Archive for the ‘Mt. Kumgang Tourist Special Zone’ Category

1.5 Million Tourists Visit Mt. Geumgang

Thursday, June 7th, 2007

Korea Times
Ryu Jin
6/7/2007

More than 1.5 million tourists have so far visited Mt. Geumgang in North Korea since the tour was launched about a decade ago, Hyundai Asan said Thursday.

Since the launch in November 1998, the accumulated number of tourists to Mt. Geumgang reached 500,000 in November 2002, 1 million in June 2005 and then 1.5 million in June this year, according to the South Korean operator of the inter-Korean tourism project.

Company officials hailed the latest achievement, which came just after the start of a new tour program to inner Mt. Geumgang, better known as “Naegeumgang’’ in Korean, early this month.

“We will hold a weekend concert this Saturday at the multi-purpose cultural center in the resort complex of Onjeong-ri,’’ a Hyndai Asan spokesman said. “Famous pop singers and bands, including Nam Jin, and rock band No Brain will be there.’’

As part of efforts to promote the Mt. Geumgang tour program, Hyundai Asan has held various cultural events in recent months including concerts and previews of films.

Mt. Geumgang, which has long held both aesthetic and spiritual allure for Koreans, can be divided into three parts: Naegeumgang (inner, western part), Oegeumgang (outer, eastern part) and Haegeumgang (seashore part).

Since the first tour to Oegeumgang in 1998, an increasing number of visitors have made the trip to the resort area. Most were South Koreans; fewer than 8,000 visitors came from 48 other countries.

But the inter-Korean tourism business has often been affected by the security situation on the Korean Peninsula. For example, it ran into difficulties when North Korea conducted a nuclear test in October last year.

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

On June 1, the company started a new tour program, which allows visitors to taste the elegance of the inner part of the 12,000-peak auspicious mountain. Hyundai Asan CEO Yoon Man-joon expressed his ambition during a pilot tour late last month where some 150 dignitaries and media took part.

“We set the target at 400,000 again this year. About 15 to 20 percent of the tourists are expected to visit Naegeumgang this year,’’ Yoon said. “I hope the launch of the Naegeumgang tour will give us an opportunity for a second leap toward successful Mt. Geumgang tour business.’’

Hyundai Asan officials said about 100,000 people have made the trip to the mountain by the end of May. They expect that the figure could reach the target as the high-demand season — from June to October — is approaching.

Each group for the two-night, three-day Naegeumgang tour will be made up of up to 150 visitors and the departure days are every Monday, Wednesday and Friday.

On the first day, the visitors would check in at the hotel and enjoy the North Korean acrobatics show and dine on unique North Korean food for supper. On the second day, they would explore the beauty of Naegeumgang, followed by a brief trip to Oegeumgang on the last day.

Yoon said 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.

“We will continue to host various cultural events, including concerts and cinema previews, to meet expectations of customers in various age groups,’’ said a company spokesman. “These efforts will also help the company advance to two million visitors.’’

Share

Hyundai considers longer Geumgang tour

Wednesday, May 30th, 2007

Korea Herald
Kim Yoon-mi
5/30/2007

Hyundai Asan, the South Korean operator of travel to Mount Geumgang in North Korea, is considering expanding its new program that would allow South Koreans to tour the inner side of the mountain, its CEO Yoon Man-joon said yesterday.

Hyundai Asan on Sunday and Monday ran two pilot tours to inner Mount Geumgang, which has been closed by North Korea despite the South Korean company’s eight-year-long request to open it to South Korean visitors.

The new tour course will be open to the general public from June 1.

“For now, the new course is open three times a week, on Tuesday, Thursday and Saturday. But depending on the tourists’ response, we could increase the visiting days. And this has already been agreed to with North Korean officials,” Yoon said during a press meeting at Pyohun Temple at inner Mount Geumgang on Monday.

Hyundai Asan’s tourism business met difficulties when North Korea conducted a nuclear test in October last year. With tension heightened on the Korean Peninsula, the number of tourists visiting Mount Geumgang plummeted, ruining Hyundai Asan’s target of securing 400,000 visitors a year. The number reached only 240,000 last year.

“We set the target at 400,000 again this year. About 15 to 20 percent of the tourists are expected to visit inner Geumgang this year. I hope by launching the inner Mount Geumgang tour, it give us a second leap toward successful Mount Geumgang tour business,” Yoon said.

The new tour includes a bus ride through North Korean villages for an hour and a half.

During the bus ride, North Korea people’s livelihoods, commercial buildings and schools will be visible to South Korean tourists.

