From Google Video:
This is America’s host Dennis Wholey does a great job filming from the Kaesong Industrial complex.
Check it out.
Archive for the ‘Economic reform’ Category
American TV show broadcasts from Kaesong
Thursday, July 13th, 2006DPRK cancels, but Kumgang hotel opens
Wednesday, July 12th, 2006From the Joong Ang Daily:
An abrupt notification by the North that it would not attend caused the postponement of a celebration by the two Koreas of the launch of the Oegeumgang Hotel at Mount Kumgang in North Korea, which had been set to take place yesterday.
The 11-story, 179-room Oegeumgang Hotel still launched operations yesterday, as did Baekseju village, designed to promote rice liquor and a rest stop called Hwajinpo near Mount Kumgang.
The hotel will be open to foreign tourists who come on a Hyundai Asan package deal to visit the mountain.
Hyundai Asan Corp., the arm of Hyundai Group that spearheads inter-Korean business, said yesterday the North told them on Monday afternoon that it would not attend.
North Korea did not say why, but Hyundai said it may have been due to the international tension caused by its missile launches last week.
A Hyundai Asan spokesman said, “the absence is not likely to affect future business with North Korea.”
He added that the opening celebration date will be reset soon after discussions with the North.
Hyundai Asan also plans an event on Mount Kumgang with the North Aug. 4-6 to commemorate the late Hyundai Group founder Chung Ju-yung, who was born in North Korea. The North has not said if it will participate.
Half-Million Bucks Go to Kaesong Every Month
Wednesday, July 12th, 2006Korea Times
Kim Yon-se
Staff Reporter
S-N Economic Cooperation Showpiece Under Double Threat
Nowadays the Kaesong Industrial Complex, the flagship of inter-Korean economic cooperation, is stuck between a rock and a hard place.
The United States has rejected a South Korean request to include it in their bilateral trade talks, taking away one of the few incentives for companies to set up shop there.
The Kaesong complex is a collaborative industrial park developed by South and North Korea located in North Korea close to the Korean Demilitarized Zone with direct road and rail access to South Korea.
The Kaesong complex is also bearing the fallout from Pyongyang’s missile tests that raised an uproar in the international community, giving Washington an excuse to push hard for its ongoing effort to choke the North’s cash flow.
“Kaesong is a lifeline that keeps alive inter-Korean business cooperation,’’ said an official who is involved in the project. “It is at a fragile stage so if anything happens that changes the current status of the Kaesong complex, there would be no turning back.’’
He said that the government is expected to keep the project going at all costs.
In the Kaesong complex, about 7,700 North Koreans work for Hyundai Asan, the project manager and scores of South Korean companies there. A North Korean worker there earns $64 in wages and allowances a month, making for half a million dollars in the monthly total payment. Most of the money is paid on the 10th of the month. This month, it was paid as scheduled.
“It is unthinkable that the wages would be withheld,’’ the official said, when asked what would happen if economic sanctions were slapped on the communist country. “I don’t think that the government would do that.’’
Some U.S. officials have said South Korea’s continuation of pushing Kaesong goods as an item for the FTA talks may be a big hurdle for signing the final pact.
“The agreement should only cover products of the U.S. and the Republic of Korea. That is our position,’’ Assistant U.S. Trade Representative Wendy Cutler told reporters.
Aside from the negative stance toward products created by North Korean employees from the North’s raw materials, the U.S. has strategies not to allow made-in-South Korea products, especially clothes, made from imported materials from China or Taiwan, according to sources.
If the U.S. allows the Kaesong products as an FTA item, it has no choice but to accept the products made from non-Korean textiles.
The U.S. clothing market has already been flooded with cheap products from China and Southeast Asian countries that are labeled as premium brands, such as Polo and Burberry.
Korean civic protestors argue the Korean government is unprepared for the talks and has few negotiation strategies. In fact, the government is falling short in making Kaesong products acknowledged as an FTA item.
According to the Chosun Ilbo, an ultra-conservative vernacular daily, a government official said Korea will ultimately drop the issue in the future talks though it will not scrap the issue on the official negotiation table.
Citing the officials’ remarks, the newspaper said it is impossible for Korea to receive concessions from the U.S. on Kaesong products and the government will use the issue as leverage for other issues.
DPRK officials to get econ 101 in Switzerland
Tuesday, July 11th, 2006From the Korea Times:
A group of North Korean officials will receive training on multilateral diplomacy and market economy in Switzerland this summer, a Swiss research institute said Tuesday.
The North Koreans, whose number was not immediately known, are slated to enroll for the training from Aug. 21 to Sept. 22 at the Geneva-based Center for Applied Studies in International Negotiations, center officials said.
The Swiss think-tank, founded in 1979, has been running a short-term training course for North Korean officials every year since 1997. Its program is financed by the Swiss Agency for Development and Cooperation, a governmental body which last year earmarked 5 million franc ($3.1 million) to help North Korea.
In 2004, 14 North Korean officials benefited from the center’s program.
