Archive for the ‘South Korea’ Category

Firms Blast North’s Business Climate

Tuesday, September 5th, 2006

From the Donga:
9/5/2006

“Problems can arise anytime you do business in North Korea since there is no market order. However, when business partners disregard agreed-upon deals, it is impossible to conduct any new business. Someone who betrays others can always betray me. Now, who will be willing to trust North Korea and make new deals with it?”

Upon hearing the news report yesterday that North Korea sold the rights to build a large-scale resort including a golf course within the Gaesong Industrial Complex to South Korean real estate developer Unico, despite the fact that Hyundai Group currently holds the rights, one executive of a large company was assured that North Korea was not a trustworthy investment partner.

“If the South Korean government fails to have a control over ‘lawless’ North Korea, the entire business with North Korea can fall into a crisis,” he worried.

During the Kim Dae-jung administration, Hyundai Group began its North Korean business led by then-chairman Chung Ju-yung. It has invested more than $1 billion in North Korea, including $450 million (about 510 billion won by then exchange rate) illegally transferred to the North as a price for holding the inter-Korean summit in 2000. In the process, the company had to go through a major management crisis and the tragedy of Chairman Chung Mong-hun’s suicide.

At such a great cost, Hyundai earned from the North “seven business rights,” which include the rights to provide electricity, railway, tourism, and a dam. With regards to the 3-phase Gaesong Industrial Complex project, it obtained a certificate with which it is allowed to use the land for 50 years.

Nevertheless, Hyundai is gradually being excluded in North Korean businesses except for the existing Geumgang Mountain tour and the first-phase Gaesong Industrial Complex development. There are even rumors that North Korea is in the final stages of negotiation with Lotte Tours over tourism business in Gaesong and Baekdu Mountain, excluding Hyundai that has the business rights in those areas.

Now that North Korea is found to have sold the rights to use 1.4 million-pyeong of land in Gaesong to Unico at the price of $40 million, there is a greater sense of crisis in Hyundai.

It is needless to say that North Korea bears the largest responsibility for the recent trouble.

However, some point out that the South Korean government has been too lukewarm in its response to the problems with the North, out of fear that inter-Korean relations might suffer. They argue that such an attitude only encourages North Korea’s “derailment.”

“Hyundai Asan’s deal with the North over the second and third phases of the Gaesong Industrial Complex development and Unico’s deal with the North can cause overlaps or conflicts. Thus, the companies will have to negotiate over the matter,” said Goh Gyeong-bin, director-general of the Social and Cultural Exchanges Bureau at the Unification Ministry, yesterday when the news on Unico’s North Korea deal was reported.

“The Ministry of Unification never approved Hyundai Asan of its North Korea business to build a golf course in Gaesong. I believe a double deal is possible here just like it is in the private area,” he added.

This implies that the extraordinary business of inter-Korean economic cooperation is being recognized as an ordinary area of private autonomy where private business partners must resolve problems through self-negotiations.

However, everyone knows that Hyundai’s North Korea business did not start out as a mere private business activity. “The government has drawn no clear line in North Korean business, allowing companies to recklessly engage in such business only to encourage North Korea to develop bad habits,” one executive of an economic organization pointed out.

“In order to effectively manage business deals with unpredictable North Korea, the South Korean government must provide clear trade rules and guidelines. Considering the extraordinary nature of North Korean business, relying on the private sector’s autonomy will only extend uncertainties,” professor Hong Ki-taek of ChungAng University emphasized.

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Kaesong golf course under consideration

Tuesday, September 5th, 2006

From the Joong Ang Daily

Kaesong golf course under consideration
9/5/2006

North Korea is in talks with a South Korean company other than Hyundai Asan Corp. for a golf course business in Kaesong, the Unification Ministry said yesterday.

Hyundai Asan, a Hyundai Group affiliate, holds an exclusive right to do business in North Korea.

According to the ministry, Unico, a real estate developer based in Daegu, signed an agreement with North Korea’s Asia Pacific Peace Committee to rent two sites near Kaesong Industrial Complex to build golf courses.

