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S. Korean Shipbuilders Question Joint Complex in North

Friday, October 5th, 2007

Korea Times
Kim Yoo-chul
10/5/2007

Daewoo Shipbuilding Unveils Plan to Build $150 Mil. Shipyard in Northern Coastal City

South Korean shipbuilders and analysts questioned the economic viability of the proposed plan to build a joint shipbuilding complex in the wake of the inter-Korean summit.

The agreement between the two Koreas calls for the two sides to construct a joint shipbuilding complex in the North’s port city of Nampo, near Pyongyang.

Most officials from major South Korean shipbuilders say that too many things are uncertain as of yet though Daewoo Shipbuilding & Marine Engineering (DSME) unveiled a bold plan to build a $150 million block plant in the North’s city of Anbyeon.

“When issues of transportation, communication, customs and capital see improvement, we will build a block plant in the North Korean city with production capacity of 200,000 tons a year,’’ DSME President Nam Sang-tae told reporters Friday.

“We will start to begin the process within this year after certain issues are solved,’’ Nam said, adding the company looks to begin production from early 2009.

He said the company is seriously considering in participating in joint projects by the two Koreas in the North’s western city of Nampo.

Unlike Daewoo Shipbuilding, Hyundai Heavy Industries, the world’s No.1 shipbuilding company, showed reservations.

“The announcement itself is good. But it is not the right time to start business talks with North Korea, given a lack of credibility and geopolitical uncertainties,’’ said a high-ranking official from Hyundai Heavy Industries.

Asked about the possibility of finding another investment area for South Korean shipbuilders in North Korea, the official said it is likely but needed a few years as the building of infrastructure there will need massive funding.

The production capacity in the North’s shipbuilding industry was 258,000 tons in 2004, about 3.1 percent that of the South’s 8.24 million tons in the same year, according to a report from the Korea Development Bank. There are eight shipyards in North Korea, including Wonsan and Najin. Total employees in the industry were 25,000, the report shows.

Analysts also said the announcement is not `fresh material’ to boost share prices in shipbuilders.

“There was no immediate positive impact on stock prices, nor will there be a negative ones in the long term,’’ said Lee Jae-kyu, an analyst from Mirae Asset Securities.

He expects the scale of investments by the South Korean shipbuilder in joint projects to be small in the near future as shipbuilding-related facilities require large amounts of capital and time.

“If the joint projects materialize, the complex will be constructed in the form of a `block plant’ _ repairing vessels or producing components. Therefore there will be no huge momentum in shipbuliding stocks,’’ Ahn Ji-hyun from NH Securities said.

Posted in Foreign direct investment, Inter-Korean summit, Labor conditions/wages, Political economy | Comments Closed

Inter-Korean Projects to Cost Over $ 11 Bil.: Report

Friday, October 5th, 2007

Korea Times
10/5/2007

More than $11 billion is needed to implement cross-border business projects that the leaders of the two Koreas agreed to at the historic summit this week, a local research institute estimated Friday.

Wrapping up a three-day summit, the second one since 2000, South Korean President Roh Moo-hyun and North Korean leader Kim Jong-il on Thursday agreed to a number of inter-Korean business projects.

According to Hyundai Research Institute, the development of a special economic zone in Haeju, the North’s western port city, will cost about $4.6 billion. Around $2.5 billion will be spent to finance the expansion of an industrial complex in the North Korean border city of Kaesong.

A project to build leisure facilities around Mount Baekdu is expected to cost $1.3 billion, the research institute said.

The estimated cost, when it is financed over five years, is equivalent to 8.75 percent of the North’s gross domestic income, and 0.25 percent of the South’s gross domestic product, Hyundai Research said.

The two leaders called for rapidly expanding the South-supported industrial park in the North’s border town of Kaesong and launching cross-border freight transportation via an inter-Korean railway between the South’s Munsan and the North’s Pongdong.

The two Koreas also agreed to jointly repair and maintain the North’s dilapidated expressway linking Kaesong and Pyongyang, as well as the North’s railway between Kaesong and Sinuiju on the North’s western Chinese border.

