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Sinuiju Price Data

Monday, April 10th, 2006

Computer Prices (Mar 14, 2006):
-17inch Pentium Ⅲ is US$110~120 retail ($90 wholesale price)
-A printer is US$65~70
-10 Floppy discs are 5,000W
-A keyboard is US$20
-A mouse is US$5

Snack prices (March 28, 2006)
-roast chicken is 6,500-8,000W
-roast duck is 9,000~12,000W
-750g of noodles are 2,400W
-box of Korean noodles is 6,750W
-1kg of potatoes is 400W
-1kg of Beans is 700W
-1kg of wheat flour is 750W (690W at wholesale price)
-400g of Milk is 5,000W
-1kg of Butter powder is 5,000W
-25g of Baking powder is 400W
-1kg of Chinese noodles of 2,000W
-1kg of dried cuttlefish is 8,800W.

Entertainment Costs (March 28, 2006)
-movie admission fee is 50W
-comic book is 1,500W, to borrow 100W
-Swimming pool is 70W
-bath admission fee is 2,500W
-5,000W ($1.67) /huor to use a Karaoke singing room
-1,000W ($0.33) /hour to use a computer in an internet café

Other Prices
–sanitary napkin is 500W, 600w, and 1,000w
-Skin lotions of three kinds are 42,000w
-Aloe cosmetics of three kinds are 42,000w
-A set of cosmetics (a skin cream and a skin lotion) is 10,000w (made in South Korea), 3,500w (made in China)
-Small gas cooking stove is 27,000w (made in South Korea / 25,000w in a wholesale price
-An electric bicycle is 150-200w.

North Korean inflation has increased following consecutively excessive issues of the 500W, 1,000W, and 5,000W notes.

Cities that can provide North Koreans with leisure facilities to enjoy are only Pyongyang, Shinuiju, Chongin, Hamhung, and Rasun. These cities possess big theaters, amusement parks, and swimming pools. Especially Shinuiju, which is close to China, has been introduced with foreign cultures and commodities very quickly. Shinuiju residents are also in the highest economic class of the North Koreans. Thus, Shinuiju has internet cafes, singing rooms, saunas, massage rooms, and comic bookstores.

The investigation was carried out by traders visiting Shinuiju in March and attaining the price levels concerned and then DailyNK gathered the information and cross-examined it.

Also, another trader emphasized that, “The official wage of North Korean workers is about 3,000 won. At the same time, the price for using a singing room per hour is 5,000 won. It shows how badly North Korea has been transformed,” adding that, “Shinuiju is the city where traders doing business with big money from North Korea and China gather. Such singing rooms, PC rooms, and saunas are just for them.”

Items marked by dollars in the price index below are usually paid in dollars, not North Korean won. A Chinese businessman who participated in the price investigation informed us that, “Currently in North Korea, the dollar is used frequently enough to be called ‘common currency’ and has more exchange value,” adding, “As trading costly articles, their paying in dollars makes them win credits.” He also said that, “That the dollar is exchanged into North Korea won is welcomed, yet to exchange the won into dollars is often impossible, even double the value.”

Now, in the early of April, the exchange rate of the dollar in North Korean black markets is roughly 3,000 won against the dollar.

Posted in China, Finance, International trade, Price liberalization, Sports | Comments Closed

Kaesong, US technology, trade with villages

Thursday, April 6th, 2006

From the Asia Times:

The only currency used in the complex is the US dollar.

No foreign investors have yet signed up for the zone

Washington requires high-tech products destined for North Korea that include US intellectual property to undergo stringent export controls. This has irritated many in the South – particularly after the process delayed the transfer of telecommunications equipment. It also appears highly unlikely that Kaesong-built products will be included in a free-trade agreement between Seoul and Washington that is under negotiation.

Officials of the complex say they have assisted local villagers with heating briquettes and rice, but there is otherwise neither trade nor contact across the fence, indicating that the experience of capitalism is strictly insulated. This assumption is buttressed by relations inside the complex: despite talk of inter-Korean fraternity, social contact between Northern and Southern workers is non-existent.

