North Korean Economy Watch

NASA has released another iconic photo of the Korean peninsula taken at night:

Image date: 2014-1-30

Here is the source. Here is video.

Here is a NASA photo from 2012-9-24.

UPDATE 2 (2014-1-27): The North Korean restaurant has re-opened in Amsterdam. According to NK News:

While the Pyongyang Restaurant [See Below] shut down the same year as it opened – allegedly due to a dispute between the Dutch owner Remco Van Daal and its North Korean staff – the Haedongwha staff will now be managed in cooperation with an ethnic Korean manager named John Kim.

…

Kim, who has lived in the Netherlands for most of his life, also runs a business in Pyongyang exporting sand to Singapore, a source familiar with his background told NK News.

Unlike Haedangwha restaurants in China, which are run directly by the North Korean government, the Netherlands branch is unique in having non-North Korean ownership but a North Korean staff.

You can read more about the restaurant in Het Parool.

Michael Madden tracked down the location.

Here is the official web page of the restaurant.

Learn more about the “other” Haedanghwa here.

UPDATE 1 (2012-9-6): The restaurant has closed. According to the Associated Press:

A North Korean restaurant in Amsterdam staffed by cooks and waitresses from the isolated country has closed its doors.

Dutch newspaper De Telegraaf reported Thursday that Pyongyang Restaurant’s closure was permanent and stemmed from a disagreement between its Dutch owners and North Korean staff.

The restaurant was an oddity, believed to be the only of its kind in Western Europe, though there are similar restaurants in Asia. Dutch labor authorities say North Koreans can get work visas for Europe under standard rules, but few do.

A woman who answered the phone at the restaurant said the establishment was closed. She couldn’t say for how long because she was not authorized to do so. Its website says it is closed “due to holidays.” Phone calls to the owner Thursday went unanswered.

See more here at North Korea Leadership Watch.

ORIGINAL POST (2012-2-5): According to Yonhap:

A North Korean restaurant has opened in the Dutch capital of Amsterdam in what could be the communist nation’s latest attempt to earn hard currency and foster closer ties with Europe.

The “Pyongyang Restaurant” was launched late last month under a joint venture between North Korea and two Dutch businessmen. While North Korea is known to operate dozens of restaurants across Asia, it is the first time a North Korean restaurant has opened in Europe, with the exception of a canteen that briefly operated near the North Korean Embassy in Vienna in the mid-1990’s, according to a local source, who spoke on the condition of anonymity.

The restaurant is staffed by nine North Koreans, including the director and manager, Han Myong-hee, who worked for 15 years at a North Korean restaurant in Beijing operated by the North’s ruling Workers’ Party.

Pyongyang Restaurant, which seats 24 people, has its walls covered with pictures of Pyongyang and North Korean nature, while its menu consists solely of a nine-course meal priced at 79 euros (US$104).

Han said there are plans to offer more affordable dishes such as Korean noodles and dumplings after the restaurant’s official opening on Feb. 17.

“After our official launch, we plan to gradually serve a variety of dishes and during lunch hours as well,” she said. The restaurant currently serves only dinner.

The opening ceremony is expected to be attended by the North Korean ambassador to Switzerland, other North Koreans, and key figures from the Netherlands and different European nations, Han said.

Analysts said the restaurant is likely to serve not only as a source of much-needed cash but also as a bridge to Europe for the isolated North.

“North Korea has been putting a lot of effort into normalizing relations with European nations since 2000,” said Yang Moo-jin, a professor at the University of North Korean Studies in Seoul. “The opening of North Korea’s first restaurant in Europe can be seen as the North’s attempt to improve ties with the West through exchanges at the civilian level.”

Read the full story here:
N. Korean restaurant opens in Netherlands
Yonhap
2012-2-5

According to Yonhap:

North Korea’s imports of Chinese grain increased 5.9 percent in 2013 from a year earlier, a South Korean think tank said Monday.

The Korea Rural Economic Institute said Pyongyang’s imports of Chinese flour, rice, corn and other grain products reached 298,257 tons in 2013, compared with 281,633 tons a year earlier.

