Archive for the ‘Labor conditions/wages’ Category

Hyesan Mine, the Center of Copper Production Is Flooding!

Thursday, November 1st, 2007

Daily NK
Moon Sung Hwee
11/1/2007

A source familiar with issues inside North Korea said on the 30th, “Most of the underground tunnel of Hyesan Youth Mine in Yangkang Province is now under water.” The source added, “Ever since Samsoo Hydroelectric Power Station started filling up the dam last year, the mine began to flood, and now it can not operate properly.”

Hyesan mine produces 80 percent of the country’s copper. North Korea expects that the mine could produce copper for the next forty years. Hebeisheng-Luanhe Industry in China once attempted to buy 51 percent shares of the Hyesan Youth Mine. However, this was unsuccessful due to opposition from North Korea’s second Economic Commission, which manages the military economy.

North Korea began the construction of Samsoo Hydroelectric Power Station in February of 2004, mobilizing thirty thousand troops of the so-called “Shock Brigade for the Propaganda of the Party Ideology” every year. Unfortunately, Samsoo Power Plant became the major cause of the flooding of Hyesan Mine.

If this mine is inundated with water, North Korea has to import huge amounts of copper. It was the Propaganda and Agitation Department that led the construction of Samsoo Power Plant, which generates 50,000 kilowatts of power and is now causing the flooding. It is absurd that North Korea is about to lose its principal copper mine because of Samsoo Power Plant, a facility that was primarily constructed for political purposes.

Jung You Sim (37, pseudonym), a defector from Hyesan who came to South Korea in July of this year, stated that “Hyesan Mine is almost abandoned. It takes about three years to fill up the Samsoo Dam with water. Even now, there is difficulty in pumping out the water leaked from the power plant. Once the dam is completely filled, the total volume of water will be 1,300 million cubic meters. By then, the water pressure will have made it impossible to pump out the water that has infiltrated the mine. North Korea must choose either Samsoo Power Plant or Hyesan Mine.”

Samsoo Power Plant was constructed in Jangan-ri of Hyesan, Yangkang Province; Hyesan Mine is located nearby in Masan-dong.

The construction of Samsoo Power Plant which began in February 2004 evoked a great deal of controversy from the beginning. The Guidance Department of the Party and the Ministry of Extractive Industries opposed the construction citing the high risk of flooding in the Hyesan Mine.

However, Jeong Ha Cheol, then Secretary of Propaganda and Agitation Department and Choi Choon Hwang, then vice director of the Central Committee of the Party pushed hard for the construction with the aim of boosting their political standing and succeeded in obtaining Kim Jong Il’s approval. It is almost certain that both men have been purged.

At that time, the Propaganda and Agitation Department reported that the water leakage could be prevented if the bottom of the power plant dam is pressed hard and cemented with mud about three meters deep. However, experts from France who inspected the area opposed the construction because the land itself was calcareous and unstable. The water leakage was inevitable.

First explored in the 1960s, Hyesan Mine produces 10,000 tons of copper concentrates annually. When Gapsan Dongjum Mine, explored during the Japanese colonial period, was finally depleted and closed in 1990, Hyesan Mine became the lifeline of the nation’s copper production. It flooded before in the mid 1990s but was restored shortly thereafter.

At that time, the mine flooded because the pumping device stopped operating due to the lack of electricity across the country. Although the workers at the mine did their best to pump the water, they could not stop the water flowing into the mine at a speed of 480㎥/hour. In January, 1997, Hyesan Mine flooded again, as did other mines throughout the country, and lost all mining facilities.

The workers faced insurmountable obstacles in trying to save the mine. This was because some workers at Hyesan mine had removed the copper from pumping devices and had smuggled it to China before the flood hit the country.

When the officials from the Ministry of Extractive Industries visited Hyesan Mine in 1999, they informed the local cadres that the mine’s copper production had become insufficient for the manufacture of military supplies, and as a result, copper would have to be imported from Chile.

Defectors coming from Yangkang Province said that when Kim Jong Il paid a visit to the mine in October, 1998 and received the report on the difficulties in the mine’s operation, he said, “We must save the mine at any cost. I will supply the money.” At once, the chief secretary of Yangkang Province and the Ministry of Extractive Industries took charge of restoring the mine and organized the recovery workforce.

