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Japan launches new satellite to watch DPRK

Wednesday, September 28th, 2011

According to Strategy Page:

Japan recently launched another photo reconnaissance satellite, replacing a radar equipped spy satellite that failed last year. A Japanese rocket was used for this launch. Four years ago Japan launched its fourth spy satellite into orbit, also using a Japanese-made rocket. The third bird was launched five years ago. The first two were launched in 2003. The 2006 launch was the second of three optical reconnaissance satellites. The cameras on board can make out objects as small as one meter (39 inches) in diameter. The new photo satellite can detect objects .6 meters (two feet) in size. The best U.S. spy satellites can make out much smaller objects, but for Japan’s needs, .6-1 meter is adequate. At this point, none of the four birds carry radar, to provide all weather coverage. Technically, the satellites are in violation of a 1969 Japanese law, which mandated Japan only use space for non-military purposes. To get around this, these satellites are technically non-military, and are not controlled by the military.

Japan had long refrained from launching military satellites, but this changed when North Korea fired a ballistic missile over Japan in 1998. Japan promptly set out to get eight surveillance satellites in orbit by 2006, in order to keep an eye on North Korean nuclear weapons and ballistic missile efforts. This proved impossible to do. While two Japanese satellites were launched in early 2003, another two were destroyed during late 2003, when the rocket malfunctioned.

Japan has long relied on commercial photo satellites, and whatever they could get from the Americans. But for high resolution shots, on demand, of North Korea, and electronic eavesdropping from space, they need their own spy satellites. It is believed that the Japanese spy satellites are also being used to watch military developments in China and Russia.

The Japanese program has cost nearly three billion dollars. The optical satellites weigh about a ton, while the radar one weighs about a third more. The United States provided a lot of technical assistance on the design and construction of the satellites. Japan built its own rockets to launch them. Like most spy satellite users, Japan does not report on how effective they are. It is known that Japan could get more detailed photos from commercial satellites. But those are not controlled by the Japanese government.

Read the full story here:
Japan Has Another Eye On North Korea
Strategy Page
2011-9-28

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Posted in Japan | Comments Closed

Lankov on DPRK-Russian economic relations

Tuesday, September 27th, 2011

Andrei Lankov writes in the Korea Times:

In 2010, the volume of trade between these two countries was merely $110 million. As international trade goes, this volume is tiny. By comparison, in the same year North Korea’s trade with China was around $3.4 billion, some 30 times larger than its trade with Russia.

The reason for this inactivity is quite simple: Russian companies have no interest in dealing with North Korea. In the Soviet era, trade flourished because it was subsidized due to geopolitical concerns of Moscow. Currently, when it comes to pure economic considerations, North Korea has almost nothing to offer the new Russian economy.

North Korea has only two resources that can be sold on the international market. First, it has deposits of minerals (coal, iron ore). Second, it has a relatively large quantity of cheap labor ― or to put things in a less cynically capitalist way, there are millions of North Koreans willing to work for $10 a month.

But Russian companies are decisively uninterested in North Korean minerals. These mines may be attractive to resource-hungry China, but not to Russia, which has the riches of Siberia at its disposal. The chronic political instability in which North Korea is immersed is another reason which lessens Russian interest in North Korean minerals.

Cheap labor is more attractive, and indeed Russia has continuously used North Korean labor since 1967 but not in the North itself. Some Chinese companies began to outsource to North Korea, and built small factories there, in order to take advantage of the obscenely low local wages. This approach is not very attractive to Russia, since it is not a major player in producing winter parkas, wool hoods, or running shoes. Russian companies prefer to use North Korean workers inside Russia itself.

These workers are sent to Russia by the North Korean authorities and can be described as indentured labor. Their families are hostages who can be punished if a worker does something improper and the workers are also expected to ‘donate’ a significant part of their wages to the state. Despite these harsh conditions, one should not forget that these jobs are among the best paid regular jobs in the country. North Koreans compete for opportunities to become indentured laborers in Russia.

That said, the scale of these ventures is rather limited, as is the demand for cheap labor in the Russian Far East (the only part of Russia where the use of North Korean laborers really makes practical sense).