As part of a bilateral agreement to boost relations in tourism, history, language, education, culture, sport and art, the Koreas agreed to open a direct air route between Seoul and Mount Paekdu, allowing South Koreans to tour the scenic North Korean mountain on the North’s northern border with China.

The research institute, meanwhile, projected that the North would get $138 billion worth of economic benefits and the South $4.8 billion should the inter-Korean business projects be implemented as planned.

Posted in Automobiles, Aviation, Foreign direct investment, Inter-Korean summit, Kaesong Industrial Complex (KIC), Railways, Transportation | Comments Closed

2nd South-North Korean Summit Joint Statement

Thursday, October 4th, 2007

Institute for Far East Studies
NK Brief No. 07-10-4-2

1. The South and the North shall uphold and endeavor actively to realize the June 15 Declaration.

The South and the North have agreed to resolve the issue of unification on their own initiative and according to the spirit of “by-the-Korean-people-themselves.”

The South and the North will work out ways to commemorate the June 15 anniversary of the announcement of the South-North Joint Declaration to reflect the common will to faithfully carry it out.

2. The South and the North have agreed to firmly transform inter-Korean relations into ties of mutual respect and trust, transcending the differences in ideology and systems.

The South and the North have agreed not to interfere in the internal affairs of the other and agreed to resolve inter-Korean issues in the spirit of reconciliation, cooperation and reunification.

The South and the North have agreed to overhaul their respective legislative and institutional apparatuses in a bid to develop inter-Korean relations in a reunification-oriented direction.

The South and the North have agreed to proactively pursue dialogue and contacts in various areas, including the legislatures of the two Koreas, in order to resolve matters concerning the expansion and advancement of inter-Korean relations in a way that meets the aspirations of the entire Korean people.

3. The South and the North have agreed to closely work together to put an end to military hostilities, mitigate tensions and guarantee peace on the Korean Peninsula.

The South and the North have agreed not to antagonize each other, reduce military tension, and resolve issues in dispute through dialogue and negotiation.

The South and the North have agreed to oppose war on the Korean Peninsula and to adhere strictly to their obligation to nonaggression.

The South and the North have agreed to designate a joint fishing area in the West Sea to avoid accidental clashes. The South”s Minister of Defense and the North”s Minister of the People”s Armed Forces have also agreed to hold talks in Pyongyang this November to discuss military confidence-building measures, including military guarantees covering the plans and various cooperative projects for making this joint fishing area into a peace area.

4. The South and the North both recognize the need to end the current armistice regime and build a permanent peace regime. The South and the North have also agreed to work together to advance the matter of having the leaders of the three or four parties directly concerned to convene on the Peninsula and declare an end to the war.

With regard to the nuclear issue on the Korean Peninsula, the South and the North have agreed to work together to implement smoothly the September 19, 2005 Joint Statement and the February 13, 2007 Agreement achieved at the Six-Party Talks.

5. The South and the North have agreed to facilitate, expand, and further develop inter-Korean economic cooperation projects on a continual basis for balanced economic development and co-prosperity on the Korean Peninsula in accordance with the principles of common interests, co-prosperity and mutual aid.

The South and the North reached an agreement on promoting economic cooperation, including investments, pushing forward with the building of infrastructure and the development of natural resources. Given the special nature of inter-Korean cooperative projects, the South and the North have agreed to grant preferential conditions and benefits to those projects.

The South and the North have agreed to create a “special peace and cooperation zone in the West Sea” encompassing Haeju and vicinity in a bid to proactively push ahead with the creation of a joint fishing zone and maritime peace zone, establishment of a special economic zone, utilization of Haeju harbor, passage of civilian vessels via direct routes in Haeju and the joint use of the Han River estuary.

The South and the North have agreed to complete the first-phase construction of the Gaeseong Industrial Complex at an early date and embark on the second-stage development project. The South and the North have agreed to open freight rail services between Munsan and Bongdong and promptly complete various institutional measures, including those related to passage, communication, and customs clearance procedures.

The South and the North have agreed to discuss repairs of the Gaeseong-Sinuiju railroad and the Gaeseong-Pyongyang expressway for their joint use.

