Archive for the ‘International Governments’ Category

If Have a Gift for Kim Jong Il, Safe Passage through the North Korean Customs

Saturday, September 1st, 2007

Daily NK
Kim Min Se
9/1/2007

The news of one Chinese trader resolving all issues with the “certification of gifts,” while passing through a high-level North Korean customs’ confiscation of goods and demand of open bribes, has received recent spotlight.

In the latter half of the 90s, a businessman who has been exporting and importing North Korean cultural and daily necessities while coming and going from North Korea met a reporter on the 30th in Dandong and relayed this anecdote, “I have returned to China after having received “honored” treatment from all customs officials under the Shinuiju customs director. That is the first time I received such treatment in the 10 years I have been conducting the trade business.”

The story of the businessman has also apparently become noteworthy news in the Dandong customs office in China.

The businessman is supposed to have earned huge gains by handling North Korean porcelain since the latter half of the 90s. Thus, for long-term gains, he supported the arts and culture projects for the idolization of the Kim father and son in North Korea under his company’s name.

Subsequently, a North Korean writers’ company recently invited him and showed him several sights in North Korea and relayed a gift (edibles) under Kim Jong Il’s name afterwards.

The businessman, after eating the goods he received as gifts in the hotel he was staying in at the time, left with the “certification of gift” in his bag as his souvenir.

He said, “At the time, in Chosun (North Korea), I acquired quite a bit of North Korean silk for gift-giving to close acquaintances, such porcelain and paintings of famous artists. However, the cargo was heavier than expected, almost one carload (2.5 tons trucks). From Pyongyang to Shinuiju, I arrived without much mishap because transportation was provided, but passing through customs was not an easy feat.”

“The North Korean customs unpackaged all goods, so they started going through my stuff as soon as I arrived. Also, they started going through the bag I was carrying and the eyes of the inspector became fixed as the goods were taken out one by one. He had seen the “gift certification” inside a red case.”

Further, he added, “The customs officer verified the name of the certification and my passport and quickly went into an office with the ‘certification.’ Shortly after, the customs director came out and ushered me into a reception area and asked about the context for my receipt of the gift.”

At the time, the customs director had said, “You are a distinguished person who has done a huge work for our country. We did not recognize that. Please let us know if there is anything you are uncomfortable with. Whatever it is, we will help you.”

Then, he is supposed to have ordered the lower level officers, “Using the customs car, make sure that this person’s luggage arrives safely in China without any damage.”

He said that a single piece of Kim Jong Il’s “gift certification” carrying so much weight was beyond the expectations of not only himself but the Chinese customs personnel.

Another related source of the Dandong customs office said, “We were surprised that a single piece of the “gift certification” could wield such power. This event became a famous anecdote within the Dandong customs office.”

Share

U.S. medical aid arrives in flood-stricken N. Korea: report

Friday, August 31st, 2007

Yonhap
8/31/2007

North Korea’s foreign minister Friday met with a U.S. delegation bringing emergency medical supplies to help North Korean victims of recent floods, the North’s official news outlet said.

The reclusive country has appealed to the international community for assistance to cope with massive flooding caused by heavy downpours that left at least 600 people dead or missing and about 100,000 people homeless in early August. The United Nations is seeking US$14 million to provide North Korea with food, medicine, drinking water and other emergency goods.

“Foreign Minister Pak Ui-chun met with guests from the United States who visited with emergency medical aid equipment donated by the U.S. administration and the non-governmental organization Samaritan’s Purse with regard to flood damage at the Mansudae Assembly hall,” said the one-sentence report carried by the Korean Central News Agency. It did not identify the U.S. guests.

Washington has so far pledged US$100,000 for the U.N. initiative, equally distributing the funds to two non-governmental relief organizations, Mercy Corps and Samaritan’s Purse, to deliver emergency aid to North Korea.

The heaviest rain in 40 years swept North Korea, which is poorly equipped to cope amid wide-spread deforestation. The severe damage caused the second inter-Korean summit to be postponed from late August to early October.

Share

1972 Declaration

Thursday, August 30th, 2007

Korea Times
Andrei Lankov
8/30/2007

At 10:00 in the morning of July 4, 1974, Lee Hu-rak, the director of the Korean Central Intelligence Agency (KCIA), convened a special press conference. It was just the place to drop a bombshell. He told the journalists that in May and June, secret high-level exchanges had been conducted between the North and South Korean governments.

