Archive for the ‘International Governments’ Category

« Older Entries
Newer Entries »

Firms Blast North’s Business Climate

Tuesday, September 5th, 2006

From the Donga:
9/5/2006

“Problems can arise anytime you do business in North Korea since there is no market order. However, when business partners disregard agreed-upon deals, it is impossible to conduct any new business. Someone who betrays others can always betray me. Now, who will be willing to trust North Korea and make new deals with it?”

Upon hearing the news report yesterday that North Korea sold the rights to build a large-scale resort including a golf course within the Gaesong Industrial Complex to South Korean real estate developer Unico, despite the fact that Hyundai Group currently holds the rights, one executive of a large company was assured that North Korea was not a trustworthy investment partner.

“If the South Korean government fails to have a control over ‘lawless’ North Korea, the entire business with North Korea can fall into a crisis,” he worried.

During the Kim Dae-jung administration, Hyundai Group began its North Korean business led by then-chairman Chung Ju-yung. It has invested more than $1 billion in North Korea, including $450 million (about 510 billion won by then exchange rate) illegally transferred to the North as a price for holding the inter-Korean summit in 2000. In the process, the company had to go through a major management crisis and the tragedy of Chairman Chung Mong-hun’s suicide.

At such a great cost, Hyundai earned from the North “seven business rights,” which include the rights to provide electricity, railway, tourism, and a dam. With regards to the 3-phase Gaesong Industrial Complex project, it obtained a certificate with which it is allowed to use the land for 50 years.

Nevertheless, Hyundai is gradually being excluded in North Korean businesses except for the existing Geumgang Mountain tour and the first-phase Gaesong Industrial Complex development. There are even rumors that North Korea is in the final stages of negotiation with Lotte Tours over tourism business in Gaesong and Baekdu Mountain, excluding Hyundai that has the business rights in those areas.

Now that North Korea is found to have sold the rights to use 1.4 million-pyeong of land in Gaesong to Unico at the price of $40 million, there is a greater sense of crisis in Hyundai.

It is needless to say that North Korea bears the largest responsibility for the recent trouble.

However, some point out that the South Korean government has been too lukewarm in its response to the problems with the North, out of fear that inter-Korean relations might suffer. They argue that such an attitude only encourages North Korea’s “derailment.”

“Hyundai Asan’s deal with the North over the second and third phases of the Gaesong Industrial Complex development and Unico’s deal with the North can cause overlaps or conflicts. Thus, the companies will have to negotiate over the matter,” said Goh Gyeong-bin, director-general of the Social and Cultural Exchanges Bureau at the Unification Ministry, yesterday when the news on Unico’s North Korea deal was reported.

“The Ministry of Unification never approved Hyundai Asan of its North Korea business to build a golf course in Gaesong. I believe a double deal is possible here just like it is in the private area,” he added.

This implies that the extraordinary business of inter-Korean economic cooperation is being recognized as an ordinary area of private autonomy where private business partners must resolve problems through self-negotiations.

However, everyone knows that Hyundai’s North Korea business did not start out as a mere private business activity. “The government has drawn no clear line in North Korean business, allowing companies to recklessly engage in such business only to encourage North Korea to develop bad habits,” one executive of an economic organization pointed out.

“In order to effectively manage business deals with unpredictable North Korea, the South Korean government must provide clear trade rules and guidelines. Considering the extraordinary nature of North Korean business, relying on the private sector’s autonomy will only extend uncertainties,” professor Hong Ki-taek of ChungAng University emphasized.

Share

Posted in Economic reform, Golf, Kaesong Industrial Complex (KIC), Mt. Kumgang Tourist Special Zone, South Korea, Sports, Tourism | Comments Closed

Kaesong golf course under consideration

Tuesday, September 5th, 2006

From the Joong Ang Daily: 

Kaesong golf course under consideration
9/5/2006

North Korea is in talks with a South Korean company other than Hyundai Asan Corp. for a golf course business in Kaesong, the Unification Ministry said yesterday.

Hyundai Asan, a Hyundai Group affiliate, holds an exclusive right to do business in North Korea.

According to the ministry, Unico, a real estate developer based in Daegu, signed an agreement with North Korea’s Asia Pacific Peace Committee to rent two sites near Kaesong Industrial Complex to build golf courses.

Under the contract, the North Korean committee will lease the two sites, one in the southwest and the other in the north, for $40 million over the next five decades.

Along with the golf courses, Unico plans to establish hotels and other entertainment facilities, said the ministry.