Aside from this, North Korea has something else to offer – its geographical location. This country blocks all land routes to the prosperous South. Russia has much interest in the South Korean market, especially when it comes to the sale of natural resources. Impeding this is the existence of North Korea, and the continued strained relations between the two Korean states, making sales of Russian commodities rather difficult.

So it is not incidental that the two most important potential projects are a railway and a gas pipeline. Both projects can hardly be described as “economic cooperation” between North Korea and Russia, since neither has much to do with the North Korean economy itself. North Korea, in these cases, is present merely as a space to be traversed. It would be no different if it were a dessert or jungle. Russia is willing to pay North Korea for facilitating Russia’s economic link with the South, and that is all.

So it is not surprising that an agreement on the pipeline construction was signed after the Russian-North Korean summit. This project is indeed acceptable to the North, since it will mean easy money for transit, it is favorable to Russia, and it will be good for the general situation since it will bind Russia, North and South Korea closer.

Yet, a word of caution is necessary. In spite of all official statements, we should not expect large-scale construction work to begin in the near future. The political risks remain huge, so it is likely that Russian companies will not rush headlong into the project. The recent agreement should rather be seen as a declaration of intent. In all probability, the trans-Korean pipeline and trans-Korean railway will be built eventually. But the completion of these important initiatives will probably take many, many years.

Read the full story here:
Russia-N. Korea Trade
Korea Times
Andrei Lankov
2011-9-25

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Posted in Energy, Foreign direct investment, International trade, Natural Gas, Russia, South Korea | 1 Comment »

DPRK-China trade update

Tuesday, September 27th, 2011

According to Yonhap:

North Korea’s trade dependence on China deepened over the past four years, in contrast to a reduction in South Korea’s share in the North’s external trade, Seoul’s Unification Ministry said in a report Sunday.

The proportion of China in North Korea’s foreign trade is on the rise, increasing from 41.6 percent in 2007 to 49.5 percent in 2008, 52.7 percent in 2009 and 57.1 percent last year, the report said.

By contrast, South Korea saw its share of the North’s trade declining from 38.0 percent in 2007 to 33.0 percent in 2009 to 31.4 percent last year, it noted.

In terms of trade volume, too, bilateral trade between North Korea and China jumped from US$1.97 billion in 2007 to $2.68 billion in 2009 and $3.47 billion in 2010, the report said, adding the inter-Korean trade volume slightly increased from $1.8 billion in 2007 to $1.91 billion last year.

I looked on the Ministry of Unification’s web page, but I was unable to find the report mentioned above.  It  has obviously not been published in English.

As this information was released in South Korea, the DPRK’s premier, Choe Yong-rim, is in China.  According to the Korea Times:

The North’s Premier Choe Yong-rim and his Chinese counterpart Wen Jiabao “pledged to promote trade, investment and economic cooperation” between the nations during a meeting held on Monday night during Choe’s official visit to China, Xinhua news agency said.

“Under the context of the complicated regional and international situation, the parties, governments and peoples of China and the DPRK (North Korea)…made joint efforts to push forward bilateral ties,” Xinhua quoted Wen as telling Choe during the talks.

Wen hailed the North’s achievements in developing its economy and vowed that Beijing will continue to offer assistance within its capability, according to the report.

He then called on the two sides to speed up mutually beneficial cooperation in fields such as trade, investment, infrastructure, natural resources and agriculture, the report said.

Here is the Xinhua report.

Scott Snyder had some interesting comments on the DPRK-PRC trade relationship:

South Korea’s perceived failure to compete with China for economic influence in the North as a result of heightened tensions in inter-Korean relations remains an active subject of frustration in South Korea, especially among progressives, but North Korea’s continued pursuit of nuclear and missile tests and other tension-raising provocations against the South make it clear that China has been unable to use the North’s economic dependency on Beijing as a tool for imposing political restraint on Pyongyang.

Read the full stories here:
N. Korea deepens trade dependence on China
Yonhap
2011-9-25

Premiers of NK, China vow to boost economic cooperation
Korea Times
2011-9-27

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Posted in China, International trade, Statistics, Trade Statistics | Comments Closed

Catholicism and the DPRK

Saturday, September 24th, 2011

According to Catholicculture.org (2011-9-23):

Religious leaders, including Catholic leaders, from democratic South Korea are visiting Communist North Korea, one of the world’s most repressive nations.