North Korea’s food production is estimated to have been at about 5.03 million metric tons in 2013, up 5 percent from the previous year, the U.N. World Food Program said in November.

Still, the food security situation is still serious, with 84 percent of all households having borderline or poor food consumption, the U.N. food agency said in a report posted on its website.

Food aid from the UN is down in 2013.

Read the full story here:
N. Korean imports of Chinese grain up 5.9 pct last year
Yonhap
2014-1-27

When Jang Song-thaek was purged, the North Korean prosecutors provided a laundry list of offenses committed against the nation. Among his crimes, Jang was specifically criticized for his management of assets in the Rason Economic and Trade Zone. The public accusation stated, “Jang made no scruple of committing such act of treachery in May last as selling off the land of the Rason economic and trade zone to a foreign country for a period of five decades under the pretext of paying those debts.”

The unnamed “foreign country” in the quote is obviously China, and the subtext of the quote implies that Rason contracts signed under Jang’s protection are in danger of being violated as the North Koreans reorganize the allocation of rents among key leadership organizations. This has to be unnerving to the Chinese business partners that signed these contracts and have been investing in the zone. In a best-case scenario for the investors, the reorganization of patronage would simply mean that they are just making payments to different organizations, but otherwise, business is pretty much unchanged. However, if the North Koreans are taking the drastic step of invalidating contracts and confiscating property, then we would expect to see a significant slow down in development of the zone in the future.

Following news of Jang’s purge, initial reports indicated that both DPRK and Chinese members of the Rason Management Committee had departed the SEZ and that most activities have come to a complete halt. But there are not enough reports to firmly conclude this is the case. Now New Focus has published information on some of the changes taking place in the Rason SEZ. The usual caveats apply:

The Kim Il-sung villa in Rajin-Sonbong is no longer available for hire, according to a reliable source in the area. The de-listing happened in the course of a Ministry of State Security (MSS) surveillance operation in North Korea’s Rajin-Sonbong special economic zone.

The operation was instigated under orders from the Organisation and Guidance Department (OGD) of the Workers’ Party, as it tightens its grip on the zone in the aftermath of Jang Song-thaek’s purge and execution. Nevertheless, the operation is being conducted in a relatively discreet manner so as not to startle Chinese businessmen in the zone.

The talk among senior DPRK cadres is that although Rajin-Sonbong’s Party Secretary, Party Committee Chair and MSS Supervisor are Jang Song-thaek’s associates, they are being left alone for the time being because of their close personal relations with Chinese investors; but that following the Supreme People’s Assembly elections in March, they will be replaced.

Nevertheless, the highest ranking female cadre in Rajin-Sonbong, the Tourism Director, was taken away. This prompted rumours that she was Jang Song-thaek’s lover, but her circumstances make this very unlikely.

The International Club in Rajin-Sonbong closed after the purge of Jang Song-thaek and the coming and going of Chinese businessmen has also decreased. The Kim Il-sung holiday villa in Rajin-Sonbong, which had been rented by HK investing company Emperor Group, has now been confiscated.

This villa is a 70s construction built as a getaway for Kim Il-sung and was a prized landmark in Rajin-Sonbong, with even a commemorative monument to mark the villa’s location. When the Emperor Group set up a casino in the area, they asked for permission to hire the villa for its VIP guests. At first, the Rajin-Sonbong Party Committee refused because it was considered a sacred landmark related to Kim Il-sung.

The person who secured the deal for the Emperor Group was an ethnic Korean Chinese named Ri Bong-hui, director of a fuel oil company. He donated US$1 million as a brokerage fee and the rental permit was granted. Rumours have now been spread that this fee had gone personally to Jang Song-thaek.

Existing land lease agreements in the Rajin-Sonbong special economic zone have also been affected. These originally stipulated that at US$20 / m2, plots of land could be leased for 20-50 years, depending on their location. The agreements have now been invalidated on the grounds that the details had been mismanaged by Jang Song-thaek.

Further, personnel tax and operating tax have been re-calculated and a request has been made by Party authorities in Rajin-Sonbong for the appropriate payments to be made in yearly groupings. As the Rajin-Sonbong authorities have asked for ten years back payment, many small investors from China are complaining about their losses.

