Archive for the ‘Coal’ Category

« Older Entries
Newer Entries »

Cabinet meeting discusses economic performance

Monday, October 22nd, 2012

UPDATE (2012-11-1): The Institute for Far Eastern Studies issues a summary of the Cabinet meeting:

North Korean Cabinet Standing Committee Meeting Held, Results for Third Quarter People’s Economy Announced

North Korea announced the results of the people’s economy plan for the third quarter and named construction as its major accomplishment. In particular, many monumental edifices of the Songun era were built and recognized to have strengthened the material and technical foundation of its national economy.

The Korean Central News Agency (KCNA) reported on October 22 that such economy achievement was reported at the extended meeting for the Cabinet Standing Committee.

According to the KCNA, evaluation of the major sectors of people’s economy was made at the Cabinet meeting, commending the construction of thousands of new factories and companies.

In particular, construction of various new buildings were introduced including the new National Gift Hall, along with Pyongyang Folk Village, Rungna People’s Pleasure Ground, Rungna Dolphinarium, Sunrise Restaurant, and other modern cultural and service facilities. In addition, new buildings were built in campuses of Kim Hyong Jik University of Education and Koryo Songgyungwan University as well as other monumental edifices and major light industry factories. Such constructions are attributed to the improvement of consumer goods production and accredited to be advancing the modernization of people’s economy.

Additionally at the meeting, power and coal production was reported to have improved and production for major industrial products such as air compressors, transformers, jack hammers, coal wagons, power cables, cement and salt were also specified to have increased, contributing to the development of local industries.

Specific cases from Changsong County and Hoeryong City were presented to emphasize the improvement of local industries. The industrial production volume was claimed to have exceeded by 107 percent for the local industrial development plan for the quarter and adding strength to the modernization process for the local industries.

In the agricultural sector, considerable damage was reported for the third quarter as the North experienced floods and typhoon but asserted repair efforts for the damages took place appropriately.

The national budget income plan for the third quarter was recorded at 109.6 percent while local budget income plan was explained to have exceeded by 113.4 percent.

Following the meeting, major tasks for the economy for the fourth quarter were discussed. They included elevating the cities and counties to serve as regional bases, early response system to repair damages caused by natural disasters, and preparation to promptly carry out the 12-year compulsory education plan.

The law for the 12-year compulsory general education was recently adopted by the cabinet at the Supreme People’s Assembly meeting on September 25.

ORIGINAL POST (2012-10-22): The world was watching the most recent Supreme Peoples’ Assembly meeting for announcements of changes to the DPRK’s economic policies. However, little of substance was publicly announced.

According to Yonhap, the DPRK also held a recent cabinet meeting–date unknown. A cabinet meeting is where we would expect more serious deliberation of economic policies taking place. According to the article, however, the meeting featured rather standard agenda items (as best I can tell):

North Korea has held a cabinet meeting to discuss the country’s economic issues, a Chinese state media said Monday, as the communist regime reportedly makes efforts to reform its sickly economy.

The People’s Daily reported on its Chinese-language Web site that North Korea’s cabinet members recently gathered to review the country’s third-quarter economic performance and discuss targets to be achieved in the fourth quarter.

The meeting was presided over by North Korean Prime Minister Choi Yong-rim, the report said, citing the cabinet’s mouthpiece “Democratic (North) Korea”.

The report did not disclose when the meeting was held.

In the third quarter, North Korea saw a substantial increase on-year in its output of electricity and coal, the report said.

It also boosted production of air compressors, transformers, mining machines, wire, cement and other industrial products in the July-September.

Accordingly, the local industry has achieved an output level 7 percent higher than its original plan, while local budget revenues were 13.4 percent higher than original estimates, the Chinese newspaper said.

The North Korean cabinet members shared the view that the fourth quarter will be an important period for the regime to achieve its annual economic target for this year.

In a bid to achieve this year’s target, the country will continue to focus on producing electricity and coal, the report said.

The cabinet also agreed to fully implement universal 12-year compulsory education, promulgated at the Supreme People’s Assembly last month.

Speculation has recently risen that the secretive regime will take legal steps to start economic reforms as new leader Kim Jong-un is seen to be seeking to consolidate his power partly through fixing the broken economy.

