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UN to contribute $400,000 to fight foot and mouth disease

Thursday, April 3rd, 2014

UPDATE 1(2014-4-5): According to VOA and Yonhap, the DPRK has  submitted a report to the UN World Health Organization for Animal Health (OIE) on the outbreak of FMD:

The Voice of America (VOA) said that Pyongyang submitted a report to the World Organization for Animal Health (OIE), saying that the disease broke out at a cow farm in Cholwon county of Kangwon Province, near the boarder area with South Korea, on March 14.

Nine cows out of 52 were infected with FMD, and one of them died, it added.

It is the first time for North Korea to report FMD in cows. It has notified OIE of outbreak of FMD in pigs in February.

Last week, the U.N. Food and Agriculture Organization (FAO) said the foot-and-mouth disease in North Korea had spread fast, infecting four cows near the border with South Korea.

According to the VOA, the United States, Canada and Mexico will consider providing vaccination to help North Korea upon its request.

ORIGINAL POST (2014-4-3): According to Yonhap:

The U.N. Food and Agriculture Organization (FAO) plans to provide US$400,000 to North Korea to help eradicate the rapidly spreading foot-and-mouth disease there, a U.S. radio report said.

…

The FAO also plans to send quarantine officials to North Korea after finalizing its aid program there, the VOA said.

Foot-and-mouth disease is an infectious and sometimes fatal disease that affects cloven-hoofed animals such as pigs, cattle, deer and sheep.

In February, the North’s state media reported that the country had culled 2,900 pigs as a preventive measure to stop the spread of the disease and buried about 360 others that had died from the disease.

Last week, the FAO said the foot-and-mouth disease in North Korea has spread fast, infecting four cows near the border with South Korea, according to the VOA.

Still, North Korea remained mum for over a month on South Korea’s offer of assistance to contain foot-and-mouth disease.

The North’s silence comes amid tensions on the Korean Peninsula over the exchange of fire by the rival Koreas across their disputed western maritime border, as well as Pyongyang’s threat of a nuclear test.

Pyongyang has also threatened to carry out a “new form” of nuclear test in anger over a United Nations condemnation of its recent ballistic missile launches. North Korea conducted nuclear tests in 2006, 2009 and 2013, drawing international condemnation and U.N. sanctions.

South Korea has vowed to continue humanitarian assistance to the North regardless of political tensions.

Read the full story here:
U.N. to provide US$400,000 to N. Korea over FMD: report
Yonhap
2014-4-3

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Posted in 2014 Food Shortage, Food, UN, UN Food and Agriculture Organization | Comments Closed

Russia and DPRK discuss economic opportunities

Saturday, March 29th, 2014

What are the opportunities? Rason port, Iron Silk Road (Rail), Kaesong Industrial Complex, gas pipeline.

According to RIA Novosti:

Russia and North Korea have signed a new protocol to transition to using the ruble for payments between the two countries as part of an effort to boost annual bilateral trade to $1 billion by 2020, Russia’s Far East Development Ministry said Friday.

The announcement came as Russian officials have expressed a desire to explore new markets for the country’s businesses, following the introduction of sanctions by the West in reaction to Moscow’s stance over Crimea. Russian leaders have simultaneously reassured international investors the country remains open for business, and there are no plans to restrict international commerce.

The protocol announced Friday came following a visit of a Russian delegation to the Asian country for a meeting of a standing bilateral commission, timed to mark the 65th anniversary of a cooperation agreement between the Soviet Union and North Korea.

The parties agreed to move towards settling payments in rubles as well as adopting further measures to boost bilateral trade, including easing visa procedures and providing for Russian access to proposed special economic zones in the country, the ministry’s statement said.

The ministry reaffirmed the countries’ mutual interest in joint projects with South Korea, including international connections for railways [Iron Silk Road], gas pipelines and power lines.

The Russian delegation also proposed the entry of Russian businesses into the Kaesong Industrial Park, a special economic zone in North Korea just north of Seoul where South Korean companies are allowed to employ northern workers.

The two sides identified areas for further cooperation, including a transshipment complex at the port of Rason and technical cooperation for the modernization of North Korea’s mining sector, automobile industry and electric power plants.

According to the statement, during the talks Russian Far East Development Minister Alexander Galushka emphasized that achieving such goals would only be possible if stability is maintained on the Korean peninsula.

The next meeting of the bilateral commission is scheduled for June in Russia’s far eastern Vladivostok.

Here is what Yonhap reports:

North Korea and Russia have agreed to boost economic ties by pushing for trilateral projects involving South Korea, including a plan to support Russian companies’ entry into an inter-Korean industrial complex, a media report said Saturday.

The agreement between the two was made earlier this week when Russia’s Far East Development Minister Alexander Galushka visited the North for a five-day run until Friday to explore ways to boost bilateral economic cooperation, according to the Russian news agency RIA Novosti.

“The Russian delegation proposed the entry of Russian businesses into the Kaesong Industrial Park, a special economic zone in North Korea just north of Seoul where South Korean companies are allowed to employ northern workers,” the RIA Novosti reported, citing the ministry.

…

Officials of Seoul’s unification ministry, which handles inter-Korean affairs, welcomed the agreement between the North and Russia, while stressing the importance of Russia’s prior consultation with the South.