“The visit of a delegation of religious leaders in North Korea is a gesture to keep an open channel with the North,” says Bishop Peter Kang of Cheju, president of the bishops’ conference. “But we need to be realistic, and not have any great illusions. Religions will continue to bring humanitarian aid to the population of the North who suffer from hunger, and this is the interest of Pyongyang. Believers in the North are closely monitored and religious freedom is denied.”

Delegation itinerary:

According to KCNA, the delegation arrived in Pyongyang on Sept 21:

A south Korean delegation of 7 religious orders headed by Kim Hui Jung, representative chairman of the South Korean Religionists Council for Peace and head of the Kwangju Archdiocese of the Catholic Church, arrived here on Wednesday.

According to KCNA, the group held a meeting on the 22nd:

A meeting of north-south religionists for national reconciliation, unity and peaceful reunification took place in Pyongyang on Thursday.
Present at the meeting were Jang Jae On, chairman of the Religious Believers Council of Korea; Kang Yong Sop, chairman of the Central Committee of the Christian Federation of Korea; Sim Sang Jin, chairman of the Central Committee of the Buddhist Federation of Korea; Kang Chol Won, vice-chairman of the Central Guidance Committee of the Chondoist Association of Korea; and members of religious organizations.
Also attending it were members of the delegation of south Korea’s 7 religious orders led by Kim Hui Jung, representative chairman of the South Korean Religionists Council for Peace and head of the Kwangju Archdiocese of the Catholic Church.
Speakers at the meeting spoke of the pleasure of representatives of different religious organizations in the north and the south at sitting together and having their meeting for national reconciliation and unity and peaceful reunification.
They noted the meeting would mark a meaningful occasion in demonstrating internally and externally the strong will of the believers in the north and the south to tide over difficulties in the way of national reunification, promote national concord and bring about a new phase of peace and independent reunification.
They called upon believers in the north and the south to advance, holding higher the banner of “By the Korean nation itself” convinced that the implementation of the June 15 joint declaration leads to the reunification and peace of the country.
A joint statement of the believers in the north and the south for national reconciliation, unity and peaceful reunification was made public at the meeting.
The statement said that they would make positive efforts to defuse antagonism and distrust, tension and confrontation between compatriots, remove the danger of war and ensure durable peace.
It stressed the need to solve all the problems between the north and the south in conformity with the will and interests common to the nation.
It went on:
The Religious Believers Council of Korea in the north and the south Korean Religionists Council for Peace will regularly hold meetings to boost dialogue and cooperation between themselves and actively conduct a movement to achieve the unity of believers and reunification.
The statement ardently called upon all the Koreans in the north and the south and abroad to join as one in the drive for national reconciliation, unity, peace and reunification.

According to KCNA, following the meeting the delegation visited Mangyongdae, Mt. Paektu, the Arch of Triumph, the Taedonggang Combined Fruit Farm and its new processing factory, and saw “Arirang”.

On Sept24, the delegation departed.

Some history:

Around the time of the delegation’s visit, Kwang On-yoo sent out the following information to the Korean Studies list:

Just before the Korean War there were 52 Catholic parishes in the North, with some 50,000 believers in three dioceses, Pyongyang, Hamhung and Chunchon, plus a territorial abbey that was a direct subject of the Holy See.

After the end of the Korean War and the resulting division of the nation, the Vatican handed over the Apostolic administration of the North Korean dioceses to bishops in South Korea.

The current Archbishop of Seoul, Cardinal Cheong Jin-suk, is the Apostolic Administrator for Pyongyang and Hamhung while Bishop Kim Un-hwi of the Chunchon diocese in South Korea is the Apostolic Administrator of Chunchon diocese in North Korea.

Over the years, requests by the South Korean Bishops for pastoral visits to the North Korean dioceses have repeatedly been denied.

Since 1988, the North Korea regime has presented Jangchung ” Cathedral” [See satellite image here], the only so called Catholic church in North Korea, to outsiders as a shining example of North Korean Catholicism with hundreds of parishioners. Actually, the church has no functioning priest and no sacraments.