Under the contract, the North Korean committee will lease the two sites, one in the southwest and the other in the north, for $40 million over the next five decades.

Along with the golf courses, Unico plans to establish hotels and other entertainment facilities, said the ministry.

However, the same sites are part of the 16,337 acres of land that Hyundai Asan was allowed to use after reaching an accord with the North in 2000. The Korean company is in the middle of building an industrial complex on 816 acres.

Building golf courses on the sites Unico made a deal on was on Hyundai’s agenda for next year.

“The right to run a golf course business there belongs to us, as we forged the contract first,” said a senior executive from Hyundai Asan.

The company began consultations with Unico yesterday over the golf courses in the North, according to the source.

“If Unico comes up with an appropriate business proposal, we can let the company be a business partner,” he added.

A high-ranking manager from Unico said the company pushed ahead with the project as North Korea explained Hyundai Asan has the right to businesses in Kaesong Industrial Complex only.

The Unification Ministry said it would consider approving the golf course business in North Korea only if North Korea, Hyundai Asan and Unico reach a compromise.

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Relief goods mirror plight of stunted N. Koreans

Wednesday, August 30th, 2006

Yonhap
8/30/2006
Sam Kim

Thousands of used but clean shirts, pants and other clothes are stacked in big heaps in warehouses outside Seoul to be sent to poverty-stricken North Korea.  But they can’t be sent as they are, because North Korean officials want to get them their way: all without English writing on them and their size no bigger than “large.”

“In addition, we have color restrictions,” Ahn Jeong-hui, director of the Korean Council for Reconciliation and Cooperation, the donor of the clothes and other relief goods. “Strong colors could easily repulse North Koreans.”

Whenever impoverished North Korea suffers from flood and other natural or man-made disasters, sympathetic South Korean civic organizations usually respond to their appeal for emergency aid with warm hearts.

The shipment-in-waiting is for thousands, perhaps tens of thousands of North Koreans who were made homeless in massive floods in mid-July.

There were no official North Korean announcement on the extent of the flood damage but its media said “hundreds” of people were killed or missing. One South Korean relief group said “thousands” were killed.

The South Korean civilian aid is in addition to more than US$200 million worth of relief goods scheduled to be sent by the Seoul government, which include 100,000 tons each of rice and cement, 50,000 tons of reinforced steel bars and a number of trucks and other construction equipment.

With its economy in shambles, impoverished North Korea turned to international handouts in 1995 to help feed its 23 million people. U.N. relief workers said the largest floods in the country are expected to result in 100,000 tons of crop damage this year.

After years of dealing with North Korea, South Korean donors have learned that helping the communist country is not just about sending large quantities of supplies. It requires certain “customization,”

“The maximum size of clothes we send to North Korea is ‘large,'” said Hyun Il-hyun, secretary at Join Together Society, another South Korean relief agency, “We know anything bigger, like ‘extra large’ or ‘extra extra large,’ won’t fit North Koreans.”

“What will fit elementary school kids in South Korea will usually fit North Korean middle-schoolers,” she said. “Most North Korean adults will fit well into what South Korean teenagers wear.”

Chronic food shortages and malnutrition have stunted many North Koreans, making some look like dwarfs. Television footage broadcast in South Korea showed gaunt North Koreans scouring winter fields for grains left by reapers.

Nearly 8,700 North Koreans have defected to South Korea since the Korean War ended in 1953, including 1,139 in 2002, 1,281 in 2003, 1,894 in 2004, 1,383 in 2005 and 1,054 in the first seven months of this year. Many complained of hunger in their communist homeland.

A 2004 survey of 2,300 North Korean defectors showed that average North Korean men and women are 5.9 centimeter and 4.1 centimeters shorter than their South Korean counterparts, respectively. An average 14-year-old boy from North Korea is up to 15.8 centimeters shorter than the same-aged South Korean.

English-embellished clothes are not welcome, either, in North Korea, relief workers said.