Kim Jong Il provided the so-called “Revolutionary Fund” for the mine’s recovery. He sent $ 3.8 million in 1998 and $2.6 million in 2001, paid all in cash. In 1998 when a great number of people were starving to death, corn was available in China for $ 137 per ton. The amount of money spent on the mine’s recovery could have been used to purchase approximately 28,000 tons of corn. In those days, the local residents in Yangkang Province were made to listen to lectures about the ‘General’s Revolutionary Fund’ over and over.

Upon the order for recovery, residents in Masan 1-dong and 2-dong in Hyesan city were mobilized every weekend to dig out the dirt in the mine. By May 1, 2003, the locals had dug to a depth of 710 m. Later that year, the mine produced 1,500 tons of copper concentrates, and in 2004 it produced 3000 tons.

The local people made huge sacrifices to recover Hyesan mine, and the recovery cost about $ 7 million. However, it was all in vain. The mine is now again flooded due to the construction of Samsoo Power Plant. Hyesan defector Jung Yoon Sim said that Kim Jong Il later changed his tone when he visited Yangkang Province and heard about the recent flooding, saying “it was anticipated.”

Samsoo Power Plant can produce up to 50,000 kilowatts of power. However, about 60,000 kilowatts of power are needed to supply electricity to the apartment complexes constructed in 2003 in Samjiyun county of Yangkang Province.

After all was said and done, Kim Jong Il had mobilized 30,000 people for three and a half years and had them work 14 hours per day while providing a mere 580 grams of grain daily in an attempt to build a power plant that generates only 50,000 kilowatts. In doing so, he destroyed the nation’s leading copper production center.

President Roh praised such an incompetent and irresponsible man as “a charismatic leader who has a deep understanding about the affairs of the country and has faith in the system.”

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Economic doldrums, restrictions on hawking cost jobs in N. Korea: aid group

Friday, October 26th, 2007

Yonhap
10/26/2007

North Koreans have been suffering from chronic job shortages due to worsening economic conditions and a recent move by North Korean authorities to limit the number of hawkers for fear of capitalism spreading in the isolated, communist state, an aid group said Friday.

The North has recently forbidden women under the age of 40 from selling merchandise on their own, Good Friends said in its latest newsletter. The previous age limit was 30.

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The Story of a Honorary Soldier Selling Noodles in Pyongyang

Friday, October 26th, 2007

Daily NK
Lee Kwang Baek
10/26/2007

Mr. “Kim,” who lives in Pyongyang, lost a foot in an accident in the army. After his discharge, he became a 1st-class Honorary Soldier of merit living on provisions and bonuses supplied by the nation. The wounded soldiers are named as “Honorary Soldiers” in North Korea. Even before the great famine, Mr. Kim and his family could survive on provisions and bonuses alone. However, after the worsening of the economic situation, they fell into serious hardship.

Nowadays, Mr. Kim steps outside every morning, dragging his one foot, because he has to buy noodles at the “Sunkyokak (a noodles restaurant)” that sells honorary soldiers at a state-assigned price of 230 won. Mr. Kim, who is a first-class honorary soldier, can buy two bowls of noodles at one time.

There is no limit on the number of times one can buy a bowl of noodles. However, with the increase in honorary soldiers living on the profit from noodles bought and resold, the number of bowls Mr. Kim can buy from standing in line all day is only four. Even then, he can sell a bowl which he bought for 230 won for 1,000 and can go home with a slightly upward amount of 3,000 won after selling four bowls.

The subsidies Mr. Kim receives as an honorary soldier every month is 3,000 won. That only comes out to 100 won per day, not even sufficient for a bowl of noodles from Sunkyokak. The cost of living for a family of four is usually 100,000 won (approx. USD30.0), so it is not enough to get by for a month. If one can earn one month’s worth of bonus in a day by selling noodles, there is nothing he can do, besides sell them, but to stand in line all day on crutches.

Until now, North Korea has poured a lot of energy to support for honorary soldiers. After the Korean War, it has guaranteed jobs for soldiers by erecting the Distinguished Soldier Fountain Pen Factory, the Sariwon Honorary Soldier Dressmaker Factory, the Hamheung Honorary Soldier Plastic Products Factory, etc. and to soldiers who have lost their ability to work, it has given provisions and bonuses. Further, it has advertised support for honorary soldiers as the “citizen’s responsibility” and has sought out civilian support.

However, recently, according to North Korean sources, among the guests who come to the Sunkyokak, approximately half are honorary soldiers who resell the noodles. The honorary soldiers demonstrate the fact that survival based on provisions and bonuses alone are impossible.

