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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

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

Another Songun-era agriculture project launched in Haeju

Friday, January 27th, 2012

Pictured Above: The DPRK’s two most famous waterways are the Paekma-Cholsan Waterway (see here and here) and the Kaechon-Lake Thaesong Waterway. A third waterway in the Miru Plain is too recent to appear on Google Earth.

According to KCNA (2012-1-26):

Waterway to Be Built in South Hwanghae Province, DPRK

Pyongyang, January 26 (KCNA) — A gravity-fed waterway will be built in South Hwanghae Province.

It is another gigantic nature-remaking project in the era of Songun as part of the far-sighted nature-harnessing plan of leader Kim Jong Il and the dear respected Kim Jong Un.

The completion of the waterway will help sufficiently irrigate tens of thousands of hectares of farmland and tideland-turned rice fields including those in Ongjin, Kangryong, Pyoksong and other several counties to ensure a safe and high yield of grain.

It will also help save tens of thousands of kilowatt of electricity and make a great contribution to the economic development and improvement of people’s living standard by preventing the damage by flood in the area along Jaeryong River.

A ground-breaking ceremony took place in Haeju City on Thursday.

Present there were Choe Yong Rim, Kim Ki Nam and other senior officials and officials of ministries and national institutions, builders and working people.

As the DPRK’s “rice bowl”, South Hwanghae Province is home to at least three additional large-scale agricultural projects at the moment: Pujiman Tideland Reclamation (Ongjin), Ryongmae Island (룡매도) land reclamation project, and the Sohae-ri-Nunggum Island Tedeland Reclamation.

Posted in Agriculture, Construction, Electricity, Energy, Kim Jong Un, Political economy | 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

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 »

An update on the Huichon and Ryesonggang Power Stations

Monday, January 23rd, 2012

Huichon Power Station on Google Earth
The Huichon Power Stations 1 & 2 (희천1호발전소, 희천2호발전소) are too new to appear on Google Earth satellite imagery. I have, however, mapped them out by hand on the old imagery to give a better idea of their locations. I have also tagged them on Wikimapia.

In the picture above you can see that the Huichon Power Station’s headwaters begin in Ryongrim County (룡림군) where the newly-built Ryongrim Dam holds back a large reservoir. This reservoir drains through a tunnel [in orange in the image above] approximately 30 km long (18.5 miles) and empties through the Huichon Power Station No. 1 in Tongsin County into the Chongchon River. The river flows south where it crosses into Huichon County and builds up behind a second reservoir. From this second reservoir the water drains out directly through the Huichon Power Station No. 2.

The construction of the Ryongrim Dam has resulted in the destruction of at least two villages, Toyang-ri (도양리) and Sinchang-ri (신창리). Toyang-ri was destroyed for the dam itself. Sinchang-ri was flooded by the reservoir. A third village, Kuryong-ri (구룡리), was also likely flooded or relocated—although this cannot be confirmed with current satellite imagery. The destroyed villages were probably relocated to Ryongrim Town itself. On several recent occasions North Korean television has highlighted improvements in housing and leisure facilities within the town.

When Kim Jong-il gave guidance visits to this site he often stood on the eastern side of the dam which offers the view captured in the image above (R).

The Huichon Power Station No. 1 itself is located in Tongsin County aproximately 30km due south from the Ryongrim Dam (40.273568°, 126.526565°).

In the satellite image above I have drawn the physical location of the power plant. Next to and below it I have posted images from KCTV dated 2011-3-10.

The Huichon Power Station No. 2 lies on the Chongchon River just south of the border with Tongsin.

This project might have resulted in the destruction of one village, Kyonghung-ri (경흥리), in Tongsin County, but this is impossible to confirm without better satellite imagery.

So where will the electricity produced at these new power stations be consumed? On January 21, 2012, Rodong Sinmun reported the answer:

Like the warm hands of leader Kim Jong Il, the transmission lines from the Huichon Power Station are now almost stretching out for the capital city of Pyongyang.