However, the same sites are part of the 16,337 acres of land that Hyundai Asan was allowed to use after reaching an accord with the North in 2000. The Korean company is in the middle of building an industrial complex on 816 acres.

Building golf courses on the sites Unico made a deal on was on Hyundai’s agenda for next year.

“The right to run a golf course business there belongs to us, as we forged the contract first,” said a senior executive from Hyundai Asan.

The company began consultations with Unico yesterday over the golf courses in the North, according to the source.

“If Unico comes up with an appropriate business proposal, we can let the company be a business partner,” he added.

A high-ranking manager from Unico said the company pushed ahead with the project as North Korea explained Hyundai Asan has the right to businesses in Kaesong Industrial Complex only.

The Unification Ministry said it would consider approving the golf course business in North Korea only if North Korea, Hyundai Asan and Unico reach a compromise.

Share

Posted in Asia-Pacific Peace Committee, DPRK organizations, Golf, Kaesong Industrial Complex (KIC), South Korea | 2 Comments »

DPRK selling goods to Chinese trade fair

Monday, September 4th, 2006

From the Daily NK:
NK, A Pitiable Medicine Peddler at aTrade Exhibition
9/4/2006
Kim Young Jin

The Second China Jilin Northeast Asia Investment and Trade Expo commenced on September 2nd in Changchun, Jilin province where North Korea dispatched 100 people from economic and trade groups to set up 36 booths promoting and consulting trade and goods.

North Korea elected Kim Dong Myeong director of Chosun International Exhibition Co. to coordinate the North Korean booths at the trade event, and director in second department of Ministry of Foreign Trade Jeon Hyeong Jeong, vice secretary of Chosun Chamber of Commerce Yoon Young Suk, Chosun Manyeon Health Co. Lee Yong as department representatives. About 100 people were allocated to various booths in addition to 30 Chinese university students who acted as translating helpers.

‘Wooden spatulas’ and ‘Dried ferns?’

The exhibition was divided into categories such as food, cars, electronic goods, petrochemicals, metal goods, construction materials and medical machinery of which North Korea exceeded technicalities and opened 32 booths related to ‘food.’

In the division of construction materials, the Chosun Chongjin Metal Corporation Company had not organized their booth even after people began to enter the exhibition hall much to the embarrassment of sponsors. Clients passed by confused as in the next booth, ‘Inpung Trade Company’ from the Trade Department in Jagang province had set up a display of wooden spatulas, chopsticks and dried ferns totally unrelated to construction.

North Korean booths categorized as ‘foods,’ health and medical products were the focus of retail sale. Each booth stationed 1~2 consultants wearing a dress shirt and pants, 1~2 sales assistants wearing the traditional Korean costume and a Chinese translator sponsored by the event.

Rather than directly advising clients on product queries, the male consultants seem to sit clustered at the back of the booth supervising the female sales assistants and translating helper. As the translating helpers were all Chinese university students and partly inexperienced in English or Korean, it was obvious that they were having difficulty trying to explain product information to foreign clients.

Abundant medical products, chili paste and sesame oil unverified

Excluding Chosun Mansudae Overseas Project Group of Companies of D.P.R.K. (MOP), Chosun Minye Corporation and Chosun Suyangsa Trade Company which sold North Korean paintings, porcelain and handicrafts, the majority of booths sold ‘food’ or ‘medical’ products.

A spokesperson for ‘Tosung Korea Medicine Export Department of Pyongyang Trading Public Corporation’ drew the attention of clients by stating “The ‘Tosung 1 injection’ developed by our company is the leading panacea of this generation. This injection is known to have outstanding effect on various illnesses such as cancer, leukemia, diabetes and tuberculosis.”

In reply to a reporter’s question “If 1,000 injections are ordered, how many days it will take for delivery?” the assistant answered “It is difficult for me to give you a definite answer. However, if equipment is offered for a large-scale order, delivery should be made possible within 3 months.”

Of the North Korean sales assistant met by the reporter, the majority of workers knew only of the cost of products on display and when questioned of large-scale orders, delivery, North Korea’s proof of inspection, ‘clinical effectiveness’ and ‘medical approval’ assistants could not give any definite answers.

However a common scene amongst North Korean booths were appeals to clients “Although economic conditions nor equipment do not yet support mass production, not only has a new medical product has been successfully created but we ensure that the world’s best ingredients, effectiveness and skills are used.”

North Korean assistants asserted by showing ‘An innovative wonder drug’ developed by ‘Chosun Dongbang Drugs Center’ as an impotent drug ‘neo-viagra-Y.R,’ the bird flu antidote ‘Kumdang-2 injection’ by ‘Chosun Pugang Pharmaceutics Company’ and longevity foods ‘Angungwoohwangan’ developed by Korea Myongsung Health Food Pharmaceutical Factory.