“We pick out any clothing that has English writing on it,” Hyun of Join Together Society said. “North Korean authorities apparently don’t want their people to think the clothes are coming from their sworn enemy, the U.S. We also restrict clothes that have the names of South Korean organizations.”

North Korea has asked them to increase shipments of rice and flour instead of instant noodles, according to South Korean relief workers.

“We will comply with the North Korean request and no longer send instant noodles,” said Ahn of the Korean Council for Reconciliation and Cooperation. “I think the North’s request has do to with the South Korean marks and logos on the packings.”

According to South Korean government officials, North Korea tightly controls the flow of information among its people. All radio sets are pre-set to monitor only state broadcasts.

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Red Cross to supervise aid delivery

Wednesday, August 30th, 2006

From the Joong Ang Daily:

Four South Korean Red Cross officials are expected to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said yesterday.

The Red Cross officials will depart from the port of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles in early July, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear program.

The government, however, pledged to give 241 billion won ($251 million) worth of aid through the country’s Red Cross as one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds of people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later asked Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civic groups’ efforts to help the country recover from devastating torrential rains and flooding.

The Unification Ministry has also agreed to provide funds matching amounts raised by each civic organization, expected to total some 10 billion won.

The government’s aid through the Red Cross will include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

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Red Cross to send first shipment of government flood aid to DPRK

Tuesday, August 29th, 2006

From Yonhap:
Byun Duk-kun
8/29/2006

Four South Korean Red Cross officials are to visit North Korea’s Nampo port this week to supervise the delivery of the first government aid package to help the North recover from recent flooding, an official at the Unification Ministry said Tuesday.

The Red Cross officials are to depart from a port in the country’s western city of Incheon at 11 a.m. Wednesday aboard the 3,000-ton ship Trade Fortune, which sails regularly between the Koreas, according to the official.

“The trip is to supervise the first shipment of the Red Cross’ flood aid to North Korea,” the official said.

The shipment includes 300 tons of rice, 20,000 blankets and 10,000 first aid kits, according to the official.

Seoul suspended shipments of its regular humanitarian assistance to the North shortly after Pyongyang launched seven ballistic missiles, including a long-range Taepodong-2, which is believed capable of reaching the U.S. west coast.

The South Korean government says it will not make additional commitments of any economic assistance to the communist state until the North returns to stalled international negotiations with the South, Japan, China, Russia and the United States over its nuclear ambitions.

The government, however, pledged to give 241 billion won (US$251 million) worth of aid through the country’s Red Cross in one-time humanitarian assistance to the North after heavy rains there last month reportedly left hundreds people killed or missing and thousands of others injured.

Pyongyang rejected an initial aid offer from the South Korean Red Cross last month, but its inter-Korean pro-unification organization later requested Seoul’s civic organizations and other “related offices” for rice and construction equipment, while expressing gratitude for the civilian efforts to help the country recover from the flooding.

The Unification Ministry has also agreed to provide funds matching those raised by each civilian organization, expected to total some 10 billion won.

The government’s aid through the Red Cross is to include 100,000 tons of rice, 100,000 tons of iron rods, 80,000 blankets and over 200 construction vehicles.

South Korea provided hundreds of thousands of tons of rice and fertilizer to the impoverished North annually since heavy rains and a nationwide famine in the mid-1990s left over 2 million North Koreans dead and millions of others displaced.

North Korea requested the South to give half a million tons of rice for the year before it launched the seven missiles into the East Sea on July 5.

Government officials say the country will not consider accepting the North’s request until the North agrees to return to the international nuclear negotiations, which have stalled since November due to Pyongyang’s boycott, as well as resumes its self-imposed moratorium on missile tests.

The Koreas remain divided along a heavily-fortified border since the end of the 1950-53 Korean War, which ended with a cease-fire.

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Inter-Korean trade tops US$600 mln until July

Sunday, August 27th, 2006

Yonhap
8/27/2006

Trade between South and North Korea in the first seven months of this year topped US$600 millio this year due to increasing trade of agricultural products and corporate products, a local trade promotion agency said Sunday.