The fact that the new rulings are being applied only to smaller companies is said to be exacerbating their disgruntlement. Chinese firms making larger investments are currently exempt, but some are still worried that the new measures might be applied to the bigger investors in a second phase of rulings.

According to Yonhap:

North Korea’s exports of anthracite coal to China grew 15.5 percent in 2013 from a year earlier, data showed Friday.

North Korea shipped a total of US$1.37 billion worth of anthracite to China last year, compared with $1.19 billion sold to the neighbor a year earlier, according to the data from the Korea International Trade Association.

North Korea exported only $162.6 million worth of the coal to China In 2007, but the figure has grown every year since then, according to the data.

The total anthracite exported to China last year was measured at 16.5 million tons, up 39.7 percent from what was exported in 2012, the data also showed, indicating that the North sold the coal to China at cheaper prices last year.

In December alone last year, the North shipped $118.06 million worth of anthracite, almost the same amount as November’s $121.45 million.

This means North Korea continued anthracite exports to China after executing leader Kim Jong-un’s once-powerful uncle Jang Song-thaek in early December for allegedly attempting to overthrow the regime and committing anti-state crimes, including selling North Korean natural resources abroad at excessively low prices.

North Korea’s anthracite exports are one of its major income sources and China is virtually the only destination for the shipments.

Read the full story here:
N. Korea’s coal exports to China up 15.1 pct in 2013
Yonhap
2014-1-24

UPDATE 2 (2014-1-21): According to Yonhap:

The number of North Korean visitors to China rose about 11 percent on-year to top 200,000 for the first time in 2013, Chinese government data showed Tuesday, in the latest sign that the flow of people between the allies was unaffected by geopolitical tensions.

About 206,600 North Koreans traveled to China last year, compared with 186,000 in 2012, the data from China’s National Tourism Administration showed.

It was the first time that the annual number of North Korean tourists to China exceeded 200,000 since the Chinese tourism administration began releasing data in 2005.

NK News reports additional data:

93,300 work visas were given to North Korean citizens[.]

Goeffrey See comments that part of the increase can be explained by repeat travelers.

Read the full story here:
N. Korean tourists to China rise 11 pct in 2013
Yonhap
2014-1-21

Work visas for North Koreans going to China up 17.2%
NK News
Oliver Hoffman
2014-1-21

UPDATE 1 (2013-7-18): According to the Japan Times:

The overall number of visitors to China dropped 5.2 percent to 12.75 million in the six-month period.

But North Korean visitors to China increased 11.7 percent to 99,100, the highest since 2005 on a first-half basis.

Nearly half of the North Koreans came to China to work, mainly at factories and restaurants. These North Koreans are low-cost labor for China, while the data signal that North Korea continues to actively use its manpower to earn foreign currency.

Read More here:
China sees 26% fewer Japanese visitors in first half but North Korean arrivals up by 12%
Japan Times
2013-7-18

ORIGINAL POST (2013-4-26): Number of DPRK visitors to China up 14% in first quarter 2013. According to Yonhap:

About 45,800 North Koreans traveled to China, the North’s closest ally, in the January-March period, compared with 40,200 recorded in the same period in 2012, according to the report by the Washington-based Voice of America (VOA), which cited data from China.

The increase is seen as showing that North Korea-China relations have not been disturbed by China’s recent shift to take an active role in implementing the U.N. sanctions against the North, adopted following the country’s December rocket launch and its third nuclear test on Feb. 12.

The majority of the North Korean travelers to China, 48.3 percent, crossed the border to work in the world’s second-biggest economy and 25.8 percent went there for business purposes, according to the report. Only 1.5 percent were on trips to China for tourism.

Out of the total visitors, 78 percent were male North Koreans while 44.5 percent of the total were aged between 45 and 64.

Read the full story here:
Number of N. Korean visitors to China up 14 pct in Q1
Yonhap
2013-4-26

According to Yonhap:

 A U.S. private relief agency plans to provide aid worth US$1 million to North Korea this year to help support North Korean children and other vulnerable people, a news report said Thursday.