The South and the North have agreed to establish cooperative complexes for shipbuilding in Anbyeon and Nampo, while continuing cooperative projects in various areas such as agriculture, health and medical services and environmental protection.

The South and the North have agreed to upgrade the status of the existing Inter-Korean Economic Cooperation Promotion Committee to a Joint Committee for Inter-Korean Economic Cooperation to be headed by deputy prime minister-level officials.

6. The South and the North have agreed to boost exchanges and cooperation in the social areas covering history, language, education, science and technology, culture and arts, and sports to highlight the long history and excellent culture of the Korean people.

The South and the North have agreed to carry out tours to Mt. Baekdu and open nonstop flight services between Seoul and Mt. Baekdu for this purpose.

The South and the North have agreed to send a joint cheering squad from both sides to the 2008 Beijing Olympic Games. The squad will use the Gyeongui Railway Line for the first-ever joint Olympic cheering.

7. The South and the North have agreed to actively promote humanitarian cooperation projects.

The South and the North have agreed to expand reunion of separated family members and their relatives and promote exchanges of video messages.

To this end, the South and the North have agreed to station resident representatives from each side at the reunion center at Mt. Geumgang when it is completed and regularize reunions of separated family members and their relatives.

The South and the North have agreed to actively cooperate in case of emergencies, including natural disasters, according to the principles of fraternal love, humanitarianism and mutual assistance.

8. The South and the North have agreed to increase cooperation to promote the interests of the Korean people and the rights and interests of overseas Koreans on the international stage.

The South and the North have agreed to hold inter-Korean prime ministers” talks for the implementation of this Declaration and have agreed to hold the first round of meetings in November 2007 in Seoul.

The South and the North have agreed that their highest authorities will meet frequently for the advancement of relations between the two sides.

Oct. 4, 2007

Pyongyang
[Document signed by both Roh Moo-hyun and Kim Jong Il]

Posted in Economic reform, Inter-Korean summit, Kaesong Industrial Complex (KIC), Political economy, Railways, Special Economic Zones (Established before 2013), Transportation | Comments Closed

Summit Spurs Stock Re-Rating

Tuesday, October 2nd, 2007

Korea Times
Yoon Ja-young
10/2/2007

The second inter-Korea summit is expected to lay the ground not only for the establishment of a permanent peace on the peninsula but for further re-rating of the Seoul stock market, analysts said.

They said that Seoul stocks, burdened so long with the so-called “Korea discount” due to geopolitical concerns, will get a fresh boost as President Roh Moo-hyun entered North Korea for a summit with the North’s leader Kim Jong-il.

The main index KOSPI closed above 2,000 points again Tuesday as it closed at 2,014.09 points, up 51.42 points, or 2.62 percent, on the balmy news from north on top of the bullish New York bourse.

Most analysts agree that the summit will have a positive effect on the bourse in the long term. They advise investors to pay attention to stocks that have to do with social overhead capital (SOC) projects in North Korea.

Samsung Securities said the summit will be a great boon for the bourse in the long run. “The political events between the two countries haven’t affected stock prices much. Opinions diverge regarding its effect in the short term, but it would greatly contribute to the revaluation of local stock market in the end,” said Ahn Tae-kang, an analyst at Samsung Securities.

The world was surprised when the two countries announced the summit plan in 2000 April, and the whole nation watched the historic scene on TV when former President Kim Dae-jung was greeted by North Korean leader Kim Jong-il in Pyongyang two months later.

The stock market soared after each of these events, yet change was not always predictable. When North Korea conducted nuclear tests in 2006, on the contrary, stocks continued to rise as foreign investors sought buying shares on cheap prices.

It is different this time, according to analysts. “It would be a remarkable bullish factor once the two come out with a concrete plan on economic cooperation and SOC,” said Lee Seon-yeob, an analyst at Goodmorning Shinhan Securities. It would be only symbolic if without concrete agreements, he feared, but it would still be meaningful, according to Lee.

“The two can talk about setting up special economic zones, which can give rising momentum to North Korea related stocks and improve overall investor sentiment,” Kiwoom Securities said in a report.