“It must have been a big decision for North Korea to open up their ‘inner bedroom’ because you would do so to only those who are really close to you,” he said.

Regarding new marketing strategy for the existing tour to the outer side of Mount Geumgang, Yoon said the company will revamp tour programs to attract younger visitors.

Also, Hyundai Asan will add two tour sites called Munpil Peak and Beobgi Rock to the outer Mount Geumgang tour course as early as in June, he said.

The inner Mount Geumgang tour, once opened in June, will be operated from April to November with a price tag of 420,000 won ($450) for a three-day tour per person. The outer Geumgang tour currently costs 390,000 won per person.

“Just as inner and outer parts of Mount Geumgang meet to become one, I hope one day the two Koreas can become one,” said Hyundai Group chairwoman Hyun Jeong-eun, who also participated in the pilot tour on Monday.

Share

Roh wants more cash for Kaesong

Tuesday, May 22nd, 2007

Joong Ang Daily
5/22/2007

President Roh Moo-hyun said yesterday that his government will accelerate investment in North Korea’s Kaesong industrial park, regarding it as part of South Korea’s “unification expenses.”

“My government has not sped up the pace of its investment in the Kaesong industrial complex due to political risks. I now regret that,” the president said in an interview with the Maeil Economic Daily and its cable news affiliate MBN.

“Uncertainties surrounding investment in Kaesong will prove to be far less than expected, as the North Korean nuclear problem is certain to be settled through dialogue and confidence-building measures. Economic benefits from the Kaesong project are immeasurable.”

The president stressed that smooth operations of the industrial park will help South Korea’s external economic credibility and small businesses struggling with rising labor costs.

“The most important factor [involving Kaesong] is unification expenses. One of the surest ways to reduce the expense of unification is to make the Kaesong project successful. We have to expand our investment in Kaesong as soon as the North Korean nuclear problem is settled,” said Roh.

The industrial park is one of two flagship projects South Korea operates to promote reconciliation with North Korea, along with tours of the North’s scenic Mount Kumgang. Over 13,000 North Korean workers are now employed in Kaesong by 23 South Korean firms.

But opposition parties and other conservatives in the South are accusing the Roh government of having blindly offered excessive aid to the Kaesong complex and other inter-Korean cooperation projects.

Roh also reiterated his determination to pursue an FTA with China.

“A free trade deal with China is inevitable. But we’ll conclude it after completing the restructuring of our agricultural sector through the FTA with the U.S.”

Commenting on South Korea’s economic growth potential, Roh said the nation’s economic growth rate will soon rise again to the 7 percent level from under 5 percent due to positive effects from FTA deals and massive planned investments in the construction of new administrative, business and public corporation towns across the nation, which are estimated to reach 54 trillion won by 2010.

Share

Venturing into North Korea

Tuesday, May 22nd, 2007

CNN (Hat tip to D”S”B)
Adam Levine
5/22/2007

Hiking on North Korea’s Mount Kumgang gives you the uneasy feeling that despite the majesty of the natural scenery, even nature cannot escape politics in one of the most closed-off countries in the world.

The four-hour walk to Kuryong Falls is the centerpiece of the Mount Kumgang resort in southeastern North Korea. The trail winds along a river with glistening pools of water and picturesque scenery all around.

But you never escape the country’s dictatorship — there is the propaganda carved into the mountainside and rocks by the North Koreans, and the Chinese before them. There are also the North Korean employees working as vendors and rescue workers on the trail. They are always in pairs, and always seem to be watching you.

Kumgang is a popular tourist destination for South Koreans, for whom the mountain holds spiritual allure, and it is one of the few places in North Korea that Americans can travel relatively easily.

Hyundai Asan, an offshoot of the Korean car company, built the resort. It paid the North Korean government US$1 billion for 50 years of exclusive rights to the region and other business interests in North Korea. It spent an additional US$400 million to build the five-hotel resort, which opened in 1998.

More than 1.5 million visitors have made the trip to Kumgang. Most visitors are South Koreans; less than 8,000 visitors are from 48 other countries. Hyundai Asan spokesman Dan Byun says a majority of the 8,000 are South Korean ex-patriots.

Despite the western style hotel accommodations, American money changing hands and duty free shop selling Johnny Walker and Marlboro cigarettes, you don’t forget that you are in North Korea.

Just getting there involves busing through the demilitarized zone, where we are constantly told “no pictures, no pictures” by our guide and informed that aside from the road we are on, the entire area is filled with land mines.

After going through North Korean immigration we are herded back on a bus and reminded again that we cannot take pictures until we get inside the resort.