World Vision Inc. also plans to provide clean water to more than 8,000 North Koreans in provincial areas while providing nutritional assistance to children under the age of six, according to the report by the Washington-based Radio Free Asia.

The Christian organization plans to expand its humanitarian project in other rural areas, the report said.

Read the full story here:
U.S. relief agency to give aid worth US$1 mln to N. Korea
Yonhap
2014-1-16

From the PRC’s Global Times:

“Like the ancient Chinese verse that goes ‘a duck knows the coming of springs beforehand,’ the so-called ‘gray’ trade on the border of China and North Korea serves as a thermometer of North Korea’s politics and economy,” Lin Jun, a merchant from Dandong, a border city of Northeast China’s Liaoning Province, told the Global Times. Lin has 12 years of experience in Sino-North Korean border trade.

Since Jang Song-thaek, allegedly the second powerful man in North Korea, was purged in December, the northeast Asian country has released mixed signals toward the outside world: On the one hand, it seems to be toughening its political stance, but on the other, it pledges continued reconciliation with South Korea and further economic development.

The sensitive border trade between the two countries has witnessed dramatic ups and downs during recent months.

“My North Korean partner came by speedboat on December 30, bringing orders from Sakchu, Bakcheon and Pyongyang, demanding all the goods ready by the next day,” said a man surnamed Deng, who works for Lin.

“However, the next day he suddenly called to cancel the deals without giving any reason. There was no such precedent, even after North Korea conducted the nuclear test [in February last year],” he said.

Luxury goods

“Two years ago, North Korean people mainly needed cooking oil, rice, garments and second-hand electric appliances,” Deng told the Global Times reporter when taking his ship to Sakchu down the Yalu River.

“Nowadays, they will also ask for Apple computers, iPads, cell phones, Japanese washing machines and brand-new fridges, though the consumers of these luxury goods are mostly officials. Even senior officials in Pyongyang are using tablet computers bought from us,” Deng said proudly.

Such gray trade between China and North Korea has been an established fact for a long period, Lü Chao, a Korea expert with the Liaoning Academy of Social Sciences, told the Global Times.

He noted that it was quite commonly seen at border areas that people throw a pack over from one side of the border and those on the other side would pick it up and go away on a motorcycle, hence “gray trade” is also known as “bag-throwing trade.”

Given the long border between China and North Korea and the common language people living around the border share, it is hard to eliminate such trade, Lü noted.

However, although gray trade was not fully legal, it was indeed a supplement to the North Korean economy and a market always short of goods, especially for people’s daily lives, Lü said.

“Those engaged in the border trade are definitely not ordinary people,” Cui Mingxuan, a Dandong businessman who has retired from border trade for more than a year, told the Global Times.

Read the full story here:
Gray trade
Global Times
2014-1-14

UPDATE 9 (2014-1-18): Joseph Terwilliger gives an interview here.

UPDATE 8 (2014-1-18): The AP reports that Rodman has checked into rehab:

Dennis Rodman has checked into an undisclosed alcohol rehabilitation center to treat his long-time struggle with alcoholism, his agent says.

Darren Prince declined on Saturday to say which facility will treat Rodman and how long he will be there. Rodman recently returned to the United States from his latest trip to North Korea.

He later apologized for comments he made in North Korea about a detained American missionary, saying he had been drinking and was under pressure as he organized an exhibition game there. He also sang “Happy Birthday” to North Korean leader Kim Jong Un at the start of the friendly game.

“What was potentially a historic and monumental event turned into a nightmare for everyone concerned,” Prince said. “Dennis Rodman came back from North Korea in pretty rough shape emotionally. The pressure that was put on him to be a combination `super human’ political figure and `fixer’ got the better of him.

“He is embarrassed, saddened and remorseful for the anger and hurt his words have caused.”

UPDATE 7 (2014-1-14): The apologies, via the Associated Press:

Former basketball star Dennis Rodman apologized on Monday for not being able to help an American missionary detained in North Korea while he played there to celebrate the birthday of his friend and leader Kim Jong Un.