Last month, a seminar aimed at attracting foreign investment in North Korea was held in a Beijing hotel.

Read the full story here:
N. Korea holds cabinet meeting to discuss economy
Yonhap
Kim Young-gyo
2012-10-22

Share

Posted in Cabinet, Coal, Electricity, Energy, GDP statistics, Statistics | Comments Closed

Robust bilateral trade and economic cooperation between China and North Korea

Monday, March 19th, 2012

Institute for Far Eastern Studies (IFES)
2012-3-15

The economic trade between China and North Korea has been robust since early this year. China’s Ministry of Commerce announced on February 29 that bilateral trade between the two countries just in January 2012 reached 418 million USD, an 18 percent jump over the same period last year. North Korea’s exports to China increased 7 percent to 139 million USD, while imports also increased 24 percent to $278 million USD.

Coal is North Korea’s largest export item to China — totaling almost half of total exports — and the total export sales are roughly worth 70 million USD. In contrast, crab and seafood exports to China were greatly reduced. This can be analyzed as one of North Korea’s measures to stock up on food to provide to its residents for the upcoming centennial birthday celebration of Kim Il Sung on April 15 (otherwise known as the Day of the Sun in the DPRK).

However, North Korea’s rice imports from China this past January plummeted 90 percent against the previous year. China’s Ministry of Commerce announced in the January 2012 Agricultural Import-Export Statistical Report that North Korea imported 614 tons (236,000 USD) in January compared to 18,140 tons (630 million USD) the same month last year, a drop of more than 94 percent. On the other hand, corn imports — the most popular grain import from China — tripled to 1,809 tons (596,000 USD) compared to last year’s import figure of 600 tons (174,000 USD).

Upon evaluation, China’s exports to North Korea appear to have increased one billion USD every three years. Based on the data collected from Chinese customs, the Korea Trade-Investment Promotion Agency (KOTRA) analyzed that China’s exports to North Korea were reported to have steadily increased from 1.08 billion USD in 2005, 2.03 billion USD in 2008, to 3.10 billion USD in 2011.

The major export items of China were crude oil and minerals, machinery, electrical equipment, vehicles and parts, and plastic products. These five categories showed steep growth from 30 to 60 percent against the previous year. Last year, China exported crude oil worth 518 million USD and petroleum products valued 192 million USD, which is a 59.1 percent and 83.4 percent rise, respectively.

In addition, 46.8 million USD of aviation kerosene and 58.31 million USD of aviation gasoline were exported to North Korea. Other export items such as fertilizers (134.4 percent) and grains (71.2 percent) steadily increased every year. KOTRA also confirmed China’s trade with North Korea peaked both in exports and imports last year, and the total trade volume towered at 5.64 billion USD. Last year, China’s exports to North Korea totaled 3.17 billion USD and imports from North Korea were 2.47 billion USD.

Trade regions that demonstrate robust economic activities include not only Dandong and Shinuiju but Hunchun, Rajin-Sonbong (currently being jointly developed) and Yanji (China)-Namyang (North Korea) areas. Trade volumes are increasing centered around these areas with expansion of bilateral economic cooperation projects and import of North Korean underground resources. Yanbian Prefecture put forth construction plans to build a new Tumen River Bridge connecting the two countries from this year, announcing the desire to continue to promote trade and economic cooperation with North Korea.

Share

Posted in Coal, Energy, Food, Statistics, Trade Statistics | 1 Comment »

Power shortage in Pyongyang prompts residents to move to older housing

Wednesday, February 1st, 2012

Two stories out with similar themes:

The first is from the Daily NK:

Many of the residents of luxury apartments in Pyongyang are leaving their homes for the heated homes of relatives or other warmer locations.

An inside source who visited Pyongyang at the end of last month said in a phone interview with the Daily NK today, “People previously had no supplies of water so didn’t have drinking water and could not go to the bathroom without difficulty, but now that there are heating problems too the people are inevitably leaving their homes. This year, many people are locking their homes and leaving for warmer places.”

The source said, “When I went to Pyongyang just three years ago, the people still stayed in their apartments even without heat, but now half of them are gone, they went to East Pyongyang where the pre-1980s homes are heated with charcoal briquettes.”