According to a speech by a sponsor, various Northeast Asian countries such as South Korea, China, Japan, Mongolia, North Korea and 46 other countries participated in The Second China-Jilin Northeast Asia Investment and Trade Expo. Of 500 corporations in the world, 71 corporations participated in the event and promoted products in 2,200 booths.

Share

Posted in China, International trade, Ministry of Foreign Trade | Comments Closed

DPRK moves accounts to Russia

Sunday, September 3rd, 2006

From AFX News on Yahoo:
9/3/2006
NKorea opens bank accounts in Russia to dodge US sanctions – report

TOKYO (XFN-ASIA) – North Korea has opened about 10 bank accounts at Russian financial institutions in an effort to secure fund flows now blocked by US financial sanctions, the Sankei Shimbun here reported at the weekend.

The newspaper, quoting sources who it described as being close to North Korean affairs, said senior North Korean officials were transferring their funds through the accounts.

Thi is part of Pyongyang’s efforts to escape pressure from the US, which has moved to freeze North Korean funds it claims are the profits of drug trafficking, money laundering and other illegal activities.

Washington is aware of North Korea’s money flows through the Russian banks and it may step up pressure on the Russian authorities to abandon such support for North Korea, the newspaper said.

North Korea has warned the United States it will take ‘all necessary counter-measures’ against Washington for increasing the the pressure on North Korea through financial sanctions.

In November, Pyongyang walked out of six-way talks on its nuclear ambitions after Washington accused a Macau-based bank of helping Pyongyang launder earnings from fake US currency, and told US financial institutions to stop dealing with the bank.

Share

Posted in Banking, Finance, Fiscal & monetary policy, International trade, Russia | Comments Closed

ROK Ship Carries 1st Flood Relief to DPRK

Wednesday, August 30th, 2006

From the Korea Times:
Ship Carries 1st Flood Relief to North
8/30/2006
Lee Jin-woo

The South Korean government has shipped its first batch of flood relief to North Korea via the Red Cross, the Ministry of Unification said yesterday.

The shipment included some rice, the supply of which had been halted since the North’s test-firing of missiles on July 5. The government has made it clear that the humanitarian aid is unrelated to the government’s halted periodic aid provided annually to the communist state.

The shipment comprising 300 tons of rice and 20,000 blankets as well as other emergency relief supplies was made through the Korean National Red Cross (KNRC) and set out from Inchon port, west of Seoul, the ministry said.

The ship, Trade Fortune, is expected to arrive at the North Korean port of Nampo in a day or two. Four Red Cross officials are on board to supervise the delivery, a KNRC official said.

The total aid, comprising 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and more than 200 construction vehicles, will be delivered in 40 installments by mid-October.

“The torrential rain also left damage in South Korea, but we decided to send the flood relief to North Koreans, who face a much more dire situation,’’ said Han Wan-sang, president of the KNRC during a ceremony before the shipment. “I hope the two Koreas can find a breakthrough in the chilly inter-Korean relations through the aid program.’’

Also speaking at the ceremony, Vice Unification Minister Shin Un-sang said the humanitarian flood relief has great symbolic meaning as it was based on bipartisan support from the governing and opposition parties as well as the public.

After a meeting of Red Cross officials from the two sides at Mt. Kumgang in the North on Aug. 19, the government announced its humanitarian aid plan for the North to help repair the damage from recent flooding.

The ministry estimates the rice aid will cost some 195 billion won ($203 million); and the construction supplies and equipment, 26 billion won.

The ministry plans to use the Inter-Korean Cooperation Fund to match the contribution made by local private relief organizations. A 10 billion won subsidy will be given to those organizations next month.

The exact number of flood victims in the North has not been confirmed yet due to a lack of information on the reclusive state.

The National Intelligence Service (NIS) has reported to the National Assembly that some 900 North Koreans are dead or missing because of flooding, sources said. The number greatly differs from claims by South Korean humanitarian aid groups who say casualties have reached 10,000.

Share

Posted in Agriculture, Foreign aid statistics, International Aid, Russia | Comments Closed

Relief goods mirror plight of stunted N. Koreans

Wednesday, August 30th, 2006

Yonhap
8/30/2006
Sam Kim

Thousands of used but clean shirts, pants and other clothes are stacked in big heaps in warehouses outside Seoul to be sent to poverty-stricken North Korea.  But they can’t be sent as they are, because North Korean officials want to get them their way: all without English writing on them and their size no bigger than “large.”