“Russian companies’ making inroads into the Kaesong park is desirable in terms of the internationalization of the complex … It would also prevent the North from unilaterally reversing its agreement with Seoul over the Kaeesong operation,” the ministry official said, requesting anonymity.

Internationalization of the enclave, a symbol of inter-Korean detente, is one of the key topics for inter-Korean meetings aimed at ensuring its normal operations and further invigorating the complex. The Kaesong park resumed operations in September, more than five months after the North unilaterally closed it in anger over Seoul-Washington joint military exercises.

“But it is crucial for Russia to discuss the matter with our side first as it is basically operated by the South Korean authorities,” he added.

A handful of companies from China, Australia and Germany have so far expressed interests in making an investment in the Kaesong complex, prompting the Seoul government to review holding joint presentation sessions with the North to lure investors from overseas, according to another ministry official.

Here is additional information from Yonhap on recent shipments from Russia to the DPRK:

Russia exported US$21.16 million’s worth of jib cranes, machinery used mostly for cargo handling at ports, to North Korea last year, accounting for nearly 22 percent of its total exports to the North, according to the report by the Korea Trade-Investment Promotion Agency (KOTRA). The amount surpasses that of Russia’s traditional export goods such as coal, petroleum and bituminous oil.

There were no records of the machines being exported to North Korea the year before, with the 2011 amount standing at $139,000.

North Korea and Russia maintain economic relations that include a project that would make North Korea’s northeastern port city of Rajin a logistics hub by connecting it to Russia’s Trans-Siberian Railway. North Korea is said to have agreed to a long-term lease of the No. 3 dock at Rajin port to Russia and that it is modernizing facilities there. The cranes may be for such modernization efforts, the KOTRA report said.

Also noteworthy is Russia’s exports of ambulances to the North, amounting to approximately 10.1 billion won ($9.45 million), the fourth largest in terms of value. Ambulances are a relatively new product on the trade list.

KCNA’s reporting of the meeting was much more muted:

DPRK Premier Meets Minister of Development of Far East of Russia

Pyongyang, March 26 (KCNA) — Pak Pong Ju, premier of the DPRK Cabinet, met Alexandr Galushka, minister of the Development of Far East of Russia who is chairman of the Russian side to the Inter-governmental Committee for Cooperation in Trade, Economy, Science and Technology between the DPRK and Russia, and his party.

He had a friendly talk with them who paid a courtesy call on him at the Mansudae Assembly Hall on Wednesday.

Minutes of Talks between Governments of DPRK, Russia Signed

Pyongyang, March 26 (KCNA) — Minutes of talks on cooperation in trade, economy, science and technology between the governments of the DPRK and Russia were signed here Wednesday.

Present at the signing ceremony were Ri Ryong Nam, minister of Foreign Trade who is chairman of the DPRK side to the Inter-governmental Committee for Cooperation in Trade, Economy, Science and Technology between the DPRK and Russia, and officials concerned, Alexandr Galushka, minister for the Development of Far East who is chairman of the Russian side to the Inter-governmental Committee, and his party and Alexandr Timonin, Russian ambassador to the DPRK.

Ri Ryong Nam and Alexandr Galushka signed the minutes of the talks.

Read the full story here:
Russia, North Korea Agree to Settle Payments in Rubles in Trade Pact
RIA Novosti
2014-3-28

N. Korea, Russia to discuss supporting Moscow firms’ advance into Kaesong park
Yonhap
2014-3-29

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Posted in Banking, Economic reform, Finance, Fiscal & monetary policy, Foreign direct investment, Health care, Kaesong Industrial Complex (KIC), Ministry of Foreign Trade, Railways, Rason Economic and Trade Zone (Rajin-Sonbong), RoK Ministry of Unification, Russia, Sea shipping, South Korea, Statistics, Trade Statistics, Transportation | Comments Closed

Russia forgives DPRK debt – transact in rubles (2006-present)

Thursday, March 20th, 2014

UPDATE 10 (2014-10-20): According to RIA Novosti, the Russians and North Koreans have conducted their first transaction in rubles:

The first transactions in rubles between Russia and North Korea were carried out in October, Russia’s Far East Development Ministry said in a statement Monday.

“Russia and the DPRK [Democratic People’s Republic of Korea] have begun carrying out transactions in rubles in the framework of agreements, reached during the 6th meeting of the intergovernmental committee on commercial-economic relations between the Russian Federation and the DPRK, headed by the Minister for the Development of the Russian Far East Alexander Galushka,” the statement posted on ministry’s website reads.

In May, Russian President Vladimir Putin signed a law ratifying an agreement on settlement of the DPRK’s debt to Russia. Russia agreed to write off 90 percent of the North Korea’s debt to the former Soviet Union, which amounted to $10.94 billion as of September 17, 2012. The remaining 10 percent ($1.09 billion) is to be paid off in 40 installments over the next 20 years.

No word yet on what was purchased.

Here is coverage in Xinhua:

Russia has started interbank transactions with the Democratic People’s Republic of Korea (DPRK) in the Russian ruble, the Ministry for Far East Development said Monday.

The business went ahead according to an agreement the two sides reached earlier this year. The ministry’s press service said in a statement that the first transactions have already been completed.