Lee himself went to Pyongyang, while Seoul was secretly visited by Kim Yong-ju, the younger brother of then North Korean President Kim Il-sung. In those days Kim Yong-ju was considered as a likely heir to the North Korean dictator (Kim Jong-il was still too young).

The visits themselves were a sensation since for the two decades following the end of the 1950-53 Korean War there were virtually no government-level contacts between the two Koreas. These secret talks produced a document which is known as the “July 4 Declaration” to the Koreans, but in English language publications it is usually referred to as the “1972 Declaration.”

The declaration stated that both Korean governments were committed to eventual unification, and that this unification should be reached independently (without the involvement of foreign forces), peacefully and with respect to their political and ideological differences.

Frankly, it was not very precise wording. However, in one regard the document was important indeed: for the first time in decades it stated that both Korean states, at least theoretically, were ready to coexist and negotiate.

The declaration produced much hype in the international media, and was welcomed as a “great breakthrough.” Of course, this was not the case, and all long-time Korea watchers knew only too well that from time to time some events would be presented by the world media as a “great turning point” _ only to be forgotten or made irrelevant in few years.

Still, the 1972 Declaration was surely a sign of new times: grudgingly, each Korea began to accept existence of the other side. Not its right to exist, God forbid, but merely its physical existence as a rather unpleasant but unchangeable fact.

This turn took place just after the worst period of confrontation, when the two Koreas seemed to be on the eve of a second Korean War. In 1968 North Korean commandos stormed (unsuccessfully) the presidential office of Cheong Wa Dae in Seoul, and they waged campaigns in the mountain ranges along the eastern coast of South Korea.

Seemingly influenced by the success of the Vietnamese Communist guerrillas, the North Korean strategists believed that a Communist revolution could be started in the South as well.

However, by 1970 Kim Il-sung and his coterie finally realized that their hopes for a Vietnam-style uprising in the South were unfounded. Perhaps, the news from Germany where the Eastern and the Western states finally recognized each other, also had some impact: Koreans always paid attention to events in Germany, another divided country.

South Korea changed its strategy as well. Since 1948, the South Korean state had not made a secret of its willingness to use all means, including military ones, to achieve unification and the “liberation” of the North from “Communist slavery.” (The North Korean leaders, in their turn, vowed to save Southerners from “Capitalist hell”).

However, on August 15, 1970, President Park Chung-hee said that unification should be achieved peacefully. He addressed the North Korean leaders (the same people who tried to kill him two years earlier) and urged them to engage in peaceful economic competition.

This statement reflected a new confidence in Seoul: throughout the first decade of the dictatorial but efficient rule of Park, South Korea’s economy was booming. The South Korean leaders thought they would win the economic competition. We know now that they were correct in this assumption.

Hence, negotiations made sense, at least as a way to win time. Indeed, for a short period after the 1972 Declaration there were a number of exchanges and contacts. The Red Cross societies of both Koreas were engaged in the negotiations of a painful question: the arrangement of meetings between members of separated families.

For all practical purposes, in those years the Red Cross societies acted as major channels of dialogues, hence both sides staffed these NGO-type bodies with high-level officials. The first rounds of talks led to nothing, but even the fact that both Koreas were willing to talk was seen as a great novelty after 25 years of division, war, and propaganda.

In 1973, the ROK government made it clear that it would tolerate the participation of North Korea in international organizations. Shortly before that, the principle of mutually exclusive international recognition had also been dropped: a foreign country could henceforth have ambassadors stationed both in Seoul and in Pyongyang.

However, the declaration did not change as much as newspaper readers worldwide were led to believe in those July days. Neither side was going to compromise too much. Domestically, both sides continued with their propaganda war, an enterprise, which was quite hysterical in the South and much worse in the North.

The generals planned future military operations, and secret services were conducting their silent war with the same zeal. Nobody was willing to give in, and talks were interrupted in 1973. They resumed only a decade later, and by that time the situation in and around Korea had changed dramatically.

Prof. Andrei Lankov was born in St. Petersburg, Russia, and now teaches at Kookmin University in Seoul.