In April, a Seoul based North Korean defector’s radio station, Free North Korea, alleged that Jangchung Church is in fact a clandestine cocaine factory where cocaine is manufactured for illegal export, to generate much needed foreign currency.

This is the current state of North Korean Catholicism.

I do not have any reason to believe that the church is used to produce cocaine since it has been effective at generating revenue and assets from abroad (especially South Korea) through more “traditional” methods–such as facilitating the recent delegation.

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Posted in Civil society, Religion, South Korea | Comments Closed

DPRK owes USD $1.5b to ROK

Monday, September 19th, 2011

According to Yonhap:

North Korea owes about 1.8 trillion won (US$1.5 billion) to South Korea in food and other shipments, with its first repayment due next June, but chances of repayment are slim given the country’s crumbling economy, a government report said Monday.

The debt is for food, railway equipment and raw materials South Korea has provided to its impoverished communist neighbor in the form of loans over the past decade, according to the Unification Ministry report submitted for the annual parliamentary audit.

South Korea had been one of the largest aid providers to the North, but such shipments were halted after President Lee Myung-bak took office in early 2008 with a pledge to link aid to progress in efforts to end Pyongyang’s nuclear weapons programs.

Repayment of the loans was scheduled over 20 years with a 10-year grace period, at 1 percent annual interest. The North is scheduled to make its first repayment in June of next year for a $5.83 million food loan extended in 2000.

South Korean officials, however, have cast doubt on that repayment given the North’s dire economic situation.

The DPRK remains in debt default from loans taken in the 1960s and 1970s. The Russians are in talks to forgive DPRK debts (Likely in connection with developments of the Rason economic zone and/or natural gas pipeline).

You can learn more about speculating on the repayment of North Korean debt here.

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Posted in Banking, Debt, Finance, Foreign direct investment, South Korea | Comments Closed

Chinese joint venture company takes over Hyesan Youth Copper Mine

Monday, September 19th, 2011

Pictured above (Google Earth): Hyesan Youth Copper Mine.  See in Google Maps here.

According to Xinhua (China):

Hyesan-China Joint Venture Mineral Company, a large joint project between China and the Democratic People’s Republic of Korea (DPRK), started operation at Hyesan of Ryanggang province on Monday.

The mineral company was jointly set up by Wanxiang Resources Limited Company of China and the Ministry of Mining Industries of the DPRK on Nov. 1, 2007. Its main business was to produce and sell copper.

DPRK Mining Industries Minister Kang Min Chol and Chinese ambassador Liu Hongcai attended the opening ceremony.

Kim Chol, chairman of the people’s committee of the Ryanggang province, said at the ceremony that the joint venture was one of the symbols of the development of the DPRK-China friendship and would be a model of modernization, science and economic benefits.

Liu believed the company would make profits for both sides, benefit the two peoples and promote traditional China-DPRK friendship.

According to Reuters:

The mine was located a few miles from the Chinese city of Changbai in the northeastern province of Jilin and was 51 percent owned by Wanxiang, a source with direct knowledge of the project told Reuters on Tuesday.

The mine had a designed annual capacity of 50,000-70,000 tonnes of copper concentrate, expected to contain 20-30 percent copper, he added.

“All the concentrate will be sold to China,” the source said.

The source said the joint venture would conduct second-phase construction to expand the capacity of the mine if production ran smoothly, but did not give details on timing or expanded capacity.

China is the world’s top copper consumer but does not produce sufficient concentrate to meet demand. The country imported 3.4 million tonnes of copper concentrate in the first seven months of 2011, down 11 percent from a year earlier.

According to KCNA:

The Hyesan Youth Mine in Ryanggang Province was successfully updated as required by the new century.

The workers and technicians of the mine together with Chinese technicians and skilled workers completed the vast modernization project and successively ensured their commissioning.

The modernization of various production processes including mining, carriage and ore dressing made it possible to boost mineral production and thus contribute to economic development and the improvement of the standard of people’s living.

A ceremony for the completion of the modernization project at the Hyesan Youth Mine and the Hyesan-China Joint Venture Mineral Company was held on Monday.

Present there were Kang Min Chol, minister of Mining Industry, Kim Hi Thaek and officials concerned, Liu Hongcai, Chinese ambassador to the DPRK, and staff members of his embassy and Han Youhong, president of the Wanxiang Resources Co., Ltd. of China, and personages concerned.