After the food shortage, an important transformation has taken place in North Korea. The number of people relying on national provisions decreased by around 30% and the rest were placed in situations where they could not survive on provisions, salaries, and bonuses provided by the state alone. At least 100,000 won is needed for monthly living costs, but the salary and bonus that the state can provide is only several thousand won. North Korea has become a society where honorary soldiers who had received the state’s special consideration and support now have to sell whatever they can to survive.

In order to buy four bowls of noodles, Mr. Kim, who has to stand on crutches all day, is the testament of North Korea’s economic system which has crumbled since the food shortage and the rapid deteriorate of whatever grip it does have.

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Unemployment Grows as DPRK Businesses Reject Hiring Regulations

Tuesday, October 23rd, 2007

Institute for Far Eastern Studies
NK Brief No. 07-10-23-1
10/23/2007

DPRK authorities are quick to stress that not one single unemployed worker can be found in Socialist North Korea. The truth is, however, unemployment has existed in the past, and now out-of-work laborers are taking on a new form.

With the exception of a small minority of North Koreans, most citizens are assigned professions and dispatched to their place of employment by DPRK authorities with no regard to personal aptitude or skills. This has led to the refusal of some to take assignments in mines, shipyards, and other undesirable factories, creating a group of ‘non-workers’.

However, today’s unemployed are different from the unemployed found in the 1980s and 90s. In the past, these workers refused positions at undesirable factories. In the late 1990s, with the cessation of food rations and lack of job positions, a good number of factories and businesses shut down operations, leading to an increase in unemployment. Now, it is the mines, companies, and yards that are refusing to take on new workers.

Currently, North Korean authorities are tasking managers of organizations and companies with the responsibility of feeding employees. Anyone with the skills and the money can become a manager. Authorities assess whether someone can provide wages and rations for employees, and if so, will put them in charge. However, the order that “Managers not able to carry out the task of feeding [employees] will be released or demoted” has been passed down, putting a considerable burden on executives and managers. As they are now responsible for both the wages and the rations of their employees, these managers are not looking to take on new workers. This is problematic for those dismissed from military service with little or no trade skill, and for those receiving only a middle-school education, especially women. These citizens are turning to trade to provide a living.

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Kaesong factory-apartment opens new horizons for inter-Korean cooperation

Tuesday, October 23rd, 2007

Yonhap
Lee Joon-seung
10/23/2007

A newly opened factory-apartment at the Kaesong Industrial Complex promises fresh possibilities for inter-Korean business cooperation, the developer of the facility said Tuesday.

The state-run Korea Industrial Complex Corp. (KICOX) said the dual-purpose manufacturing and residential facility is specifically designed for small and medium enterprises (SMEs) that are currently being phased out of South Korea due to the lack of workers and high labor costs.

At the formal opening ceremony of the factory-apartment, KICOX President Kim Chil-doo said, “The new facility provides an ideal business model for South Korea’s labor-intensive SMEs trying to stay afloat, and is an ideal means to start off business in North Korea.” About 300 people from South Korea were present at Tuesday’s opening in Kaesong, including lawmakers and Vice Industry Minister Oh Young-ho.

The 32 companies that will use the new facility are generally small clothing companies that were at the critical juncture of deciding whether to move to China and Southeast Asian countries, or close their businesses altogether. The factory-apartment provides an alternative means to continue making goods and is beneficial to all sides, the developer said.

By moving to Kaesong, the companies can stay in business by hiring workers for about US$60 a month, while 2,700 North Korean workers benefit from new jobs. In addition, the dual arrangement permits cheaper operating costs, a better working environment and allows companies to cooperate with each other for logistics support, said the developer.

The corporation, which runs 11 similar factory-apartments in South Korea, said the five-story building covers 27,880 square meters and was built in 14 months at the expense of 21.1 billion won (US$22.8 million). It is equipped with a storage area, a training center, a product display room, two dining halls, a store and fitness center. The new building is equipped with 71 dormitories for South Korean workers and various support staff.

The monthly rent in the factory-apartments is 4,500 won (US$4.9) per square meter, and there are six different floor arrangements available, ranging from 396 to 1983 square meters.

KICOX said that based on the projected success of the first factory-apartment, up to seven more will be built in Kaesong by 2010. It said 19,489 square meters of land were reserved in May 2007 for the project.

A second factory-apartment is being built the Kaesong Industrial District Management Committee (KIDMAC), and is scheduled for completion by late 2008.

Companies that have moved into the new factory-apartment, meanwhile, said they are satisfied with the proficiency of workers and cheap labor costs.

