North Korean Economy Watch

According to the Financial Times:

Hungary has revealed that it was asked by North Korea to write-off more than 90 per cent of its outstanding debt in the latest indication of the secretive totalitarian regime’s financial distress.

Hungary’s economy ministry told the Financial Times that North Korean negotiators had tabled the request in November 2008 during a meeting in Pyongyang.

“They asked [us] to take good consideration of the Democratic People’s Republic of Korea’s current economic difficulties and asked for cancellation of over 90 per cent of the total debt amount,” the ministry said.

The revelation follows a report in the FT last week that Pyongyang had asked the Czech Republic to write-off 95 per cent of its Kc186m ($10m) debt.

The cash-strapped totalitarian state offered to settle 5 per cent of the debt in ginseng, a root that is said to combat lethargy and impotence.

North Korea appears to be struggling to meet its financial obligations owing to the pressures of a moribund domestic economy and international trade sanctions imposed over its nuclear weapons programme.

Following the mysterious sinking of a South Korean warship in March, Washington vowed to further crack down on North Korea’s international financing, money laundering and narcotics operations.

Pyongyang’s outstanding debts are estimated at about $12bn, about two-thirds of which is owed to former communist states.

Its Hungarian debt emerged from a trade surplus between the two countries, mostly in the period before the fall of the Iron Curtain, an official said.

The total debt is 29.6m clearing roubles – an accounting unit used in the former Soviet Bloc.

Hungary said North Korea had agreed in principle to pay the debt in cash, with partial cancellation.

Details such as the clearing-rouble conversion rate and the size of the cancellation must still be settled, however.

Officials were unable to say when the negotiations would resume. Ginseng was not mentioned during previous talks.

Read the full sotry here:
Hungary reveals North Korean debt request
Financial Times
Chris Bryant
8/18/2010

According to the Choson Ilbo:

Academics from North Korea and Japan have unearthed a large tumulus from the Koguryo period in Pyongyang, providing valuable material for studying the history of ancient East Asia, Japan’s Kyodo news agency said Saturday. About 4.5 km away from the downtown Pyongyang, the tomb was discovered during construction work in Tongsan-dong, the Lelang District of the Koguryo era and is presumed to have been created around the 5th century.

According to the news agency, the mural paintings in the tomb show a man in horn-shaped headgear on horseback, a procession of men holding flags on armored horses, and warriors with swords. The antechamber and main chamber at the back are connected with a narrow passage, while the bones of a man and two women have been found in the back chamber. The tomb has some unique features, including the antechamber’s arched ceilings with three layers of triangular props and the mound created by piling up alternate layers of lime, charcoal and red clay to cover the stone chambers beneath, the report said. The mound is 35 m in diameter and 8 m high.

Pyongyang plans to register the tomb with UNESCO as a World Heritage site. Japanese scholars said the tomb’s murals are comparable to those of Tokhung-ri Tomb in Nampo, South Pyongan Province, which is included in the Complex of Koguryo Tombs inscribed in the World Heritage List in 2004.

The team also found relics offering a glimpse of how sophisticated Koguryo culture was, such as gold and silver ornaments, tiger-shaped pottery, bronze coins and nails for coffins. The celadon candlestick is the first of its kind to be excavated in the North, the report added.

The team consists of researchers with the Archaeological Institute of the North’s Academy of Social Sciences and Japanese scholars sent by Kyoto news agency including Prof. Masahiro Saotome, an archaeologist at the University of Tokyo, and Shigeo Aoki, a Cyber University professor specializing in the preservation of historic remains. Saotome said the tomb “was unearthed in an area where experts believed there would be no Koguryo mural tombs.”

Ahn Hwi-joon, a Korean art historian and professor emeritus at Seoul National University, echoed him saying, “It is the first time that Koguryo tomb murals have been unearthed in the area once controlled by the Chinese Han Dynasty Commander of Lelang. They are especially valuable as they were executed in the late fourth to the fifth centuries, immediately after Koguryo incorporated Lelang.”