“I’m sorry, I’m sorry I couldn’t do anything,” Rodman told media on his arrival at Beijing airport from a weeklong trip. “It’s not my fault. I’m sorry. I just want to do some good stuff, that’s all I want to do.”

He said he would return to North Korea next month, but gave no details.

…
Acknowledging the controversy surrounding the trip, one of the players, Charles D. Smith, said Rodman “opened the door and he did some missteps along the way.”

In an interview in Beijing, Smith said Rodman’s singing of “Happy Birthday” to Kim before the exhibition game at a Pyongyang stadium was something that he alone had decided to do. “I think that it might not have been the right thing to do, but he did it … if it was done in private it would be different, but when it’s done in the open like that, people are going to have opinions.”

During the trip, Rodman was also slammed for not using his influence with Kim to help free Kenneth Bae, the missionary in poor health who has been detained for more than a year for “anti-state crimes.” Rodman apologized last week for comments he made in a CNN interview implying Bae was at fault, saying he had been drinking and was upset because some of his teammates were under pressure to leave.

Smith said the controversy surrounding Bae was a “bad situation” that “overshadowed some of the things that we were doing.”

“Dennis is not a member of the State Department, he is not a member of the U.N.,” Smith said. “For them to put the flag in his hands and say go and negotiate and talk about it, he probably would have made it worse, you know.”

He said North Korean officials had invited the team back “at any given time.”

On Monday, Rodman reiterated that his trip was one of goodwill.

“This is not a bad deal,” he said. “I want to show people that no matter what’s going on in the world, for one day, just one day, no politics, not all that stuff.

“I’m sorry for all the people and what’s going on, I’m sorry,” he continued. “I’m not the president, I’m not an ambassador, I’m just an individual that wants to show the world the fact that we can actually get along and be happy for one day.”

Rodman and Kim struck up a friendship when the basketball-player-turned-celebrity first traveled to the secretive state last year.

UPDATE 6 (2014-1-9): KCTV footage of the visit has been made public. The fist video shows Rodman’s delegation meeting with Kim Jong-un, presenting him with customized vodka bottles, singing “Happy Birthday” to Kim Jong-un, then offers game highlights.

The second video shows the game itself.

UPDATE 5 (2014-1-8): Dennis Rodman sings “Happy Birthday” to Kim Jong-un. Here is Simon Cockerell talking about the game via Skype.

UPDATE 4 (2014-1-8): According to the Daily NK, the DPRK is using the Rodman game to treat Chinese investors.

A source in China informed Daily NK on the 8th, “Some Chinese traders who have given a great deal to projects in Pyongyang, including the construction of department stores, shops and restaurants, have been invited to go and celebrate Kim Jong Eun’s birthday. All accommodation, food and travel while in the country is being covered by the Chosun side, and all other expenses are to be borne by the invitee.”

“Chosun [North Korea] has only invited a select group, and there will only be two or three officials from the Chinese side, so the total number of people won’t have exceeded 30. Their schedules for today are to attend the friendly basketball game and then inspect Pyongyang [Munsu] Water Park. Later there will be a tour of Kaesong and Panmunjom, and I hear that a number of banquets have been prepared,” the source went on.

By hosting the group in this way, Kim Jong Eun is following in the footsteps of Kim Il Sung and Kim Jong Il, both of whom invited foreign business people and dignitaries to partake of their birthday celebrations. The only difference is the small number of invitees, the lack of publicity outside the country thus far, and the fact that today is not actually a North Korean public holiday.

“Kim Jong Eun has not done much in terms of showing himself off as yet,” the source posited, “and since he has a great many things to worry about at home right now, such as the execution of Jang Song Taek, he cannot host a large spectacle for this birthday this year. Nevertheless, it does appear that they want to convey their gratitude to foreign investors, so he’s invited them to help him celebrate.”

Furthermore, “These invitations have been extended because there is a sense of urgency about attracting investment for special economic zones and other projects that call for capital. After creating a genial atmosphere via the tourist activities, they will actively work to encourage the invitees to invest in things like the construction of water parks in each major city.”