While the railways between the two Koreas were reconnected in early 2004, theoretically linking Seoul and Sinuiju on North Korea’s Chinese border, it is uncertain when trains will start to run through Kaesong.

“There will be talks on opening the line in July, but it is not certain,” said a South Korean official at Dorasan Station, a giant steel-and-glass edifice on the southern side of the border. The lack of rail transport complicates his firm’s logistics costs, said Stafild’s Moon, whose head office is on the south coast of the peninsula, in Busan.

Posted in Foreign direct investment, International trade, Kaesong Industrial Complex (KIC), Railways, South Korea, USA | Comments Closed

Tumen River Development Project

Thursday, April 6th, 2006

From the Daily NK:

The deputy director of Yanbian Korean Autonomous Prefecture in Jilin Province recently said he plans to “establish permanent trade relation with North Korea and pursue multinational tourism projects which connects China-North Korea-Russia through Tumen River Area Development Project”. He also said, “the government of Yanbian Korean Autonomous Prefecture will more actively pursue cooperation with North Korea during the 11th Five-Year Plan(2006~2010)”.

The Korean Autonomous Prefecture decided to establish 2 level highway between Rajin, North Korea and Yuanzheng maritime customs, Hunchun, China and to reconstruct the tailway between Rajin and Onsung in North Hamkyung Province.

Lee Yong Nam at Department of Trade in North Korea said, “economic trade between North Korea-China is improving with the attention of leaders in each country. Intimate economic cooperation will be maintained by all means possible”.

China gained exclusive right to use and develop Rajin port in North Korea, as compensation for establishment of high way in Wonjung-Rajin in North Hamkyung Province. China was excused from all the custom formalities of labor and equipments related to the establishment and development of highway and port, from which they saved 4 million Yuan per year.

Through the trading zone between North Korea-China in Tumen River area, China plans to export food, fertilizers, electronics, textile, plastic goods, cigarrete, mechanical devices. Yanbian Korean Autonomous Prefecture had 11 million 430 thousand dollars trade surplus from trade with North Korea in the first half of last year. A government official at the local government said, “trade surplus will increase drastically when the trading zone between North Korea- China is established” with excitement.

Posted in China, Economic reform, International trade | Comments Closed

Are US Sanctions Affecting DPRK regime?

Monday, April 3rd, 2006

From Chosun Ilbo:

U.S. Treasury Department Under Secretary Stuart Levy said its ongoing financial sanctions against North Korea put “huge pressure” on the regime that could have a “snowballing … avalanche effect.

Washington identified Macao-based Banco Delta Asia as Pyongyang’s “primary money-laundering concern” last September. since then the bank has folded. According to Newsweek, “In today’s interconnected financial world, an official U.S. move to blacklist a foreign bank would be the kiss of death, since any financial institution doing business in dollars needs to hold accounts in correspondent U.S. banks in order to complete transactions.” Washington believes it has finally found a strategy that is putting real pressure on the regime — going after its sources of cash, all across the world.

Kim Jong il is reported to have told Chinese President Hu Jintao during a visit to China in January that his regime might collapse due to the U.S. crackdown on its financial transactions. [but this could be a bargaining chip to use aginast China…help us, or the US gets the peninsula].

“Numerous U.S. government agencies, including the FBI, Treasury, State Department and CIA, have been working for three years to curtail Pyongyang’s vast network of black-market activities” and “to cut off the financial conduits by which the proceeds are laundered.”

North Korea complains the sanctions imposed by the U.S. made its legitimate financial transactions impossible, and is boycotting six-party talks on its nuclear program as a result.

