Archive for the ‘International trade’ Category

ROK report claims DPRK luxury imports up

Monday, October 14th, 2013

According to Yonhap:

According to Rep. Yoon Sang-hyun of the ruling Saenuri Party, imports of luxury goods reached US$645.8 million last year, up sharply from an annual import average of around $300 million tallied under the current leader’s father Kim Jong-il.

Citing data provided by the government ahead of the parliamentary audit on the Ministry of Unification, the lawmaker said the isolationist country imported such non-essential goods as pets, feed for such animals, and various European and U.S.-made bath, sauna and maternity products.

The report also showed a noticeable rise in imports of expensive musical instruments, cosmetic goods, handbags, leather products, watches, and mid-sized sedans made in Japan and China.

“The products were given as gifts to key figures in North Korean society to ensure their loyalty to the regime,” Yoon said. He claimed that handing out such gifts contrasted with the hardships felt by ordinary people.

The United Nations Food and Agriculture Organization said earlier in the month that North Korea remains one of the 34 countries in the world that require external assistance to properly feed their people.

It estimated that some 2.8 million “vulnerable” people in the communist country needed outside assistance at least until this year’s fall harvest.

The Saenuri lawmaker said that imports of wine, liquor, consumer electronics, fur products and expensive watches led the growth last year.

Imports of alcoholic beverages surpassed the $30 million mark, with electronics and watches reaching $37 million and $8.2 million, respectively, for the whole of last year, he said.

Read the full story here:
N. Korea’s luxury goods imports surge under Kim Jong-un leadership
Yonhap
2013-10-14

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2nd annual China-DPRK Economic, Trade, Culture and Tourism Expo

Thursday, October 10th, 2013

UPDATE 1 (2013-10-15): Yonhap reports on the activities carried out at the expo:

North Korean companies participating in an annual trade fair with China signed a total of 93 preliminary deals worth US$1.6 billion at the event, China’s state media reported Tuesday.

North Korea and its economic lifeline, China, wrapped up the trade expo, the second of its kind, on Monday in the Chinese border city of Dandong with some 130 North Korean firms attending the five-day exhibition.

The North Korea-China Economic, Trade, Culture and Tourism Expo came as China has been deepening its economic ties with the North even though Beijing appears to have become increasingly frustrated with Pyongyang’s nuclear weapons program.

During the trade fair, preliminary investment deals worth $510 million and export deals worth $1.09 billion were signed, the official China News Service reported.

North Korea and China held the inaugural trade fair last year, with $1.26 billion worth of preliminary deals signed.

In the first eight months of this year, two-way trade between North Korea and China stood at $4.09 billion, compared with $4.1 billion for the same period last year, South Korean government data showed.

ORIGINAL POST (2013-10-10): According to Yonhap:

An annual trade fair between North Korea and China kicked off in the Chinese border city of Dandong on Thursday, with some 130 North Korean firms attending the five-day exhibition, organizers said.

The North Korea-China Economic, Trade, Culture and Tourism Expo, the second of its kind, comes as China is deepening its economic ties with the North even though Beijing appears to have become increasingly frustrated with Pyongyang’s nuclear weapons program.

About 500 North Koreans, including a 115-member propaganda troupe, joined the exhibition that features 700 booths for products ranging from foods and garments to mining and machinery equipment, according to the China Council for the Promotion of International Trade (CCPIT), which organized the event.

Of the booths, about 200 were allocated to buyers from Pakistan, Malaysia, India, Russia, Hong Kong and Taiwan, a Dandong branch of the CCPIT said.

North Korea and China held the inaugural trade fair last year, with US$1.26 billion worth of preliminary deals signed.

According to Xinhua:

The second China-DPRK economic, trade, culture and tourism expo has opened in the border city of Dandong in Northeast China’s Liaoning province.

The DPRK’s National Folk Art Troupe performed its ethnic dances at the opening ceremony on Thursday. A 500-member delegation from the DPRK is attending the expo which lasts from Thursday to Monday.

The expo is by far the largest foreign economic and trade event for the DPRK. And more than 90 percent of the country’s foreign trade companies have sent their representatives. Meanwhile there are over 10,000 traders from China.

The expo also attracts companies from Malaysia and Thailand. There are 16 events including promotion of China-DPRK commodities, and DPRK tourism. The DPRK’s investment policies are also to be introduced to attract investors.

The first such expo was held in 2012 with 72 agreements of cooperation signed. They have a combined value of over 1 billion US dollars.

According to KCNA:

The 2nd DPRK-China Economic, Trade, Cultural and Tourism EXPO opened on Thursday with due ceremony in Dandong, China.

Colorful events are to be held during the EXPO including trade fair, fine art exhibition, exhibition of photos on tourism and art performance.

Present at the ceremony were officials of the party and government of Liaoning Province and the city and those in the field of culture, economy and trade including Bing Zhigang, vice-governor of the province, citizens in Dandong, Liu Hongcai, Chinese ambassador to the DPRK, and his embassy members and diplomatic envoys of different countries to the DPRK.

Also present there were members of the delegation of the 2nd DPRK-China Economic, Trade, Cultural and Tourism EXPO led by Hong Kil Nam, vice-chairman of North Phyongan Provincial People’s Committee, Kim Kwang Hun, DPRK consul general to Shenyang, and Choe Un Bok, chairperson of the General Association of Koreans in China.

An opening speech was made there, which was followed by congratulatory speeches.

The speakers said that the EXPO will be a good opportunity to swap the successes and experience gained in various fields and boost the cooperation between the two countries.

They expressed the conviction that it will contribute to deepening the mutual understanding and trust and promoting the friendly and cooperative relations between the peoples of the two countries.

An art performance was given by the National Folk Art Troupe on the same day.

Prior to this, a reception was given for the participants of the Expo.

Xinhua also published this helpful advice for North Korean policy makers:

China-DPRK economic cooperation is important for maintaining peace and stability in Northeast Asia. China has a long history of investment in the DPRK, and is the country’s biggest trade partner. So what’s it like to do business in the DPRK?

Economic cooperation between China and the DPRK has strengthened as tons of goods are coming in and out the border each day. And the scale of their trade and investment has expanded over the past few decades. But the rapidly developing China-DPRK economic relations have certain problems that need to be solved. Many concerns have been raised in regards to the risk factor when investing in the country.