The source added, “Even until last year, the residents in these apartments spent the whole winter season there with cotton blankets on the floor all day long, filling pint bottles with hot water to warm their blankets when they slept; however, as the situation has gotten worse this year whole families cannot take any more and have chosen to leave their homes behind.”

The 20-40 storey apartments on Gwangbok and Tongil Streets, which are boasted of by the North Korean authorities for their modernity, are among those falling into dilapidation.

The source explained, “If the rooms had just enough lukewarm water that they wouldn’t freeze we could live, but now they are not even able to do that. Nobody knows when heat will come.”

Among many North Korean people, the situation is such that the letter ‘ㄹ’ has come to be ridiculed, with people saying that they suffer from a particular lack of words that have the letter ‘ㄹ’ in them, for example, water (‘물’), fire/electric (‘불’), and rice (‘쌀’).

The second story is from Reuters:

North Korea’s capital faces its worst electricity shortages in years just as a new leadership takes power in the impoverished state and pushes ahead with lavish building projects to celebrate the centenary of its founder’s birth.

The Pyongyang-based diplomat, who asked not to be named, said the city of 3 million and home to the leadership elite, has seen daily power supplies almost evaporate as freezing winter temperatures bite.

“Embassies and others with generators are using them most of the time to compensate both for poor quality and cuts, and I can tell you that power problems are a main issue of discussion,” said the diplomat, one of a small number of foreigners allowed to live in the country.

“We certainly assess that there is more darkness on the streets and in the residential blocks in the evening than before/during the mourning period (for Kim Jong-il).”

The young Kim Jong-un has been declared the country’s new “supreme leader” following the death of his father Kim Jong-il in December.

Fuel shortages have long been a chronic problem in North Korea which is heavily sanctioned by the outside world for a series of nuclear and missile tests.

Temperatures in the capital on Wednesday hit -19 Celsius (-2 Fahrenheit).

This winter’s outages have coincided with Pyongyang’s building spree to mark the 100th anniversary this year of the birth of founder Kim Il-sung — the current leader’s grandfather — including building 100,000 new homes in the capital.

The North is also struggling with chronic food shortages, with United Nations’ food agencies estimating nearly 3 million people will need food assistance this year.

Read the full stories here:
No Electricity, No Water, No Patience
Daily NK
Choi Song Min
2012-1-13

North Korea Power Cut: Pyongyang Diplomat Says Capital Faces Worst Electricity Shortages In Years
Reuters
2012-2-1

Share

Posted in Civil society, Coal, Construction, Electricity, Energy, Real estate | Comments Closed

KCNA: 20-day industrial output value increases over Jan 2011

Friday, January 27th, 2012

According to KCNA (2012-1-25):

The gross industrial output value grew 1.2 times for twenty days of January this year as against the same period last year.

This is the result of the high-pitched drive waged by all the workers of the country since the first day of this year after receiving with excitement the joint calls of the Central Committee and the Central Military Commission of the Workers’ Party of Korea, the joint New Year editorial for this year and the letter of the working people in South Hamgyong Province.

In the period, the Ministry of Light Industry increased the production 1.4 times and the Ministry of Food and Daily Necessities sharply boosted the production.

Thermal and hydropower stations have increased the ratio of operating the generating equipment.

Much effort is being concentrated on supplying coal to the thermal power plants and chemical and metal plants and developing more coal beds.

The Ministry of Coal Industry produced 12,000 more tons of coal than planned for the 20 days.

Iron mills and steelworks also increased the production.

The freight transport volume increased by 12 percent from the same period last year.

Innovations were made in the production of vinalon and fertilizer by the industrial establishments in the field of chemical industry and in the production of custom built equipment and mining machines by the industrial enterprises of the field of machine industry.

The forestry stations and pit wood stations increased the timber production.

Progress has been reported on a daily basis from the important projects including the building of apartments in Mansudae areas and the Paektusan Songun Youth Power Station.

For the uninitiated, this is about as close as the DPRK gets to releasing economic statistics. Note there are no base numbers–only [some] % increases. Also, despite the measure being officially named “output value”, it is really just a claim of increased physical production.  There is no value (prices) or mention of “services” included in these measures.

Unfortunately without more solid numbers, and the proclivity to ascribe productivity gains to effective propaganda, these reports cannot be taken seriously.