Posted in Counterfeiting, International trade, USA | Comments Closed

Raijin back in the news

Thursday, March 30th, 2006

This story from the Daily NK has an update on whats happening at Raijin as well as a history of the area:

Read whole story here:

In December 1991, Rajin and Seunbong cities were declared “Free Trade Economic Regions”, Rajin Port was planned to be expanded according to a 3-stage development scheme. The first stage consisted of infrastructure construction such as railroads, roads, and ports. In the ten years since, the budgetary outlays have been insufficient.

In 1996, the Committee for Promoting NK Foreign Economic Cooperation published a report, “Reality and Outlook for Rajin- Sunbong Free Trade Economic Regions.” According to the report, the Rajin Port should first build capacity for large-sized containers. In stage two, its loading-handling capacity should be improved from 300 million tons to 1,700 million tons. The third stage, beginning in 2010, the port should have the capacity to manage 100 million tons.

Posted in China, Economic reform, International trade, Rason Economic and Trade Zone (Rajin-Sonbong) | Comments Closed

N Korean report raises Pong Su compo claim

Wednesday, March 29th, 2006

Australia Broadcasting Corporation (Reuters)
3/29/2006

North Korea hinted at seeking compensation from Australia for seizing and sinking the Pong Su, that was used to transport drugs, according to a state media report.

Last week, two Australian fighter jets bombed and sank the impounded North Korean cargo ship in what Foreign Minister Alexander Downer said was a strong message to Pyongyang about its suspected involvement in drug running.

The official KCNA news agency cited a relatively obscure pro-North Korean group as saying Australia needs to compensate North Korea.

“The Australian authorities should make an honest apology to it according to the results of the trial and compensate to the ship and its crewmen for the human, material and mental damage done to them,” KCNA reported the Federation of Koreans in the United States as saying in a commentary.

There was no official demand for compensation from North Korea but analysts have noted that since the government controls the media, it only permits approved comments to appear.

The 4,000-tonne ship the Pong Su had been impounded since 2003, when it led the Australian navy on a 1,100 kilometre chase off the south-eastern coast after being spotted unloading part of a 150 kilogram shipment of heroin at a secluded beach.

Eight crew members were charged with drug smuggling.

The captain and three officers were sent back to North Korea earlier this month after being found not guilty of aiding the drug operation. Four other men have been found guilty of drugs charges relate to the case.

The United States has said it suspects North Korea of engaging in illicit activities such as counterfeiting and drug trafficking as a way to secure funds for its anaemic economy.

Posted in Australia, Drug smuggling, Illicit activities, International trade, Sea shipping | Comments Closed

N Korean heroin ship sunk by jet

Thursday, March 23rd, 2006

BBC
3/23/2006

Video of the ship’s destruction on Youtube

A North Korean cargo ship that was used to smuggle heroin into Australia has been sunk by an Australian fighter jet.

An F-111 aircraft bombed the Pong Su during target practice on Thursday at a secret location offshore, police said.

Australian troops seized the ship in 2003 after spotting it unloading part of a huge heroin shipment at a beach.

The Australian government said the bombing was a warning to North Korea to halt its involvement in drug smuggling – an allegation Pyongyang rejects.

“It is appropriate that we publicly demonstrate our outrage at what has happened by sinking this ship,” Foreign Minister Alexander Downer said.

Captain cleared

“We are concerned about possible links between the North Korean ship and the North Korean government.”

The Pong Su’s cargo of heroin, worth about US$115 million (£66 million), would have provided four million hits of the drug on Australian streets, Mr Downer said.

Earlier this month, an Australian jury cleared the captain of the Pong Su and three officers of involvement in an international drug ring.

But four crew members who were involved in transporting the heroin from ship to shore pleaded guilty to drug charges.

Two have been sentenced to 22 and 23 years in prison and the other two are awaiting sentence.

The 3,500-tonne Pong Su was used to smuggle in more than 125 kilograms of heroin.

High-sea chase

It had anchored off the town of Lorne in Victoria state while the cargo was carried ashore by dinghy.

It was seized in April 2003 after a four-day chase by the Australian navy.