Today, China’s investment in the DPRK is mainly concentrated on minerals and other strategic resources. And many investors claimed that the main difficulties when they set up businesses in the DPRK is to cope with the country’s frequent policy changes.

Many Chinese companies and manufacturers have come to the exhibition hall for trade talks with the DPRK, and to have a better understanding of the country in which they have invested or intend to invest. The best way to find out the business environment there is to speak with someone who has been there long enough.

“You need to have certain knowledge about the rules and regulations in the DPRK before conducting investments there. A thorough business plan is a good start, and it’s crucial to have a business partner from the DPRK with a strong background,” said Ma Pengxiu, general manager of Dandong Hantong Trading company.

Some Chinese companies that have invested in the DPRK reportedly suffered losses, for which they blame the investment environment in that country. It’s true that enterprises cannot be certain of making profits, no matter which country they invest in they need to cope with local laws and regulations to avoid risks. But it’s also true that the DPRK has to improve its investment environment and make its policies more stable.

“There were companies and individuals who have experienced failures in the investments in the DPRK, so investors in these days are more concerned about the relevant protections from the DPRK side; my advise is to protect your business with a written wontract always,” said Ma.

Needless to say the DPRK delegation at the EXPO this year was well prepared and ambitious in seeking cooperation opportunities with the outside world. The country is keen on drawing investments to beef up its industries. In the meantime the DPRK still needs to take measures to ensure a stable business environment to make it easier for investors to thrive in the country.

Here is a link to the inaugural trade fair post.

Read the full stories here:
N. Korea, China kick off annual trade fair
Yonhap
2013-10-10

2nd China-DPRK Expo opens in Dandong
Xinhua
2013-10-11

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New Yalu/Amnok River bridge in south-west Dandong (UPDATED)

Thursday, October 10th, 2013

New-Dandong-bridge-2014-4-2

 

Pictured above (Google Earth): The new Yalu/Amnok River bridge under construction

UPDATE 13 (2014-10-31): Opening of new NK-China bridge delayed indefinitely. According to the Daily NK:

The planned opening of the bridge connecting Dandong in Liaoning Province, China with Sinuiju, North Pyongan Province in North Korea has been delayed indefinitely, according a report by China’s state-run Global Times on October 31st.

According to the report, North Korea has not followed the business plan stipulating that it construct access roads to the bridge, and as such, its opening remains on hold. North Korea was charged with construction on access roads for the bridge, but work at the site has yet to begin, in fact, the area continues to be nothing but swathes of farmland.

On the ground in Dandong, the report conveyed the disappointment by many in the area, “This new bridge that was going to be so magnificently built is finished on one side, and a vegetable plot on the North Korean end.” Many traders and people purchasing homes and opening stores in the area were anticipating to benefit from increased commerce between the two cities, which account for 70% of bilateral trade, after the bridge’s completion.

The construction of the new bridge over the Amrok [Yalu] River, to replace the aging “Sino-Korean Friendship Bridge,” was officially proposed by China’s former Vice Minister of Foreign Affairs, Wu Dawei, when he visited North Korea in 2007. However, it was not until October 2009 that former Premier Wen Jiabao visited North Korea to make the deal official, for which China agreed to take on the construction costs. The two countries then finalized plans for the project in February 2010, with China continually pushing for construction to begin in October, only to see them finally begin in December that year after a series of delays.

Over the past four years of construction, China accelerated efforts to build a four-lane highway and other advanced features amounting to 2.22 billion RMB [approximately 360 million USD].

As to why the project has not moved forward despite China’s completion of its end of the deal, “North Korea demanded more investment from China for the connecting roads and has done no construction,” the report stated.

Daily NK previously reported in July about the advanced construction efforts on the Chinese side and predicted delays in the bridge’s opening due to failure by North Korea to uphold its end of the contract.

The story is not completely accurate, however, because the North Koreans have at least begun the process of building a road to connect the bridge to Sinuiju. According to Google Earth satellite imagery dated 2014-6-9 we can see the beginning of road construction:

Yalu-river-bridge-road-2014-6-9

Here is more in the Hankyoreh.

UPDATE 12 (2014-7-18): The Institute for Far Eastern Studies (IFES) offers an explanation for the lack of progress on the DPRK side of the bridge:

New Amnok (Yalu) River Bridge – Present Conditions and Future Outlook

According to recent reports, the New Amnok (Yalu) River Bridge may not be finished by its projected date of September 2014 due to delays in the construction of roads and customs facilities.

The bridge, which will connect the North Korean city of Sinuiju with the Chinese city of Dandong in Liaoning Province, has advanced into the final stages of construction following the recent completion of the control tower and the bridge deck.

When the bridge is completed, the existing Amnok River Bridge (located approximately 10km away from the new bridge) will be restricted to railroad traffic only, and general road traffic to-and-from North Korea and China will be rerouted to the new bridge.

The existing Amnok River Bridge has been cited as a bottleneck for the blooming trade industry between North Korea and China for several reasons. The bridge, built in 1911, accommodates both a railway and roadway, but has only one lane. Furthermore, its old age has sparked safety concerns; trucks weighing over 20 tons have been prohibited from using the bridge.

Reportedly, China has begun construction on a new commerce zone costing 2 billion RMB (330 billion KRW) that will connect with the New Amnok River Bridge from the Chinese side.

The new commerce zone is set to be built on a 380 thousand square-meter plot of land and will include various services such as border checkpoints, customs, quarantine facilities, and immigration. Business facilities such as hotels, shopping centers and other residential and commercial buildings are also expected to be built in this area.

Once construction finishes and operations begin, China is expecting that the new area will accommodate for the passage of up to twenty thousand cars and fifty thousand people per day. It is also predicted that the new trade zone will be responsible for up to 60 percent of the total trade volume passing between the two countries.

However, on the North Korean side, it appears that construction has yet to begin on any of the necessary immigration facilities such as checkpoints and customs.

It has been reported that since construction of the New Amnok (Yalu) River Bridge began in 2010, abrupt changes in the state of affairs and weakening international ties between the two countries has left North Korea without a financier. North Korea had originally projected total construction and operation costs of 20 million USD (approx. 20 billion KRW), but has yet to secure the money from foreign investors.

In the past, the Chinese government persuaded North Korea into constructing the New Amnok (Yalu) River Bridge, but appears to have lost its previous fervor.