Read the full story here:
N.Korean-Japanese Team Finds Koguryo Tomb in Pyongyang
Choson Ilbo
8/16/2010

According to the Daily NK:

Trade between North Korea and China for the first half of 2010 was $1.29 billion, a 16.8% increase over the corresponding period of last year.

Using Chinese customs statistics, the South Korean embassy in China revealed the details of Sino-North Korean trade on Monday. According to the statistics, North Korean exports to China fell by 1.1% in the same period to $350 million, while imports from China increased by 25.2% to $940 million.

As a result, North Korea’s trade deficit with China was $590 million, a 48.5% increase over the previous year.

According to the statistics, North Korea imported 140,000 tons of food, 300,000 tons of oil and 100,000 tons of fertilizer during the period. Notably, flour imports rose by 383%.

Reduced inter-Korean trade and other economic exchanges following the Cheonan sinking and reduced international humanitarian aid due to UN sanctions were two of the most significant causes of the burgeoning reliance upon China.

Read the full story here:
Sino-North Korean Trade Deficit Rises
Daily NK
8/16/2010

According to Asahi:

The General Association of Korean Residents in Japan (Chongryon), the main pro-North Korea organization in Japan, is rapidly losing its tax-exempt status on facilities throughout the country.

On Wednesday, the government released the property tax collection practices for Chongryon-related facilities at 130 local governments throughout Japan.

According to officials of the Ministry of Internal Affairs and Communications, no local governments completely exempt Chongryon from paying property taxes on its facilities.

Kushiro in Hokkaido ended its total property tax exemption last fiscal year. It was the last community to grant Chongryon a complete tax exemption. The ministry began its annual surveys in fiscal 2005.

Other municipalities have also toughened property tax collection on Chongryon-related facilities.

Nagoya ended its partial exemption, while the cities of Kyoto, Okayama, Kiryu in Gunma Prefecture and Nishinomiya in Hyogo Prefecture, all effectively raised property taxes on Chongryon facilities.

There are now 94 local governments that no longer reduce property tax amounts for Chongryon facilities, while 30 still have a partial exemption. The remaining six local governments are reviewing their tax policies for the organization.

Local governments previously exempted property taxes on Chongryon’s headquarters and local chapters on the grounds that those facilities were of a public nature.

However, local governments began reviewing their practices after the Supreme Court declared a tax reduction measure by the Kumamoto city government illegal in November 2007.

Among other things, Chongryon serves as North Korea’s de facto embassy in Japan.

Read the full story here:
Pro-North Korea group losing tax breaks
Asahi Shimbun
8/13/2010

UPDATE: According to Yonhap:

A group of five South Koreans on Tuesday crossed the heavily armed border into North Korea, an official here said, delivering 400 million won (US$340,000) worth of anti-malaria aid despite tension between the divided states.

The crossing marked the first South Korean civilian visit to the communist state since Seoul banned trips to North Korea three months ago in protest over the sinking of a South Korean warship in March near their Yellow Sea border.

A doctor and four others, including two drivers, traveled to the North Korean border city of Kaesong on Tuesday morning, Unification Ministry spokesman Chun Hae-sung told reporters. The doctor was needed to explain to North Korean authorities how to use the aid kits, Chun said earlier this week.

ORIGINAL POST: According to Yonhap:

South Korea will allow a doctor to travel to North Korea next week in the first approval of a civilian visit on a humanitarian mission to the communist state since Seoul banned exchanges with Pyongyang in May over the sinking of a South Korean warship, an official said Friday.

The doctor, accompanied by two drivers, will visit the North Korean border town of Kaesong next Tuesday, Unification Ministry spokesman Chun Hae-sung told reporters in a briefing. The group is transporting 400 million won (US$336,100) worth of anti-malaria aid from a civilian relief group, Chun said.

“The doctor’s visit has been granted because he needs to explain to the North how to use the aid kits,” he said, adding any spread of malaria in the North has the potential to affect South Korean residents south of the border.