Samsung Securities’ Ahn cited decreasing geopolitical risk and consequent reevaluation of stocks, the economic cooperation between the two and decreasing cost of unification after North Korea’s adoption of a market system and opening of the market as meanings of the summit. “The growing possibility of the sovereign credit ratings raise and Seoul index’s incorporation into developed world indices and the risk premium decrease are some of the positive effects,” he said.

He advised investors to concentrate on large cap blue chips that will benefit from infra projects in North Korea. Hyundai Engineering & Construction, POSCO, Hyundai Merchant Marine, Hyundai Elevator, KEPCO, and Hyosung were among his top picks.

Goodmorning Shinhan’s Lee said cited SOC related businesses, including construction and power transmission as the ones to benefit from the summit. “In the first summit, all stocks related with North Korea skyrocketed, but not this time. Investors are taking out the ones that will have a visible benefit. Investors seem to know how to make a good investment,” Lee said.

With just a day left before the second epoch-making inter-Korean summit, North Korea-related shares surged on the Korean stock market yesterday.

The power facility industry enjoyed a moderate increase. Geumhwa PCS Co. advanced 5.5 percent, and Doosan Heavy Industries & Construction Co. climbed 2.37 percent.

The electric wire sector also posted a bull run as LG Cable and Taihan Electric Wire Co. surged 5.3 percent and 2.8 percent.

Nam Hae Chemical Corporation, a local agrichemical product manufacture, increased 5.6 percent.

However, the companies that have penetrated into the Kaeseong Industrial Complex suffered a loss.

Romanson Co. tumbled 3.3 percent and JY Solutec Co. slid 0.8 percent.

The share prices of Ewha Technologies Information, Cheryong Industrial Co. and KwangMyung Electronic, potential beneficiaries of electricity transmission from South to North Korea, dropped by 6 to 13 percent.

The second inter-Korean summit is expected to improve investment sentiment, generating strong gains across the board.

However, some market watchers warn investors not to make impulsive investments in North Korea-related shares.

“Although investment sentiment surrounding the stock market is [expected] to improve once the inter-Korean summit kicks off, it will only have a short-term effect,” said Oh Hyun-seok, the investment information manager at Samsung Securities.

Posted in Banking, Electricity, Energy, Finance, Foreign direct investment, Inter-Korean summit, Political economy | Comments Closed

NK Projects: Chance or Risk for Businesses?

Tuesday, October 2nd, 2007

Korea Times
Jane Han
10/2/2007

Economic cooperation topping the agenda for the inter-Korean summit, plus the van of corporate decision makers traveling to the North together, begs the question: Will the trip bear fruit for two-way business?

Chung Mong-koo of Hyundai-Kia Automotive Group, Chey Tae-won of SK Group, Koo Bon-moo of LG Group and Hyun Jeong-eun of Hyundai Group, who are among the 18 CEOs accompanying President Roh Moo-hyun as part of a special entourage, showed signs of hope as they departed for Pyongyang on their three-day trip that started Tuesday.

“I hope the talks will go well and further the ongoing business between the two Koreas, while opening doors to new areas as well,” said Hyundai Chairwoman Hyun.

Unification Minister Lee Jae-joung was also optimistic as he detailed some of the items, including North Korea’s expansion of social overhead capital (SOC) and construction of railroads, which may be discussed among leaders of both sides.

“As there has been much progress in the peninsula over the past seven years, we’re hoping that this experience will set a milestone in history,” he said in a television interview.

These hopes may be translated into reality through at least two scheduled business leader meetings during the summit period.

“The definition of economic cooperation between the two Koreas, so far, has implied one-way support from Seoul,” said Koh Il-dong, a research fellow of the Korea Development Institute (KDI). “But now, it’s time to break free of that old understanding and move toward real cooperation.”

And “real cooperation” is what the North bound corporate executives are looking to, as they hint some of the possibilities they have in mind.

Among the top three business topics expected for discussion _ natural resource developments, roadway and railway distribution system expansions and dockyard construction _ Hyundai-Kia Automotive Group is said to be interested in building railroad cars through its shipping affiliate Glovis, and also measure the feasibility of SOC businesses, while POSCO showed interest in forestation.