Back in 2007, China’s former Vice Minister of Foreign Affairs, Wu Dawei, proposed the construction of the new bridge under the condition that China will be responsible for the entirety of construction costs. In October 2009, former Premier Wen Jiabao visited North Korea and finalized the agreement.

From the outset, plans for the creation of the New Amnok River Bridge were not drawn up by North Korea, but rather strongly demanded by the regional governments in China’s Liaoning province and Dandong city. North Korea set its focus on the repair of the original existing Amnok River Bridge in order to set a fixed limit on the exchange of personnel and materials, citing regime stability as a reason. However, China persisted, promising to provide financial support for the construction of not only a new bridge, but also for customs facilities, immigration, and a highway connecting the bridge to Pyongyang.

At first, China was actively engaged in supplying North Korea with the financial resources necessary for construction. However, with the increase in nuclear tests, missile launches and increasingly negative internal public opinion, as well as the execution of Chinese ally Jang Song Thaek, China seems to have slowed the pace and now carefully monitors its involvement with North Korea.

In order to protect its domestic and foreign image, it is expected that China will complete construction of the infrastructure on their side of the New Amnok River Bridge within the year. China is also expected to offer less support to North Korea, showing an increasingly passive response.

According to recent reports, North Korea is currently in the process of preparing the customs and immigration facilities in Sinuiju—connected to the existing Amnok River Bridge—to handle procedures after construction of the new bridge is finished. The existing facilities are expected to be used due to North Korea’s inability to finish construction of the new immigration facilities and other connecting roads on time.

North Korea’s Central News Agency (KCNA) introduced the New Amnok River Bridge on a television program in August 2013, boasting that over 3,000 lorries and cargo ships will pass over and under the bridge per day. In the program, it is said that the bridge will be completed by September 2014

UPDATE 11 (2014-7-2): The bridge opening is likely to be delayed (again). According to the Daily NK:

The planned opening of a large new bridge across the Yalu River connecting Dandong in Liaoning Province with Sinuiju is likely to be delayed, Daily NK has learned. The cause of the delay is thought to be North Korea’s failure to make good on its contractual obligations.

“The Chosun side took on the job of constructing the roads, but they are making painfully slow work of it. Because the roads are still not finished, people are wondering whether their initial aim of increasing trade volumes is on its way down the drain,” a source close to the project told Daily NK on the 1st.

“China provided a lot of materials and machinery to the North, but there is a story that this machinery was sent for use on other projects rather than for the bridge construction. The Chinese traders who did harbor high hopes for [economic] opening brought on by the bridge are showing their disappointment more and more,” the source explained.

The partially complete New Amrok [Yalu] River Bridge is designed to connect Langtou new city with south Sinuiju at a total cost of 2.22 billion RMB (approximately 357 million USD). It lies 8 km downstream from the ageing “Sino-Korean Friendship Bridge” (formerly the Amrok [Yalu] River Bridge).

The old bridge is currently the only one that connects the two cities, but, built in 1943, it is wholly unfit for purpose. Trucks that weigh more than 20 tons are not allowed on it due to safety concerns, and it also has just one lane, which restricts trade volumes. Traders had hoped that the new bridge would speed up commerce between the two cities, which account for 70% of bilateral trade despite these structural limitations.

The construction of the new bridge was officially proposed by China’s former Vice Minister of Foreign Affairs, Wu Dawei, when he visited North Korea in 2007. However, it was not until October 2009 that former Premier Wen Jiabao visited Pyongyang and sealed the deal, under which China agreed to foot the bill for construction. The two countries then finalized plans for the project in February 2010, and the groundbreaking ceremony was held in December that year.

The Chinese side has demonstrated its intent to see the completion of the four-lane bridge, with its accompanying management, security and inspection infrastructure.

“In accordance with the plan, China has already got a customs office in place to administer the flow of goods over the bridge,” the source revealed. “But the North has slowed right down, and the talk of trade expansion from before has gone away.”

This declining enthusiasm is tangible in the property market in Langtou, the region of Dandong that ought to benefit the most from bilateral economic activity across the new bridge. “Apartment prices remain where they were three years ago, at roughly 4000 Yuan per pyeong,” explained the source. Pyeong is a Korean unit of measuring area, and amounts to 3.305785m².

“The number of people wanting to learn Korean in Dandong is still the same,” he admitted, “but that’s only because they want to watch Korean dramas. They have already given up on the idea of booming trade with North Korea since they saw those who had been successful going to the wall after the execution of Jang Song Taek.”

In addition to problems with the bridge, Daily NK established in May that almost no progress has been made on the development of two Special Economic Zones in the Sinuiju area (see linked article).

UPDATE 10 (2014-1-14): Xinhua reports the bridge will open in 2014:

A new bridge over the river border between China and the Democratic People’s Republic of Korea (DPRK) is expected to open this year, local authorities said on Tuesday.

About 80 percent of work on the Yalu River Bridge is complete, according to the Transport Department of northeast China’s Liaoning Province.

Construction began on the 3 km bridge at the end of 2010, and will cost 2.22 billion yuan (356 million U.S. dollars).

A joint project between the two countries, the bridge will have four two-way lanes upon completion, according to an agreement signed in February 2010. The new route is expected to boost communication and economic cooperation.

The only bridge connecting the nations was built in 1937. Trucks weighing more than 20 tonnes are not allowed on the one-way bridge, considerably restricting trade volume.

UPDATE 9 (2013-11-8): Yonhap releases a photo of the bridge nearing completion:

Yal-Amnok-2013-10-Yonhap

UPDATE 8 (2013-10-14): According to the Global Times:

A new bridge will link China and the Democratic Republic of Korea (DPRK) by 2014 and greatly boost exchange and trade between the two countries, officials said Monday.

A new border trade complex, complete with customs services, border control and quarantine services, as well as office buildings, hotels and markets will also be operational by 2014, according to Shi Guang, mayor of Dandong city, where the bridge is located.

The whole complex will cover 38 hectares and cost two billion yuan (325.8 million USdollars) to build, Shi said.

The new bridge is 10 kilometers down the Yalu river from the old bridge, which was built in 1937 and has been sole major passage on the China-DPRK border.

The two governments agreed to build the new bridge in early 2010. It will have four lanes and a span of about three kilometers.

The new facilities will be able to handle as many as 20,000 vehicles and 50,000 people a day and Dandong authorities expect that businesses done at the trade complex will account for 60 percent of China-DPRK trade.