Ok Sung-seok, president of Nine Mode Co. and chairman of the corporate management committee at the KICOX factory, said Kaesong plants cost a third less to operate than similar plants in China. He added that his shirt-making company should turn a profit by next year.

“I ran a factory in Qingtao, China for four years, but the operating cost there is skyrocketing,” the businessman said. He said Nine Mode closed its Chinese factory and plans to downsize its operations in Seoul so it can concentrate on its efforts in Kaesong.

Ok said that depending on the type of business and size, four or five factories in the factory-apartments should turn a profit by the end of the year.

The Kaesong complex lies 60 kilometers northeast of Seoul, and is hailed as the crowning achievement of the historic 2000 inter-Korean summit. It has played a key role in expanding two-way economic exchange that stood at just $300 million in 1999 to $1.35 billion last year.

Construction of the industrial district began in June 2003, with 3.3 square kilometers of factory land have been built to house up to 450 firms. By 2012, 11.6 square kilometers of industrial park is to be laid down that can hold several thousand South Korean factories and hire over 200,000 North Korean workers.

There are at present about 13,000 North Korean workers employed by 57 South Korean firms in Kaesong that have churned out garments, watches, kitchen utensils, auto parts and other labor-intensive goods since 2004.

The complex just north of the demilitarized zone that separates the two Koreas has been in the spotlight after the second inter-Korean summit. South Korean President Roh Moo-hyun and North Korean leader Kim Jong-il agreed to build a region of peace and prosperity centered around Kaesong and the North Korean city of Haeju, 75 kilometers west of Kaesong.

“People at Kaesong expect progress to be made in such areas as communications and travel, which had previously been an obstacle to the development of the industrial district,” said a KIDMAC official. The prime ministers of the two sides are to meet in November to implement follow-up measures to the summit.

There is only one telephone line linking Kaesong with Seoul, while no mobile phones are allowed in the area. People and materials are also prevented from moving in and out of the complex.

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Kaesong Prodiction Surpasses US$200m

Tuesday, October 16th, 2007

Institute for Far Easter Studies
NK Brief No. 07-10-16-1

The Kaesong Industrial District Management Committee reported on October 10 that after two years and nine months of operation, the total value of goods manufactured in the Kaesong Industrial Complex (KIC) surpassed 200,000,000 USD. In 2005, production by companies in the KIC totaled 15,000,000 USD; in 2006, 74,000,000 USD; and in the first 9 months of 2007, 124,000,000 USD, for a total since 2005 until last September of 213,000,000 USD.

There are currently a total of 45 companies operating in the complex, employing 19,433 North Korean workers and 800 workers from South Korea, for a total of over twenty thousand employees. The Committee’s report further detailed that the production output of the North Korean workers averaged 1,275 USD per person during the first half of 2007, up 28 percent over last year’s per-capita output of 989 USD.

After overall production surpassed 100,000,000 USD at the end of last January, the 200,000,000 USD barrier was broken in only eight months. This expansion of production is a result of a stable business environment, the increase in the number of companies entering the complex and the number of North Korean workers employed, and overall productivity growth.

The 1,275 USD per-capita production output for the first half of the year shows a 28 percent increase over the 989 USD per-capita recorded in 2006, and 15 percent higher than the 1,108 USD per-capita average of the first two quarters of last year. Despite employment regulations calling for continually increasing numbers of workers, which tend to lower productivity statistics, overall North Korean workers’ average per-capita production numbers did not fall, and the increase shown is significant.

The increase in productivity is not unrelated to the level of education of the workers. Currently, the majority of workers in the KIC have at least a high-school education, and more than 20 percent have completed some form of technical college or higher. A technical training center scheduled for completion in October of this year will provide even more formal technical training for the workers, further increasing productivity.

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In the So-called Socialist Country, North Korea, the Number of Unemployment Is Increasing

Tuesday, October 16th, 2007

Daily NK
Kim Min Se
10/16/2007

The North Korean authorities always proclaim that “There is not a single unemployed person in socialist North Korea.”

Although that is a lie, the North Korean authorities keep propagating it. Indeed, the state has been using the propaganda maneuver for over fifty years. Unfortunately, there are some South Korean people who take this lie as truth.

The North Korean regime arbitrarily posts most of its people, except for a few, at the workplaces regardless of their fit with the job or ability. Therefore, of those placed into unfavorable places such as coal mines or factories (in bad conditions) are individuals who refused the job.