The 4.5-mile trip moves through southern North Korea, which the guide says is all a military base. Soldiers appear ominously standing at attention along the road. Each carries a red flag, which, we are told, will be raised if any soldier sees one of us taking a picture. Tanks and what appear to be anti-aircraft weapons are hidden in bunkers in the hills overlooking the roads.

The actual resort area looks no different than any typical tourist destination with a welcome center, hotels, bus parking and retail stores. North Korean folk songs blare from overhead speakers in the parking lot. But surrounding it all is a fence to separate tourists from the North Korean village of On Jung Li.

A two-night, three-day tour can cost as much as US$490. There are five hotels to choose from including a beach-side hotel and floating hotel and one that used to be the vacation home of Kim Il Sung’s wife.

There are 11 restaurants, including a branch of a North Korean noodle restaurant that is an exact replica of its counterpart in Pyongyang. An 18-hole golf course is opening in the fall and there is a Korean acrobatics show that performs each night at the theater.

The government has gone to extremes to accommodate the resort, even tearing down a village and moving it and its inhabitants to make way for the welcome center and shop.

The company defends its $1 billion payment to the North Korean government as economic revitalization. Hyundai Asan built a railway and border station to allow trains to travel from Seoul, South Korea, into North Korea. After refusing to let the trains through for a long time, the North Korean government finally allowed the first train to cross the border last week.

Hyundai is also building a reunification center to allow families from both sides of the border to hold reunions when allowed.

Some North Koreans work at the resort as waiters, vendors, rescue teams and maintenance. Most wear a pin of their president on their lapel.

Most refused to be photographed, cryptically saying “no pictures while I am working.” All but a few will refuse to talk to you. The ones that did talk to us offer some glimpse into their thinking.

One rescue worker told us that the only reason President Bush has not invaded North Korea is because Bush is afraid of Kim Jung Il. A vendor told us that she likes Americans, but hates the American government.

The resort is surrounded by a fence, through which you can see villagers planting in the fields and walking down the roads. They are forbidden to come to the resort or talk to the tourists. Not that they appear to be trying.

Ashley Moore, from Oklahoma, remembers North Koreans ducking behind trees and plants.

“We weren’t allowed to speak to any of them,” Moore said.

Moore, and her boyfriend Zac Gambill took a trip to Mount Kumgang when they lived in South Korea last year.

She and Gambill went from being a bit frightened to be in North Korea to surprise about the unabashed consumerism at the resort.

“Seeing the commercialism at the resort was a real shock,” Moore said. But she never felt totally at ease.

“We got a sense of the North Korean government’s determination to convey a favorable image to the outside world and a small sense of what it feels like to be constantly under surveillance,” Moore observed.

Share

Inter-Korean railway test

Thursday, May 17th, 2007

There has been a plethroa of articles on the ROK/DPRK train crossing.  Here is a grab-bag of facts and sources:

17korea337.jpg

Joong Ang Daily
5/15/2007
Unification Minister Lee Jae-joung expressed hope that regular inter-Korean rail services would transport workers to an industrial complex in the North’s city of Kaesong as well as serve as a mode of transportation for South Korean tourists at the Mount Kumgang resort.  However, North Korea has only agreed to one test run.

The sticking point was the number of passengers aboard the trains. South Korea stressed the need for an equal number of North Koreans, but North Korea declined the offer, citing unspecified reasons, ministry officials said. The two sides will exchange passenger lists via an inter-Korean economic office in Kaesong tomorrow.

The two Koreas are set to conduct test runs on a 27.3-kilometer (17-mile) line between Munsan Station and Kaesong Station in the western section, and on a 25.5-kilometer line between Jejin Station and Kumgang Station in the eastern section.

Rare experience aboard N. Korean train across the border
Yonhap
Sohn Suk-joo
5/17/2007

At the urging of North Korean conductors, 100 South Koreans and 50 North Koreans boarded a five-car train at 11:25 a.m. With no speaker system at Kumgangsan Station at the North’s scenic mountain along the east coast, conductors repeated “Please board the train” through a loudspeaker mounted upon a South Korean-made Hyundai Starex utility vehicle.

Painted green on the main body and the roof a faint gray, the facade of the train was far from modern. “The train looks like South Korea’s obsolete third-class train, but its ability is better than that,” said Lim Jong-il, a South Korean official at the Ministry of Construction and Transportation.

South Korean Construction Minister Lee Yong-sup, Kim Yong-sam, the North’s railway minister, and some 20 South and North Korean journalists crowded into the second car of the train. The smell of new paint assailed the nostrils upon ascending the steps, while a pair of portraits of Kim Il-sung and his son Kim Jong-il hung on the wall above the door.