UPDATE 7 (2013-10-10): The Institute for Far Eastern Studies (IFES) offers some new information:

The construction of the New Yalu River Bridge, the new suspension bridge over the Yalu River, connecting China’s Dandong city (Liaoning Province) and North Korea’s Sinuiju city (North Pyongan Province) is in its final stages.

Currently, the volume of trade between Sinuiju and Dandong is heavy, and the Yalu River Railway Bridge is saddled with transporting goods. It is hoped that the new bridge will help ease that burden. Several hundred workers are involved in its construction.

According to one Dandong resident, “Despite North Korea’s nuclear test and China’s decision to impose sanctions against the North, construction of the New Yalu River Bridge has been relentless.” The new bridge is considered as an important symbol of Sino-DPRK economic cooperation. Its construction is believed to be well on track.

The total project cost of the construction is estimated to be 2.22 billion CYN (about 390 billion KRW or 3.6 million USD). China is covering the bridge’s construction costs and has reportedly introduced a variety of new technologies to improve the precision and safety of the structure. Once completed, the bridge will be 3 km in length, with the height of its two pylons at 197 meters and the distance between pylons to be about 636 meters.

Travel from Pyongyang to Dandong currently takes 4 hours; that time is expected to be cut in half as the new suspension bridge is located 8 km downstream from the existing railway bridge.

If the construction progresses smoothly, the bridge should open for operation by July 2014. The Korean Central News Agency (KCNA) reported on August 23 that the new bridge should accommodate over 3,000 55-tonne freight cars per day, and 3,000-tonne ships will be able to pass under the bridge.

Along with the new bridge, China and North Korea are also engaged in joint development of a new district in Dandong and the Hwanggumpyong Special Economic Zone (SEZ). Despite the lingering concerns over the development of these areas after the death of former North Korean leader Kim Jong Il, the development has reportedly continued uninterrupted.

Despite the continued international and other sanctions against North Korea, the development of Hwanggumpyeong SEZ is speculated to pick up speed after the completion of the bridge. The Hwanggumpyeong SEZ is a project that North Korea put forth in response to the “May 24 Sanctions” imposed by the South Korean government after the sinking of ROKS Cheonan. These sanctions essentially had brought an end to all inter-Korean economic cooperation and exchanges (with the exception of the operations at the Kaesong Industrial Complex).

Last September, a groundbreaking ceremony for the administrative building in the Hwanggumpyeong SEZ was held. Since then a customs building, security facilities, management office, street lights, and transport inspection office are reported to have been built or are currently under construction.

UPDATE 6 (2013-8-23): New KCTV footage of the bridge can be seen here:

UPDATE 5 (2013-6-4): I wrote an update on the construction of the bridge at NK News.

UPDATE 4 (2012-11-7): The China Daily’s English-language Dandong page reports on the status of the bridge:

Construction on the new bridge, with an investment of 2.22 billion yuan, began at the end of 2011. According to the Dandong government, the main structure of the bridge has been completed. It is expected to become operational in July 2014.

UPDATE 3 (2011-6-25): Adam Cathcart took some pictures of the new bridge construction–so it is progressing!

UPDATE 2 (2011-2-2): For some time I have been trying to track down the location of the proposed new Yalu River bridge which will connect the DPRK and China.  Thanks to a story in the Daily NK, I was able to map it out on Google Earth:

Pictured above: Location of the proposed Yalu Bridge (Google Earth) [UPDATE-The bridge was ultimately moved from this location]

According to the Daily NK:

According to someone inside the construction company responsible for the bridge’s development, “The development of Xinchengqu has been on the drawing board for two years. This time, the construction of the New River Yalu Bridge was confirmed between China and North Korea. This is a very good chance for us, from now on Xinchengqu will become the center of China-North Korea trade.

According to Dandong’s urban development plan, the bridge will connect Busan-Seoul-Pyongyang-Dandong and Beijing in the future, implying that future trade and cooperation between a reunited Korea and China is being taken into account.

China is providing the construction costs for the New Yalu River Bridge; an estimated one billion Yuan (approximately $145 million).

This particular location is interesting because it completely bypasses the city and county of Sinuiju–where earlier reports (below) described its location.  The bridge actually crosses from China into Sopuk-ri, Ryongchon County (서북리, 룡천군)—in the middle of nowhere.  There is absolutely no infrastructure at this location for administering trade between the DPRK, China, and prospectively South Korea, so it will all need to be built from scratch or moved from Sinuiju. Either way, this is bad news for Sinuiju which today benefits financially as both the capital of North Pyongan Province and as the gateway for the majority of trade between the DPRK and China.  It looks like Ryongchon may be taking some of their business!

In addition, the North Koreans have been widening  the Sinuiju highway and “beautifying” all of the surrounding residential areas in anticipation of greater loads of traffic coming from China.  See more about this here.  This could all be for naught if the Chinese end up building a trade artery south of all this construction!

UPDATE 1 (2010-12-31): (KCNA h/t Aidan Foster-Carter) The ceremony did take place to mark the launch of the bridge’s construction:

Pyongyang, December 31 (KCNA) — A ground-breaking ceremony for a DPRK-China bridge across the River Amnok took place in Dandong City, China, on Friday.

Present there from the DPRK side were its government delegation headed by Kim Chang Ryong, minister of Land and Environmental Conservation, and from the Chinese side Li Shenglin, minister of Transport, Hu Zhengyue, assistant to Foreign Minister, and Chen Zhenggao, governor of the Liaoning Provincial People’s Government, and other officials concerned of the central and local governments of China.

Speeches were made by Kim Chang Ryong, Kim Song Gi, vice-minister of Foreign Affairs, and Choe Jong Gon, chairman of the North Phyongan Provincial People’s Committee, from the DPRK side and Li Shenglin, Hu Zhengyue, and Chen Zhenggao from the Chinese side.

They said that two rounds of General Secretary Kim Jong Il’s visit to China this year marked historic events of epoch-making significance in developing the DPRK-China friendship on a fresh high stage.

They expressed belief that the bridge would make a contribution to demonstrating once again the great vitality and invincible might of the DPRK-China friendship steadily growing stronger.

The bridge will be successfully built as a symbol of the DPRK-China friendship and a structure of the two peoples, they added.

Then followed a ceremony of the ground-breaking for the project.

The Ministry of Transport, the Liaoning Provincial Committee of the Communist Party and the Liaoning Provincial People’s Government of China arranged a reception in connection with the ceremony.