Although we all talk about the DPRK’s GDP and per capita income as if the numbers are solid, the reality is quite the opposite.  In addition to the general lack of information, there are all sorts of methodological problems with assessing the value of the DPRK’s economy.  Here are some helpful sources if you want to learn more:

1. DPRK Economic Statistics Report

2. G. Warren Nutter papers:

– (JSTOR) “Soviet Industrial Growth”, Source: Science, New Series, Vol. 130, No. 3370 (Jul. 31, 1959), pp. 252-255

-(JSTOR) “Industrial Growth in the Soviet Union”, The American Economic Review , Vol. 48, No. 2, Papers and Proceedings of the Seventieth Annual Meeting of the American Economic Association (May, 1958), pp. 398-411

-(JSTOR) Some Observations on Soviet Industrial Growth”, The American Economic Review , Vol. 47, No. 2, Papers and Proceedings of the Sixty-eighth Annual Meeting of the American Economic Association (May, 1957), pp. 618-630

3. The North Korean Economy by Nicholas Eberstadt

4. Assessing the economic performance of North Korea, 1954–1989: Estimates and growth accounting analysis

5. Bank of Korea’s assessment fo the DPRK economy in 2010.

6. My North Korean Economic Statistics Page

Share

Posted in Agriculture statistics, Central Bureau of Statistics (CBS), Coal, Construction, Dams/hydro, Electricity, Energy, Forestry, GDP statistics, Lumber, Mining/Minerals, Ministry of Coal Industry, Ministry of Foodstuff and Daily Necessities Industry, Ministry of Light Industry, Statistics, Transportation | 1 Comment »

New report claims 2009 DPRK economy is 86.5% of 1995

Monday, January 9th, 2012

NOTE: I have not seen this report yet, so I cannot directly comment.  If you see a copy, please send it to me.

Here is the story in the Daily NK:

If 1995 represented a baseline level of 100 for the North Korean economy, then by 2009 it had declined to 86.5 following sharp reductions in inter-Korean aid over the preceding year, according to newly released economic analysis.

The analysis, ‘Research into the State of Inter-Korean Change Seen through Statistics,’ was produced by the Sejong Institute pursuant to a request from Statistics Korea, the South Korean state statistics body.

The report incorporated ten different statistical variables, including North Korea’s estimated food and electricity production, trade and finance volumes and levels of international aid.

During the March of Tribulation, the mid-1990s famine that killed hundreds of thousands of North Koreans, the economy declined to a nadir of 70.3 (in 1998), according to the report’s findings; conversely, at the very peak of ‘Sunshine Policy’ aid deliveries in 2007, it reached a level of 104.7.

Elsewhere, North Korea’s food production had risen to 119 by 2009, while coal and electricity production had reached 107.6 and 102.2 respectively, it also reports. Conversely, steel production declined to 81.8, marine production to 63, and oil imports to 47.1.

Analyzing the situation, it goes on, “Steel and electricity production, the core of the North Korean command economy, did not change much so they could not have much of an effect. The decline of industrial facilities is serious, and due to this worn out equipment mineral production is slumping and there is never enough electrical power for smelting.”

The report notes pessimistically that current difficulties are set to continue, adding that even if North Korea embarked on root and branch reform tomorrow, in many cases it would already be too late for recovery without massive and sustained investment.

“In a society like North Korea where politics dominates everything else and the biggest impediments to state development, dictatorship and the 3rd generation succession, normal economic development is impossible,” it concludes.

The Donga Ilbo also reported on the study:

North Korea`s economic prowess has deteriorated due to stalled inter-Korean relations since peaking in 2007 due to expanded aid from South Korea and trade with China, a report released Monday in Seoul said.

The North`s economic ability peaked to 104.7 in 2007, up from the benchmark score of 100 in 1995, but plunged afterward to as low as 86.5 in 2009, the Sejong Institute said in the report prepared at the request of Statistics Korea. The Stalinist country`s economic prowess was based on 10 indicators including steel and electricity production, trade volume, state budget and the value of the South’s assistance to the North.

The North Korean economy began to deteriorate from the mid-1990s, when millions of people starved to death due to famine, and the economic ability figure fell to as low as 70.3 in 1998. It rose again, however, and reached 104.7 in 2007.