The inter-Korean trade reached $668 million in the January-July period, up 14.7 percent from a year earlier, according to the Korea International Trade Association (KITA).

Corporate-related trade, including the trading related to inter-Korean industrial complex in Kaesong, increased 31.9 percent to $489 million worth, while non-corporate trade such as government and private aids fell 15.3 percent to $178.5 million.

South Korea sent $446.6 million worth of goods to the North, down 2.2 percent, from the same period last year while the value of products coming to South Korea reached $263.2 million, up 56.8 percent, the association said.

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Number of N. Koreans defecting to S. Korea increases nearly 60 percent

Wednesday, August 23rd, 2006

Yonhap
Byun Duk-kun
8/23/2006

The number of North Korean defectors coming to South Korea increased by nearly 60 percent in the first seven months of this year compared to the same period of last year, the Unification Ministry said Wednesday.

A total of 1,054 North Koreans have come to the country as of the end of July, up 59 percent from a year ago, the ministry said in a report. Apparently hundreds more are waiting to find their way here, it said.

Earlier reports said a group of 175 North Koreans were rounded up by Thai police on suspicion of illegal immigration Tuesday, only hours before they were to board a passenger jet flying to South Korea.

The chief of the Thai police’s immigration bureau, Lt. Gen. Suwat Tumrongsiskul, was quoted as saying the North Koreans would be prosecuted, but would be detained “on a humanitarian basis” until they leave the country since they are seeking refuge in third countries.

The number of North Koreans coming to the South has steadily increased since the late 1990s with more than 100 finding their way here in 1999 for the first time since the end of 1950-53 Korean War.

The number increased to 1,139, breaking the 1,000 mark for the first time, in 2002, and rose to 1,281 in 2003 and 1,894 a year later.

International relief agencies, however, believe as many as 100,000 North Koreans may still be hiding in other countries, mostly in China, while civic organizations working to help the North Koreans put the number at 300,000 in China alone.

With no relatives or jobs in China, most of the North Korean defectors live in extreme destitution, usually making a living by begging. The Chinese government refuses to recognize them as refugees and regularly rounds them up and sends them back to their communist homeland where they are reportedly tortured, prosecuted and often executed.

The South Korean government says it will accept any North Koreans coming to the country, but cannot encourage or support their defection because of its relations with the North, as well as with other countries, which are used as stopovers for North Korean defectors.

Beijing is bound by a written agreement with Pyongyang to repatriate any North Koreans in its custody, according to government officials.

North and South Korea remain divided along a heavily-fortified border since the fratricidal Korean War (1950-53).

Defection through the inter-Korean border is not unprecedented, but is nearly impossible with nearly 70 percent of some 1.8 million troops on both sides standing guard within a radius of a few kilometers from the border.

Relations between the divided Koreas significantly warmed up following a historic meeting of their leaders in the North Korean capital in 2000.

The two, however, still remain technically in a state of war as the Korean War ended with an armistice agreement, not a peace treaty.

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South to Offer $10.5 Million to N. Korea for Relief

Wednesday, August 23rd, 2006

Korea Times
Lee Jin-woo
8/23/2006

The Ministry of Unification will begin providing financial support to South Korean humanitarian aid groups, which have sent, or have plans to send, flood relief materials for North Korean victims beginning early next month.

“The ministry plans to use the Inter-Korean Cooperation Fund to meet the amount of contribution made by local private relief organizations under a matching fund system,” said a ministry official. “Up to 10 billion won ($10.5 million) will be subsidized for those civic groups beginning early next month.”

Once the group of those 23 South Korean organizations-which have sent or considered sending flood relief material to the communist state-submits a list of purchased aid goods, the ministry will reimburse half of the total costs, he said.

“In order to find out what North Korean victims need most urgently, we will have a working-level meeting with North Korean counterparts on Aug. 31,’’ said Shin Myung-chul, an official belonging to the group. He added civic groups are likely to purchase mostly flour and clothes as well as other necessities, but will exclude rice and other emergency relief supplies to be provided by the government through the South’s Korean National Red Cross (KNRC).