ORIGINAL POST (2010-12-28): According to Daily NK:

It was reported that there will be a ceremony to celebrate the start of construction of the New Yalu River Bridge linking Shinuiju and Dandong, China, before the end of the year.

Yonhap News yesterday quoted Shenyang and Dandong sources saying that both the North Korean and Chinese authorities decided to hold the ceremony this year and have started preparing for the event.

The source in Dandong said, “Instructions that the start of the bridge construction must not slip to next year were handed down from the Chinese government last week, so the governments of Dandong City and Liaoning Province urgently are trying to set a date. It will likely happen the 30th or 31st.”

The source also explained the reason why the Chinese government is hurrying to start the construction, which was supposed to start early next year. “Both China and North Korea intend to show observers domestically and internationally they have the will to construct the bridge.”

In Langtou, Dandong, where one end of the bridge will be built, a construction board has been set up and says the New Yalu River Bridge will connect to Jangseo in the southern part of Shinuiju.

China and North Korea agreed to construct the bridge in October 2009, and in February, the Vice Minister of Foreign Affairs of North Korea, Pak Gil Yon, and Chinese Assistant Foreign Minister Wu Hailong signed the agreement in Dandong, China.

Dandong City had announced plans to start construction of the bridge in October, but it has been delayed for uncertain reasons. It was rumored there was conflict over the construction of the bridge because North Korea had requested additional aid from the Chinese government.

Researcher Jeon Byung Gon of the Korea Institute for National Unification said in a telephone interview with The Daily NK that, “The ceremonial ground-breaking will be a chance to promote the friendship between China and North Korea again.”

Researcher Jeon explained that, “So far, there have been several impediments to trade such as quotas, outdated facilities for transportation, both countries’ border management, etc. However, when the New Yalu River Bridge is constructed, such limitations can be resolved and trade between China and North Korea can be revitalized.”

He predicted, “Since they are trying to carry out the construction in a hurry, economic cooperation and friendship relations between two countries will be taken to the next level.”

Also, from the Choso Ilbo:

A source in Dandong said Wednesday that North Korea and China will start construction of the bridge as early as Friday. The two sides agreed to build the bridge during Chinese Premier Wen Jiabao’s visit to North Korea in October last year, with work expected to start this October.

China insists on having the bridge connect the newly renovated area of southern Dandong and southern Sinuiju, but North Korea wanted it to cross over Wihwa Island in Apnok River and connect Dandong with the old part of Sinuiju. The North claimed the route preferred by China would necessitate building a long embankment but in fact seems to have been nervous that a direct link to Pyongyang would cause security concerns like making it easier for North Koreans to flee.

But the North seems to have caved in. A source said construction will begin in March but a groundbreaking ceremony will be held before the end of this year.

Meanwhile, transport of goods and products has picked up via the Hunchun- Rajin-Sonbong route as part of an economic cooperation project. Around 500 truckloads of coal from China’s Jilin Province were shipped out of Rajin-Sonbong Port on Dec. 7 and are being transported to Shanghai across the East and South seas.

Read the full stories here:
New Yalu Bridge Groundbreaking This Year
Daily NK
Mok Yong Jae
12/28/2010

N.Korea’s Cross-Border Business with China Picking Up
Choson Ilbo
12/30/2010

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Hong Kong rises to DPRK’s no two trading partner

Wednesday, October 9th, 2013

According to the South China Morning Post:

In 2012, Hong Kong became North Korea’s No 2 trading partner with two-way trade reaching US$111 million (HK$861 million), rising 457 per cent from the year before, according to data from a South Korean trade organisation.

Last year alone, the Stalinist country exported US$58 million (HK$450m) worth of goods to Hong Kong and imported items worth nearly US$53 million (HK$411m) from the city, according to a recent report by South Korea’s government-run Korea Trade-Investment Promotion Agency.

The upward trend in two-way trade might be explained as a one-time jump, but experts suggest that Hong Kong may be part of the mainland China’s broader agenda for its relations with North Korea.

“Hong Kong is a tool for Sino-Korean relations because it can play certain functions in pushing forward the relationship between Beijing and North Korea,” explained Steve Chung, a professor of international relations at the Chinese University of Hong Kong.

The rise in trade between North Korea and Hong Kong in recent years coincides with the establishment of a joint industrial zone to be operated by Beijing and Pyongyang.

Read the full story here:
How did Hong Kong become North Korea’s No 2 trading partner?
South China Morning Post
Audrey Yoo
2013-10-9

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Changes in DPRK – EU trade patterns over 2011-2012

Monday, October 7th, 2013

According to the Daily NK:

International sanctions against North Korea are leading to declining bilateral trade volumes with the European Union (EU), it has been revealed.

“The total amount of trade between North Korea and the EU in 2012 fell 40%, from 159,000,000 Euros in 2011 to 92,000,000 Euros in 2012,” Voice of America reported yesterday, citing the latest trade statistics from the European Commission.

The root of the decline lies in exports from North Korea; in other words, Pyongyang’s exports to the EU decreased dramatically, and this led to an overall decrease in bilateral trade.

North Korean imports from the EU last year amounted to 73,000,000 Euros, a 60% increase from the previous year. However, exports in the same period were only worth 19,000,000 Euros, not even 1/5 of the previous year’s 116,000,000 Euros.

A report released by the Korean International Trade association last month yielded a similar outcome, concluding that trade between North Korea and the EU in the first five months of 2013 was on a declining curve, being worth just 12,500,000 Euros, a 77% decrease over the same period of 2012.

The EU also reported that North Korea’s foreign trade last year was worth 690,000,000 Euros overall. North Korea’s biggest trade partner was China, with 470,000,000 Euros, 68% of total foreign trade.

North Korea’s other major trade partners in 2012 India, the Democratic Republic of Congo, Saudi Arabia, and the Dominican Republic.

Read the full story here:
North Losing Out in European Market
Daily NK
Yang Jung A
2013-10-7

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DPRK exports to China up 8% in Jan-Aug 2013

Monday, October 7th, 2013

According to Yonhap:

North Korea’s exports to China rose 8 percent on-year to US$1.85 billion in the first eight months of this year, thanks to higher exports of coal, ores and woven garments, a South Korean diplomat said Monday.