Share

S.Korean Networks to Pay Millions for N.Korean Footage

Thursday, August 30th, 2007

Choson Ilbo (Hat Tip DPRK Studies)
8/30/2007

Three South Korean terrestrial TV stations agreed in July to pay tens of millions to North Korea annually for footage from North Korea’s state-run Korean Central Broadcasting Station. An SBS executive said South Korean TV stations have used TV pictures aired by KCBS for free, but in July, the Korean Foundation for South-North Economic and Cultural Cooperation, as a proxy of the North Korean TV station, concluded negotiations with three TV stations whereby SBS will pay about W20 million every year to KCBS through the foundation. MBC will pay slightly more than that, and KBS will pay about W30 million.

The foundation, chaired by United New Democratic Party member Im Jong-seok, was established in 2004. It held talks with the three terrestrial networks for a year and a half. In the talks, the three argued it was unreasonable for South Korean TV stations to pay for North Korean footage in programs that aim at promoting mutual understanding, and they generally rejected the idea of unilaterally paying North Korea when the North does not pay South Korean broadcasters for footage.

Share

Nigeria seeks North Korean energy investment

Wednesday, August 29th, 2007

Reuters
(Hat tip DPRK Forum)
8/29/2007

Nigeria will send a high-level delegation to North Korea to discuss attracting investment in Nigerian energy and natural gas, President Umaru Yar’Adua has said.

Nigeria is the fifth largest oil supplier to the United States and an ally of Washington, but it also maintains warm relations with the secretive Stalinist state as a fellow member of the Non-Aligned Movement.

“I will direct the minister of state for energy to visit your country for discussions on energy and gas, a sector where we have an emergency,” Yar’Adua told the outgoing North Korean ambassador to Nigeria, King Pyong Gi, on Tuesday.

Yar’Adua, who took office in May, intends to declare a state of emergency in energy and power to accelerate development of the sector, which has been mismanaged and starved of investment for decades.

Yar’Adua promised to encourage high-level visits between the two countries, the state-run News Agency of Nigeria said.

In 2004 North Korea, which tested a nuclear device for the first time in October 2006, offered to share missile technology with Nigeria as part of a wide-ranging military cooperation agreement. It is unclear if it went ahead after Washington opposed it.

Ambassador Pyong expressed North Korea’s support for Nigeria’s bid for a permanent seat at the U.N. Security Council, the agency said.

Share

Foreign Business Begins Entry Into KIC

Wednesday, August 29th, 2007

Institute for Far Eastern Studies
NK Brief No. 07-8-29-1

A Chinese manufacturer of artificial fingernails has become the first non-Korean business to set up shop in the Kaesong Industrial Complex. The (South) Korea Land Corporation announced that on August 27, a contract for entry into the Kaesong Industrial Complex was concluded with Dashing Diva, the South Korean subsidiary of Tianjin Jci Cosmetic, which had applied for a plot in the 1st stage of the KIC. Another firm, a plywood manufacturer located in Linyi, a city in China’s Shandong province and the hub of the country’s lumber industry, is preparing to close a contract for a 2000 square meter plot by the end of August.

In order to enhance the global image of the KIC, six plots in the first stage of the complex, designed to house small and medium-sized manufacturers, have been slated specifically for foreign manufacturers. In the event a foreign enterprise wishes to do business in the KIC, it must have a South Korean subsidiary with which a land development contract can be drawn. However, when applications were solicited last June, not a single company showed interest, so the lots were offered contract ad libitum beginning at the end of July.

In addition to these Chinese companies, representatives of the Kimberly-Clark Corporation, a U.S.-based global leader in health and hygiene products, met with KIC officials at the ROK Ministry of Unification on August 14 in order to reach an understanding on investment issues. Yuhan-Kimberly Ltd., Kimberly-Clark Corporation’s Seoul-based subsidiary, oversees all of the corporation’s Northeast Asian branches. Yuhan-Kimberly Ltd. CEO Moon Kook-hyun stated that the corporation’s Beijing plant was interested in a lot in the KIC, after Kimberly-Clark Corp. CEO Thomas Falk visited the complex earlier in the year.

Investment by foreign companies has special meaning for the inter-Korean joint project, as it reflects international confidence in the complex. In particular, when taking into account the importance of U.S.-DPRK relations, investment by the multinational Kimberly-Clark Corp. could have even greater meaning.