To meet the great expectations of Kim Jong Il who entrusted them to such a gigantic work, the builders of the power station have gained great successes.

They have erected big dams, cut waterway tunnels and carried out other bulky tasks that were said to take ten years and more; and in the wake of trial operation of generating equipment at the Huichon Power Station No. 1, they successfully assembled the hulks of generators at the Huichon Power Station No. 2.

These successes had an immediate chain reaction on the scaffold workers laying transmission cables from the power station to the capital city.

They have already laid transmission cables in scores of kilometer long section, while preceding the construction of pylons in two months.

By their heroic labor, the excavation work to lay the foundation for the pylons have been wound up, too.

Now, their job is concrete tamping of the pylons’ foundations. By introducing new work methods they are hastening their work of erecting pylons as firm as would stand for many hundred years.

Now that power lines have been lain in major sections, they have buckled down to laying the power lines in the remaining sections and erecting transformer substations to reach the capital city as early as possible.

It won’t be long before we can see the power lines reach Pyongyang amid the cheers of the citizens.

Since I have mapped out a significant portion of the North Korean electricity grid on Google Earth, I can point out an area where I believe these power cables are being constructed. In the image below, dated 2010-9-14, I have connected the power cable tower construction sites with a yellow line:

In the image above there are approximately 146 power cable towers under construction between Pakchon (North Pyongan-top of image) and Sunan (Pyongyang-bottom of image). Of course, to be certain that these are the specific lines connecting Huichon and Pyongyang, I will need more imagery.

More on the Huichon Power Stations here.

Ryesonggang Power Station 2 update

I previously wrote about the Ryesonggang Power Station No. 2 here. Since a newer satellite image has come to my attention that shows the project completed, however, I thought I would post an update.

Ryesonggang Power Station No. 3

On June 25, 2011 North Korean television showed construction of the Ryesonggang Power Station No. 3 had begun. The DPRK submitted this project to the UNFCC’s Carbon trading program. Using satellite imagery, we can see that construction is indeed well under way:

The satellite images above are dated 2007-10-4 (L) and 2011-3-23 (R). In the right-hand photo I have boxed in the construction site and the quarters and facilities of the construction workers.

UPDATE: This was picked up by Radio Free Asia.

Posted in Dams/hydro, Electricity, Energy, Fiscal & monetary policy, Uncategorized, UNFCC | 2 Comments »

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

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

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

Some new Google Earth imagery…

Monday, November 28th, 2011

Google Earth is offering some new imagery of the DPRK so I wanted to point out a few of the new locations we can identify. The Pyongyang imagery is dated 2011-3-15. The east-coast imagery is dated 2011-5-14.

1. Solar Equipment Center (태양열설비쎈)

(Google Earth Coordinates: 39.014504°, 125.662840° , Google Maps, Wikimapia)

Kim Jong-il visited this facility on October 9, 2011. It produces solar water heaters (KCNA).

2. Kumkop (gold cup) Combined Foodstuff Factory (금컵체육인종합식료공장)

(Google Earth Coordinates: 39.009592°, 125.671213°, Google Maps, Wikimapia)

According to KCNA:

The factory produces rice cake, bread, confectionary, processed meat and drinks. It also has welfare facilities for its employees.

The drinks, including carbonated water and nutritious water, are made with natural medicinal materials good for recovery from fatigue and promotion of health.

3. New Taekwando Center construction:

(Google Earth Coordinates: 39.016453°, 125.681939°, Google Maps, Wikimapia)

This facility is due to be completed in July. I am not sure what it offers that the other Taekwando Center located right next door doesn’t have.

4. Something new at the old baseball stadium:

(Google Earth Coordinates: 39.008113°, 125.679196°, Google Maps, Wikimapia)

5. Wonsan – Hamhung Road (Partial map):

(Google Earth Coordinates: 39.421286°, 127.272296°, Google Maps, Wikimapia)

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.