Earlier this week, the freighter was towed out of Sydney Harbour to a location 140km (90 miles) off the coast of eastern Australia, the Australian Federal Police said.

The fighter jet then dropped the bomb that sank the ship, the police added.

Although North Korea has denied any link to the smuggling operation, Mr Downer said it was hard to imagine a shipping company acting on its own in Pyongyang’s Stalinist-style economy.

“I mean this isn’t, after all, a private sector economy where private companies are doing things on their own accord,” Mr Downer said.

“North Korea has been involved in illicit drug trade, North Korea has been involved in illicit financial dealings, and North Korea has been involved in the illicit trade in WMD (weapons of mass destruction) technology over quite some years,” he added.

Australia and the United States have said the case of the Pong Su strengthens their suspicions that Pyongyang deals in drugs to help support its failing economy.

Posted in Australia, Drug smuggling, Illicit activities | Comments Closed

Triplets rounded up?

Thursday, March 9th, 2006

From the Times of London:
3/9/2006
Michael Sheridan

ALL baby triplets in North Korea are being removed from their parents and placed in bleak state orphanages where they are fed by foreign aid.

The policy has prompted concern among diplomats and aid officials, who have witnessed sets of babies kept in special “triplet rooms” in orphanages across the country.

“There is no doubt that the policy is compulsory and universal,” said a seasoned diplomatic visitor to North Korea who has seen the rooms. He said he had not noticed family members visiting the children in his many calls at the orphanages. Conditions when foreigners are allowed to enter appear to be spartan but clean, according to several witnesses.

Food supplies to orphanages are a priority for both the United Nations relief agencies and the North Korean authorities. Local officials have assured inquirers that the babies are being given privileges to relieve their parents of the anxiety of feeding three mouths while the impoverished Stalinist nation endures an eighth year of food shortages.

But diplomatic experts who understand the Korean language and culture cast doubt on the official explanation.

They believe the true reason is linked to some of the most bizarre aspects of Kim Jong-il’s dictatorship. The number three is auspicious in Korean mysticism and triplets are revered for exceptional good fortune. Some believe they may be destined for power and great achievements, which would account for the regime’s desire to keep them under observation.

Diplomats and international aid officials also doubt that poverty is the explanation, because not even triplets born to high-ranking party members are exempt. “It may be officially atheistic and Stalinist but essentially North Korea operates a state religion infused with superstition, astrology and a personality cult which glorifies Kim as a unique individual,” said the veteran diplomat. “You don’t take any chances with rivals in that system.”

Power conferred by blood descent is also important in Korea’s Confucian tradition. The North Korean capital, Pyongyang, was rebuilt by its communist rulers along principles of Chinese geomancy, with “power lines” linking the purported birthplace of the previous dictator, Kim Il-sung, with the purported tomb of Tangun, founder of the Korean race. As heir to the world’s only communist dynasty, the younger Kim exploits every such tradition to exalt himself, while keeping a careful watch on his clan network of intermarried army and party men.

Children of the elite are usually taken from their parents by the age of two and placed in party-controlled schools to break family bonds and to consecrate their devotion to Kim. Foreign observers believe the triplets are kept together and transferred to these schools when old enough.

The segregation of triplets has provoked debate among UN aid agencies and non-governmental organisations delivering help to North Korea.

Although there appear to be no reasons to fear for the physical safety of the triplets, regular visitors to North Korean orphanages report desperate scenes of isolation and sadness.

On a recent visit a member of a foreign delegation entered a room to see infants placed several to a cot, all rocking backwards and forwards.

“Our people were stunned into silence,” the delegate said. A paediatrician outside North Korea who assessed evidence collected on the visit diagnosed severe emotional trauma.

Witnesses said they had noticed better nursing attention and care for triplets in the special rooms. “But none of those infants knows what affection is,” said one visitor. “Our staff try to cuddle them for a few minutes but then, of course, we have to leave.”

