy in Kampala.
Here is their address/contact info:
10, Prince Charles Drive, Kololo
PO Box 5885
Kampala, Uganda
Phone: +256-41-2546033, +256-41-343424
Fax: +256-41-250224

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N. Korea [not] growing more tolerant of foreign movies

Tuesday, October 13th, 2009

UPDATE 2: (hat tip to a couple of appreciated readers) Park Soo-me reports on the proliferation of South Korean films in the DPRK:

“It’s safe to assume that a majority of North Korean residents have watched a South Korean film or a soap opera at least once,” said Kim, who left North Korea in 2004, and established a think-tank in Seoul called the “North Korea Intellectuals Solidarity.”

The group, which frequently communicates with their inside contacts in the North, recently broke revealing news that a group of North Korean students were caught watching “Haeundae,” a mega-hit South Korean disaster film locally released just over a month ago, at a computer lab inside a Pyongyang college.

The defector group cited an anonymous source in Pyongyang who told their reporter that the government is tightening a crackdown of digital files, as South Korean films smuggled through China are endangering the North’s dictatorial regime.

A student identified only as “Choi” said he had downloaded the film at his relative’s house in Cheongjin, a city about 50 miles from the Chinese border. He was arrested for promoting the ideology of his enemy state, not for circulating a pirated film.

Since the late 1990s, South Korean dramas and films were illegally traded in the North through local businessmen frequenting the Chinese borders. The phenomenon is not unlike that from the young Soviets in the 1970s, who secretly acquired rock ‘n’ roll records and American videotapes through its black market, despite the country’s ban on the cultural products of the capitalist state.

Last year, an insider from another defectors’ group based in Seoul broke news that DVD compilations of South Korean adult films and TV dramas are becoming popular in the North, as the sales of the average South Korean soap opera has declined in recent years. Such DVDs were found in a North Korean market in Cheongjin, the group said through its newsletter.

The situation in the North has gotten to the point where Oh Yang-yeol, a professor at the University of North Korean Studies in Seoul, published a paper on “Hallyu in North Korea: Now and Future.”

The term hallyu recalls the Korean wave of pop culture that hit Southeast Asia in the early 2000s. Oh’s paper stresses the spread of South Korean fashion, drama and music among the younger generation of North Koreans.

In a separate release by the Korean Institute of National Unification, experts have quoted North Korean defectors who have testified that South Korean melodramas like “Autumn in My Heart” and “Winter Sonata” have become a such hit in the North that a special squad was once organized to crack down on the violators.

But not all dramas smuggled into the North are soft, touchy-feely soap operas. Among the works that have been found and blacklisted by the Northern authorities include films like Park Chan-wook’s “Joint Security Area,” a story which is essentially built around a forbidden friendship between solders from the North and South who are stationed in the Demilitarized Zone that divides the two countries.

On the distribution side, South Korean films and TV dramas are appearing in the North faster and with a broader reach, as evident in the recent case of “Haeundae.”

“In the past, it normally took up to six months for a South Korean film to arrive in the North,” Oh said. “Now, it takes little over a month. In wealthier neighborhoods in Pyongyang we start to see local girls imitating the hairstyle and fashion of South Korean celebrities who starred in the latest TV dramas.”

Irritated by the spread of hallyu — often referred to as the “yellow wind” in the North — authorities have tightened censorship regulations and house inspections to encourage “ideological discipline.” But there is a limit as to what they can do.

Although limited to a privileged few, more computer-savvy Koreans in Pyongyang are finding easier alternatives to enjoy pop culture from the outside world, making the North’s isolation more difficult. Internet access is limited to an Intranet for most people in the North. But USB drives are becoming more common among local college and middle school students, and frequent traffic between North Korea and China is increasing opportunities for cross-border smuggling of pirated films from Hollywood and Seoul.

Read the full story below:
Pop culture making inroads into North Korea
Hollywood Reporter
Park Soo-mee
10/8/2009

UPDATE 1: Although the Donga Ilbo previously reported that the DPRK was growing more tolerant of foreign films (below), Channel News Asia reports the DPRK is clamping down:

The student in Pyongyang was caught on September 5 while watching a digital copy of “Haeundae” with his dorm friends, the North Korea Intellectuals Solidarity said in a newsletter posted on its website.