Ri Mun Yong, manager of the Ryanggang Provincial Mining Complex, made an address to be followed by congratulatory and other speeches.

At the end of the ceremony, the participants went round production processes.

That day a reception was given in connection with the ceremony.

Although foreign investors and aid groups frequently build/ repair / upgrade North Korea’s state owned enterprises, it is rare that they are given any credit for their work in the official media.

Previous posts about the Hyesan Mine:
1. Poor electricity supply (2011-5-16)

3. Mine is flooded (2007-11-1)

4. China investing in mine (2007-4-12)

5. Chinese investing in mine (2006-12-24)

Additional mining information:
1. DPRK – China minerals for food program (2011-8-19)

2. DPRK looking to export rare earths (2011-7-23)

3. DPRK – China trade: 1995 – 2009 (2011-6-7)

4. Increase in DPRK’s mineral resources exports to China expected again for this year (2011-2-28)

5. DPRK – China mining deal (2011-2-6)

6. China expanding mining rights in DPRK (2010-1-15)

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Posted in China, Copper, Foreign direct investment, International trade, Joint Ventures, Mining/Minerals, Statistics, Trade Statistics | Comments Closed

DPRK luxury imports 2011

Monday, September 19th, 2011

Pictured above in Wonsan: Possibly a new yacht (see more here)

According to the Choson Ilbo:

The North Korean regime has spent US$1.04 billion since 2008 importing luxury goods in contravention of UN Security Council resolutions.

According to data Grand National Party lawmaker Yoon Sang-hyun obtained from the Foreign Ministry and other government agencies, the regime imported luxury goods worth $272.14 million in 2008, $322.53 million in 2009, and $446.17 million in 2010.

TVs, digital cameras, and video recorders made up the largest proportion, jumping from $115.47 million in 2008 to $215.95 million in 2010.

Luxury cars and parts came second and movie equipment such as film cameras and projectors third.

UN Security Council resolutions 1718 and 1874 ban exports of luxury goods and weapons of mass destruction to the North.

The amount the regime spent buying luxury goods was about 10 times the total humanitarian aid of $107.29 million it received from South Korea and the international community over the same period.

Read the full story here.

Additional information:
1. Back in July, there were several estimates of DPRK luxury goods imports based on Chinese data.

2. The DPRK maintains appx 200-300 foreign trade companies.

3. Office 38 is reportedly responsible for engaging in trade deals.

4. On the life of an overseas North Korean trade agent.

5. Here is an American Hummer parked at the Yangakdo Hotel.

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Posted in Foreign aid statistics, International Aid, International trade, Statistics, Trade Statistics, UN Security Council | 1 Comment »

North Korea Encourages Investment in Rajin-Sonbong (Rason) Economic and Trade Zone

Friday, September 16th, 2011

Institute for Far Eastern Studies (IFES)
2011-9-14

At the seventh China Jilin and Northeast Asia Investment and Trade Expo (NEASIAEXPO), the North Korean delegation actively promoted the Rajin-Sonbong (Rajin) Economic and Trade Zone to attract investment.

During the expo, the DPRK’s Ministry of Trade and China’s Ministry of Commerce and People’s Government of Jilin Province co-sponsored the “(North) Korean Business Day and China-DPRK Trade and Investment Session” at the Changchun International Conference and Exhibition Center on September 7. Hwang Chol-nam, the vice mayor of Rason City, briefed the attendees on the current situation, advantages, and special benefits of his city.

According to Hwang, “The spacious 470 square-kilometer Rason Economic and Trade Zone is one of the largest economic trade zones,” and advertised the geographic and economic advantages of Rason as the “transportation hub of Northeast Asia that connects China and Russia via Tumen River and with Japan across the East Sea.”

He also introduced the three ports in the region. “Rajin Port is equipped with the annual loading capacity of 3 million ton and Sonbong Harbor is able to transport 2 to 3 million ton of oil while Ungsang Harbor is able to handle up to 600,000 cubic-meter of lumber annually.” He also boasted the ports to be deep enough where it does not freeze during the winter.