Up to 300 sets of triplets a year are believed to be born in North Korea. In an official statement to the UN Human Rights Commission in Geneva, North Korea said: “Triplets are supplied by the state free of charge with clothing, bedding, a one-year supply of dairy products and a pre-school subsidy, and special medical workers take charge of such mothers and children and care for their health.”

The UN’s World Food Programme has reported a sharp improvement in children’s health in North Korea thanks to foreign aid. Since 1998 cases of acute malnutrition in children under seven have fallen from 16% to 9%, and the number of underweight children has decreased from 61% to 21%.

As tension mounts between North Korea and the United States over Pyongyang’s nuclear programme, however, aid officials fear that any military clash could put at risk their ability to feed the children.

There is little doubt of the regime’s cold-hearted approach to paediatrics. In 1998, Médecins sans Frontières pulled out of North Korea, alleging that aid agencies were denied access to so-called 9-27 camps in which sick and disabled children had been dumped under a decree issued by Kim to “normalise” the country.

UN agencies are still arguing for access to closed districts in the northeast of the country, where prison camps and military facilities are located.

Posted in Pediatrics, UN World Food Program | Comments Closed

North Korean Sneakers gumming up trade talks

Sunday, March 5th, 2006

from Bloomberg:

North Korean workers stitching Made in Korea labels on $150 sneakers may hold the key to a $29 billion free-trade agreement between the U.S. and South Korea, the biggest U.S. accord in a decade.The 6,000 North Koreans, working 48-hour weeks for 1/20th of the pay of their southern colleagues, are churning out pots, sneakers and clothes in a South Korean-funded business park just north of the demilitarized zone that separates the two Koreas.

South Korea’s government is counting on free-trade status to help lure local and overseas companies to the park near Gaeseong, an ancient capital of united Korea. The U.S. says goods made north of the DMZ won’t qualify for special treatment.

“The free-trade agreement must be expanded to include Gaeseong products,” said Kim Dong Keun, chairman of the park’s management committee, in Gaeseong. “I understand that nothing has been set in stone. The matter is still up for negotiation.”

At stake is an accord forecast to boost U.S. exports by $19 billion and lift imports from South Korea, the U.S.’s seventh- largest trading partner, by $10 billion. Talks may start as soon as this month.

The U.S. last year exported $29 billion of goods to South Korea and bought $43 billion of Korean imports, according to the South Korean Ministry of Foreign Affairs and Trade. The U.S. is the country’s third-largest trading partner.

“The starting point is that an FTA applies to goods originating in the U.S. and the Republic of Korea,” Alexander Vershbow, the U.S. ambassador to South Korea, said at a seminar with economists in Seoul on Feb. 14. “How Gaeseong is treated under the free-trade agreement is going to be a complex issue.”

Europe Waives Duties

South Korean Trade Minister Kim Hyun Chong said at a Feb. 2 press conference with U.S. Trade Representative Rob Portman in Washington that his government expects goods made in Gaeseong to be part of the trade deal. Portman said the agreement would only cover goods produced in South Korea.

“This is a negotiation between the United States and the Republic of Korea,” Christin Baker, Portman’s spokeswoman, said March 2. “Its provisions will apply to goods originating within the territories of the two parties.”

Singapore on March 2 implemented a free-trade agreement with South Korea that eliminated tariffs on all goods, including those from the North Korean industrial zone.

The European Free-Trade Association waives duties on Gaeseong goods if more than 60 percent of the product is sourced from South Korea.

Delayed Plans

At Gaeseong, Moon Chang Seop, president of South Korean shoemaker Samduk Stafild Co., is delaying his expansion plans until the U.S. talks end.

Moon’s company is among 15 South Korean enterprises to have opened factories in the zone since June 2003. He’s hoping to shift all of his $50 million annual production from the southern city of Busan.

“It all depends on whether the U.S. can accept products made in Gaeseong as South Korean-made,” said Moon, 55, as North Korean music played to rows of uniformed seamstresses in his factory. “If the U.S. won’t budge, I won’t be able to move our main plant.”