The North’s imports from China fell 6 percent on-year to $2.24 billion in the eight-month period, with two-way trade totaling $4.09 billion, said the diplomat at the South Korean Embassy in Beijing.

Total trade volume between North Korea and China was little changed in the January-August period, compared with $4.1 billion for the cited period a year earlier, the diplomat said on the condition of anonymity, in a sign that their trade is on a recovery track.

It was not immediately clear, however, whether the rebound in bilateral trade meant that Beijing might ease its tougher stance on Pyongyang’s nuclear weapons program.

“North Korea’s exports of coal and ores to China showed a double-digit growth during the eight-month period, despite declines in their international spot prices,” the diplomat said.

North Korea’s traditional ally has become increasingly frustrated with its wayward neighbor, particularly after the North’s third nuclear test in February in defiance of China. Beijing voted in favor of tougher sanctions by the United Nations Security Council to punish Pyongyang for conducting the nuclear test.

In May, the Bank of China closed accounts with North Korea’s Foreign Trade Bank, which was accused by the U.S. of helping finance the North’s nuclear weapons program.

Last month, China disclosed a list of weapons-related goods banned for export to North Korea, highlighting Beijing’s commitment to enforcing international sanctions against Pyongyang.

Still, many Chinese businesses keep close trading ties with North Korea, supplying key commodities and hard currency to the North.

Yonhap also offered additional information in an artiucle published by the Korea Herald:

However, he said sales of clothing topped $290 million as of end-August, compared to $200 million during the same period last year.

On imports, the North brought in mostly crude oil, food and fertilizers from China, although overall numbers were down 6 percent on-year.

Imports of food and fertilizers were down 57 percent and 27 percent, respectively, with crude imports dipping 6 percent compared to the year before.

The North has been importing less food from China after a good harvest last year.

Read the full story here:
N. Korea’s exports to China rise 8 pct in Jan.-Aug.
Yonhap
2013-10-7

N. Korea-China trade in 2013 largely unchanged from previous year
Korea Herald
29103-10-9

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Recent DPRK agricultural statistics

Wednesday, October 2nd, 2013

According to Yonhap, the DPRK’s food imports increased over the summer:

North Korea’s crop imports from China rose 16.5 percent in August from the previous month, data showed Tuesday, indicating stability in food supply for people in the impoverished nation.

According to the data compiled by Kwon Tae-jin, a researcher at the Korea Rural Economic Institute, North Korea imported 26,804 tons of grains such as flour, rice, corn and bean in August from its neighboring country, compared with 22,988 tons a month earlier.

The North spent a total of US$15.4 million to buy the crops that month, the largest monthly spending for the year, the data showed.

August also marked the seventh consecutive month that the North’s crop imports topped 20,000 tons.

“Since February, the North has imported more than 20,000 tons of crops per month from its strongest ally,” Kwon said.

“Factoring in the forecast of good harvests for the autumn thanks to good weather conditions, the North is expected to enjoy a relatively stable supply of crops at least for the rest of the year,” he added.

Meanwhile, North Korea’s fertilizer imports from China totaled 183,639 tons in the January-August period, down 27.1 percent from the same period a year earlier, according to the data.

North Korea’s domestic food production is also apparently higher. According to Yonhap:

North Korea’s grain harvest is expected to grow about 8 percent this year from 2012 thanks to relatively favorable weather conditions, a source with the knowledge of food situation in the communist nation said Wednesday.

The North is estimated to produce as much as 5.3 million tons of grains this year, a 7.7 percent increase from 4.92 million tons last year, the source said on the condition of anonymity.

This year’s estimated grain harvest roughly meets with the North’s annual demand of 5.4 million tons. The annual demand was calculated by South Korea’s state-run Korea Rural Economic Institute.

“Grain harvest in North Korea this year is much better than last year because there were no big natural disasters, except for heavy rains in July this year,” the source said.

Despite the positive assessments of the DPRK’s food supply, the UN warns more food assistance is needed. According to Yonhap:

North Korea remains one of the 34 countries in the world that require external assistance to properly feed their people, a media report said Friday.

The Voice of America said the October issue of Crop Prospects and Food Situation by the Food and Agriculture Organization (FAO) estimated that there will be some 2.8 million “vulnerable” people in the communist country needing assistance until this year’s fall harvest.

The Washington-based media outlet said that judging by official estimates tallied by the United Nations organization, Pyongyang’s spring cereal harvest for 2013, mainly winter, wheat and barley, fell shy of the initial forecast, and that this is the main reason for the current shortage.

The country had reported improved harvests in the fall of 2012.

The U.N. agency also said people in the country are experiencing “widespread lack of access” to food caused in part by past floods.

The latest findings added that overall conditions in the North have not changed vis-a-vis July when the last food situation report was released.

At the time, the North was the only country in East Asia to be placed on the list requiring external aid. Others on the list of the 34 countries were in Africa and Central Asia.

The FAO, meanwhile, estimated that the North has been able to secure 328,000 tons of various grain from November of 2012 to early last month. This is equal to 65 percent of the 507,000 tons of grain Pyongyang needs to properly feed its population.

Read the full stories here:
N. Korea’s crop imports from China up 16 pct in Aug.
Yonhap
2013-10-1

N. Korea’s grain harvest seen improving: source
Yonhap
2013-10-2

N. Korea needs external aid to feed its people: report
Yonhap
2013-10-4

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China releases document on trade restrictions with DPRK

Tuesday, September 24th, 2013

…although I cannot find a copy of it anywhere.  It is probably being sent around in PDF form and only available in Chinese.

According to the New York Times:

In a sign of growing concern about North Korea’s nuclear ambitions, China published a long list on Tuesday of equipment and chemical substances to be banned from export to North Korea for fear they could be used in adding to its increasingly sophisticated nuclear weapons programs.

If put into place, the export controls would be some of the strongest steps taken by China, the North’s closest ally, to try to limit the country’s nuclear programs. The announcement indicates that China is now following through on some United Nations Security Council sanctions it approved months ago, according to a noted American arms expert.

The list of banned items was released amid a flurry of reports suggesting that North Korea is accelerating its two nuclear weapons programs. Two weeks ago, new satellite photographs showed that North Korea might be resuming production of plutonium at its newly reconstructed nuclear reactor at Yongbyon. And this week, two American arms experts reported that North Korea appeared to have learned to produce its own crucial components for uranium enrichment.