“In addition, we have color restrictions,” Ahn Jeong-hui, director of the Korean Council for Reconciliation and Cooperation, the donor of the clothes and other relief goods. “Strong colors could easily repulse North Koreans.”

Whenever impoverished North Korea suffers from flood and other natural or man-made disasters, sympathetic South Korean civic organizations usually respond to their appeal for emergency aid with warm hearts.

The shipment-in-waiting is for thousands, perhaps tens of thousands of North Koreans who were made homeless in massive floods in mid-July.

There were no official North Korean announcement on the extent of the flood damage but its media said “hundreds” of people were killed or missing. One South Korean relief group said “thousands” were killed.

The South Korean civilian aid is in addition to more than US$200 million worth of relief goods scheduled to be sent by the Seoul government, which include 100,000 tons each of rice and cement, 50,000 tons of reinforced steel bars and a number of trucks and other construction equipment.

With its economy in shambles, impoverished North Korea turned to international handouts in 1995 to help feed its 23 million people. U.N. relief workers said the largest floods in the country are expected to result in 100,000 tons of crop damage this year.

After years of dealing with North Korea, South Korean donors have learned that helping the communist country is not just about sending large quantities of supplies. It requires certain “customization,”

“The maximum size of clothes we send to North Korea is ‘large,'” said Hyun Il-hyun, secretary at Join Together Society, another South Korean relief agency, “We know anything bigger, like ‘extra large’ or ‘extra extra large,’ won’t fit North Koreans.”

“What will fit elementary school kids in South Korea will usually fit North Korean middle-schoolers,” she said. “Most North Korean adults will fit well into what South Korean teenagers wear.”

Chronic food shortages and malnutrition have stunted many North Koreans, making some look like dwarfs. Television footage broadcast in South Korea showed gaunt North Koreans scouring winter fields for grains left by reapers.

Nearly 8,700 North Koreans have defected to South Korea since the Korean War ended in 1953, including 1,139 in 2002, 1,281 in 2003, 1,894 in 2004, 1,383 in 2005 and 1,054 in the first seven months of this year. Many complained of hunger in their communist homeland.

A 2004 survey of 2,300 North Korean defectors showed that average North Korean men and women are 5.9 centimeter and 4.1 centimeters shorter than their South Korean counterparts, respectively. An average 14-year-old boy from North Korea is up to 15.8 centimeters shorter than the same-aged South Korean.

English-embellished clothes are not welcome, either, in North Korea, relief workers said.

“We pick out any clothing that has English writing on it,” Hyun of Join Together Society said. “North Korean authorities apparently don’t want their people to think the clothes are coming from their sworn enemy, the U.S. We also restrict clothes that have the names of South Korean organizations.”

North Korea has asked them to increase shipments of rice and flour instead of instant noodles, according to South Korean relief workers.

“We will comply with the North Korean request and no longer send instant noodles,” said Ahn of the Korean Council for Reconciliation and Cooperation. “I think the North’s request has do to with the South Korean marks and logos on the packings.”

According to South Korean government officials, North Korea tightly controls the flow of information among its people. All radio sets are pre-set to monitor only state broadcasts.

Share

Posted in Emigration statistics, International Aid, South Korea | Comments Closed

DPRK exports to Japan halved amid economic sanctions

Wednesday, August 30th, 2006

From Yonhap:
8/30/2006

North Korean exports to Japan dropped by nearly 50 percent last month from June amid Tokyo’s economic sanctions against the communist state for its test-firing of missiles early last month, a report by Japan’s Finance Ministry released on Wednesday showed.

The total amount of North Korea’s exports to Japan last month dropped to some 440 million yen (US$3.75 million), a 44.2 percent decrease from that of June, the report said. The amount is also down 42.2 percent from that of the same period in 2005.

The report failed to provide specific reasons for the drop, but observers believed it was mainly due to the country’s economic sanctions against the impoverished North, which followed Pyongyang’s test-firing of seven ballistic missiles on July 5.

The observers also said trade between the two is likely to further shrink amid Tokyo’s strong reaction to North Korea’s missile tests and the communist state’s alleged preparations to test a nuclear bomb.

The United Nations Security Council unanimously adopted a resolution on July 15, condemning the North Korean missile tests and prohibiting any missile-related dealings with the North. But Tokyo has been taking additional steps to cut off any cash inflow to North Korea from its country.

The country has banned a major North Korean ferry, Mankyongbong-ho, from its ports at least for the next six months, cutting off the largest and almost the only direct means of transportation between the two for North Koreans and some 200,000 pro-Pyongyang Korean residents in Japan.