South Korean assistance to the North surged to raise the indicator to a high of 236.9 in 2007, a huge leap from the baseline score of 100 in 1995. The communist country`s trade volume also jumped 43.4 percent due to the expansion of trade with China.

The North`s economy began to shrink from 2008, when the South halted aid. Notably, the indicator fell to as low as 86.5 in 2009 to tie the record-low set in 2000. Due to deterioration of inter-Korean relations, the volume of South Korean government assistance to the North tumbled over the period to 36.2 in 2009, down 84.7 percent from that in 2007.

A decline in external trade except with China due to tougher international sanctions against Pyongyang also hastened the deterioration of the North Korean economy. Due to the participation by Singapore, one of the North`s top five trading partners, in the sanctions, the combined volume of the North`s trade fell about 10.7 percent, resulting in the indicator falling from 186.3 in 2008 to 166.3 in 2009.

The think tank said,“Considering that production of steel and electricity, the cornerstone of the centrally planned North Korean economy, remained largely unchanged, the recent deterioration of the North Korean economy stems from reduction of South Korean aid and contraction of the North`s overall trade volume.”

Here is a link to the Statistics Korea page on North Korea.

Read the full stories here:
NK Economy Lagging Heavy in 2009
Daily NK
Cho Jong Ik
2012-01-09

N.Korean economy plunges after hitting high in 2007: report
Donga Ilbo
2012-1-9

Share

Posted in Arduous March, Coal, Electricity, Energy, Food, GDP statistics, International trade, Statistics, Trade Statistics | Comments Closed

Rason update

Thursday, December 22nd, 2011

Andray Abrahamin and John Kim worte a comprehensive summary of the current state of Rason. The article appears in The Diplomat:

In 1991, the North Korean government dubbed Rajin-Sonbong (Rason) a free trade zone to attract foreign capital. However, less than a decade later, the zone lost its free trade status. According to local businessmen, the party secretary of Rason, a relative of the late Kim Jong-il himself, was charged with corruption and eventually executed, a harbinger for the long period of isolation ahead. Since the end of 2009, signs of renewed commitment to Rason have sprouted. While it may be too early to say whether the region will succeed in drawing investment and reform, our recent trips to Rason lead us to believe that developments on the ground may eventually warrant a shift in foreign policy by governments around the globe.

China has long eyed Rason as a potential import/export center for the landlocked provinces of Jilin and Heilongjiang. However, from Rason’s inception, the Middle Kingdom held little influence or interest in the region’s success. In 2002, North Korea establishedanother special economic zone in Shinuiju and instated businessman Yang Bin, then China’s second richest man, as the SEZ’s Chief Executive. The Chinese authorities promptly placed Yang Bin under house arrest. Perhaps as a lesson learned from this episode, the North Koreans have made the Chinese government a major stakeholder in Rason’s development.

The Chinese have moved 80,000 metric tons of coal this year through a pier they leased at the Rajin port.They are also reportedly sending regular delegations of senior officials, including the Chairman of the China Development Bank, and they have invested $30 million to repave the road from the border town of Wonjong to the Rajin Port. This road was 60 percent paved during a visit in October, and recent reports from businessmen inside the region confirm that the road is now 95 percent paved, allowing for large trucks to pass through. The Chinese have also constructed a new road on their side of the border, part of the support this area has received after the Chinese central government designated it “The Changjitu Development Region” in November of 2009.Officials from the North explained that the Chinese will have a say in everything from zoning of real estate to port customs and investment policies.

Though Russia’s involvement doesn’t run as deep, it also maintains a keen interest in Rason’s ice-free port and has pledged an investment of $200 million to refurbish a railway from the border town of Khasan and to upgrade pier three at the Rajin port, which it has leased for 49 years. Rason’s third port at Oongsang was once a major exporter of lumber from the Soviet Union, and though Oongsang looks far from reviving the Soviet involvement of its heyday, Russia clearly has an interest in Rason’s success as well.

In addition to neighboring countries’ newfound interest in the zone’s success, the North Korean leadership has also shown a renewed desire in luring investment into the region. In December 2009, Kim Jong-il made a visit to the area, sent his former trade minister to run the region as party secretary, and reinstated Rason’s status as a special city, wresting it out of provincial control. Any potential investor who visits the SEZ would experience the thirst of the local government to develop the region, as reflected by the words of an official with the Rason Economic Cooperation Bureau, Rhee Sung Hye: “The future of my career depends on how much investment I can bring.”