The move is part of the efforts aimed at the ambitious goal of boosting annual bilateral trade to 1 billion U.S. dollars by 2020, the Itar-Tass news agency quoted the ministry as saying.

“Moscow and Pyongyang signed a deal on May 5 about writing off all DPRK debts to Russia, which has facilitated the launch of ruble-based accounting between the two countries,” Far East Development Minister Alexander Galushka said.

Under the deal, Russia has written off 90 percent of the DPRK’s debt and restructured the remaining 1.09 billion dollars to be paid off in the next 20 years.

Amid worsening ties with the West, Russia has turned to Asian countries for more economic and political cooperation.

Prime Minister Dmitry Medvedev said in July that Russia should push for a breakthrough in economic relations with the Asia-Pacific region.

UPDATE 9 (2014-6-5): RIA Novosti reports that Russia and the DPRK will begin negotiating bilateral trade contracts in rubles rather than dollars. According to the article:

Russia and North Korea are preparing to launch bilateral transactions in the Russian ruble this month to boost trade turnover between the two nations to $1 billion by 2020, Russia’s Far East Development Minister said Thursday.

In May 2014, Moscow agreed to write off 10.94 billion of Pyongyang’s Soviet debt with the remaining 1.09 billion to be paid in installments over the next 20 years.

“The decision to write off DPRK’s debt to Russia has opened up the way to resolve a wide range of issues that was previously blocked by this debt load. Ruble transactions between Russia and DPRK will begin as early as this month, with first bank accounts to be set up in Russian banks,” Far East’s Development Minister Alexander Galushko said.

North Korea currently uses euros as the official currency in settling overseas trade deals.

The announcement came on the heels of a meeting in Russia’s far eastern city of Vladivostok where Galushko took part in the sixth annual session of the Russian-Korean standing commission, an intergovernmental agency on trade, economic and scientific cooperation.

The minister added that Russia hoped to ramp up its trade turnover with Korea to $1 billion, up from the current $112 million. “It is not much,” he pointed out, saying that a greater degree of Korea’s commitment to the existing bilateral projects could whip up sales to $400-500 million.

UPDATE 8 (2014-4-19): Russia has reportedly [formally] written of the DPRK’s debt. According to Reuters:

The State Duma lower house on Friday ratified a 2012 agreement to write off the bulk of North Korea’s debt. It said the total debt stood at $10.96 billion as of Sept. 17, 2012.

The rest of the debt, $1.09 billion, would be redeemed during the next 20 years, to be paid in equal instalments every six months. The outstanding debt owed by North Korea will be managed by Russia’s state development bank, Vnesheconombank.

Russia’s Deputy Finance Minister Sergei Storchak told Russian media that the money could be used to fund mutual projects in North Korea, including a proposed gas pipeline and a railway to South Korea.

More at the Voice of Russia.

UPDATE 7 (2014-3-20): Russian Duma committee recommends write off $10 b DPRK debt. According to Voice of Russia:

Committee of the State Duma for the budget and taxes has issued a recommendation to the MPs to ratify an agreement between the Russian government and the Democratic People’s Republic of Korea on settling the North Korea’s debt to Russia on the Soviet-era loans issued to that country.

The document that was submitted for ratification by the Russian government features the agreements reached at the negotiations that lasted almost twenty years and took account of the special features of financial, political and economic relations between Russia and North Korea.

Debt settlement embraces all the categories of reciprocal financial claims and obligations of the former USSR and the DPRK, with the precise parameters registered on the date when the agreement is signed.

Overall amount of the DPRK’s financial obligations to Russia stood at an equivalent of $ 10.96 billion as of September 17, 2012.

“This amount is rather conventional in many ways – not only because of the exchange rate but also due to the interest rates accumulated over a huge period or, in other words, a non-return of the loans because many of them were issued in the 1980’s,” Sergei Storchak, a deputy minister of finance said at the session.

“We applied a standard pattern in which we write off 90% of the debts amount and 10% is left over,” he said. “We agreed to utilize this 10% for financing the joint projects implemented on the North Korean territory.”

There projects are related to the energy sector, healthcare, and the country’s foodstuff security.

“Frankly speaking, we hope we’ll be able to attain agreement in the course of future joint work on allotting plots of land for construction of a gas pipeline on the DPRK territory,” Storchak said adding that Russia’s major producer and exporter of natural gas, OAO Gazprom, continues eyeing a possible integration in the Korean market of gas.

For this purpose, it will need some land acquisitions and “a part of the debt can be utilized for this purpose,” Storchak said.

Russian government officials say settlement of debts on the loans issued by the former USSR with the observance of conditions coordinated with Pyongyang pursues three objectives.

In the first place, it removes the problem of North Korea’s outstanding debt to the Russian Federation that was an irritating factor for bilateral relations for quite some time.

Secondly, the agreements that have been reached enable Russia to exert noticeable influence on the DPRK’s social and economic development through projects in healthcare, education, and the energy sector, since Russia will have a say in the decisions on their financing.

Thirdly, owing to the presence of big enough debt claims, Russia will have an opportunity to take part in multilateral talks on settling the North Korean debts in the format of the Paris Club of Sovereign Debtors and to influence the terms of debt repayments in Pyongyang’s interests.