Share

Posted in Chongryun, International trade, Japan, Trade Statistics | Comments Closed

Red Cross to supervise aid delivery

Wednesday, August 30th, 2006

From the Joong Ang Daily:

Four South Korean Red Cross officials are expected to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said yesterday.

The Red Cross officials will depart from the port of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles in early July, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear program.

The government, however, pledged to give 241 billion won ($251 million) worth of aid through the country’s Red Cross as one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds of people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later asked Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civic groups’ efforts to help the country recover from devastating torrential rains and flooding.

The Unification Ministry has also agreed to provide funds matching amounts raised by each civic organization, expected to total some 10 billion won.

The government’s aid through the Red Cross will include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

Share

Posted in International Aid, International/Korean Red Cross, South Korea | Comments Closed

Red Cross to send first shipment of government flood aid to DPRK

Tuesday, August 29th, 2006

From Yonhap:
Byun Duk-kun
8/29/2006

Four South Korean Red Cross officials are to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said Tuesday.

The Red Cross officials are to depart from a port in the country’s western city of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

“The trip is to supervise the first shipment of the Red Cross’ flood aid to North Korea,” the official said.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear ambitions.

The government, however, pledged to give 241 billion won (US$251 million) worth of aid through the country’s Red Cross in one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later requested Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civilian efforts to help the country recover from the flooding.

The Unification Ministry has also agreed to provide funds matching those raised by each civilian organization, expected to total some 10 billion won.

The government’s aid through the Red Cross is to include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

South Korea provided hundreds of thousands of tons of rice and fertilizer to the impoverished North annually since heavy rains and a nationwide famine in the mid-1990s left over 2 million North Koreans dead and millions of others displaced.

North Korea requested the South to give half a million tons of rice for the year before it launched the seven missiles into the East Sea on July 5.

Government officials say the country will not consider accepting the North’s request until the North agrees to return to the international nuclear negotiations, which have stalled since November due to Pyongyang’s boycott, as well as resumes its self-imposed moratorium on missile tests.

The Koreas remain divided along a heavily-fortified border since the end of the 1950-53 Korean War, which ended with a cease-fire.

Share

Posted in International Aid, International/Korean Red Cross, South Korea | Comments Closed

Suspects Admits Smuggling N.Korean ‘Supernotes’

Monday, August 28th, 2006

From the Choson Ilbo
8/28/2006

A Californian man indicted on charges of smuggling counterfeit dollars into the U.S. testified at his trial that the high-quality counterfeit US$100 bills or “supernotes” were manufactured in North Korea, the National Intelligence Service said Monday. The NIS reported to the National Assembly’s Intelligence Committee that the man admitted conspiracy to smuggle the supernotes and admitted where the phony bills were made.

The man is a Chinese-American named Chao Tung Wu, the NIS said. There have been reports in the U.S. media quoting anonymous government officials as saying the supernotes were made in North Korea, but this is the first time the claim was confirmed in legal testimony by a chief suspect.

A joint taskforce of the FBI, the CIA, the Justice Department and the Treasury conducted secret investigations and rounded up 59 suspects around the U.S. on charges of smuggling counterfeit dollars and cigarettes in August last year. The taskforce worked under the code name “Smoking Dragon” and “Royal Charm” between 1999 and 2005. It alleges suspects attempted to smuggle millions worth of forged dollars and some $40 million worth of counterfeit cigarettes.

The case drew much publicity not only because of its sheer scale but also because of North Korea’s suspected involvement. The Treasury Department led the investigation that ended up designating Macao’s Banco Delta Asia as Pyongyang‘s “primary money laundering concern” on Sept. 15 last year, a month after the suspects were arrested.

“We should note that talk of political solutions between the U.S. and North Korea over the counterfeit dollars disappeared in South Korea and China since the end of last year,” a diplomatic source in Seoul said. Some until then claimed the U.S. was pressuring the North without clear evidence, but they lost their ground as Washington acquired evidence to support North Korea’s involvement.

The trial is likely to take one or two years, a diplomatic source said. If it ends with a guilty verdict for the main suspect for smuggling made-in-North Korea supernotes, it would get Pyongyang into serious trouble on the global stage. The North denies the charges and says the resulting sanctions amount to “theft.” The communist country in a statement last Saturday said the U.S. has produced no clear evidence so far. But the suspect’s guilty plea undermines the credibility of that claim.

Share

Posted in Counterfeiting, Tobacco, USA | Comments Closed

« Older Entries
Newer Entries »