The seating arrangement was face-to-face, and refreshments for passengers were set on a small table in front of the window — one lemon-lime soda, one strawberry juice, one bottled water, two apples and a pear. North Korean female attendants served a cup of ginseng tea for passengers later.

The upright, ivory-colored vinyl seats were a little bit uncomfortable and did not recline, but the cushions were softer than they appeared to be.

Outside the window, a uniformed North Korean conductor waved a red flag and goose-stepped past the train, which signaled the impending departure. A few North Korean security officers came inside to check the number of passengers and asked journalists jostling for position to sit down.   

At 11:27 a.m. a long whistle sounded, reminiscent of an old-time steam locomotive. The train spluttered back and forth several times and then slowly started forward. “North Korean trains usually whistle a lot,” a South Korean transportation official said. 

North Korean middle school students, who attended a ceremony, started to wave their hands, and South Korean passengers responded in kind. The train moved out of Kumgangsan Station at the speed of 10 kilometers per hour, and North Koreans working nearby just looked at the train without reacting in a friendly manner.

Some 50 meters away from the railway on the right side, a paved road appeared as the scenic Mount Geumgang faded from sight. Rice paddies were waiting for rice seedlings to be planted, but no peasant was seen working outside.

Unexpectedly, well wishers were South Korean tourists traveling to the Mount Geumgang resort in a convoy of eight buses. “At this time of the day tourist buses go to the resort,” a South Korean official said.

At 11:30 a.m. the stretch of hills and mountains continued, and the clouds moved quickly against the blue sky, cleansed from the previous day’s rain.

A few Toyota jeeps driven by soldiers, military jeeps and trucks drove parallel with the train and then fell behind. North Korean soldiers were stationed at the checkpoints of major intersections.

Then the track turned sharply, a rare occurrence on South Korean track. The sharp turns came again and again, and a woman peeked outside the window at a nearby village.

The overall atmosphere was friendly, a throwback to a picnic in the 1970s-80s on a slow, squeaking train. Hills and mountains passed by, and splendid pine trees of all kinds of shapes. After awhile the Nam River appeared on the right side of the train. At one village, some 10 residents came out and looked over the communal wall to watch the passing train.

At 11:50 a.m. the train passed Samilpo Station. The painted name on the station was very small, like Kumgangsan Station, and an oversized portrait of Kim Il-sung hung on the front of the station, along with pro-communist and cult propaganda slogans.

The train crossed the river on a bridge restored with steel plates provided by South Korea. Outside the window, North Korean tourist attractions such as Haegumgang and Samilpo were seen a little farther away.

At 11:50 a.m. some passengers pushed up the windows, and the unpolluted air coming through the open windows refreshed them. A group of 10 North Korean soldiers stood guarding a storage house of diesel engine trains built for the railway test run. There was no other train in sight.

The train slowed down at Kamho Station, where North Korean customs officials were stationed. It was 11:55 a.m.

Around 12:00 p.m. four customs officials and two conductors boarded each car of the train. One of them shouted, “We fervently welcome you who have become the first passengers of the train! Now we will start customs clearance procedures.”

Conductors checked the identities of the passengers and digital cameras. They asked a passenger to delete a photo of portraits of Kim Il-sung and Kim Jong-il that had been blurred from the shaking of the camera.

At 12:15 p.m. the conductors suddenly moved to the exit and disembarked. They must have gotten orders to let it pass, as the inspection took longer than expected. The train started to move again right away.

“Now you will see an outpost about 200 meters. It is the Military Demarcation Line,” said Kim Kyong-jung, chief of the inter-Korean railway team at the Ministry of Construction and Transportation.

A sharp whistle blew, and the train picked up speed, double its previous pace. The shaking was palpable, but not enough to affect the bottles on the small table. With the speed increasing, the frequency of the whistle’s call also increased.

In five minutes, the train passed the Northern Limit Line and went into the Demilitarized Zone. At 12:21 p.m., it passed the Military Demarcation Line to roars of applause. The train slowed a bit and the passengers became quiet, awaiting arrival.

At 12:25 p.m., a South Korean tourist observatory appeared, and some 200 tourists on the porch waved their hands eagerly, welcoming the North Korean train. Wide paved roads came into view and the train arrived at Jejin Station five minutes later. Amid the loud sound of a welcoming brass band and the cheering crowd, the train stopped at a South Korean station for the first time in more than half a century.

Trains cross inter-Korean border for first time in over 50 years
Yonhap
5/17/2007

A North Korean train traveling on reconnected track along the east coast of the Korean Peninsula on Thursday crossed the heavily armed border to return to its point of departure after a brief stay here.