Although company officials said forestation is just a possibility, as the steel maker has shown its interest in securing carbon credit overseas, industry insiders say the opportunity will be advantageous for POSCO if cooperation comes through.

And as speculations rose that SK Group may be considering communication and energy projects in the North, company officials said plans are open for review if the right offer is made.

LG and Samsung, which are said to be mulling over their specialty areas of electronics, seem to be in the same scouting stages as others.

“Each company needs to be given the time and circumstances to carry out through market research,” said Dong Yong-sueng, a research fellow of the Samsung Economic Research Institute (SERI), implying that those are some of the accommodations that must be worked out if business is to happen.

Contrary to the high hopes, economic experts pointed out that some corporations would be wary of cooperating with North Korea, as it may ruin their reputation in the global market.

Posted in Automobiles, Communications, Energy, Environmental protection, Foreign direct investment, Forestry, Inter-Korean summit, International Aid, Lumber, Mining/Minerals, Railways, Sea shipping, Transportation | 1 Comment »

Mt. Geumgang Project to Take Another Leap

Monday, October 1st, 2007

Korea Times
Ryu Jin
10/1/2007

Mt. Geumgang tourism project, launched in 1998, has grown up as one of the three major inter-Korean economic projects in accordance with the reconciliation of the two Koreas. And it now braces itself for another leap with the 2007 South-North Summit.

But the project went through a rough and difficult road in the past nine years, largely due to exterior factors such as the political instability such as the nuclear standoff between North Korea and the United States since 2002.

Hyundai Asan, the operator of the cross-border tourism project, expects the summit to provide a fresh momentum for their business. Hyundai Group Chairwoman Hyun Jeong-eun will accompany President Roh Moo-hyun to Pyongyang.

Riding on Reconciliation

In June, Mount Geumgang opened the elegance of its inner part to outsiders for the first time since the pre-modern Korea was divided into two different systems — the capitalist South and the communist North — more than half a century ago.

Since it became accessible in 1998, Mt. Geumgang has emerged not only as a popular tourist destination for South Koreans but also one of the few places in North Korea where foreigners could travel relatively easily.

But the inner part of the mountain, better known as “Naegeumgang” in Korean, has been closed by North Korea despite the repeated requests by Hyundai Asan in the past several years.

Geumgang-san, a 12,000-peak mountain that has long held aesthetic and spiritual allures for Koreans, could be divided into three parts: “Naegeumgang” (inner, western part), “Oegeumgang” (outer, eastern part) and “Haegeumgang” (seashore part).

In the past, people took trains to Cheorwon to explore the auspicious mountain _ they climbed up through Naegeumgang to get to the highest Biro-bong peak (1,638 meters), looked around Oegeumgang and then came down to Haegeumgang.

Former Unification Minister Lee Jong-seok, who climbed up the new course, said it was quite meaningful that Pyongyang has finally decided to open the secretive area, given the strategic importance of the military bases facing the South’s Cheorwon.

After a four-month operation of the Naegeumgang tour, more than 50,000 people are expected to visit Mt. Geumgang in October to break the record for the number of visitors in a single month, according to Hyundai Asan.

For Another Leap

Since the first tour to Oegeumgang in late 1998, more than 1.5 million visitors have made the trip to the mountain resort as of May. Most visitors were South Koreans, while nearly 8,000 visitors came from 48 other countries.

But Hyundai Asan’s tourism business has often been affected by security situations on the peninsula. It met difficulties when North Korea conducted a nuclear test in October last year.

Amid the heightened tension, the number of tourists to the mountain resort plummeted to some 240,000 last year, putting a damper on Hyundai Asan’s target of securing more than 400,000 visitors.

Hyundai Asan CEO Yoon Man-joon said earlier this year that the company set the target at 400,000 again for this year. By the end of May, about 100,000 people have made the trip to Mt. Geumgang this year, according to Hyundai Asan spokespersons.

Yoon said that the company would also try to revamp tour programs to draw more younger visitors as part of its new marketing strategy for the existing tour to the outer side of the mountain, Oegeumgang.