You can read more about the gas pipeline here.

UPDATE 6 (2012-9-18): RIA Novosti reports that the DPRK and Russia have signed a debt deal.  According to the article:

Russia and North Korea have signed a deal on settlement of the DPRK’s $11 billion debts to Russia, Deputy Finance Minister Sergei Storchak told Prime news agency on Tuesday.

“It was signed yesterday,” Storchak said.

Russia and North Korea have been negotiating over the issue of Pyongyang’s debt to Russia, left over from the Soviet era, for the last four years without result. Russia did not rule out writing off part of the debt and either rescheduling the remainder or offsetting it against investment.

Storchak previously said it was understood a debt settlement would involve a conversion of the ruble debt into dollars, giving an initial discount of around 90 percent of the debt.

The remaining debt of over $1 billion would be used in a “debt for aid exchange” plan to assist with joint education, health and energy projects in North Korea.

Here is coverage of the deal in KCNA:

Agreement on Debt Settlement between DPRK, Russia Signed

Pyongyang, September 18 (KCNA) — An agreement on settling the debt incurred by the loan provided by the former Soviet Union which the DPRK owes to the Russian Federation was signed between the governments of the two countries in Moscow on Monday.

The agreement was inked by Vice-Minister of Finance Ki Kwang Ho from the DPRK side and Vice-Minister of Finance Sergey Storchak from the Russian side.

The conclusion of the agreement on the debt settlement would create fresh conditions for boosting the relations of economic cooperation between the two countries in the future.

The Wall Street Journal offers some additional details on the deal:

Deputy Finance Minister Sergei Storchak told Interfax that the “restructuring conditions are standard in connection with our membership in the Paris Club, with a conversion into U.S. dollars at an appropriate discounted rate with the balance of the debt to be used for a debt-for-aid program.”

The $11 billion figure was reached by using the Soviet conversion rate of 67 kopecks to the dollar, the ministry said, which at today’s exchange rate would make the debt just $238 million. Russia has reached similar agreements over the years with many former Soviet-clients in larger part because there was little chance the loans would ever be repaid.

Russian and North Korea had resumed negotiations over the decades-old debt in August 2011, following a meeting between former Russian President Dmitry Medvedev and the late-North Korean leader Kim Jong Il. During the meeting, the two sides agreed to pursue a pipeline project that would send Russian gas to South Korea via North Korea.

The following June, a preliminary agreement was reached and the finance ministry submitted a proposal to the Russian government for approval, Interfax reported.

Experts say the settlement of the long-stalled debt talks represented a change in political will on both sides and would help spur along the pipeline project as well as other railway and electricity deals.

“The decision on a settlement of debt is a significant step as it removes the obstacles for cooperation. Now credits can be granted,” said Alexander Vorontsov, an expert on North Korea at the Russian Academy of Sciences.

Read more below:

(more…)

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Posted in Debt, Finance, Fiscal & monetary policy, Railways, Rason Economic and Trade Zone (Rajin-Sonbong), Russia | 2 Comments »

Handicap International earmarks $1.12 million in DPRK aid

Wednesday, March 19th, 2014

According to Yonhap:

The Belgium branch of Handicap International earmarked $1.12 million for this year to support medical and rehabilitation facilities in the communist country to promote the health and well-being of the disabled there, the Voice of America (VOA) reported, citing an e-mail from the agency’s official Dominique Delvigne.

The budget is also to be spent for such projects as nurturing teachers in charge of special education for visually- and hearing-impaired people, and assisting the (North) Korean Federation for the Protection of the Disabled (KFPD), the official added.

The NGO, established in 1982 to help disabled and vulnerable people in situations of poverty and exclusion, conflict and disaster, began to help physically challenged people in North Korea in 1998 at the request of the KFPD.

According to the report on disability published by the World Health Organization in 2013, some 3.4 percent of the population in North Korea suffered from a disability as of 2007.

Read the full story here:
Belgium-based NGO to spend US$1.1 mln in 2014 for disabled N. Koreans
Yonhap
2014-3-19

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Posted in EU, Foreign aid statistics, Health care, International Aid | Comments Closed

Wellspring assistance in drilling water wells

Friday, March 14th, 2014

According to Wellspring’s website:

Wellspring has had the privilege to partner with several Non-Government Organizations (NGO’s) in our work in North Korea. Partnering with other groups allows Wellspring to work efficiently and effectively by focusing on our specialty – drilling water wells in North Korea. We have provided wells for our partners in several areas of the country and desire to work with new partners who are currently working in North Korea.

According to Yonhap:

Private agencies in the United States have provided North Korea with aid to help its people have access to clean water and medicine, media reports said Friday.

According to the Washington-based Radio Free Asia (RFA), Wellspring, a non-governmental organization in the U.S., sent a large truck to the North earlier this week to support its groundwater development project.

The aid was provided at the request of the North’s underground water development research institute, and the lorry was purchased in China, according to the RFA.

Under the vision of “Bringing living water to the people of North Korea,” James Linton, who leads the organization, has visited the communist country every year since 2007 to provide training, equipment, and expertise in the field and has drilled some 200 wells across the country.