After a meeting between Red Cross officials from South and North Korea at Mt. Kumgang in the North on Saturday, the ministry announced its plan to send 100,000 tons of rice, and construction supplies and equipment to North Korea by the end of this month to help repair damages from recent flooding despite chilly inter-Korean relations after the North’s July 5 missile launches.

Vice Unification Minister Shin Un-sang told reporters on Sunday the rice aid would cost some 195 billion won ($203 million), and the shipment would also include some 26 billion won worth of construction supplies and equipment, including 100,000 tons of cement, 5,000 tons of steel and 100 trucks.

But the ministry has made it clear that the one-time aid package is unrelated to government’s periodic aid provided annually to the North that has been abruptly halted due to the missile threat.

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DPRK finds market for stamps in ROK

Friday, August 18th, 2006

Who ever would have thought that the North Koreans would find a way to make money off the Dokdo Island controversy.  Entrepreneurship is alive and well in the DPRK?

From the Korea Times:

NK Dokdo Stamp for Sale in S. Korea

A South Korean distributor began receiving orders this week for postage stamps featuring a set of South Korean islets in the East Sea printed by North Korea, in an apparent protest against Japan’s continued claim to the islets, the distributor said Friday.

The South Korean company said it is receiving orders for sets of nine stamps priced at 18,000 won ($19), through its Web site, www.dprkpost.com, until Sept. 2.

The stamps are to be imported by a Hong Kong contractor to the communist state, Ko Sun Film Video Trading Co., Ltd

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What is the extent of the flood damage? (Updated again)

Thursday, August 17th, 2006

From the New York Times:
8/17/2006

Floods Claim Huge Toll in North Korea, Group Says
By THE ASSOCIATED PRESS

SEOUL, South Korea- A South Korean aid group said Wednesday that 54,700 people were dead or missing after huge floods in North Korea last month and that as many as 2.5 million people had been left homeless.

The figure is by far the highest toll reported from floods that hit North Korea in mid-July.

The private aid agency Good Friends, based in Seoul, said it had “many sources” inside North Korea but did not say where it had obtained the information. The toll could not be independently confirmed because North Korea tightly controls the news media and information.

The aid group’s previous reports on activities inside North Korea have been confirmed by South Korean government sources, although some of its figures have been disputed.

North Korea’s official news media have reported that “hundreds” were killed by the floods, without giving specific numbers.

The Choson Sinbo, a newspaper published in Japan by a pro-North Korean association linked to the government, said this month that the floods had killed at least 549 people and that 295 more were missing.

Officials with South Korea’s Red Cross, the South Korean Unification Ministry, North Korea’s economic cooperation office in Beijing and other agencies could not immediately be reached for comment on Wednesday.

Representatives of Good Friends refused to elaborate on their report, saying they feared their sources would face reprisals.

The group said the floods had destroyed more than 230 bridges and inundated hundreds of thousands of acres of farmland, further straining North Korea’s ability to feed its population. North Korea has relied on foreign food donations since the mid-1990’s, when famine caused by natural disasters and decades of mismanagement is believed to have killed up to two million people.

“Food prices are skyrocketing as food distribution has become nearly impossible” as a result of the floods, the aid group said.

The group also contended that North Korea, to curb possible unrest, prevented those left homeless by the floods from traveling.

A South Korean citizens’ group said last week that North Korea had requested help from South Korea to cope with the devastation from the floods.

From Yonhap:

Flood damage in N. Korea seems lesser than previously estimated:official
8/10/2006

Recent floods in impoverished North Korea resulted in a loss of large amounts of food, but the loss may not be as great as previously estimated by domestic and international relief agencies, a government official said Thursday.

The claim comes amid efforts by South Korea’s pro-unification and other civic organizations to put together large amounts of emergency relief aid for flood victims in the North.