The student allegedly acquired a file of the film at a relative’s house in the northeastern port city of Chongjin and downloaded it onto his college computer, it said.

The case prompted authorities to launch an extensive probe aimed at preventing the spread of the movie, the group said, quoting a “correspondent” in the North.

The inspection revealed that tens of thousands of North Koreans have secretly seen foreign films, it said.

Defectors say South Korean pop songs and movies are popular in the isolated communist country, despite a steady campaign to weed out what state media has termed “decadent foreign culture and ideals”.

In December 2007, three North Koreans including a schoolteacher were sentenced to death for smuggling illegal adult films from China and South Korea, according to Good Friends, a Seoul-based aid group working in the North.

ORIGINAL POST: According to the Donga Ilbo:

Recently, the North has televised the shows “International Common Sense,” “Animals in the World,” and “Foreign Culture,” programs which had been abolished long ago. Those programs even show the daily lives of Westerners.

A few days ago, a video clip was aired in which North Korean singers in military uniform played the guitar and sang Italian songs. When broadcasting sports, Pyongyang used to simply air competitions in which North Korean athletes participated, but when airing the IAAF World Championship in Athletics in Berlin last month, the North summarized footage of major events and televised them.

North Korea’s attitude toward foreign movies has also changed. CD-ROMs containing foreign movies have been manufactured by the state-run Hana Electronics, which has sold them across the nation. Most of the CD-ROMs include foreign movies aired by Mansudae TV, which serves Pyongyang only.

A CD-ROM is priced at 1,500 North Korean won (41 U.S. cents) and a DVD goes for 7,500 won (2.07 dollars). CD-ROMs of cooking game programs as well as those on the lives of famous soccer players such as Diego Maradona and Franz Beckenbauer are also on the market.

The North has also embraced world-famous animated films. The Disney productions of “Cinderella,” “Pinocchio,” “Sleeping Beauty” and “Robin Hood” are available across the nation. The popular American cartoon “Tom and Jerry” is called “The Magic World of a Mouse” in the North.

The proliferation of foreign movies has also led to an increase in secret movie rental stores. Government-manufactured CD-ROMs can be rented out at 300 won (eight cents) per day and illegal movies can be borrowed at 500 won (14 cents) per day.

Yet most foreign programs broadcast in North Korea are created in China, which, in turn, has encouraged North Koreans to adopt the Chinese way of life. Mansudae TV routinely broadcasts Chinese soap operas like the drama “Unnamed Hero” and “Vertical Blow,” which shows the training of China’s special forces.

Despite the apparent liberalization of North Korean television, Pyongyang has toughened its punishment for those watching South Korean TV programs. In the past, punishment for watching a South Korean program was usually avoided through a bribe but the offense is now considered more severe than a drug-related crime.

Read the full story here:
N. Korea Growing More Tolerant of Foreign Movies
Donga Ilbo
9/19/2009

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Int’l Press Gets Glimpse of N.Korea’s Daily Grind

Monday, October 12th, 2009

The Choson Ilbo recently posted an article which contained several interesting facts.  Quoting from the article:

A W35 million price tag for the Internet connection to transmit a five-minute piece of footage is only one of the endless list of inconveniences that make up daily life in North Korea (US$1=W1,163). Kristine Kwok, a reporter for Hong Kong’s South China Morning Post who accompanied Chinese Premier Wen Jiabao on his visit to North Korea on Oct. 4 to 6, recounts them in a story titled “Life in the Hermit Kingdom.”

“Accessing the Internet is a distant dream for North Korean citizens and an expensive luxury for visiting foreigners,” Kwok wrote. “Filing a news report of Wen shaking hands with North Korean leader Kim Jong-il would cost a TV station the equivalent of HK$233,472. The North Korean Foreign Ministry eventually decided to pay all the Internet fees for the reporters –much to their relief.”

The report said North Korea’s 24 million people are barred from the Internet, with connections available only in some hotels, where sending a picture costs around W68,000 and a single email W3,400. North Korea has set up road blocks along the information super highway and is committing “robbery,” Kwok added.