Company officials added, once the 500,000-pyong (408-acre) 18-hole golf course is completed in October, Mt. Geumgang would be reborn as a new resort complex with “things to see, eat, buy and enjoy.”

Hyundai Asan has a new plan for the next year. “Our tourism business would be put on the right track next year, if the visitors could drive their own cars all the way to the resort area across the border and clime up to the highest Biro-bong,” a spokesman said.

Posted in Foreign direct investment, Inter-Korean summit, Mt. Kumgang Tourist Special Zone, Tourism | Comments Closed

Samsung, LG Likely to Expand TV Business in North Korea

Friday, September 28th, 2007

Korea Times
Kim Yoo-chul
9/28/2007

Samsung Electronics and LG Electronics are considering expanding investment in the TV business in North Korea, according to company sources Friday.

Such expectations came after the government confirmed that Samsung Group Vice Chairman Yoon Jong-yong and LG Group Chairman Koo Bon-moo will join President Roh Moo-hyun’s entourage for the inter-Korean summit on Oct. 2-4.

Expectations have arisen among business groups that the second inter-Korean summit will produce substantial results in creating more business opportunities in North Korea, though big firms responded less enthusiastically than they did seven years ago.

“As our vice chairman will go to North Korea, we will start reviewing the North Korean business,’’ a Samsung spokesman told The Korea Times.

Asked about the possibility to expand production of cathode-ray TVs (CRT) in the North, the spokesman declined to elaborate.

But a source familiar with the situation raised the possibility of more production of CRTs.

Samsung began producing CRTs in the reclusive country on an original equipment manufacturer (OEM) basis since late 2000, the year then President Kim Dae-jung visited the North.

LG, which has produced between 15,000 and 20,000 CRTs in the communist state since 1996, is also considering expanding its TV business there in a long-term perspective.

“Nothing has been confirmed yet. But the issue is a possibility,’’ an LG spokesman said.

He said there will be more discussions after Chairman Koo returns from Pyongyang.

Posted in Foreign direct investment, Light Industry, Manufacturing, Television | Comments Closed

DPRK trade officials crack down on corruption

Friday, September 28th, 2007

Institute for Far Eastern Studies
NK Brief No. 07-9-28-1
9/28/2007

Since early this year, North Korean authorities have been systematically implementing a double-entry accounting system to keep track of cross border trade with China, and as of late have been cracking down on private sales of goods imported under state requisitions.

It has become common practice for most traders to keep two sets of books, a private accounting record, and a set of records for government use. As these traders exported state goods to China, they would conspire with Chinese counterparts and make huge profits by recording lower prices than goods were actually being sold for. In many cases, bribes are taken to turn officially imported and exported goods (minerals, seafood, etc.) over to private sellers. These facts came to light through Chinese traders in business with North Korea.

Recently, however, investigations by the Kangsung Trade Company, operated under the supervision of the People’s Armed Forces Bureau, led to the conviction and execution of a foreign currency trader in Kangwon Province, Wonsan City and another from South Hamkyung Province, Hamheung City on charges of funneling company funds for private use. The crackdown appears to be because embezzlement and other forms of corruption are on the rise.

It was also disclosed that the foreign currency trader in Hamheung was accepting money from private business operators and using the company’s name to lend import and export quota chits. Inspectors raided the homes of the suspects and found large amounts of U.S. currency and gold, as well as no small amount of Japanese yen.

The human rights NGO ‘Good Friends’ reported in last month’s newsletter, “ After Oh Moon-hyuk, foreign currency director for the Chosun Fabric 88 Trade Company in Yunsa County, North Hamkyung Province, built a private villa on a plot with a good view, and purchased a Mercedes out of pocket, he drew the attention of General [Kim Jong Il] and was exposed. He was publicly executed in the middle of last July.” The NGO went on to report, “Every day young girls were called to the villa for his enjoyment, and security forces and police made it a point not to stop by the area near the villa often.”

Trade authorities in the area report that the crackdown on these violators has had no effect on DPRK-PRC trade. High ranking officials are aware of the abuse of authority to earn money, but had to some extent turned a blind eye to the issue. The crackdown is a result of the recent considerable growth in the problem.