Meanwhile, a second source has revealed that the North Korean authorities have also summoned a select group of provincial cadres to Pyongyang for the birthday celebrations. The source from North Hamkyung Province reported to Daily NK, “Some provincial cadres have gone up to Pyongyang for the Marshal’s (Kim Jong Eun’s) birthday celebrations on January 8th. This has not been officially reported to the people, and cadres are the only ones being quietly called up.”

UPDATE 3 (2014-1-7): Dennis Rodman completely lost it during this live interview on CNN. Here is Andray Abrahamian’s response.

UPDATE 2 (2014-1-7): A traveler visiting the DPRK to see the Dennis Rodman game has introduced Bitcoin to the DPRK. Here is an instagram photo of the first Bitcoin transaction in the DPRK.

UPDATE 1 (2014-1-6): Apparently Paddy Power is still funding this trip despite publicly bowing out during Rodman’s last visit. According to the Irish Times:

Just before Christmas, Paddy Power withdrew sponsorship of Rodman’s event, saying this was as a result of general condemnation of Pyongyang. This followed the rare public purge of leader Kim’s powerful uncle Jang Song-thaek, who was executed last month.

The company said it “took a back seat” after those events but would still “honour all of its contractual obligations”.

ORIGINAL POST (2014-1-4): Rodman has made three trips to the DPRK. Here are links to the first, second and third trips. In a gesture towards his fourth trip he has named a slate of basketball players that will be joining him for an exhibition match in honor of Kim Jong-un’s birthday.

According to Sports Illustrated:

Dennis Rodman has named a team of former NBA players to participate in an exhibition basketball game in Pyongyang, North Korea.

Rodman leads a team that includes former NBA All-Stars Kenny Anderson, Cliff Robinson, and Vin Baker. Craig Hodges, Doug Christie and Charles D. Smith are on the team, as well. They will play against a top North Korean Senior National team on Jan. 8, marking Kim Jong Un’s birthday.

and…

Rodman calls the game his version of “basketball diplomacy.”

“My previous travels have allowed me to feel the enthusiasm and warmth of fans,” Rodman said. “The positive memories and smiles on the faces of the children and families are a testament to the great efforts we have put into fulfilling our mission wherever we go voiding any politics. We are all looking forward to arriving in Pyongyang, meeting the citizens, visiting various charities and using the opportunity to develop new relationships that result in our annual return.”

Here is some more infor on the players.

According to Yonhap:

North Korea received record-low food aid from the United Nations food agency in 2013 due to sluggish contributions from the international community, a media report said Wednesday.

Some 38,000 tons of food were delivered from the World Food Program (WFP) to the impoverished communist country in 2013, some 30 percent of the agency’s target for the year, according to the Washington-based Radio Free Asia (RFA).

It was less than half the amount sent in the previous year and the smallest since 1996 when the agency began helping the North, the report said, adding it was attributable to the WFP’s failure to raise enough funds to achieve the goal.

The amount of the U.N. agency’s food aid to the North has been fluctuating from some 136,000 tons in 2008, 50,000 tons in 2010, 100,000 tons in 2011 and 84,000 tons in 2012, according to WFP data.

Citing its dark fund-raising prospects in 2014, the WFP told the RFA that most of its factories for producing nutrition biscuits for the people there were on the verge of shutting down in February.

The daily food rations for the people in the North came to some 400 grams per person last year, far lower than the minimum recommended amount of 600 grams and the North Korean regime’s target amount of 573 grams, the WFP said.

North Korea’s food production is estimated to have been at about 5.03 million metric tons in 2013, up 5 percent from the previous year, according to the WFP report posted on its website.

The food security situation, however, is still serious, with 84 percent of all households having borderline or poor food consumption, it added.

The North’s leader Kim Jong-un put an emphasis on food production in his New Year’s message last week, saying “all efforts should go for agriculture … in order to build a strong economy and to improve the people’s livelihoods.”

Here is the UNFAO November 2013 food security assessment.

Here is additional analysis from Benjamin Silberstein.

Here are previous posts on “Food“, “Agriculture“, “International Aid“, “International Aid Statistics“.

Read the full story here:
WFP’s food aid to N. Korea hits all-time low in 2013
Yonhap
2014-1-8