Read the full story here:
S. Korea to allow rare civilian visit to N. Korea amid tension
Yonhap
Sam Kim
8/13/2010

UPDATE: Google just updated their satellite imagery over Kinshasa.  Now we can see where the statue is located:

ORIGINAL POST: The DPRK’s Mansudae Overseas Development Group has designed and built many buildings and statues across the Middle East, Africa and Asia.  I have been trying to map out these projects on Google Earth.

The most recent project appears to be the statue of Joseph Kasavubu in the DR Congo.  June 30th 2010 was the DRC’s 50th independence day and the statue of its first president was unveiled as part of the celebrations:

Here is a story in French about the unveiling of the new statue.

Using Google Translate, I pulled out the following blurbs:

(June 29, 2010) President Joseph Kabila unveiled Tuesday in Kimpwanza Square in the town of Kasavubu, to the cheers of the people, the monument to the first president of the Democratic Republic of Congo, Joseph Kasavubu.

…

It is a bronze monument of 5 tons, 5.45 meters high.

The story incorrectly notes that the statue was made in South Korea.

I have so far been unable to locate the square where this statue is located.  Help appreciated. A reader called “NKObserver” identifies the location here: 4° 20′ 17.19S 15° 18′ 18.38″E.

Additional information:

1. Here is a set of photos of the statue taken by a visitor.

2. Here is an interesting video clip of a Chinese protest of Kasavubu in 1961 featuring Zhou Enlai.

3. Here are previous posts on the Mansudae Overseas Development Group.  They do not reflect all the projects I have identified, but if you know of any others, please pass the information to me.

Volker Elosser of Nosotek gives an interview in German here.

Here is a translation of the article by Google Translate:

Click on the images to read the article.  I apologize for using these awkward images, but Google Translate only allowed me to copy/paste the original German.  This was the only fast/easy solution I could come up with.

The article references an article in PC World by Martyn Williams.  You can read this here.

According to Yonhap:

Inter-Korean trade soared to a record high in the first half of this year despite escalating tensions caused by the sinking of a South Korean naval ship in late March, a government report said Thursday.

Two-way trade jumped 52.4 percent on-year to US$983.2 million in the January-June period, according to report by the Korea Customs Service (KCS). It also represents a six-fold increase from the $161.6 million tallied in the same period in 1999.

Outbound shipments spiked 66 percent on-year to $430.5 million, with imports from the North surging 44 percent to $552.7 million for a deficit of slightly more than $122.2 million.

The report, however, said that with most cross-border exchanges being cut off by Seoul in retaliation for the sinking of the South Korean warship Cheonan, inter-Korean trade is expected to drop about 30 percent on-year in the second half.

A Seoul-led multinational investigation team found the North responsible for the sinking of the 1,200-ton warship that resulted in the deaths of 46 sailors. The North countered that it was in no way in involved.

Only the Kaesong Complex, located just north of the DMZ that separates the two countries, has not been affected by the fallout from the ship sinking. The complex accounts for roughly 70 percent of all inter-Korean trade and is home to 120 South Korean companies that make products with the help of North Korean laborers.

The customs office, meanwhile, said trade between the two Koreas rose from $328.6 million in 1999 to $1.08 billion in 2005 and peaked at $1.82 billion in 2008. Last year, the trade volume fell to $1.66 billion after Pyongyang detonated its second nuclear device.

According to the Choson Ilbo:

In spite of strained inter-Korean relations following the March sinking of the South Korean Navy corvette Cheonan, trade volume between the two Koreas hit a record high in the first half of this year.

According to data from the Korea Customs Service, the total value of exchanged goods reached over US$983 million in the January to June period, up more than 52 percent from $645 million a year ago.

The latest figure tops the previous record of $885 million in 2008, and is six times higher than the $162 million recorded in 1999.

The South’s cross-border exports jumped 66 percent to $435 million, and inbound shipments 44 percent to $553 million.