At the same time, a South Korean train returned to the South in the west of the Korean Peninsula.

Earlier in the day, the two trains, one carrying 100 South Koreans and the other 50 North Koreans, crossed the Military Demarcation Line (MDL) dividing the two countries for the first time in more than half a century.

“It took more than half a century to cross this short, approximately 20-kilometer distance. We have to prevent anyone from blocking the railways. They were so hard to reconnect,” Kim Yong-sam, North Korea’s railway minister, said in a luncheon speech after arriving here.

In response, South Korean Construction Minister Lee Yong-sup hailed the test run of the cross-border railways, suggesting South and North Korea cooperate in promoting the mutual interest and prosperity of the Korean people.

At 11:30 a.m., Lee, who led the 100-member delegation to North Korea Thursday morning, boarded the North Korean train in Kumgangsan Station near the scenic Mount Geumgang resort for a test run on a 25.6-kilometer track in the eastern section of the peninsula.

At the same time, Kwon Ho-ung, chief councilor of the North Korean Cabinet, who had led the 50-member delegation to the South, boarded the South Korean train at Munsan Station in the western side of the peninsula on a restored 27.3-kilometer track, along with his South Korean counterpart, Lee Jae-joung.

Before the trains departed, South and North Korea held ceremonies to mark the historic event at Kumgangsan and Munsan stations, respectively.

“I hope it will contribute to forming a joint economic community and making balanced development on the Korean Peninsula. A new curtain of peace has been raised on the peninsula,” Lee said in a commemorative speech.

In his speech, Kwon said that North Korea will make every effort to make sure that the “train of unification” runs along a “track” of inter-Korean collaboration, with its emphasis on peace and understanding.

“Right at this moment, however, the challenge from divisive forces inside and outside is continuing. We should not waiver or be derailed from the track of national sovereignty and inter-Korean collaboration,” Kwon said.

The one-time test run came only after North Korea reluctantly agreed to provide military security arrangements last week. The tracks have been set to undergo tests since they were restored in 2003, while a set of parallel roads has been in use since 2005 for South Koreans traveling to the North.

In May 2006, North Korea abruptly called off the scheduled test runs, apparently under pressure from its hard-line military. The cancellation led to the mothballing of an economic accord in which North Korea would receive US$80 million worth of light industry raw materials from the South in return for its natural resources. North Korea’s subsequent missile and nuclear weapons tests further clouded hopes of implementing the agreement.

The reconnection of roads and train lines severed during the 1950-53 Korean War was one of the tangible inter-Korean rapprochement projects agreed upon following the historic summit between then South Korean President Kim Dae-jung and North Korean leader Kim Jong-il in 2000.

South Korea hopes to use the restored railways to help North Korean workers commute to a joint industrial complex in the North Korean border city of Kaesong as well as to transport South Korean tourists to the North’s scenic Mount Geumgang.

The Gyeongui (Seoul-Sinuiju) line cutting across the western section of the border was severed on June 12 in 1951, while the Donghae (East Coast) line crossing the eastern side was cut shortly after the outbreak of the Korean War.

South and North Korea used radio communication between Dorasan Station in the South and Panmun Station in the North for the western rail line, and between the South’s Jejin Station and the North’s Kamho Station for the eastern one. The stations are closest ones to the border on both sides.

In March, the two Koreas agreed to put humanitarian and economic inter-Korean projects back on track just days after North Korea promised to take the first steps toward its nuclear dismantlement in return for energy aid and other concessions from the other five members of the six-party talks.

South and North Korea are still technically at war, as the Korean War ended in an armistice, not a peace treaty.

Korean Train Crossing Seen as Sign of Progress
New York Times

Choe Sang-Hun
5/17/2007

[excerpts]

South Korea has long dreamed of building a trans-Korea railroad that would connect its train network to China and to the Trans-Siberian Railway in the former Soviet Union, creating a so-called Iron Silk Road.

North Korea blocks overland access to Asia, which makes South Koreans “feel as if we live in an island,” the South Korean transportation minister, Lee Yong Sup, said yesterday.

A trans-Korea railroad would offer a faster and cheaper way for South Korea to bring exports that are now shipped by sea to China and Europe. It would also provide a shortcut for Russian oil and other natural resources transported to South Korea. Such a rail system would save South Korea $34 to $50 a ton in shipping costs, said Lim Jae Kyung, a researcher at the Korea Transport Institute.

But before the dream of a trans-Korea rail system comes true, transportation analysts and government officials say, years of confidence-building talks and billions of dollars in investment in North Korea’s decrepit rail system will be needed.