The move also comes less than a week after China made an unsuccessful attempt to revive talks aimed at persuading the North to give up its nuclear capabilities. The United States continues to resist restarting the talks, which North Korea has used in the past to extract concessions without making long-term changes to its nuclear program.

“The release of the new export control list is a signal China is concerned about the speeding up of weaponization” of North Korea’s nuclear capabilities, said Zhu Feng, the deputy director of the Center for International and Strategic Studies at Beijing University, who called the move “very important.” In particular, he said, the Chinese are concerned about resumption of plutonium production at the Yongbyon complex, the centerpiece of North Korea’s nuclear program.

Another Chinese expert on North Korea, who declined to be identified because of his position in the government, said the publication of the list “says that China is increasingly unsatisfied with North Korea’s actions.”

“This is one of the practical actions to show it,” he said.

Both plutonium and highly enriched uranium can be used in nuclear bombs, but analysts say the North’s plutonium program is much further along. At least two of the three bombs the country has tested used plutonium.

China has long resisted punishing North Korea for its nuclear programs, but has appeared increasingly frustrated as the North’s young leader, Kim Jong-un, has appeared to ignore Chinese pleas for moderation. China agreed to the United Nations sanctions after the North conducted a nuclear test this year over Chinese objections.

The North responded to the sanctions with months of nuclear threats against South Korea and the United States, which, analysts say, ended only after China exerted strong pressure, apparently fearful of instability that could harm its economic progress.

David Albright, the American expert who said China was now implementing the United Nations sanctions passed in March, added that the Chinese ban “will help, since North Korea procures so much from China.” Mr. Albright, the president of the Institute for Science and International Security, added that China could take additional measures to “dramatically increase the inspection of goods into North Korea by road and rail.”

China has moved before to stop the export of other technologies that could be used in nuclear programs, including missile technology, though it did not single out any countries when it did so.

The items on the list China released Tuesday were called “dual-use technologies” because they can be used for either civilian or military purposes, and they included items that could be used to build more chemical weapons and to make biological weapons.

Banned items include Ebola, a virus that can be used for medical research as well as a biological weapon; nickel powder; radium; flash X-ray generators; and microwave antennas designed to accelerate ions. China’s Commerce Ministry, the Ministry of Industry and Information Technology, the General Administration of Customs, and the Atomic Energy Authority jointly published the list.

In a statement, the Ministry of Commerce said the items in the 236-page document were prohibited from being sent to North Korea because “the dual-use products and technologies delineated in this list have uses in weapons of mass destruction.”

Reuters also adds:

Released by the commerce ministry along with the Ministry of Industry and Information Technology and the China Atomic Energy Authority, the document describes items that could be used to build nuclear and chemical weapons, as well as technology that could build and fuel nuclear reactors.

Yonhap adds:

The ban took effect on Monday (September 23).

Read the full stories here:
China Bans Items for Export to North Korea, Fearing Their Use in Weapons
New York Times
Jane Perlez
2013-9-24

China releases list of goods banned from export to North Korea
Reuters
Megha Rajagopalan
2013-9-23

China issues long list of banned items for exports to N. Korea
Yonhap
2013-9-24

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Russian firm Evraz selling coking coal to DPRK

Monday, September 23rd, 2013

According the Russian outlet Izvestia (translated by Google Translate):

Tensions between the U.S. and North Korea do not interfere with the group Evraz, the largest shareholder is Roman Abramovich, it is advantageous to work with both countries: part of the holding coal company “Raspadskaya (Распадской)” began selling coal in North Korea. At the end of 2013 the total supply of “Raspadskaya” to North Korea could reach $ 32 million – half of it is comparable to last year’s total exports from Russia to North Korea.

During the first half of 2013 “Raspadskaya” delivered to North Korea coking coal at $ 4.5 million, follows from the statements of the company. In the total volume of exports “Raspadskaya” is about 4%, which makes the DPRK fifth largest export market for sales of coal (after China, Ukraine, South Korea and Japan).

In the DPRK embassy in Russia, “Izvestia” reported that, except for “Raspadskaya”, none of the Russian coal industry supplies goods to North Korea. There’s also clarified that the recipient of coal – Metallurgical Works named. Kimchaek– one of the largest steel companies in North Korea.  Total design capacity metkombinatu them. Kimchaek on all kinds of products, according to various estimates, 6.5 million tons, but in recent years the plant has significantly underutilized. According to South Korean estimates, the actual production of steel in all of North Korea is 1.25 million tons per year (Statistics Korea itself does not publish a lot of years). 

The volume of coal supply to the “Raspadskaya” to North Korea – to 20 kt (4-5 railroad tracks) on a monthly basis under the current annual contract, described in the company. Price is tied to the international price system (quotation Australian HCC with a discount for the quality of the brand SHCC). That is the sum total of the contract – about $ 32 million, considered BCS analyst Oleg Peter and Paul: The current market price of coking coal at $ 152 per ton (FOB Australia), but the average price for the first half was $ 134.

– Last year, the entire bilateral trade between Russia and North Korea amounted to less than $ 80 million – says Ludmila Zakharova, a senior researcher at the Center for Korean Research Institute of Far Eastern Studies. – At present, trade between our two countries in a state of crisis, Russia accounts for less than 1% of North Korea’s foreign trade.

In 2012, Russian exports to Korea totaled $ 65 million, told “Izvestia” in Economic Development. North Korea among foreign trade partners of Russia occupies 124th place with a “specific weight of 0%,” stated in the department.  Starting this year, however, there is growth of sales: in January-July 2013 two-way trade turnover of Russia and North Korea reached $ 56 million ( an increase of 31% compared to the same period in 2012), including Russian exports totaled nearly $ 51 million (an increase of 38%).

A small volume of direct trade is partially offset by other forms of economic cooperation continues Ludmila Zakharova. For example, it is estimated that about $ 100 million a year is the so-called labor services: experts from North Korea come to work in Russia (for the current year quota for North Korean workers reached 35 thousand people). Since the DPRK shortage of agricultural land, there are projects to provide Koreans to lease farmland in the Primorye Territory. In the last few years has intensified investment direction of Russian-North Korean cooperation. The other day, completed the reconstruction of the railway Hasan-Rajin. Investment in this project is a joint Russian Railways and the Ministry of Railways North Korea amounted to more than $ 200 million

According to data provided by the Ministry of Economic Development, the amount of accumulated investment of Russia to the DPRK at the end of the first quarter of 2013 amounted to only $ 572 million, while the DPRK in Russia – more than $ 79 million

Evraz – a vertically integrated global company with assets not only in Russia but also in other countries, including the United States. Evraz North American division includes several large steel companies formerly known as Oregon Steel, Rocky Mountain Steel, Claymont Steel and Ipsco.