Seoul-based Hyundai Group, which controls the world’s largest ship-builder, began developing Gaeseong after a landmark summit in 2000 between then South Korean President Kim Dae Jung and his northern counterpart, Kim Jong Il.

The 10-hectare (25-acre) park borders Gaeseong city, the capital of Korea’s Goryeo kingdom from 918 to 1392. It’s ringed by a 2-meter-high (6.5 feet) fence and guarded by North Korean soldiers armed with pistols and semi-automatic weapons.

More than 300 trucks cross the heavily fortified demilitarized zone every day, carrying in raw materials from the South and carting off finished products. Gaeseong is an hour’s drive from both Seoul and Inchon, the nearest South Korean port, and two hours from Pyongyang.

Golf Course

The South Korean government is spending $220 million to expand the site to 330 hectares by 2007, with 24 new tenant companies already building plants.

By 2012, factories will cover 26 square kilometers (10 square miles), according to the Gaeseong committee. It plans to build a supporting urban area of 40 square kilometers, including a 36-hole golf course.

About 730,000 North Koreans, or almost 3 percent of the communist nation’s population, will be housed there by then, said Kim, the committee chairman.

South Korean companies are paying the North Korean government $57.50 a month for each worker, according to Kim. Of that, North Korea collects at least $7.50 in what it calls a social tax.

By comparison, the average monthly wage for factory workers in the South is more than $1,000, according to Hyundai.

Gaeseong isn’t the only obstacle to a trade accord that may be the biggest negotiated by the U.S. since its 1994 North American Free Trade Agreement with Mexico and Canada.

Agriculture, Autos

U.S. officials also will push South Korea to cut trade barriers in agriculture, auto, pharmaceutical and services industries, according to a Feb. 9 report by the research department of the U.S Congress.

South Korea last month reduced quotas on Korean movies to allow more U.S. films to be shown in cinemas and lifted a two- year ban on U.S. beef imports, paving the way for talks to start.

It also agreed to accept some U.S. auto imports, temporarily exempting them from emission rules that are tighter than U.S. federal standards.

U.S. Trade Representative Portman and South Korean Trade Minister Kim said on Feb. 2 that both parties aim to sign an agreement by the end of this year.

At Gaeseong, Oh Sung Chang, the senior managing director of South Korean package maker Taesung Hata Co., is biding his time.

Taesung Hata, which makes cosmetics cases and casings for brands such as Stila, Bobby Brown and Shiseido, plans to quadruple its initial $14 million investment in Gaeseong in the next few years, Oh said.

“Of course, the outcome of the trade negotiations may influence our decision,” he said, as North Korean workers assembled compact-powder casings in the Taesung factory. “We await a favorable outcome.”

Posted in Economic reform, International trade, Kaesong Industrial Complex (KIC), USA | Comments Closed

Rainbow Trading Company Selling DPRK currency

Sunday, March 5th, 2006

Well, I dont know how, but my personal email address has been on the distribution list of the Rainbow Trading Company…a Tokyo based shop that specializes in North Korean art and books. The owner, Jun Miyagawa, does not seem to be Korean, and I have never spent more time in Tokyo than to pass through several times on my way to the countryside.

Still, I just thought I would let you know that he is selling a complete set of North Korean Currency (1,5,10,50,100,200,500,1,000,5000W) for $66.50.

If you add up all of the denominations, you get 6866Won. Using the market exchange rate of 3,000W=$1USD, the sum value of these notes is $2.28. This is a markup of 2816% (not including postage).

Remember this when you purchase North Korean currency from ebay. Also, When I was visiting, I was told that they have trouble with counterfiters in China. It is likely the money you are buying has never been to the DPRK, unless it is from an actual visitor that you can verify.

Posted in Banking, Counterfeiting, Finance, International trade, Japan | Comments Closed

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