Officials acknowledge that such a dream will not be made real until after North Korea gives up its nuclear weapons and improves its human rights record. Those moves would help build public support in South Korea for large investments across the border and would open the way for international development aid.

South Korean officials say a trans-Korea railroad would invigorate inter-Korean trade, which tripled from $430 million in 2000 to $1.35 billion last year.

It would also bring cash to North Korea, which could collect an estimated $150 million a year in transit fees from trains that pass through its territory, according to some estimates.

But it is unclear whether or when North Korea might agree to regular train service across the border.

Procuring international aid to renovate the rail network and letting trains from one of Asia’s most vibrant economies, carrying exports and tourists, rumble through its isolated territory could threaten the North Korean regime, analysts and others say.

The agreement came after South Korea promised to send North Korea 400,000 tons of rice, as well as $80 million worth of raw materials for shoes, soap and textiles.

South Korea has spent 544.5 billion won, or $589 million, on reconnecting the rail system, including 180 billion won in equipment, tracks and other material loaned to North Korea.

South Korean policy makers have called for patience in working toward reconciliation with the North. They have often been accused by conservative politicians and civic groups of giving in to North Korea’s strategy of extracting economic aid for every step toward reconciliation.

“This is a precious first step for a 1,000-mile journey,” Mr. Lee, the unification minister, said today.

South Korea has seen some tangible results in its overtures to the North in recent years.

The North Korean military cleared mines and moved some of its weapons to make room for the rail system and the Gaesong industrial complex. In addition, South Korean factory managers commute from Seoul to Gaesong using a road that was reconnected in 2004, and South Korean buses regularly take tourists to the Diamond Mountain resort in the North.

Share

Railway test runs

Saturday, May 12th, 2007

Korea Herald
5/12/2007

South and North Korea have agreed to guarantee security for test runs on cross-border rail connections. The accord will make it possible for trains to resume operations across the Demilitarized Zone after the Korean War stopped the railway service more than five decades ago.

But South Korea may not be 100 percent assured that the test runs will proceed as scheduled, given that North Korean commitments have more often than not proved unreliable. Actually, North Korea withdrew its security guarantee on the eve of the railway test runs that had been scheduled for May 25 last year.

Moreover, the security accord is flawed because it will not apply to commercial operations that will follow the test runs. South and North Korea will have to negotiate enduring rules governing inter-Korea railway transportation in the near future.

At the four-day general-level talks that ended on Friday, the North Korean military withheld a security guarantee for commercial operations for the incomprehensible reason that construction of a southern part of the eastern rail link has yet to be completed. Given that the part in question could be reconnected anytime, the North Korean military no doubt has ulterior motives, including extracting concessions from the South in exchange for a security guarantee.

It goes without saying that North Korea is misguided in refusing to guarantee security for commercial operations. It is North Korea that stands to benefit much more from the rail connections.

But South Korea should also be held accountable for the North’s irresponsible behavior. It made the wrong decision when it decided to provide the North with $80 million worth of intermediate materials for the manufacture of necessities and 400,000 tons of rice in exchange for railway test runs.

When negotiating the terms of commercial operations next time, South Korea will have to avoid making similar mistakes. It has no reason to accept being played for a fool when offering a helping hand.

Share

Ready to Run

Friday, May 4th, 2007

Joong Ang Daily
5/4/2007

train.jpgAt Jejin Station on the east coast of South Korea, railroad officials yesterday checked a train to be used in the scheduled test of the restored inter-Korean railroads on May 17. In the pilot operation to reconnect the East Coast Line and the Gyeongui Line, trains from both sides will cross the demilitarized zone. North Korea has broken a promise to hold similar trial runs three times in the past.

Share

The North Korean Economy: Between Crisis and Catastrophe

Thursday, May 3rd, 2007

American Enterprise Institute Book forum
4/17/2007

A couple of weeks ago, I had the opportunity to attend a book forum at the American Enterprise Institute on Nicholas Eberstadt’s new book, The North Korean Economy: Between Crisis and Catastrophe.  It was very informative to hear three different perspectives on the direction of North Korea’s economic reform.

Panelists included:

Nicholas Eberstadt, AEI
Andrei Lankov, Kookmin University
Deok-Ryong Yoon, Korea Institute for International Economic Policy

In summary, Mr. Eberstadt and Mr. Lankov are pessimistic about the North Korean leadership’s desire to enact reforms–knowing that information leakages will undermine their political authority.  As Mr. Lankov pointed out, the North Korean nomenklatura are all children and grandchildren of the founders of the country who are highly vested in the current system.  They have no way out politically, and as such, cannot reform.