Posted in Black markets, China, Economic reform, Good Friends, International trade, Kangsung Trading Company, Military, Political economy | Comments Closed

US Geological Survey 2006 Minerals Yearbook

Wednesday, September 26th, 2007

Summary: For the next 4 to 5 years, the North Korean mining sector is likely to continue to be dominated by the production of coal, iron ore, limestone, magnesite, and zinc. Because of growing demand for minerals by China and the Republic of Korea, their investment in North Korea’s mining sector is expected to increase and to extend beyond their current investments in apatite, coal, copper, and iron ore into other minerals, such as gold, magnesite, molybdenum, nickel, and zinc. North Korea’s real GDP is expected to grow at between 1% and 2% during the next 2 years.

Other highlights:

North Korea ranked third in production of magnesiate in the world. Its value-added product–magnesia clinker, which is used as a refractory metal–was marketed world wide.
According to Corporate social Responsibility Asia (CSR Asia), North Kroea ranked virtually last in environmental sustainability in the world, despite the country’s enactment of major laws for environmental protection, such as the Land Law of 1977, the Environmental Protection Law of 1986, the Forrestry Law in 1982, and the Law on Protection of Useful Animals in 1998.
On the basis of North Korea’s industrial structure in 2004 (the last year in which data is available), the mining sector accounted for about 8.7% of North Korea’s gross domestic product.
Recoverable coal reserves in North Korea were estimated to total about 8 billion metric tons in 2006. Coal production reportedly dropped to about 23 Mt/yr in 2006 from 37.5 Mt/yr in 1985 mainly because of outdated mining equipment and technology.

Download the full version here: USGS.pdf

Posted in Agriculture, Coal, Copper, Economic reform, Energy, Environmental protection, Foreign direct investment, Gold, Graphite, Iron Ore, Mining/Minerals, Sand, South Korea | Comments Closed

Oppressive regime’s ID cards pave path to liberty

Monday, September 24th, 2007

Joong Ang Daily
Jeon Jin-bae
9/22/2007

North Korean resident identification cards have become a hot item on the black market in China for ethnic Koreans who want to live in Europe.

Mr. Kim, an ethnic Korean man from China, moved to Paris last year and obtained a resident permit from the French government a few months ago allowing him to stay in the country for 10 years. He asked not to be identified by his full name, because he obtained his permit illegally.

His resident permit states that he is a North Korean refugee and identifies him as a North Korean citizen, not a Chinese national. Kim said he purchased a North Korean resident’s ID card and pretended to be a refugee from China when he sought asylum in France.

Kim said he is not alone. “At least 100 people have sought refugee status in the last year using the same means,” he said.

According to other ethnic Koreans in China, North Korean IDs were traded in cities near the China-North Korea border, such as Yanbian and Dandong. The prices range between 1,000 yuan and 1,500 yuan ($134 to $199), they said.

“As far as I know, there are many North Koreans who want to sell their IDs,” said an ethnic Korean who lives in China.

North Koreans who manage to escape to China are anxious to sell their IDs, because they are afraid of being captured, identified as North Korean and then send back to their homeland.

According to sources, ethnic Koreans who want to live in Europe prearrange their trips through middlemen who transport them through China’s Shenzhen Province to Hong Kong.

From there they fly to Thailand and meet with South Korean middlemen who provide fake South Korean passports.

Using these documents, the ethnic Koreans will often fly to Switzerland and then move to the country of their destination, often France or Italy, via overland routes.

Reaching Europe is seen as being more than half way to success, sources said, because the process of seeking refugee status is relatively simple.

In France, immigrants only have to submit an application along with a North Korean ID card to qualify. The French government then provides a temporary three-month residence permit, which is extended until a final decision is made.

Four months after applying for refugee status an interview will take place. A French official who speaks Korean will question the applicant, but most ethnic Koreans are well prepared to pass this simple screening, the sources said.

Europe is a popular destination because it only costs 10,000 euros for a Korean-Chinese to buy refugee status and various organizations often provide them with extra protection and assistance.

Posted in Black markets, China, Civil society, Emigration | 2 Comments »

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