At the national level there are also signs that the regime is increasing its focus on economic development as a source of legitimacy. In 2009, the Joint Venture Investment Commission was formed as a one stop shop for foreign investors, while the Taepung Group and State Development Bank were created to attract foreign investment. In the first half of 2011, Kim Jong-il made more appearances related to the economy and less related to defense than in prior years, and a focus on improving lives through focus on light industry and agriculture was emphasized in joint editorials that signaled policy direction at the beginning of 2010 and 2011.

The alignment of simultaneous commitment from North Korea, China, and Russia sets the scene for a North Korean special economic zone with higher chances of success than perhaps ever before. However, interest and desire may not necessarily translate into results without knowledge of markets and how to create a stable investment environment. After a recent tour of his 200MW fuel oil powered generation facility, the President of Songbong Power, Rhee Kang Chul, expressed that the reason for his plant’s inactivity and the subsequent blackouts in the region was the rise in feedstock costs. When asked about mechanisms for electricity pricing, Rhee responded that the government had set power prices at 6.5 euro cents/kwh, but he couldn’t provide further details on how the number was arrived at and when it might change again. Though Rhee was clearly an expert on the technical aspects of power generation, he hadn’t had the chance to consider that potential investors, after getting comfortable with country risk, would have little clarity on the revenue side of their equation. When this was expressed to the Vice Mayor of Rason, he replied, “We can change the price of electricity here. Rason is not under the same restrictions as the rest of the country.”

North Korea could theoretically piggyback off the market knowledge that their Chinese partners have gained over the last 30 years, but Rason’s neighbors are only likely to share when it suits their interests. In the case of Sonbong Power, Kang told us that every Chinese official who has visited stated that the most effective solution would be to pipe in power from the Chinese grid. “We plan to have a power line installed from the border by the end of 2013.” As power is as strategic asset like food or water, dependence on Chinese power clearly leaves the North Koreans in a vulnerable position.

China is clearly North Korea’s closest ally, but their relationship has a thorny history and Pyongyang is acutely aware of its reliance on big brother Beijing. With China’s rise, many other countries in the region are increasingly dependent on trade but increasingly cautious of dependence, welcoming a stronger presence from the United States, which is in the midst of a strategic pivot towards Asia.

In December 2009, the Asia Society and the Institute on Global Conflict and Cooperation published a report arguing that economic engagement of Pyongyang by the United States would result in creation of vested interests in continued reform, a changed perception of self-interest and a less confrontational foreign policy from North Korea. Against the backdrop of a more uncertain domestic environment after the death of Kim Jong-il, and the shifting dynamics in Asia generally, a North Korea that trades more and engages with the outside world may necessitate a change in foreign policy of governments around the world, most specifically the United States, South Korea, and Japan.

The Rajin-Sonbong SEZ has a checkered past and it would be naïve to say that North Korea is embarking on late 1970’s style Chinese economic reforms. However, we believe that the unprecedented alignment of interests in the region make it a likely starting point for any lasting directional change, which is why the world should watch Rason.

Read the full story here:
Why World Should Watch Rason
The Diplomat
John Kim & Andray Abrahamian
2011-12-22

Share

Posted in Automobiles, China, Coal, Energy, International trade, Railways, Rason Economic and Trade Zone (Rajin-Sonbong), Rason International Trade Fair, Sea shipping, Special Economic Zones (Established before 2013), Transportation | Comments Closed

Anthracite export to China suspended temporarily

Monday, November 28th, 2011

Institute for Far Eastern Studies (IFES)
2011-11-23

North Korea has reportedly stopped coal export temporarily to manage fuel shortage during the winter season.

According to Chinese traders from Shenyang, their North Korean trade counterparts informed them that they recently received official orders from the government to stop exporting coal. Except for those orders previously received, coal from North Korea will not be leaving the country for the time being.

The export volume of coal has continuously increased this year, consequently causing a domestic shortfall in the supply of coal. In fear of power and fuel shortages for the winter season, North Korea is believed to be taking precautionary measures to preserve energy supply, especially with hydroelectric power generators not in operation.