The Connecticut-based private agency AmeriCares also recently sent medicine, medical devices and food for children worth $370,000, according to the Voice of America.

They are expected to arrive in the North next month to be delivered to hospitals and local clinics in Pyongyang and North Hwanghae, it added.

North Korea has regularly suffered from acute food and medical shortages caused mainly by isolation and natural disasters.

Read the full story here:
U.S. NGOs offer humanitarian aid to N. Korea
Yonhap
2014-3-14

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Posted in 2014 DPRK engagement, Disease prevention, Health care, International Aid, USA, Wellspring | Comments Closed

North Korean oil tanker in Lybia (UPDATED)

Thursday, March 13th, 2014

UPDATE 4 (2014-3-17): US Navy Seals have boarded the Morning Glory.According to the BBC:

The raid by Navy Seals took place in international waters south of Cyprus, said spokesman Rear Adm John Kirby.

The Morning Glory’s evasion of a naval blockade at the eastern port of Sidra prompted Libya’s parliament to sack Prime Minister Ali Zeidan last week.

The oil terminal has been under the control of militia wanting autonomy for eastern Libya since July 2013.

Meanwhile, there has been a deadly attack on the barracks in the main eastern city of Benghazi.

This was their first attempt to export oil from rebel-held areas. It is not clear where the tanker was headed.

Adm Kirby said the operation had been authorised by President Barack Obama and that no-one had been hurt.

“The Morning Glory is carrying a cargo of oil owned by the Libyan government National Oil Company. The ship and its cargo were illicitly obtained,” he said, adding that it would now be returned to a Libyan port.

The vessel was flagged in North Korea but officials in Pyongyang said it had been deregistered because of the incident.

It was said to have been operated by an Egyptian company.

More in the Washington Post here.

See Marcus Noland’s comments here.

UPDATE 3 (2014-3-13): Morning Glory is on the run! According to The Diplomat:

…The Libyan government didn’t take kindly to this and threatened to attack the tanker, threatening airstrikes against it. Eventually, the tanker was intercepted and taken to Misrata where it was held by Libyan warships.

Remarkably, the North Korean tanker managed to escape its capture by the Libyan fleet in the middle of the night. It made its escape when the weather forced the smaller Libyan warships and patrol boats to sail close to the coast, leaving a gap in the convoy guarding the tanker. The Morning Glory made a run for the open seas and is now confirmed to be back in international waters according to Mohammad Hitab a spokesman for Libya’s al-Waha Oil Company, the state-run company running the Es Sider port.

It remains unknown the extent to which North Korea is communicating with Libya’s federalist rebels. In the case of the oil sale, the rebels were looking for buyers willing to purchase risky oil at rates far below the asking market price. Given North Korea’s energy situation, it appeared to be one of the few buyers interested in the deal. A report from the Libya Herald earlier this week noted that members of the federalist rebels were spotted on board the Morning Glory prior to its attempted departure from Es Sider port.

The tanker’s escape resulted in a no confidence vote on Prime Minister Ali Zeidan’s leadership in Libya. Zeidan lost the vote and had his travel barred. Libyan Defense Minister Abdallah al-Thinni was sworn in on Tuesday evening, according to Reuters.

The United States Department of State issued a statement where it said it was “deeply concerned by reports that a vessel sailing under the name Morning Glory is loading a cargo of illicitly obtained oil at the Libyan port of As-Sidra.” The statement does not mention North Korea but notes that the Morning Glory‘s ”action is counter to law and amounts to theft from the Libyan people.” The Italian Navy had reportedly assisted the Libyans in intercepting the Morning Glory but has since withdrawn from attempting to prevent the ship from leaving the Mediterranean.

UPDATE 2 (2014-3-12): Here is the full statement from KCNA on the tanker:

Spokesman for Maritime Administration of DPRK on “Oil Tanker Incident” in Libya

Pyongyang, March 12 (KCNA) — A spokesman for the Maritime Administration of the DPRK Wednesday gave the following answer to the question raised by KCNA in connection with the recent DPRK-flagged “oil tanker incident” which occurred in Libya:

On March 8 the government of Libya informed the DPRK of the fact that the DPRK-flagged oil tanker Morning Glory made an oil contract with an individual armed group in Libya and illegally entered a port under the control of the group in the eastern part of Libya, and urged the DPRK to take a necessary measure for settling it through a formal channel.

As far as the oil tanker is concerned, it is a ship run by the Golden East Logistics Company in Alexandria, Egypt and is allowed to temporarily use the DPRK flag for six months in accordance with the contract made by the company with the DPRK at the end of February.

Right after being informed of the fact by the Libyan side, the DPRK strongly blamed the company side for the violation of the contract and demanded it let the ship leave the port at once without loading oil.

In addition to it, the DPRK formally notified the Libyan government and the International Maritime Organization that it cancelled and deleted the ship’s DPRK registry and invalidated all the certificates as the ship violated the DPRK’s law on the registry of ships and the contract that prohibited it from transporting contraband cargo and entering the warring, dispute-torn or natural disaster-affected areas.

Therefore, the ship has nothing to do with the DPRK at present and it has no responsibility whatsoever as regards the ship.