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

DPRK-South Sudan diplomatic ties established

Friday, November 18th, 2011

Pyongyang, November 18 (KCNA) — The governments of the DPRK and South Sudan established diplomatic ties at an ambassadorial level.

A joint communique on the establishment of bilateral diplomatic relations was made public in Ethiopia on Nov. 16.

The communique was signed by Kim Hyok Chol and Arop Kuol Deng, ambassadors of the DPRK and South Sudan to Ethiopia, upon authorization of the governments of their countries.

The two countries agreed to open their diplomatic ties from the very day of their signature to the joint communique, on the basis of the principle of respect for sovereignty, equality, reciprocity and non-interference and in line with the April 18, 1961, Vienna Convention on Diplomatic Relations.

Since all North Korean embassies must self-finance their operations, it is not likely that they will open an embassy in South Sudan until there are sufficient business contracts to maintain the office overhead. In the meantime, many of their diplomatic and consular functions will probably be held out of the Ethiopian embassy.

What kind of business opportunities await the DPRK in South Sudan? South Sudan is the world’s newest oil-producing nation, so it is likely that the DPRK will try to pursue oil contracts there. As a new nation, South Sudan also has an interest in building up its military capabilities. The DPRK has long supplied military equipment to the African continent, so they will probably look for opportunities in this new nation as well.

To date, the DPRK maintains embassies in the following African countries: Benin, Burundi, Cape Verde, DR Congo, Côte d’Ivoire, Equatorial Guinea, Ethiopia, Ghana, Guinea, Guinea-Bissau, Libya, Madagascar, Mali, Niger, Nigeria, Rwanda, Somalia, South Africa, Tanzania, Uganda, and Zimbabwe.

Posted in Arms shipment, Illicit activities, International trade, Oil | Comments Closed

KEDO to demand $1.89 bln from N. Korea over failed LWR project

Monday, November 14th, 2011

Pictured above (Google Earth): The KEDO light water reactor construction site in Sinpho County, South Hamgyong Province. See in Google Maps here.

According to Yonhap:

An international consortium once tasked with building two power-generating nuclear reactors in North Korea will soon demand that the communist country provide US$1.89 billion in compensation for the project’s failure, a Seoul official said Monday.

The demand comes after North Korea filed its own compensation claim worth some $5.8 billion in September, saying it suffered heavy financial losses and other troubles from the failed project.

In a 1994 deal linked to North Korea’s promise to denuclearize, the Korean Peninsula Energy Development Organization (KEDO), which includes South Korea, Japan and the United States, agreed to build two 1,000-megawatt light-water reactors in the communist country within several years.

After years of delays due to poor funding and other problems, the project fell through in 2006 after the U.S. caught North Korea pushing a second nuclear weapons program based on enriched uranium in addition to its widely known plutonium-based one.

The $4.2 billion project was about 35 percent complete when the KEDO called it off.

“Ever since the project fell through in 2006, the KEDO has sent a request to North Korea each year, demanding compensation for its breach of the agreement,” the government official said, requesting anonymity. “North Korea gave no response, and its sudden claim for compensation is completely unacceptable. The KEDO plans to send an official reply in the coming days.”

The latest development comes as diplomatic efforts are under way to revive the stalled six-party talks on ending North Korea’s nuclear weapons programs. Pyongyang is pushing for an unconditional reopening of the multilateral negotiations it walked away from in April 2009, while Seoul and Washington insist that the communist country first demonstrate its sincerity toward denuclearization through such pre-steps as a monitored shutdown of its uranium enrichment program.

The forum, which offers economic and political aid to North Korea in exchange for its denuclearization, also involves Japan, China and Russia.

The Korea Times also reported on this story.

Read the full story here:
Power consortium to demand $1.89 bln from N. Korea over failed energy project
Yonhap
2011-11-14

Posted in KEDO, Nuclear | 1 Comment »

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