From this year, North Korea has drastically increased coal export to China. From January to July, China has imported about 816,700 tons of North Korean anthracites, nine times more than the previous year. Anthracites made up 46.3 percent of the all the exports to China.

The amount of North Korean anthracites that entered China via Donggang Port (located in Dandong City, Liaoning Province) reached over 77.7 million USD. The city of Dandong is located across from Sinuiju. Separated by the Amnok River (Yalu River), it is the trade hub between China and the DPRK, with over 70 percent of total bilateral trade taking place in the city, as anthracite coal as the main object of trade.

With the international price of coal on the rise and operation of hydroelectric power plants in decline, dependence on thermoelectricity is growing, which explains the recent climb in China’s anthracite import.

Toughened international sanctions and halted trade with South Korea has made North Korea turn to natural resource trading with China to bring in hard currency.

In August 2009, North Korea halted coal exports when it was faced with extreme power shortage. However, coal trade was resumed the following April.

Massive amounts of coal were exported to China to earn foreign currency, but this has created serious energy shortage affecting the operations of factories and other industrial facilities.

During the field guidance visit to the February 8 Vinalon Complex, Kim Jong Il emphasized that “Raw materials must be adequately supplied to normalize the production of factories.”

However, most North Korean traders agreed that such suspension would not be prolonged for a lengthy period, since North Korea, who is heavily dependent on mined resource exports including coal and steel, cannot afford to enforce a trade embargo for long. Many expect the trade to resume by next spring.

Share

Posted in China, Coal, Energy, International trade, Mining/Minerals, Statistics, Trade Statistics | 2 Comments »

Recent DPRK publications

Sunday, June 19th, 2011

Imports from North Korea: Existing Rules,Implications of the KORUS FTA, and the Kaesong Industrial Complex
Mark E. Manyin, Coordinator, Jeanne J. Grimmett, Vivian C. Jones, Dick K. Nanto, Michaela D. Platzer, Dianne E. Rennack
Congressional Research Service (CRS)
June 2, 2011

Download the PDF here.  This publication has been added to the list of previous CRS reports on the DPRK here.

________

Trade with China 1995-2009
Nathaniel Aden
Nautilus Institute
June 7, 2011

View the paper here.  A link to this paper has been added to the DPRK Economic Statistics Page. The Nautilus Insitute has also posted links to some very interesting presentations from the 2010 DPRK Energy and Minerals Working Group.

________

[Book] The Contemporary North Korean Politics: History, Ideology, and Power System (현대 북한의 정치: 역사, 이념, 권력체계)
Jong Song-Jang (정성장)
More information TBA, but see here and here (Korean).

________

[Book] Architekturführer Pjöngjang (German: Pyongyang Architecture Guide)
Philipp Meuser
Order here at Amazon. More here and here.

Share

Posted in Architecture, China, Coal, Construction, Copper, Electricity, Energy, Gold, Graphite, International trade, Iron Ore, Mining/Minerals, Natural Gas, Oil, Sand, Statistics, Trade Statistics | Comments Closed

The blueprint for the development of the Rajin-Sonbong (Rason) economic and trade zone is released

Tuesday, May 31st, 2011

Institute for Far Eastern Studies (IFES)
2011.05.26

On May 23, the DPRK released the “Outline of DPRK-China Joint Development Plan for Rason and Hwanggumpyong Economic and Trade Zone” consisting of detailed blueprint of two countries’ recent bilateral joint development deal.

According to Yonhap News, China and North Korea are planning to turn the Rason and Hwanggumpyong areas into a comprehensive industrial complex of tourism and manufacturing producing automobiles, mobile phones, agricultural and chemical products.

In addition, the Law on Rason Economic and Trade Zone and the Special Law on Hwanggumpyong Zone will adopt market economy principles which will permit foreign bank investments and independent contracts between corporations and workers. Although the development plans are not definite yet, it is significant since it hints at North Korea’s shifting position on opening up and economic development.

The bilateral development plan between Pyongyang and Beijing will stretch from Rajin, Sonbong, Ungsang, to Gulpo areas.

In the Rajin area, four major industrial complexes will be constructed consisting of storage, logistics and distribution centers, state of the art technology, and equipment, clothing and food manufacturing. In the Ungsang area, comprehensive a wood processing complex will be built while in the Gulpo area, a high-efficiency agriculture zone will be constructed. In the Sonbong area, truck manufacturing factories will be built along with other metal producing factories. In Rajin, docks will be built for ship building and maintenance.