What matters is that some foreign media are making much fuss, deliberately linking the case with the DPRK, claiming that “the north Korean ship tried to purchase oil from Libya in an illegal manner” and “the government force of Libya opened fire on the north Korean flagged oil tanker.”

Some forces are misleading the public opinion, persistently linking the issue with the DPRK. This is obviously aimed at achieving a sinister political purpose to tarnish its image.

They should clearly know that with neither false propaganda nor mud-slinging can they damage the image of the dignified DPRK.

The AP reports on proof the DPRK provided to the western media to back up its claims:

North Korea offers its flag to foreign-owned ships in the same way as a number of other countries do.

Jon provided a document he said was the official deletion of the Morning Glory from the Maritime Administration’s registry. He also showed email correspondence he said was from IHS Maritime in London, a company that manages shipping information, that purportedly acknowledged the deletion of a vessel from the North Korean registry.

UPDATE 1 (2014-3-12): The DPRK has denied it owns the ship. According to the Wall Street Journal:

North Korea denied on Thursday it was illegally exporting oil from rebel-controlled eastern Libya, claiming that an Egyptian company was operating a North Korean flagged oil tanker in the center of an armed standoff since Saturday.

North Korea said it had revoked the registry of the tanker, named “Morning Glory,” and demanded that Alexandria-based Golden East Logistics Company leave al-Sidra port without loading oil.

The tanker, carrying at least 234,000 barrels of crude oil, sailed from a rebel-controlled port into international waters on Tuesday.

A contract signed by North Korea with the Egyptian company prohibits the tanker from transporting contraband cargo and entering war or disaster zones, North Korea said through a report in its state media.

“The ship has nothing to do with the DPRK at present and it (North Korea) has no responsibility whatsoever as regards the ship,” the report said, using the abbreviation of country’s official name Democratic People’s Republic of Korea.

The Golden East Logistics Company couldn’t be immediately reached for comment.

The presence of a North Korean-flagged vessel in the Mediterranean is very unusual, although the country has been involved in trading arms in the region. Cheong Seong-chang, a senior analyst at Seoul-based think tank Sejong Institute, said the rebels may have offered oil to North Korea at a fraction of market prices.

ORIGINAL POST (2014-3-6): According to IBT:

A North Korean oil tanker has tried to dock at Libya’s Es-Sider port which has been seized by armed protesters, Reuters reports.

It has not yet been confirmed whether the tanker wanted to take oil from the protesters, who have threatened to sell it independently unless they get political autonomy from Tripoli and a greater share of oil revenues, according to Libyan officials.

“The tanker came to Es-Sider but did not load oil,” said an official at the state-owned Waha Oil Co, which operates the port and connecting oilfields.

An official at National Oil Corp (NOC), which owns Waha, said he did not know whether the protesters, led by former militia leader Ibrahim Jathran, had tried to attract buyers with the tanker but said: “We know they have been trying to sell oil.”

It is extremely unusual for a North Korean-flagged oil tanker to operate in the Mediterranean region, shipping sources said.

Jathran’s group seized three oil ports which accounted for 600,000 barrels per day of export, before the protests started in 2013.

The Libyan government has tried to end the protests but little progress has been made so far.

Libya’s defence minister held talks with protesters blocking the 340,000-bpd El Sharara oilfield in the south, but NOC has not confirmed whether it will reopen in the near future.

The strikers are also demanding national identity cards and a local council; the ministers have promised to meet the requests.

Jathran’s group declined to comment.

The Libyan navy fired on a Maltese-flagged tanker which allegedly tried to load oil from the protesters in the port in January.

Libya’s oil output has fallen to little over 200,000 bpd from 1.4 million bpd in July when protests started across the country.

“The financial situation of the government is difficult,” Culture Minister Habib al-Amin, who acts as a government spokesman, said in February.

“Some ministries have been unable to pay for expenditures due to a lack of budget and liquidity.”

Read the full story here:
Libya: North Korea Oil Tanker Tries to Dock at Seized Es-Sider Oil Port
International Business Times
Ludovica Iaccino
2014-3-6

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Posted in Egypt, International trade, Libya, Oil, Sea shipping, Transportation | Comments Closed

Sino-DPRK trade booms in January 2014

Wednesday, March 12th, 2014

Institute for Far Eastern Studies (IFES)
2014-3-12

North Korea has been actively working to procure large quantities of fertilizer since the beginning of 2014 in an effort to increase production in the agricultural sector. According to statistics provided by the Korea Rural Economic Institute, North Korea imported 35,113 tons of Chinese fertilizer in January 2014.

In January and February of recent past years, North Korea imported small, insignificant amounts of Chinese fertilizer — for example, a mere two tons in January 2013. This year’s sudden increase comes as an unexpected surprise. January imports of Chinese fertilizer doubled that of imports procured in December 2013, increasing by 17,416 tons. This comes in spite of the fact that total imports of Chinese fertilizer decreased 18 percent from 252,789 tons in 2012 to 207,334 tons in 2013.

In the past, the North Korean pattern has been to import Chinese fertilizer from March and peak during the April-to-July farming season. Import figures show that North Korea has begun to procure its fertilizer earlier than usual, beginning in January and February. This vigorous importing of fertilizer could be directly connected to North Korea’s efforts to increase agricultural production to solve the nation’s chronic food shortages.