Share

Hyundai Motor’s union to provide aid to North Korea despite looming strike

Wednesday, August 29th, 2007

Yonhap
8/29/2007

The labor union of Hyundai Motor Co. decided to provide aid to North Korea to help a South Korean humanitarian group expand a corn-noodle plant in North Korea, union officials said Wednesday, despite the union’s steps to stage a possible strike next week.

The workers at Hyundai, South Korea’s largest automaker, are scheduled to vote Thursday on whether to launch a walkout over higher wages and better working conditions, almost an annual ritual for the 44,000-strong union.

In a statement, the union said it will provide the aid worth 500 million won (US$530,786), including noodle-processing machines, a minibus, a truck and a power generator, to the corn-noodle plant in the North Korean capital of Pyongyang.

The aid will be provided via the Seoul-based humanitarian group Movement for One Korea, an official at Hyundai’s union said by telephone from Ulsan, a port city on the nation’s southeast coast where Hyundai’s main plant is located.

“We decided to provide the aid to help North Korea recover from its food shortage and to implement the union’s corporate social responsibility,” said the official, refusing to give his name.

The timing and other details have yet to be decided, he said.

It is the first time that a union of a private company has decided to give aid to North Korea.

The North has had to rely on international humanitarian aid for the past decade, due to floods, drought and economic mismanagement.

Earlier in the day, conservative newspapers questioned the Hyundai union’s rationale, criticizing it for deciding to give aid to the North as the strike looms.

“It’s an inappropriate time for Hyundai Motor’s union to do this as public criticism is mounting over its 13th consecutive annual strike,” Bae Son-geun, a professor at Korea University, was quoted as saying by the daily Dong-a Ilbo.

Hyundai and its union have had 10 sessions of formal negotiations. The union is demanding an 8.9 percent increase in monthly basic salary, after rejecting the company’s offer of a 5.4 percent rise.

The strike vote will be held on Friday and the outcome is to be announced later in the day or early Saturday, union officials said.

So far this year, Hyundai workers staged a 13-day partial strike over a bonus dispute and a proposed free trade agreement with the United States which they argued could hurt the livelihoods of farmers and factory workers.

Hyundai’s union has held walkouts every year except 1994 since its foundation in 1987. In the past 20 years, the union has gone on strike for 313 days, costing the company 8.94 trillion won (US$9.53 billion) in total lost sales, according to the automaker.

Share

The Forgotten Victims of the North Korean Crisis

Wednesday, August 29th, 2007

Japan Focus
Tessa Morris-Suzuki
3/15/2007

As the slow and difficult negotiations on North Korean denuclearisation unfold, one small group of a hundred people or so in Japan are watching proceedings with a unique personal interest. Some are Japanese, others ethnic Koreans. All are survivors of one of the modern world’s most bizarre, tragic and utterly forgotten “humanitarian” projects.

Between 1959 and 1984, these few were among the 93,340 people who migrated from Japan to North Korea in search of a new and better life. There were several particularly ironic features of this migration. First, it took place precisely at the time of Japan’s “economic miracle”. Secondly, although it was described as a “repatriation”, almost all those who “returned” to North Korea originally came from the south of the Korean peninsula, and many had been born and lived all their lives in Japan. Third, the glowing images of life which tempted them to Kim Il Sung’s “worker’s paradise” came, not just from the North Korean propaganda machine but from the Japanese mainstream media, supported and encouraged by politicians including key members of Japan’s ruling Liberal Democratic Party.

After decades in North Korea, around one hundred migrants have now escaped the harsh realities of life there, and made the perilous return journey back to Japan. Other survivors of the same project who managed to escape have settled in South Korea.

The story of their migration has been almost entirely unheard by the rest of the world. But it urgently needs to be heard, not least because it involves an injustice that resulted in the deaths of thousands of people, and is still causing the deaths and untold suffering today. The history of this migration also reveals the complexity of postwar Japan’s connections with North Korea: and without understanding this, it is impossible fully to understand the impasse which their relations have now reached.

As secret documents from the Cold War era are declassified and testimony from survivors emerges, the true story of this mass movement is now starting to emerge for the first time. We now know that it was the product of a deliberate policy, very carefully designed and implemented at the height of the Cold War by the North Korean and Japanese governments often working in concert, and supported in various ways by the Soviet Union, the United States and the International Red Cross movement. It is a history that sheds important light on the complex background to Northeast Asia’s contemporary conflicts. It also evokes chilling echoes of other coerced or manipulated migrations, including the repatriation of Eastern Europeans to the Soviet Union and other Communist countries in the immediate post-war era.