There are also plans of developing the Rason area into an international tourism zone. There are immediate plans to build basic tourism infrastructure such as hotels, resorts, and roads for sightseeing. The long-term goal is to build a grand Northeast Asia tour course, which will include Yanbian of China; Rason, Chongjin, Mount Chilbo and Mount Kumgang of North Korea; Vladivostok and Sakhalin of Russia; Sapporo and Nakata of Japan; and Sokcho and Busan of South Korea.

As for the Hwanggumpyong area, four major industrial complexes will be established: one each for information, tourism and culture, modern protected agriculture, and food processing. More specifically, Hwanggumpyong will connect information between Hwanggumpyong and the border city of Dandong in China. In addition, culture and tourism will be developed through promotion of Arirang and other cultural performances and exhibitions.

As for the high-efficiency agriculture zone, a modern agriculture technology research center will be established and China-DPRK joint markets will be set up to serve as a central commerce center.

To assist with the industrial development in the area, land and sea routes will be developed where roads and railroads will be built and Rajin will be upgraded to a comprehensive and multi-purpose port.

There are additional plans of constructing a coal power station to replace the current thermoelectric power plant in Sonbong. There is also discussion of possibly developing other alternative energy plants, such as wind and solar. There are also plans of building basic facilities of mobile telecommunication to promote international communication.

Hwanggumpyong is an island on the Yalu River and the new developments in building ports and roads along with distribution network, Internet, and mobile telecommunication will become a link connecting North Korea with China.

Pyongyang is pursuing development through multiple cooperation channels. It has plans of establishing three-tiered cooperative system with joint management committee, joint development management committee and investment development corporation with Beijing. These committees will be responsible for amending and negotiating any issues that may arise during the process of development and supervise various areas of investments, enterprises, and environment and as well as inspect land and commerce development and basic facility operations.

Both Pyongyang and Beijing will attract foreign investments through market-based tax and financial policies in the Rason and Hwanggumpyong zones. Specifically, tax refund policy will be implemented and tariffs will be lifted from any imported equipment and materials necessary for production. The foreign investment companies will be allowed to choose their own banks or even establish financial institutions to assist in their business management.

In addition, workers and companies will be permitted to sign their own labor contracts. The companies will be granted autonomy in hiring and firing, pricing, bankruptcy, liquidation and other business practices based on market principles.

As for investment protection policy, foreign investors will be permitted to transfer or inherit profits and assets and foreign investor’s investments and assets will not be collected as national property by North Korea.

Share

Posted in China, Coal, Economic reform, Electricity, Energy, Foreign direct investment, Hwanggumphyong and Wihwado Economic Zones (Sinuiju), Rason Economic and Trade Zone (Rajin-Sonbong), Sea shipping, Special Economic Zones (Established before 2013), Tourism, Transportation | Comments Closed

DPRK mineral exports top US$860m last year

Saturday, May 7th, 2011

According to Yonhap:

North Korea’s exports of mineral resources jumped 17-fold in a decade with its outbound shipment of coals and iron ores leading the growth, a U.S. report showed on Saturday.
According to Radio Free Asia (RFA), the communist state’s exports of mineral resources reached US$860 million last year, compared with some $50 million in 2002.

Citing data compiled by the Korea Trade-Investment Promotion Agency [KOTRA], the RFA said exports of such minerals as coal and iron ore accounted for 63 percent of its total exports to its strongest ally China.

In the first quarter of the year, the North earned around $154 million by exporting coal to the neighboring country, compared with $9.68 million seen a year earlier.

North Korea’s mineral reserves are believed to be among the largest in the world, worth some 7,000 trillion won, based on 2008 prices, according to an earlier report by the Unification Ministry.

I am unable to locate either the RFA story or the KOTRA report so I don’t have much to say on this.  If you have a link please send it to me.

Read the full story here:
N. Korea’s exports of mineral resources top US$860 mln last year
Yonhap
2011-5-7

Share

Posted in Coal, Energy, Iron Ore, Korea Trade-Investment Promotion Agency (KOTRA), Mining/Minerals, Statistics, Trade Statistics | Comments Closed

« Older Entries
Newer Entries »