Amid the ever-changing atmosphere on the Korean Peninsula, inter-governmental efforts to spur North-South trade and the expansion of the joint Kaesong Industrial Complex have fueled a gradual yet continuous growth in trade activity.

The annual trade volume, which amounted to nearly $329 million in 1999, peaked at over $1.8 billion in 2008 before dropping slightly to $1.67 billion in the wake of North Korea’s second nuclear test in 2009.

Experts, however, forecast the trade volume to drop by as much as 30 percent on-year in the second half of this year, reflecting Seoul’s suspension of all trade with Pyongyang, except for operations at the Kaesong Industrial Complex, in response to the sinking of the Cheonan.

Much attention is focused on the future of business at the industrial park, which produces 70 percent of the goods traded between the two sides.

Read the full stories here:
Inter-Korean trade hits record high in H1: report
Yonhap
8/12/2010

Inter-Korean Trade Reaches Record High
Choson Ilbo
8/13/2010

According to Reuters:

China said Thursday it had offered to help North Korea tackle cross-border crime — two months after North Korean soldiers killed three suspected Chinese smugglers, raising tensions between the allies.

Beijing, Pyongyang’s most important ally and trading partner, said it had handed over military equipment to North Korea’s National Defence Commission during a visit by China’s Deputy Public Security Minister Liu Jing on Sunday.

China said in a statement that it was willing to work with North Korea in cracking down on cross-border crime and building up its law enforcement forces.

The statement gave o details of what type of equipment China had provided or which type of crimes could be targeted.

Read the full story here:
China offers to help N.Korea crack down on crime
Reuters
8/12/2010

UPDATE: As noted in the comments and in this post, Uriminzokkiri is run by the North Koreans, not the Chongryun.

ORIGINAL POST:

The pro-Pyongyang ethnic Korean community in Japan (Chongryun, Chosen Soren) has apparently opend a YouTube channel named “uriminzokkiri” (“On our own as a nation”) where they are uploading pro-DPRK and DPRK-made videos.

The Chongryun operate a number of web pages on behalf of themselves and the North Korean government (Chongryon.com, Naenara, elufa.net, uriminzokkiri.com, and more) all of which host video content.  So why open a YouTube account?  All these web pages are blocked in South Korea—so I am wondering if South Korean readers see these YouTube videos? 

UPDATE: Gag notes the following in the comments: “The ‘uriminzokkiri’ account is presumably run by the website of the same name, which links to it. The uriminzokkiri.com homepage lists two email addresses on silibank.com, so I doubt that it’s run by the Chongryon either. (elufa.net, which is in Japanese, has an email address on its own domain.)

I wonder also whether it is just a matter of time before the US Justice Department/Treasury Department goes knocking on YouTube’s door.  If this account is sponsored by the official Chonryon organization, the US government might have a problem with that.  I suspect, however, that the account is “maintained” by a “private” individual so that it cannot be construed as engagement in a business trade with the DPRK.  In the past, on line chat services owned by Yahoo and Linkedin have been asked to close accounts of individuals in sanctioned countries like the DPRK.  

As of now, the account hosts nearly 40 videos.  Unfortunatley not a single one is of the North Korean evening news.  The North Korean news is usually posted on Elufa.net, but has not been updated since July 26. Rather than running 10 pages poorly, they might consider consolidating and running 2 pages well!

According to Yonhap:

North Korea has apparently registered an account with the iconic U.S. video-sharing site YouTube, uploading clips that praise the isolated regime and defend itself against accusations that it attacked a South Korean warship.

…

The name in Korean means “on our own as a nation” and was registered July 14.

The uploaded footage contain regurgitations of official cant that honor the North’s leader, Kim Jong-il, and the usual South Korea bashing. The Aug. 2 upload contained an elaborately produced three-minute clip lashing out at South Korea’s foreign minister.

Another clip, uploaded the same day and also produced in Korean, ridicules Seoul for its failure to stop the U.N. Security Council from placing Pyongyang’s denial in its statement deploring the deadly March sinking of the Cheonan warship.