Rason was also introduced to have received the “special city” designation in 2010 and will grow to have a population of one million. The recently amended “Law on the Rason Economic and Trade Zone” was revised and supplement with over 50 articles.

Hwang also elaborated on the eight preferential policies providing special tax benefits to foreign investors. He asserted, “The government of North Korea will guarantee the investment of the foreign investors by not nationalizing or demanding requisitions. For inevitable cases where such demands occur, proper compensation will be provided.”

The income tax is also at 14 percent, which is 11 percent lower than other areas in North Korea. For companies with business plans over ten years, foreign capital companies will receive three years of tax-free benefit starting from the profit earning year and two years thereon after will receive 50 percent tax-free benefits. According to Hwang, over 100 foreign companies and offices are operating businesses currently in the special economic zone.

He also announced that the current highway construction project connecting Rajin with Wonjung is expected to be completed in October, and that the Tumen-Rajin port railway system is to be upgraded to a broad gauge railway next month.

Specifically, Russian Railways reached an agreement with North Korea to repair the Hasan-Rajin Railway and improve the Rajin port facilities, especially focusing on Pier 3. The plans include upgrading Rajin as a container harbor to be capable of transporting twenty-foot equivalent units annually. Russia and the DPRK have already conducted measurement and geological surveys and reached the process design phase.

However, Seo Gil-bok, the DPRK’s vice minister of commerce, stated in a speech that North Korea would “actively work hard to make the Rason region a successful collaboration between the DPRK and China,” saying further that they would “pull out all the stops to realize the goals agreed by the best leaders from both nations.”

Many foreign media and correspondents were present at the event to cover the “Korean Business Day.” At the event, North Korea actively promoted the Rason Economic and Trade Zone by also presenting a promotional video of the zone.

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Posted in Automobiles, China, Economic reform, Finance, Fiscal & monetary policy, Foreign direct investment, Ministry of Trade, Railways, Rason Economic and Trade Zone (Rajin-Sonbong), Russia, Sea shipping, Special Economic Zones (Established before 2013), Transportation | Comments Closed

Rajin market on display to foreigners

Tuesday, September 13th, 2011

Pictured above: (L) satellite image of the Rajin Market, (R) a ground-level photo taken in 1999

Among the the flurry of activities that comprised the DPRK’s recent public relations campaign in Rason (Rajin-Sonbong), the Rajin Market appeared on the itineraries of a few visiting delegates. Alexa Olsen writes about the market for the Associated Press:

Chinese travel agents, potential investors and foreign journalists recently traveled into the North to get a look at the special economic zone Pyongyang is promoting in Rason. It lies in the far northeastern tip of North Korea, 600 miles (1,000 kilometers) from Pyongyang, but will be about an hour’s drive from China once the road is completed.

Rumbling Chinese cargo trucks already ply the route, churning up plumes of choking dust and ferrying containers of Chinese-made shoes, plastic toys, computer speakers, T-shirts and DVDs to the Rason Free Trade Market.

The market, a 13-year-old experiment in small-scale capitalism, has been so successful that the Chinese managing company, the Tianyu Group, is planning to expand the jam-packed 54,000-square-foot (5,000-square-meter) market to 320,000 square feet (30,000 square meters), Tianyu vice director Zheng Zhexi said.

“As I see it, this is the way of economic development, and it’s something that the people want,” Zheng said. “I think it’s reached a point where it cannot be reversed.”

North Korea declared the area a special economic zone 20 years ago. But after a brief flurry of activity and funding from the U.N. Development Program, the project languished without backing from Pyongyang’s leadership.

…

Rason has benefited from the shift in Pyongyang’s priorities. When Zheng arrived in 1997 to set up the market, people were hesitant to get involved. Now Tianyu doesn’t have the space to approve even a fraction of the applications from prospective vendors, he said.

“Ordinary people’s sense and the awareness of the market, and their views on the economy — all these have changed a lot,” Zheng said.

Foreign journalists, who typically are barred from local markets, were taken on a strictly controlled, 15-minute tour. No photos, no notes, the guide instructed: “Just use your eyes.”

Vendors, mostly women, stood behind stands loaded with freshly skinned rabbit and live chickens, as well as goods mostly imported from China: blouses, speakers, refrigerators, sofas, shampoo, playing cards, binoculars.