The last time I visited the DPRK, I recall that emails and phone calls from the Yangakdo Hotel are exorbitant–also, there are no phone books available and switch board operators (yes, they still have them) are of no help. If you don’t know the number you need to call you have to get creative.  But, with prices like that you would think the DPRK would like more journalists to visit!

Also mentioned in the article is Pyongyang’s new fast-food Samtaesong Restaurant, which I blogged about here when it opened.  According to the article “Samtaesong” translates to “three big stars”.  I am going to go out on a limb and guess that those three stars are the “Three Stars of Paektu: Kim il Sung, Kim Jong Suk, and Kim Jong il.”  now you can show your loyalty to the three stars while eating a burger, which is much more pleasant than standing silently in line formation under the hot sun for hours on end while political leaders you have never met read long speeches to you.

Also, “The most expensive item on the menu is ‘crispy chicken,’ which costs 3 euros, while a hamburger costs between 1.2 to 1.7 euros. That is high given the fact that North Korea’s per-capita GDP was US$1,000 last year, but AFP said Samtaeseong sells 300 burgers each day.”

Read the full article here:
Int’l Press Gets Glimpse of N.Korea’s Daily Grind
Choson Ilbo
10/13/2009

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Potential DPRK-US magician exchange

Sunday, October 11th, 2009

According to the Los Angeles Times:

Dale Salwak, who teaches English literature by day and performs as a magician at night, knows that arranging for North Korean illusionists to visit the U.S. is no easy trick.

Salwak teaches English literature by day at Citrus College and performs illusions at night at places such as Hollywood’s Magic Castle. His skill at floating mysterious zombie balls in the air and turning silk scarves into exploding flowers earned him an invitation earlier this year to visit the secretive Asian nation.

His six-day stay in Pyongyang in April prompted him to attempt to organize an exchange program that will lead to visits by North Korean magicians to this country.

Officially, the 62-year-old Salwak was attending the 26th Spring Friendship Art Festival, which is held biannually by the Kim Jong-il government to promote “friendship, solidarity, exchange and cooperation” among musicians, dancers, acrobats and other performers.

Salwak’s invitation was arranged by several South Korean magicians who were acquainted with him. He was the only American among 680 performers from Asia and Europe. [This last fact is not true. See here.]

“When I arrived, I was told to ‘act as if you’re always being watched, because you are.’ We were given a list of dos and don’ts — ‘don’t express your feelings, don’t talk about politics’ — and told we’d have to turn over our cellphones. We weren’t allowed to take telescopic camera lenses, we could bring no books or magazines. We turned over our passports when we arrived.”

Salwak was assigned two young college-student “managers” who were at his side every time he stepped from his hotel. They spoke fluent English and translated when he spoke with others. They also supervised the two-minute phone calls he was allowed to make from the hotel.

Nonetheless, he came to respect his escorts. “I knew how I behaved, what I said, would reflect on my managers,” he said. “So I was extra careful.”

The visitors had no direct contact with regular Pyongyang residents, although they saw blocks-long lines of people waiting for buses as their group was driven through the capital, he said.

Salwak said the visiting magicians took in several North Korean magic shows and performed twice themselves. He said he staged his own impromptu 20-minute card-trick exhibition for two dozen dining room workers when he showed up early for breakfast at the hotel.

He said he hopes to arrange for the North Korean magicians’ American visit in time for them to attend a planned International Brotherhood of Magicians convention next July in San Diego. He said there will be no restrictions on where they go or whom they talk to.

“I’ve started by writing a letter and sending it through the appropriate channels. We’ll see what happens,” Salwak said.

Along with giving North Koreans an opportunity to perform here, Salwak envisions holding a forum so that the visitors can discuss their views of the performing arts and their role in it.

Read the full story below:
La Verne professor wants to pull some diplomacy out of his hat
Los Angeles Times
Bob Pool
10/9/2009

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Seoul signals increase to inter-Korean budget, but far from spending current budget

Wednesday, October 7th, 2009

UPDATE: Although South Korea has signaled willingness to increase spending in North Korea (below), it appears they have come nowhere close to spending their current budget.  According to Yonhap:

South Korea has so far this year spent less than 5 percent of its annual budget earmarked to promote reconciliation with North Korea, the Unification Ministry’s data showed Wednesday.