In his 2014 New Year’s speech, North Korean leader Kim Jong Un pledged to rebuild the country’s moribund economy, emphasizing the agricultural sector in this endeavor. In his letter to last month’s national conference of subworkteam leaders, he also emphasized the need to boost agricultural production in order to attain self-sufficiency.

Subsequently, it is expected that North Korea will actively scale up imports of Chinese fertilizer again this year in correlation with Chinese export tariff cuts.

Trade between North Korea and China in January has increased roughly 16 percent against the previous year. After the December 2013 purge of Jang Song Thaek it was predicted that trade between the two countries would decrease; however, there is no visible sign of this yet.

According to the Korean Foreign Trade Association’s data, trade between North Korea and China in February increased from 471 million USD to 546 million USD, up 15.9 percent compared to the previous year.

February also showed an increase in anthracite exports, North Korea’s main export to China, rising 21.3 percent to 102 million USD. Iron ore exports also showed a slight increase of 35 million USD compared to last year.

Chinese exports to North Korea, including leading export commodities such as cellular phones and other wireless radio/communication devices, increased 28 percent compared to January of last year, totaling 14.5 million USD. In February, goods exported through China to North Korea increased by 10.2 million USD, a 38.6 percent increase compared to January of last year.

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Posted in China, International trade, Statistics, Trade Statistics | 1 Comment »

Zimbabwe signs $5m contracts with DPRK for statue and museum

Wednesday, March 12th, 2014

According to the Christian Science Monitor:

The cost of Bona Mugabe’s wedding on March 1, attended by the heads of state of South Africa, Zambia, and Equatorial Guinea at Mugabe’s private home in Harare’s plush Borrowdale suburb, cost $5 million.

Just after the wedding, plans leaked out that Mugabe’s Zanu (PF) government clandestinely signed North Korea, one of its old friends, to build two statues of Mugabe at an estimated cost of $5 million.

The statues were commissioned by the minister of local government, Ignatius Chombo.

One is a nearly 30-foot high bronze image worth $3.5 million to be placed in Harare; the other is a $1.5 million version to be placed in a $3.8 million museum to be built in Mugabe’s rural Zvimba home, in Mashonaland West. Building statues of leaders is something North Korea has considerable experience doing.

Read more about the story at Bloomberg and Bulawayo 24.

I have documented many of North Korea’s Africa projects on this web page.  See here.

Read the full story here:
Mugabe splashes $5m on N. Korea statues
Christian Science Monitor
Mxosili Ncube
2014-3-12

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Posted in International trade, Mansudae creative Company (art studio), Mansudae Overseas Development Group, Statistics, Trade Statistics, Zimbabwe | Comments Closed

Hong Kong firm signs onto Sinuiju Economic Development Zone

Wednesday, March 12th, 2014

Sinuiju-SEZ-2014-2

Pictured Above (Google Earth): The approximate borders of the Sinuiju Special Economic Zone.

According to Yonhap:

North Korea has joined hands with a Hong Kong-based company to develop the country’s northwestern border city of Sinuiju into a special economic zone, a North Korean official said.

Sinuiju, which borders China’s Dandong city, has drawn much attention from foreign investors for its geographical advantage as North Korea’s western gateway to China, Ri Chol-sok, the vice chairman of North Korea’s economic development committee, said in an interview in the March issue of Kumsugangsan magazine, a North Korean government mouthpiece.

“Now a joint development company has been established for the development of (Sinuiju) and is striving to win back lost opportunities,” said the North Korean official.

Hong Kong-based conglomerate Great China International Investment Groups Ltd. reportedly signed the deal with North Korea.

North Korea is also making efforts to lure foreign investment to other special economic zones, including one in the Rason area in the northern tip of the country, according to Ri.

The foreign company already has deep ties with the North, having joined the country’s project launched in January to renovate the eastern part of the capital Pyongyang.

The Institute for Far Eastern Studies (IFES) reported the following:

It has been reported that North Korea has established relations with a Hong Kong-based company with the goals of developing Sinuiju, a city bordering China in the northwest region of North Pyongan Province, into a special economic zone (SEZ). Vice Chairman of North Korea’s Committee for Economic Development Ri Chol Sok emphasized the nation’s efforts to attract foreign investors to the Sinuiju economic zone in an interview in the March issue of Kumsugangsan, a North Korean government magazine.

Vice Chairman Ri specifically mentioned that, in the past, Sinuiju garnered praise and attention from foreign investors due to its geographically advantageous location along the western border. Ri also announced the establishment of the Sinuiju-Great China joint venture development company, which plans to draw further interest and investment from abroad.

It is reported that the Sinuiju-Great China joint venture development company was created alongside a Hong Kong-based finance conglomerate known as Great China International Investment Groups, Ltd. (“Great China Groups”). Great China Groups has recently shown great interest in investing in North Korea and recently began the construction of East Pyongyang Commercial Street this past January.

Recent reports from other foreign media outlets have shown that Great China Groups had intentions to invest in the development of the Sinuiju region for some time, but Vice Chairman Ri’s announcement marks the first time that North Korean state media has officially recognized their joint development plans.