High heels went for 25 yuan (US$4), a Kim Jong Il-style beige suit for 85 yuan ($13) and a container of sea salt for 3 yuan ($0.47).

North Korean tour guide Mun Ho Yong, 25, said his family shops at the market several times a week to supplement state rations of rice, oil and fish.

Everything Mun wore — striped dress shirt, belt, polyester trousers and black dress shoes — was bought at the market except his pin of late President Kim Il Sung attached to his shirt, over his heart.

One major challenge will be to successfully leap from the market’s small-scale commerce to full-fledged manufacturing and trade.

(UPDATE) In an article published later in the New York Times (2011-10-12):

A Chinese company critical to Rason’s development, the Yanbian Tianyu International Trade Company, got involved here 13 years ago. It began by erecting the bazaar, then built the casino, a hospital, a bread factory and a telecommunications building. It is now working on a cement factory, and operates two iron mines.

“The policy environment has been improving continuously,” said Zheng Zhexi, 58, the company’s vice president. “It’s moving towards a market economy.”

He pointed to the official tolerance for the bazaar, where merchants rent stalls from the government to sell goods that they buy from Chinese traders. Prices fluctuate and shoppers haggle. The bazaar has proved so successful that it is expanding to six times the current size.

These kinds of markets have sprung up all over the country to supplement the government’s weak food distribution system. Still, the government is sensitive to their capitalist nature, and some top officials have tried to set limits on them. Foreign journalists were permitted a 15-minute tour of the Rason market on the condition that they not photograph it or take notes.

The market, open just a few hours each day, was bustling, with goods like skinned rabbits, sofas, Sony headphones and Dell computer mice. A soldier with a Kalashnikov slung over his back walked among the aisles, looking to buy, and women running stalls wore red vests, the uniform of officially registered merchants.

In one corner was an office with the English words “Foreign Exchange” above the door. In Rason, currency is exchanged at the market rate — one Chinese renminbi to 350 North Korea won — rather than at the official rate, which values one renminbi at 15 won.

Additional Information:

1. Previous posts on Rason can be found here.

2. Additional information can be found here.

3. Source:
Tending a Small Patch of Capitalism
New York Times
Edward Wong
2011-10-12

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Posted in Black markets, China, Economic reform, Fiscal & monetary policy, Foreign direct investment, General markets (FMR: Farmers Market), Joint Ventures, Price liberalization, Rason Economic and Trade Zone (Rajin-Sonbong), Special Economic Zones (Established before 2013) | Comments Closed

Dandong customs house is busy, busy, busy

Tuesday, September 13th, 2011

In the last decade we have seen the expansion of trade between the DPRK and the PRC.  You can see the data here (KEI) and here (Natuilus). You can also see this trend using satellite imagery:

Above image date: 2002-4-29

Pictured above (2002) is the former coal yard next to the Dandong train station in China.  Through this facility, China managed its DPRK coal trade.

Above image date: 2005-1-19

By January 2005, the coal field had given way to the construction of what was to become the Dandong Customs House, which manages rail and vehicle trade with the DPRK city of Sinuiju on the other side of the Amnok (Yalu) river. There are three things to notice in the picture above: New registration office (yellow box on the right), new main building (blue roof), preservation of nearby apartment blocks (yellow box on left).

Above image date: 2009-10-11

Above is the first photo of the completed facility which was taken in October 2009.  As is usually the case the parking lot is nearly entirely full.

Above image date: 2010-4-5

In the picture above we can see trucks moving in both directions through the registration office.  This facility is the first port of call for vehicles crossing the Friendship Bridge from Sinuiju, DPRK. Again we can see that the customs house is busy.

 

Above image dates: 2010-6-7, 2010-10-28

The above pictures (most recent on Google Earth) again reinforce the notion that the Dandong-Sinuiju trade route is bustling.

For the record, the North Koreans have expanded their customs facilities on the Sinuiju side of the border in relationship to the growing levels of trade:

Above image dates: 2002-4-29, 2010-10-28

But this is not all.  The North Koreans and Chinese are also building a second bridge and additional trade infrastructure in Ryongchon County, south-west of Sinuiju.  Learn more about that here.

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Posted in China, Google Earth, International trade | Comments Closed

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