The meager spending of the inter-Korean cooperation budget mirrored stagnant economic exchanges yet to be enlivened despite a recent thaw in political relations.

The data showed that South Korea has set aside 1.16 trillion won (US$990.94 million) for this year’s inter-Korean cooperation budget, which includes 43 billion won transferred from last year, to support joint business projects and provide industrial and humanitarian aid to the North.

The budget spending as of the end of September amounted to 55.9 billion won, 4.8 percent of the total, according to the data.

In a detailed breakdown of expenditures, the ministry spent 10.6 billion won, or 11.3 percent of the 93.8 billion won budget earmarked for the South Korean-run factory park in the North’s border town of Kaesong. Planned projects to build a dormitory for North Korean workers and modernize roads there have also not begun. The Kaesong park hosts about 110 South Korean firms with 40,000 employees from the North.

Humanitarian aid was the area in which funds were held back most. Out of the earmarked 819.8 billion won, the ministry has spent a meager 0.9 percent, or 7.7 billion won, so far. Unification Minister Hyun In-taek said in a parliamentary audit Tuesday that Seoul will decide when to resume its rice and fertilizer aid, crucial to food supplies in the North, after “considering the climate of future inter-Korean relations.”

For social and cultural exchanges, the ministry spent 2.2 billion won, or 25.3 percent of the earmarked 8.7 billion won. Loans for inter-Korean cooperation projects amounted to 11.3 percent, or 21 billion won out of 186.6 billion won.

ORIGINAL POST: According to Yonhap:

South Korea’s government proposed a 30 percent increase in its budget spending aimed at supporting inter-Korean economic cooperation projects for next year, the finance ministry said Tuesday.

According to the Ministry of Strategy and Finance, the budget set aside for inter-Korean economic cooperation next year will amount to 398.2 billion won (US$339.6 million), compared with 304.6 billion won assigned for this year.

Citation:
Seoul proposes 30 pct increase in budget for inter-Korean economic cooperation
Yonhap
10/6/2009

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China and DPRK mineral wealth

Tuesday, October 6th, 2009

According to the Financial Times:

North Korea’s mineral wealth is receiving close scrutiny, with South Kor­ea’s government this week valuing reserves at $6,000bn (€4,070bn, £3,670bn). Encouraged by data on metals, Goldman Sachs last month predicted the economy of a unified Korea could rival Japan’s by 2050.

Trade with China is growing, reaching $2.8bn last year from about $2bn in 2007. But military authorities in North Korea are perceived as hostile to the changes in society and infrastructure that foreign investment could bring.

“If the North opens its mineral resources to foreign countries, that is tantamount to taking a military, social and political gamble, jeopardising their security,” said Lim Eul-chul, of Seoul’s Institute of Far Eastern Studies.

A South Korean diplomat closely involved with nuc­lear talks doubted Pyong­yang would allow China to make big investments inside its border. “They cannot permit that kind of influence,” he said.

Although they were long communist allies, North Korea and China have a mutual mistrust, partly tied to territorial claims.

Still, limited foreign investment in the sector is not impossible. Colin McAskill, executive chairman of Koryo Asia, says he has signed a letter of intent and memorandum of understanding to invest in North Korean metals and argues his model would not interfere with sovereignty issues that concern Pyongyang.

Switzerland’s Quintermina has posted reports on its website saying it is looking to extract magnesite in North Korea.

Chinese investors are believed to have some metals interests and are also involved in coal mining.

“The Chinese companies that have tried to do business in North Korea complain a lot that the regulations change frequently and that the power supply is erratic,” said a Chinese academic in Beijing.

One quote in this article struck me as a little off:

A South Korean diplomat closely involved with nuc­lear talks doubted Pyong­yang would allow China to make big investments inside its border. “They cannot permit that kind of influence,” he said.

First of all, China has already made plenty of investments inside the DPRK and the Chinese government and companies already exert influence.  There is a difference between having influence and being in control.  Secondly, China is the largest market for North Korean exports.  Even though they might not “own” the North Korean assets from which they purchase the goods, the North Koreans are limited in terms of who will/can trade with them.  In this sense China earns surplus through either bulk purchase discounts or monopsony power.

Read the full story here:
China eyes N Korea’s mineral wealth
Financial Times
Christian Oliver
10/6/2009

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