During their stay in Switzerland, they visited the European Union, headquartered in the Brussels, Belgium, and met with members of the European Parliament in Strasbourg, France.
Missle test could affect ROK aid to DPRK
Thursday, July 6th, 2006From Joong Ang Daily:
One ROK official said yesterday that shipments of 100,000 tons of fertilizer and 500,000 tons of rice, the remainder of assistance promised this year, would be suspended at least temporarily.
“There should be no misunderstanding on this,” the official said. “We told the North that actions would be taken if they fired a missile.”
Other projects, such as manufacturing at the Kaesong Industrial Complex and tours to the resort area of Mount Kumgang, will probably not be touched. Mr. Lee, the Unification Minister, said the two projects had long-term goals and involved private capital, and so were not appropriate instruments of retaliation.
Firms in North say they’re not bothered by test
Thursday, July 6th, 2006Joong Ang Daily
Kim Hyung-soo
7/6/2006
However concerned politicians may be about North Korea’s missile test, many Korean companies that deal with the reclusive state are saying it has had minimal impact on business. So far.
Hyundai Asan, which does much of its business in North Korea ― including the Mount Kumgang tour and operating the Kaesong industrial complex ― said it was business as usual. Hyundai Asan said only 50 people canceled their trip to Mount Kumgang yesterday, while 700 people went as planned.
“As the government has already mentioned, private businesses are not subject to restrictions because of the North Korean missile problem,” a Hyundai Asan official said.
The South Korean company stressed that although it has faced problems in the past because of developments in the North, its businesses there have never been forced to stop.
“Business in North Korea should be consistently maintained, as it could be a solution that could solve the strained relationship between the two Koreas,” the official said.
Hyundai Asan said they were more concerned that the North’s recent actions could end up reducing the number of tourists in summer, the high season for travelers.
ShinWon, which manufacturers clothing at Kaesong industrial complex, said the plants there were operating as usual.
“The only difference was that our headquarters in Seoul called to ask what the atmosphere was like in Kaesong,” said a South Korean ShinWon worker at Kaesong.
Despite the firms’ apparent sangfroid, experts were quick to point out the possible long-term consequences. “[The launch] could reduce the credibility of the Korean economy and affect foreign investments,” said an official at the Korea Chamber of Commerce and Industry. “The future of economic cooperation between the two Koreas has become more uncertain.”
“Poor security is the economy’s biggest negative factor,” said Lee Dong-eung at the Korea Employers Federation. “At times like this society needs to remain calm and unified.”
Though many foreign investors who visited Kaesong last month stressed that politics and business should be kept separate, it remains to be seen how the missile launch will affect foreign sentiment toward the industrial complex.
Kumgang to get weather center
Thursday, July 6th, 2006From the Korea Times:
Two Koreas Discuss Setting Up Weather Center at Mt. Kumgang
By Lee Jin-woo
Tourists visiting North Korea’s scenic Mt. Kumgang resort are likely to be presented with more accurate weather forecasts as early as this fall, officials at South Korea’s Unification Ministry said Wednesday.
South and North Korea are in negotiations to open a weather forecasting center at the mountain to provide tourists with more accurate meteorological information in the region, notorious for its unpredictable weather, said a ministry official, who asked not to be identified.
“Negotiations between the two Koreas are currently under way to open a weather center. There are still some areas that the two sides need to agree upon,” the official said. “Pyongyang is showing a positive response to the plan though.”
In May, a survey team comprised of officials from the ministry, Hyundai Asan Corp. as well as the Korea Meteorological Administration (KMA) was dispatched to the area to gather information prior to beginning construction, sources said.
Hyundai Asan has led the tourism project under which more than 1.2 million South Koreans have visited the resort area since the communist state opened the outer part of Mt. Kumgang on its east coast in 1998. Last year, the annual number of South Korean visitors to Mt. Kumgang reached over 300,000 for the first time.
“It was early last year when we first requested local broadcasting companies to add weather forecasts for Mt. Kumgang and its adjacent areas,” said Kwon Kee-seob, who is in charge of public relations at Hyundai Asan. “The broadcasters, however, told us to discuss the matter with the KMA and the Unification Ministry to set up some facilities to gather information there.”
Kwon added over 2,000 South Koreans, including some 1,000 travelers, visit or stay in the North Korean territory on average everyday.
“We’ve got many phone calls from those who plan to make a trip to Mt. Kumgang, but have not been able to give them good weather information,” he said.
South Korean officials once considered making use of weather forecasts by the North Korean meteorological agency, but later gave up the plan due to the poor quality of weather information from the North, sources said.
Kumgang contracts with foreign companies
Wednesday, July 5th, 2006Kumgang resort goes international
Emerson Pacific Group, a Korean company that is now building a golf and spa resort at North Korea’s Mount Kumgang, said yesterday that it had reached an agreement with a British resort operator to co-manage those facilities.