The story starts in the mid-1950s at the height of the Cold War. Some 600,000 Koreans were living in Japan, most having migrated to Japan from the southern part of the Korean Peninsula during the colonial period (1910-1945). Having been unilaterally designated “foreigners” by the Japanese government, they had no legal right to permanent residence and faced continual discrimination, prejudice and poverty. South Korea was then an impoverished nation under the authoritarian rule of Yi Seung-Man (Syngman Rhee) and had no interest in taking them back.

The newly released records show that from 1955 onwards, some Japanese bureaucrats and politicians (notably members of the ruling party then and now) began to develop strategies to encourage Koreans in Japan to “return” instead to North Korea. Knowing that this was a politically explosive issue, they tried to keep their role in the scheme covert and to ensure that the exodus was carried out under the auspices of the neutral and humanitarian Red Cross. However, as a leading Japanese Red Cross official put it, his government’s real aim was “to rid itself of several tens of thousands of Koreans who are indigent and vaguely communist”.

Via their national Red Cross Societies, Japan made secret contact with North Korea in 1956 and 1957, urging its government to accept a substantial influx of Koreans from Japan. The Japanese government and Japan Red Cross officials placed intense pressure on the International Committee of the Red Cross to lend its name and support to a mass “repatriation”, thus enabling the scheme to be presented to the world as an apolitical, humanitarian venture. To this end, they provided the international body with some highly questionable information.

Meanwhile, the limited welfare payments available to Koreans in Japan were being drastically slashed – a measure that must surely have made the prospect of life in communist North Korea look more appealing. At the same time, the Japanese Red Cross was engaged in a secret search for ships to carry out the project.

At first, the North Korean response to the proposal was cool. It was happy to accept a small number of “true believers”, but it was having enough problems feeding its own people in the wake of the Korean-US War without accepting a mass inflow of immigrants. In 1958, however, North Korean leader Kim Il Sung dramatically changed course. Apparently seeing the scheme as a valuable source of skilled labor, and as an international propaganda coup which might damage Japan’s relations with South Korea and the US, he issued a public welcome to ethnic Koreans from Japan, promising them housing, jobs, education and welfare.

Immediately, propaganda campaigns began to sweep through Japan’s Korean community, orchestrated by a local pro-North Korean organization, but amplified by a flood of articles in the Japanese mass media. A special “Repatriation Cooperation Society”, involving politicians from across Japan’s political spectrum, was set up to distribute information encouraging Koreans to “return” to North Korea. Leading members included former Prime Minister Hatoyama Ichiro and prominent ruling-party politician Koizumi Junya (whose son Koizumi Junichiro was to become Prime Minister in 2001).

Another troubling aspect revealed by declassified documents is the United States attitude toward the scheme. The US State Department was at that time focussed on renegotiating its all-important security treaty with Japan, a process for which it relied on the enthusiastic cooperation of Japanese Prime Minister Kishi Nobusuke (grandfather of the present Japanese Prime Minister, Abe Shinzo).

The US appears to have been unaware of the secret contacts between Japan and North Korea in 1956 and 1957. When it first became aware of the repatriation plan a couple of years later, the Eisenhower administration regarded it with concern. But once the Japanese and North Korean Red Cross Societies reached an agreement on a mass “return” in mid-1959, the Eisenhower administration did not take any practical steps to halt the unfolding tragedy.

US Ambassador in Tokyo Douglas MacArthur II (who played a key role on the US side) told his Australian counterpart in 1959 that the “American Embassy had checked Japanese opinion and found it was almost unanimously in favour of ‘getting rid of the Koreans'”. At this sensitive moment in US-Japan relations, the State Department was clearly cautious of intervening in a scheme that was an obvious vote-winner for the Kishi regime. Besides, MacArthur personally sympathised with the public emotion, commenting (as the Australian Ambassador at the time reported) that “he himself can scarcely criticize the Japanese for this as the Koreans left in Japan are a poor lot including many Communists and many criminals.”