They argue that the economic reforms enacted in 2002 were primarily efforts to reassert control over the de facto institutions that had emerged in the collapse of the state-run Public Distribition System, not primarily intended to revive the economy.  Lankov does admit, however, that North Korea is more open and market-oriented than it has ever been, and  Mr. Yoon was by far the most optomistic on the prospects of North Korean reform.

Personally, I think it makes sense to think about North Korean politics as one would in any other country–as composed of political factions that each seek their own goals.  Although the range of policy options is limited by current political realities, there are North Koreans who are interested in reform and opening up–even if only to earn more money.  In this light, even if the new market institutions recognized in the 2002 reforms were acknowledged only grudgingly, they were still acknowledged, and their legal-social-economic positions in society are now de jure, not just de facto.  The North Korean leadership might be opposed to wholesale reform, but that is economically and strategically different than a controlled opening up on an ad hoc basis–which is what I believe we are currently seeing. Anyway, dont take my word for it, check out the full commentary posted below the fold:

(more…)

Share

Cable Cars to Run on Mt. Geumgang

Monday, April 30th, 2007

Korea Times
Kim Yon-se
4/30/2007

Hyundai Group is gearing up to activate its inter-Korean businesses as negative factors, such as North Korea’s nuclear test last October, have started to settle down.

As early as this year, Hyundai Asan, the group’s tourism unit, plans to operate cable cars on Mount Kumgang to attract more South Korean tourists. The company has been in talks with North Korea to run cable cars on part of the mountain.

“It usually takes about one year or more to complete the construction of a cable car system. We launched the construction last year,” a company official said, suggesting that tourists could enjoy the service in 2007 or early 2008.

He said cable cars will run between the mountain’s top and the Sejonbong ridge, one of Mount Kumgang’s peaks. As the peak is located near the East Sea, tourists will enjoy scenic views of the mountain and sea simultaneously.

Hyundai Asan has set the goal of attracting 400,000 tourists, including South Koreans and foreigners, to Mount Kumgang this year, compared with 234,446 last year.

Its rosy outlook comes largely from the six-party agreement to dismantle North Korea’s nuclear programs in February. Hyundai Asan officials say the event will help normalize inter-Korean businesses.

“The landmark accord will enable our inter-Korean projects, including Mount Kumgang tours and the Kaesong Industrial Complex, to get revitalized,” the official said.

Along with the scheduled opening of tours to inner Mount Kumgang from May 27, Hyundai Asan has decided to hire more than 10 fresh employees.

As the number of tourists fell to fewer than 250,000 in 2006 from 301,822 in 2005 and 272,820 in 2004, the company had to conduct layoffs and cut monthly payments to some employees amid deteriorating profitability last year.

Now the company plans to restore the salary level and pay delayed bonuses in a bid to encourage workers.

The tour project accounts for about 70 percent of Hyundai Asan’s total sales. It has set a sales target of 300 billion won for 2007.

Hyundai is also poised to push ahead with a plan to begin tours to Kaesong, a North Korean historical city near the border that is home to the South Korean-invested industrial complex. It plans to hold working-level meetings with the North in order to hasten the start of the tours.

Share

North Korean resort gives solace to South

Monday, April 23rd, 2007

Star Bulletin
Jim Borg
4/23/2007

The Mount Kumgang project has become a place of spiritual if not political reconnection

Amid ongoing international tensions, North Korea has embraced Western-style tourism at its most famous natural attraction, Mount Kumgang.

Thousands of Korean and foreign tourists flock each month to a modern resort under development by South Korea’s Hyundai Asan Corp., which paid $1 billion for exclusive rights to the business.

After $400 million in additional expenditures since 1998, Hyundai Asan has created not only a tourism hub, but the epicenter for reunification efforts on the peninsula.

“Through the Kumgang tourism business, the reconciliation process has begun between the North and the South,” says Young-Hyun Kim, the company’s on-site general managing director.

Star-Bulletin reporter Jim Borg visited the stunning locale last week as part of a journalism exchange sponsored by the East-West Center and the Korea Press Foundation.

MOUNT KUMGANG, North Korea »

Mist rose from the high mountain pool under the thundering waters of Kuryong Falls, adding to the chilly dampness of the day.

Four hours after an unsmiling North Korean soldier scrutinized our passports and waved us on, we stood at the top of a trail traveled each month by thousands of tourists from both sides of the border, all in search of a spiritual reconnection with their ancestral land.

On a divided peninsula technically still at war, Mount Kumgang has become part of a bold experiment in rapprochement. As their political leaders stagger toward the stated goal of reunification, North and South Korea have carved a modern resort out of this imposing landscape along the Sea of Japan.