A spokeswoman for Emerson Pacific said that her company would be responsible for development planning for the resort and fund it entirely; the British company, General Hotel Marketing, would oversee the resort’s construction and interior design, operating systems, staff training and global marketing. General Hotel Management operates 16 resorts around the world, including at Langkawi and Bali in Asia.
The agreement gives an international polish to the formerly inter-Korean project to develop tourism at Mount Kumgang, widely acclaimed from antiquity as the Korean Peninsula’s most scenic area.
Ralf W. Ohletz, the executive vice president of General Hotel Management, told the press yesterday that he was convinced that the resort “has the potential to become a global-scale tourist attraction.” He added that the locale ― North Korea ― made the project both challenging and attractive.
Emerson said it would spend about 80 billion won ($85 million) on the resort, which is scheduled to open next year. It is already selling memberships in the golf course there for 17 million won each.
Hyundai Asan, which is the overall operator of the tourism project at Mount Kumgang, said yesterday that the beach there will be open for swimming and picnicking beginning Saturday.
The tour operator also said the Oegeumgang Hotel, on the mountains’ eastern slope, has been remodeled and will be open on July 11. The 11-story building, with 179 rooms, was formerly a retreat for senior North Korean officials.
Womens’ inome makes divorce more affordable
Tuesday, July 4th, 2006From the Daily NK:
North Korean Women Responsible for 90% of Family Living…Recent Increase in Divorce
Recently, it has been found that the divorce rate of North Korean women is rapidly increasing.
According to a newsletter published by a support organization for North Korea ‘Good Friends’ on the 29th, the majority of North Korean women bound to this battle of life are responsible for more than 90% of the family’s living and are caught in a severe lifestyle where they even have to gather bribes to the liking of security officers and protection officers.
It was reported that “The majority of women wake up at 3.30am to make rice and work outside the home all day. On returning home, they are still in charge of domestic housework such as cooking, washing, cleaning. For these reasons divorce has rapidly increased.”
The newsletter also reported “In the case of North Hamkyung province, in spite of divorce proceedings being complicated and approval difficult, of the people married the actual figure of couples living separately or undergoing divorce has reached 20%.”
The major basis of divorce is the burden of women to fulfill duties both in society and traditional female roles within the home.
In addition, it was explained that the reason divorces rates are rising is “During the period of full mobilization to farms like in May and June, not only is it difficult to eat three proper meals a day, but the number of husbands that help in domestic affairs does not even reach 10%.”
Russia to trade DPRK electricity for natural resources
Tuesday, July 4th, 2006In the old days, the DPRK nurtured its independence by alternating its allegiance between China and Russia, playing the big boys off each other. Today, China clearly holds more influence in the DPRK in terms of trade and direct political influence. In fact, China and the DPRK are involved in several hydro-power projects on the Yalu river. Perhaps energy subsidies are a way for Russia to regain a foothold in the DPRK and protect its direct link to Pyongyang and potential land links to Seoul.
On an economic note, this kind of behavior is typically called “dumping” in the west and it is not allowed under WTO rules. But both parties are clearly better off if the deal goes through. This should tell us something about our Anti-dumping trade rules in the west as well.
But this is all just silly speculation on my part. Here is the article from the Joong Ang:
July 04, 2006
KHABAROVSK, Russia ― Russia has been in discussions with North Korea to supply it with surplus electricity, Russian officials at a state-owned electric power company recently told the JoongAng Ilbo. In return, North Korea would provide Russia with natural resources.
“We have been discussing exporting surplus electricity from the far eastern district of the country to North Korea,” Victor Minakov, president of Vostokenergo, the far eastern branch of the United Energy System of Russia, said in an interview last week in Khabarovsk.
“The fastest and most efficient way to resolve North Korea’s electricity problem is to supply electricity from Russia,” Mr. Minakov said.
According to Mr. Minakov, negotiations have been delayed because Russia initially asked North Korea to pay cash for the electricity, and then asked it to cover the expenses for building power transmission lines, neither of which the North could afford.
However, the negotiations resumed after Pyongyang offered to pay for the electricity with natural mineral resources. “Representatives from the Russian energy company will visit Pyongyang at the end of this month for further discussions on detailed matters,” Mr. Minakov said.
The far eastern area of Russia, reportedly has around 300,000 kilowatts of surplus electricity, and the government plans to further improve productivity there by building more power plants. Russia and North Korea has been negotiating on the supply of electricity since 2001.
Russia plans to build a 370-kilometer (229-mile) power transmission line between Vladivostok, Russia, and Chongjin, North Korea, to supply 300,000 to 500,000 kilowatts of electricity. Building power transmission lines and converters would take three years, and cost at least $200 million.
“It costs much less to supply electricity from Russia to North Korea than from South Korea to the North or through the programs of the Korean Peninsula Energy Development Organization,” Pavel Korovko, vice president of Vostokenergo, said on June 27 at a seminar in Khabarovsk.
The Korean Peninsula Energy Development Organization was dissolved recently after failing to build light water reactors in North Korea under the terms of a 1994 agreement between North Korea and the United States.