International relief agencies working with the communist state, such as the World Food Program and the International Federation of the Red Cross and Crescent Societies, had previously estimated that some 30,000 hectares of farmland was either submerged or destroyed due to last month’s heavy rains in the North, leading to the loss of some 100,000 tons of food.

The official, speaking on condition of anonymity, said the government, too, depends on the reports, or estimates, by the international agencies to estimate damage in the North, but said a thorough analysis of the reports showed a significantly smaller loss of food than estimated.

“(The government) believes damage to 20,000 to 30,000 hectares of arable land in the North would lead to the loss of some 32,000 tons of crops,” the official said.

The official said the discrepancy comes because the international organizations assumed the worst.

“I believe the WFP’s estimate was based on an assumption that no crops would be produced from any of the affected farmland,” the official said.

“A close analysis and consultation with experts showed the North’s loss of food would come to about 30 percent of the WFP estimate,” the official added.

The new estimate, or claim, by the government is expected to affect the South’s expected decision on the size and composition of its assistance for the flood-hit North as the government continues to suspend its regular aid for the communist state.

Seoul suspended its humanitarian aid for the communist North, which includes rice and fertilizer, shortly after Pyongyang test-fired seven mid- and long-range missiles into the East Sea on July 5.

Officials at the Unification Ministry say the government is unlikely to remove or loosen its suspension of rice and fertilizer shipments to the North until the latter returns to international negotiations over its nuclear weapons program and announces resumption of its self-imposed moratorium on missile tests.

Unification Minister Lee Jong-seok, Seoul’s highest official on North Korea, held a meeting with the head of the country’s National Red Cross on Thursday to discuss a possible inclusion of food, mainly rice, in a Red Cross aid package for the North.

Ministry officials said the provision of rice, if made, would only be a one-time assistance to help relieve the suffering of flood victims and will not lead to a resumption of regular aid shipments.  

From the BBC:

North Korea flooding ‘kills 549′
8/7/2006

At least 549 people died and another 295 are still missing as a result of floods which struck North Korea last month, a pro-Pyongyang daily said.

ays of heavy rain caused flooding which North Korean media have already confirmed led to “hundreds” of deaths.

But the figures, from the Japan-based daily, are the most specific released so far on the extent of the disaster.

Last month, the UN food agency estimated that about 60,000 people had been left homeless by the flooding.

The Choson Shinbo newspaper is based in Japan and is run by a pro-North Korea association.

Over 7,000 homes were destroyed or damaged, the daily said, and almost 40,000 acres (16,000 ha) of farmland had been washed away.

“Recovery efforts are proceeding at rapid speed as relief supplies are being sent to the afflicted areas,” the daily said on its web site.

Secretive

In South Korea, opposition Grand National Party leader Kang Jae-sup urged that a fact-finding mission be sent to the North to determine the full extent of the damage there, Yonhap news agency reported.

One activists’ group has suggested that the number of dead or missing is as high as 10,000, but has not said where it obtained the information.

North Korea is secretive about releasing details of accidents or natural disasters, making any confirmation of the extent of the flooding difficult.

But Pyongyang has cancelled a mass gymnastics display, called Arirang, which is a key source of income for the nation, to focus, it says, on recovering from the floods.

North Korea has refused offers from international agencies to launch appeals on its behalf, but an official said last week that Pyongyang would accept aid from the South if it came with no strings attached.

South Korea has suspended food aid to the North because of concerns over deadlocked talks on its nuclear programme and Pyongyang’s recent missile tests.

From the Associated Press

Up to 10,000 casualties in North Korea flooding: aid group
8/2/2006

Up to 10,000 North Koreans are believed dead or missing in what Pyongyang’s official media is describing as the worst flooding in a century, a respected South Korean humanitarian group said.

“About 4,000 people are now listed as missing, and we expect the final toll of dead and missing to reach 10,000,” said the independent aid group Good Friends.

North Korea’s official media has so far admitted that hundreds of people were dead or missing after the country was battered by heavy rainfall for nearly two weeks from July 10.

Seoul-based Good Friends said the media was now terming the flooding as the worst to hit the impoverished country in a century.

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