Despite international tensions over North Korea’s nuclear program and missile launches last July, South Korea’s Hyundai Asan Corp. is pressing ahead with plans to develop this 922-square-mile expanse a short drive north of the Demilitarized Zone.

Already in place are three multistory hotels, a beach lodge for families, 34 single-family cabins, camping facilities, four North Korean restaurants, six South Korean restaurants, duty-free shops, convenience stores, a hot-spring spa, shows featuring acrobats and folk music, and stone-paved trails punctuated by snack tables. A swimming beach adjoins the floating Hotel Haekumgang in nearby Kosung Bay.

A railway links the two countries here. North Korea, for obscure reasons, has yet to green-light the trains, and border stations remain eerily empty, but Hyundai Asan’s Ha-Jung “Dan” Byun expresses confidence that that hurdle will be cleared soon.

“Everything is connected,” he says. “Everything is ready. What we are waiting for is the final confirmation between the two governments.”

Byun, general manager for planning and foreign investor relations, greeted U.S. reporters visiting Mount Kumgang last week as part of a program sponsored by the East-West Center. This is the first time that the Korea-United States Journalism Exchange, now in its third year, has sent reporters into North Korea.

One of the lessons that emerged is that business interests seem to be succeeding where diplomacy has often failed.

Hyundai Asan, an enterprise separate from the automotive and shipbuilding giants, paid $1 billion to North Korea for exclusive business rights at Mount Kumgang and, farther west, the Kaesong Industrial Complex, where South Korean technology meets cheap North Korean labor.

Scandal clouded the early years of the association, when corruption and embezzlement charges presumably prompted the company’s chairman, Chung Mong-hun, to commit suicide in 2003 by leaping from his 12th-floor office in Seoul. Asked whether Hyundai Asan’s largesse could be viewed as helping to finance North Korea’s weapons programs, Byun said the firm believes the lump sum payments in 1999-2000 were used for economic revitalization.

But even elsewhere along the Demilitarized Zone, a remnant of the 1950-53 Korean War, conflict has bred commerce, drawing tourists to souvenir shops and a carnival park called Peace Land. Tourists and South Korean schoolchildren are taken by tram into a tunnel dug under the DMZ by the North Koreans and discovered in 1978.

Peace Land is a short drive from Seoul, up a highway where billboard-type advertising masks barricades rigged with explosives to stop invading tanks.

South Koreans seem at ease with this dichotomy, taking North Korean anti-U.S. rhetoric and military posturing in stride in an atmosphere of care-free prosperity.

THE BEDROCK for North Korea’s burgeoning tourism is a collection of crags that seem to reach skyward like fingers pressed in prayer. Mile-high Birobong Peak caps this Yosemite-esque experience.

The brochure for Mount Kumgang shows colorful photos in every season, but even in a chilly drizzle the three-hour trek was breathtaking. A river spilled down the narrow canyon to collect in crystal green pools.

“The water is pure and clear,” observed Yong-Sik Im, 41, who came to the mountain with 31 other residents of Namgu village. He recalled singing a song about Mount Kumgang as a schoolboy and always longed to visit.

South Korean hikers here are essentially pilgrims.

At Kumgang they see harmonious manifestations of heaven, earth and water, symbolized on the national flag. The mountain’s yin-yang mix of strength and fluidity has even inspired some movements in the Korean martial art of tae kwon do.

Byun said most South Koreans hope to visit this spot at least once before they die. More than 1.4 million have come since 1998, with a highway route open since 2003.

The site has also been used for meetings arranged by the Red Cross between family members separated by the border. Special accommodations for those families are due to open next year.

THE NORTH KOREAN security guards and snack vendors we met along the trail were polite, if cool, and talked little about their lifestyles except to say they are satisfied.

The exception was one particularly articulate female worker, obviously briefed on the six-nation nuclear talks and other current events, who criticized the United States for aggression. At least one North Korean said the United States deserved the Sept. 11, 2001, attacks because of chronic warmongering.

Most of the North Korean workers, including the waitresses at the Okryukwan restaurant, where lunch was served after the hike, refused to be photographed. But over this caution hovered a palpable aura of promise.

Maybe it arises from the $400 million that Hyundai Asan has already spent on development above the $1 billion for rights.

About 1,500 people make a living here: 95 with Hyundai Asan, another 162 with other South Korean companies, about 780 North Koreans and 450 ethnic Koreans recruited by the North Koreans in China.

But don’t try to spend your South Korean currency in the North Korean shops.

Only U.S. dollars are accepted.

Share