In fact, although some were doubtless ideologically committed to the Kim Il Sung regime, those who “returned” to North Korea included tens of thousands of people whose only dream was a better future for themselves and their families: people who included entrepreneurs, technicians and university lecturers as well as the poor and unemployed. While most were ethnic Koreans, their number also included over 6,000 Japanese nationals (mostly spouses of Korean men). Many thousands, of course, were children.

The International Red Cross “confirmation of free will”, which was set in place to guarantee to the world that this was a voluntary migration, proved (despite the best intentions of some of those involved) to be little more than a public ritual, too poorly-staffed, lacking the necessary information, and carried out too late in the day to have its intended effect.

Testimony from the small number of former “returnees” who have recently slipped across the border out of North Korea recalls the shock they felt on first arriving and realising the desperate poverty of the country to which they had come. Their plight was made worse some years after the start of the “repatriation”, when the North Korean government began to regard “returnees” from Japan with growing suspicion and prejudice. Thousands were sent to labour camps. Of these, many were never heard from again.

Today in Japan, relatives of those who “returned” to North Korea in the Cold War years watch the difficult process of nuclear diplomacy quietly but with intense concern. The support they send through unreliable communications channels is often the only means of survival for family members left behind in North Korea. While the story of the Japanese kidnap victims of North Korea has dominated news headlines, this tragic story of the 93,340 who were “returned” remains little known, and hostility to North Korea (as well as fears for the fate of relatives in the North) makes it difficult for the small group of survivors now living in Japan to raise their voices. Fears of a mass “re-return” of the ethnic Koreans who left under the repatriation scheme is also a little-discussed factor at work in Japanese government calculations on its relationship with North Korea.

The slow process of dialogue that began at the Six Party Talks in Beijing holds out a faint ray of hope for the future of these divided families. In the meanwhile, it is surely time for their story finally to be told.

Video Here:
http://myspacetv.com/index.cfm?fuseaction=vids.individual&videoid=14645562

Tessa Morris-Suzuki is Professor of Japanese History and Convenor of the Division of Pacific and Asian History in the College of Asia and the Pacific, Australian National University. Her book Exodus to North Korea: Shadows from Japan’s Cold War will be published next month at Rowman and Littlefield. Contact e-mail: [email protected].

Share

Chinese Firm to Open Plant in Gaesong

Tuesday, August 28th, 2007

Korea Times
Ryu Jin
8/28/2007

A Chinese company is going to be the first foreign enterprise to do business in the inter-Korean industrial park in the North Korean border city of Gaeseong, according to the Korea Land Corporation (KLC) Tuesday.

KLC officials said that Dashing Diva, the South Korean branch of Chinese artificial nail manufacturer Tianjin Jci Cosmetic, signed a contract to purchase a 6,000-square-meter lot in the Gaeseong Industrial Complex.

It marks the first time that a foreign company has bought a site in the inter-Korean joint venture, where about 15,000 North Korean workers commute to factories owned and operated by South Koreans.

While the first-phase pilot site has so far been occupied only by South Korean firms, the KLC designated a portion of land in Gaeseong for foreign businesses to boost the industrial complex’s international image and put the lots on sale in June.

Despite the South Korean government’s efforts to lure foreign investment there, no firms had come from outside the country until recently. Multinational sanitary goods maker Kimberly-Clark has also visited the complex to discuss investment there.

Located just north of the border, the Gaeseong Industrial Complex is a flagship project signifying reconciliation between the two Koreas, which remain still technically at war after a fratricidal conflict more than half a century ago.

Despite potential risks stemming from political uncertainty, the special zone has an inescapable economic logic: cheap labor and land of the North combined with the capital and technology of the South.

Gaeseong upbeat with foreign entrants
Korea Herald
Kim Yoon-mi
8/17/2007
 
The recent submissions of applications by two Chinese companies hoping to build factories in the Gaeseong industrial park in North Korea have further brightened the outlook on the joint economic project between the two Koreas, industry sources said yesterday.

South Korean government agency, The Korea Land Corp., said both a Chinese artificial fingernail manufacturer and a plywood producer submitted documents on July 30 in hopes of securing 6,000 square meters and 29,000 square meters of land, respectively, at the Gaeseong industrial park.