– Evraz to some degree of risk. Under existing U.S. sanctions against the DPRK any large company with offices in the U.S. carries certain risks, working with North Korea – warns Ludmila Zakharova. – America includes a list of objects sanctioned North Korean banks and organizations that are involved in nuclear and missile program. All legal entities operating in the United States, engaging in economic relations with the companies on this list are subject to the relevant law and can not only get the fines, but generally lose access to the U.S. market and the U.S. banking system. In this case, unlike the UN sanctions, the U.S. rules imply a sufficiently broad interpretation than may be exploited Evraz. Of course, the steel industry is difficult to draw to a nuclear program, but you can.

The contract with the DPRK was verified for international risks assured “News” in the “Raspadskaya”.

– At Evraz in America a lot of assets, but the supply of this market are small. Much more dangerous for her to lose access to local banking system – says Oleg Peter and Paul. – Still, the U.S. market civilized, hardly any of the competitors Evraz want to speculate on its relations with the DPRK. Also tied to the steel industry’s nuclear program would be extremely difficult. 

If any Russian translators care to improve on the text offered by Google Translate, please do so.

Read the full story here:
Компания Абрамовича подзаработает в Северной Корее
Известия
2013-9-23

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9th Autumn Pyongyang International Trade Fair

Monday, September 23rd, 2013

UPDATE 1 (2013-10-1): Briefing session for investors held at the Pyongyang International Product Exhibition
Institute for Far Eastern Studies (IFES)
2013-10-1

North Korea recently held a briefing session for foreign investors at the 9th Pyongyang Autumn International Products Expo.

According to Choson Sinbo, pro-North Korean Newspaper in Japan, the expo was held from September 23 to 26, 2013 and many foreign businessmen took part in this event at the Koryo Hotel in Pyongyang.

The briefing sessions for investors was organized by the Korea Foreign Economic Cooperation Committee. An official from the joint venture investment committee, which is responsible for attracting foreign investment, announced that North Korea has great interest in expanding economic cooperation with other nations and working to promote a favorable investment environment.

North Korean government is reported to be welcoming foreign investments and is taking actions to establish protection of foreign investors’ legal rights and interests, and stressed that various tax incentives and benefits for foreign businesses will be granted.

Choson Sinbo reported foreign businesses listened with great interest and expressed hope in investing in North Korea.

The Expo consisted of participants from twelve countries and 226 trading companies with over 800 participants. Out of the total companies, 118 were foreign companies, mostlyfrom China. The number of Chinese companies participating at the Fall Expo increased greatly compared to the Spring Expo where participation of Chinese businesses drastically decreased against the previous year. This increase is attributed to the improved relations between the two allies.

North Korea hosts the Pyongyang International Product Exhibition twice a year — spring and autumn — for the purpose of attracting foreign investments. At this recent event, North Korean machinery, electronics, light industrial goods and food products were on display. There were over 2,400 different items and a total of 57,000 products.

The president of the Korea International Exhibition, Kim Ung Sik, delivered a speech at the opening ceremony saying, “North Korea is working to improve investments, trade, and tourism with many countries in wide-ranging areas and we are hopeful that this exhibition will contribute to the expansion of economic and trade relations with foreign countries and contribute to regional economic development.”

ORIGINAL POST : According to KCNA (2013-9-23):

The 9th Pyongyang Autumn International Trade Fair was opened with due ceremony at the Three-Revolution Exhibition House on Monday.

Present there were Kang Sok Ju, vice-premier of the Cabinet, officials in the trade field, delegations of foreign countries and regions, diplomatic envoys of different countries here and their embassy officials.

Pak Ung Sik, director of the Korean International Exhibition Corporation, made an opening address. Then followed a congratulatory speech by So Kil Bok, vice-minister of Foreign Trade.

The speakers said that the trade fair will offer a good occasion in promoting friendship and unity and boosting broad and multi-faceted economic trade, introducing goods and conducting scientific and technological exchange among countries.

They expressed their will to steadily expand and develop bilateral and multilateral cooperation in the fields of the economy and trade with foreign countries and regions on the principle of equality and mutual benefit.

Then the participants went round products displayed by companies of different countries and regions including the DPRK, Germany, Russia, Malaysia, Mongolia, Singapore, Italy, China, Cuba, Turkey and Taipei of China.

The trade fair will last till Thursday.

On 2013-09-24, KCNA reported the following:

Taking part in it are more than 220 trading companies from 10-odd countries and regions, mostly from Beijing, Dandong, Dalian, Shenyang and other areas of China.

Popov Sergey, commercial director of Russia’s Maritime Territory Confectionary Company, told KCNA that he hoped for strengthened economic cooperation between the DPRK and Russia, expecting products of his company to be favored by Korean people.

Juana Navarrete Mendoza, a section chief of Cuba’s LABIOFAM Enterprise Group, said it was honor for them to attend the excellent fair with main products of the Group.

On display at the fair are more than 57,000 products of 2,400-odd kinds, including machinery, electric and electronic appliances, light industrial goods, foodstuffs, medical instruments, medicines, building materials, chemicals and vehicles.

On 2013-9-26 KCNA reported the following:

The 9th Pyongyang Autumn International Trade Fair is going on with attendance of many foreign companies.

Among them is the Beijing Bridge International Trading Company Ltd. of Germany, which has been strange to Korea. The company, founded in Juche 97 (2008), engages itself in sale of Germany-made foodstuffs and electronic appliances in China.

On 2013-9-26 KCNA also reported the following:

Li Nan, general manager of the Shenyang International Exhibition Corporation of the Shenyang Sub Council of China Council for the Promotion of International Trade, said:

President Kim Il Sung was the great leader of the Korean people and a close friend of the Chinese people.

He made a great contribution to the victory of the Chinese revolution.

The Chinese people will always remember his exploits.

Li Yongjian, manager of overseas business of the Beijing Purkinje General Instrument Co., Ltd., said that the President dedicated all his life to the prosperity of the country and the happiness of its people, adding that he was a great revolutionary and a peerless patriot.

Martyn Williams tracks down other participating companies here.

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