Meanwhile, the North Korean foreign publicity website Naenara announced that development of an additional economic development zone (EDZ) in North Pyongan Province along the Amnok (Yalu) River began on January 27 of this year. The Amnok (Yalu) River economic development zone will extend 6.6 square kilometers, with construction taking place in Ryongun-ri and continuing up to the Guri and Ojok Islands, where the North Korean border meets the city of Dandong and the Hu Mountain in China’s Liaoning Province.

North Korea plans to draw in tourists visiting China’s Hu Mountain to Ojok Island, where an “international services station” will offer food, entertainment, and tourist attractions. There are also plans to develop a modern agricultural sciences research complex on Guri Island that will specialize in flower and vegetable production.

North Korea specifically pushed for this location for the development of the Amnok (Yalu) River economic development zone — which will operate autonomously in Pyongan — due to its border location with China. In addition to its desirable geographical location, convenient transportation between the two nations will likely attract more attention from Chinese foreign investors, giving the Amnok (Yalu) River EDZ a higher chance of success compared to other economic development zones.

Investments reaching upwards of 240 million USD (approx. 260.3 billion KRW) make the Amnok River EDZ the largest in scale among the 13 total development areas.  In terms of actual size, however, the largest economic development zone in North Korea is the Shinpyong tourist development zone (8.1km2), located in North Hwanghae province.

Apart from the EDZs in the North Pyongan region of Sinuiju, the central government has announced their plans to push forward with two other special economic zones. The Hwanggeumpyong and Wihwa Islands SEZ was announced in June 2010, and in November of last year, plans were revealed to develop an additional special economic zone in the Sinuiju region.

All the economic development zones are listed here. Some people say there are 13 of them. Some people say 14 because they consider the Sinuiju Special Economic Zone an economic development zone. I am in the 14 camp. There have also been at least three other zones proposed that did not make the final list. 

The Sinuiju Special Economic Zone was announced on 2013-11-21 (the same day as the other 13 EDZs were announced–though in a different article).

Besides the Sinuiju Special Economic Zone, the only other EDZ to have reportedly made any progress is the  North Hamgyong Provincial Onsong Island Tourist Development Zone.

Read the full story here:
N. Korean, Hong Kong firms to develop border city of Sinuiju
Yonhap
2014-3-12

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Posted in China, China-DPRK Trade Expo, Economic Development Zones (2013), Economic reform, Foreign direct investment, North Hwanghae Provincial Sinphyong tourist development zone, North Phyongan Provincial Amnokgang economic development zone, Sinuiju International Economic Zone, Special Economic Zones | Comments Closed

DPRK as e-waste conduit

Thursday, March 6th, 2014

According to Bloomberg:

How did North Korea become the conduit by which thousands of tons of old junk moved from the developed world into China’s bustling e-waste recycling industry?

As with any smuggling story, the tale starts with a prohibition. In this case, Chinese laws and regulations prohibit e-waste — most commonly understood as old, non-working electronics like laptops, monitors and mobile phones — from being imported into the country. The reasons are several, including a government interest in keeping used foreign goods from competing against new ones, and environmental concerns about how some of those goods are recycled. Nevertheless, China’s national-level environmental and customs authorities have long struggled to maintain those prohibitions against local ports and authorities — especially in south China — who view e-waste recycling as a good source of jobs, tax revenue, and used components to drive local industry. Of the several conduits through which e-waste has traditionally been smuggled, the most common and long-standing was over the Hong Kong-China border.

That all changed in February 2013 when — for reasons that are still unclear — Beijing announced “Green Fence,” a high-level crackdown on the import of prohibited waste and recycling exports, including old electronics. Nonetheless, here and there, imported old electronics still turned up in Chinese recycling facilities (I personally saw them).

The likely means, as described in state media after the North Korea bust, was convoluted. A Hong Kong “gang” allegedly received containers of used electronics from abroad. They arranged for them to be placed them on smaller ships bound for a “country in Northeast Asia.” The culprit’s identity is clear from the awkward phrasing. Criticism of North Korea in the Chinese press is exceedingly rare and -– needless to say — connecting the country to an e-waste smuggling ring qualifies as criticism. Were the country Japan, or even South Korea, it would have been named.

In fact, North Korea has long been rumored to be an e-waste recycling center. Since January 2008 a Chinese company based in Liaoning Province along the border has advertised for scrap to feed its e-waste recycling operations in North Korea itself. The facilities are located, according to the ad, in the port of Nanpo, and “take advantage of North Korea’s environmental policies and inexpensive labor resources.” There, the ad promises, prohibited e-waste can be dismantled and transformed into a product acceptable for export to China.

The smuggling ring was allegedly doing something similar, although its “transformed” e-waste clearly did not meet environmental standards. In North Korea the bulky e-waste was dismantled (steel cases would be removed from old desktop PCs, for example), segregated into marketable components like computer chips for re-use, and then sent to Dandong, a Chinese city and port on the Yalu River, directly across from North Korea. From there, the goods were trucked south, to recycling and re-use centers in Guangdong Province, a straight-line distance of roughly 1,800 miles.

Read the full story here:
Did North Korea Recycle Your Laptop?
Bloomberg
Adam Minter
2014-3-6

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Posted in Black markets, China, International trade, Sea shipping, Transportation | Comments Closed

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