The Korea Land Corp. rents land in Gaeseong to individual South Korean or foreign companies under 50-year leases. The company had initially announced in late May that there were six applications available for foreign companies for 1,750,000 square meters of land in Gaeseong. No foreign applications were received until the two Chinese companies submitted their applications in July, according to an official at Korea Land Corp., who declined to be named.

“For foreign companies to build factories in Gaeseong, they should establish entities in South Korea. So, we are waiting for the two Chinese companies to finish that procedure first,” the official said.

The contract with the two companies is expected to be completed late this month, the official said.

Experts say Chinese manufacturers may have decided to move factories to North Korea because China’s rapid economic growth is raising wages and prices.

Currently, an average North Korean employed by any one of the 26 South Korean companies operating in the Gaeseong Industrial Complex earns $60.37 per month.

There have been unconfirmed news reports that the U.S. paper-based consumer product maker Kimberly-Clark Corp. may try to invest in the North Korean city.

Kimberly-Clark CEO Thomas Falk earlier hinted that the company would be interested in investing in Gaeseong, after he visited the North Korean city in late February.

“Gaeseong industrial part has the best environment (skilled labor) and facilities for South Korean SMEs to step forward…. Kimberly-Clark will be very interested in investment (in Gaeseong),” he was quoted as saying by the local daily, Maeil Business, on March 1.

The unnamed official from The Korea Land Corp. said he could not comment on the Kimberly-Clark proposition because he is not at liberty to discuss which foreign companies are in contact with his company.

However, the official said many foreign companies have contacted the Korea Land Corp., inquiring about going into North Korea.

The entry of foreign companies into Gaeseong will clearly be a boon for Hyundai Asan, the South Korean operator of major business projects in North Korea, the company’s officials said. This good news comes in light of a second summit between the two Koreas, another upbeat announcement for the park, Hyundai Asan officials said.

Hyundai Asan is in charge of the construction of factories in Gaeseong industrial park and operates South Korea’s tour business to Mount Geumgang resort in North Korea.

The Gaeseong industrial park, near the border with South Korea, was established in 2000 following the first landmark summit between South Korea’s then-President Kim Dae-jung and North Korean leader Kim Jong-il.

Chinese want some Kaesong action
Joong Ang Daily

8/13/2007

Two small Chinese light-industry companies have applied to build factories in an industrial complex in North Korea where South Korean companies are invested, a South Korean state land developer said on Saturday.

The Korea Land Corp. said a Chinese cosmetics manufacturer and a plywood firm submitted documents on June 30 requesting 6,000 and 2,000 square meters of land respectively in the Kaesong Industrial Complex near Kaesong, a North Korean city close to the border with South Korea.

It is the first time that foreign companies have applied to build plants at the complex where 26 South Korean labor-intensive companies are currently operating with a North Korean workforce of 15,000.

By 2012, it’s anticipated the complex will have several hundred South Korean plants employing as many as 500,000 North Koreans. South Korea is responsible for water, electricity and other infrastructure at the complex which opened three years ago.

The complex is a much-vaunted achievement of the first-ever inter-Korean summit of leaders in 2000 in the North Korean capital, Pyongyang. The second-ever summit of Korean leaders is scheduled to begin on Aug 28, also in Pyongyang.

Share

S. Korea unable to recoup 2.2 trillion won in rice loan to N. Korea: lawmaker

Sunday, August 26th, 2007

Yonhap
8/26/2007

South Korea will likely lose 2.2 trillion won (US$ 2 billion) in its food loan to North Korea, because the price was set by international market standards, an opposition lawmaker said Sunday.

Since 2002, South Korea has loaned 2.1 million tons of rice worth 2.86 trillion won to North Korea to help alleviate chronic food shortages in the impoverished communist country.

The loan was offered at international prices at the time of the shipments, although 2.1 million tons of the shipment were homegrown products, whose domestic price is four times higher than international prices, said Rep. Hong Moon-pyo of the Grand National Party.

Citing data from unification and agriculture ministries, Hong said the total monetary value of the South Korean food loaned to North Korea during the period comes to 2.86 trillion won.

North Korea is required to pay back the loan at international market prices, which currently stand at US$380 on the average, the lawmaker said.

“According to the terms of the contract, South Korea will not be able to recover about 2.2 trillion won, so the difference should be offset by taxpayers’ money,” Hong said, adding that the government should unveil the exact amount of the loan and its conditions.

Share