However, the current day unemployed are different from their counterparts back in the 1980s and 90s. In the past, the unemployed were those who rejected the jobs provided by the regime. Now, people become jobless because factories and complexes refuse to receive new workers.

The number of the unemployed has increased especially since the late 1990s when the authorities suspended its food distribution and many factories or complexes stopped operating because there was no work provided.

Lately, the North Korean authorities ordered that the managers of the factory complexes take responsibility for providing food rations for their workers. If they fail, the authorities warned that the managers would lose their positions. Thus, it is burdensome for the managers to receive new workers.

In a phone conversation with DailyNK on October 12th, Kim Chul Man (pseudonym), who works in Yanji in China and conducts trade business between North Korea and China said, “There are many unemployed people in North Korea. It is because the managers do not want to receive new workers since they have to provide for their workers both wage and food ration.”

“How could the managers receive the new workers when it is hard to give wage and food to existing workers?” Mr. Kim said, “Even those who work under managers competent for providing both food and wage for their workers are concerned about securing their jobs.”

Mr. Kim also said, “Discharged solders who are incompetent and those females who only finished junior high school are of particular concern. Most of them make a living by doing petty business.”

Lee Yung Gu(pseudonym), a defector who came to South Korea this year said, “In North Korea, anyone who has money and ability can become a manager. The authorities appoint new managers based on their ability to provide wage and money for workers.”

“The state factories are indeed managers’ factories,” said Lee, adding “In such a situation, the managers act highhandedly.” Lee said, “Some female workers even prostitute themselves to their mangers in order to secure jobs and receive more food and money.”

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30 Days Imprisonment Penalty Revived

Monday, October 8th, 2007

Daily NK
Kwon Jeong Hyun
10/8/2007

It was revealed that North Korea has revived the “30 days imprisonment penalty” to workers who were lazy or failed to complete their duties among the executives of factories and companies in their concentration of flood assistance of city.

The 30 day imprisonment penalty is a policy that confines executives, managers of factory or company in the prison for 30-50 days in case of their over usage of electricity, resources or laziness or failure to conduct their duty.

The inside source in North Korea revealed on the 28th of September that, “The authorities said that if the target figure is not achieved, they called it as neglect of duty and inflicted the “30 days imprisonment penalty” on them. It had disappeared during the famine but it is now revived again, causing the company managers and executives to become anxious. ”

According to the inside source, this treatment can be interpreted as a method to ask for business responsibilities in case the managers or executives takes the profit into their personal use and to create a scapegoat in case of low revenue.

The 30 days imprisonment penalty was established in 1990 at first. Back then the company workers was forced upon mobilized labor every day to assistance of agriculture or construction of houses and evaders increased, so that there needed to be a scapegoat who would take responsibility upon the people who would avoid the workforce.

However, with the March of the Tribulation (Mass starvation period in the 1990s) and with the factory’s operation rate at lower than 30%, this appeared to have been abolished.

The initiation of the 30 days imprisonment means there will be an additional method for the Party secretary posted in each factory to take political control over the manager of factories and companies. Therefore, there will be increased control by the Party departments. However, there was the structure of connection between the Party secretary and the manager in many of the companies even along with the corruption of the inspection groups. It is highly doubtful whether this measurement will be successfully implemented.

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North Korea on Google Earth

Saturday, October 6th, 2007

Version 5: Download it here (on Google Earth) 

This map covers North Korea’s agriculture, aviation, cultural locations, manufacturing facilities, railroad, energy infrastructure, politics, sports venues, military establishments, religious facilities, leisure destinations, and national parks. It is continually expanding and undergoing revisions. This is the fifth version.

Additions to the latest version of “North Korea Uncovered” include updates to new Google Earth overlays of Sinchon, UNESCO sites, Railroads, canals, and the DMZ, in addition to Kim Jong Suk college of eduation (Hyesan), a huge expansion of the electricity grid (with a little help from Martyn Williams) plus a few more parks, antiaircraft sites, dams, mines, canals, etc.

Disclaimer: I cannot vouch for the authenticity of many locations since I have not seen or been to them, but great efforts have been made to check for authenticity. These efforts include pouring over books, maps, conducting interviews, and keeping up with other peoples’ discoveries. In many cases, I have posted sources, though not for all. This is a thorough compilation of lots of material, but I will leave it up to the reader to make up their own minds as to what they see. I cannot catch everything and I welcome contributions.

I hope this map will increase interest in North Korea. There is still plenty more to learn, and I look forward to receiving your additions to this project.

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S. Korean Shipbuilders Question Joint Complex in North

Friday, October 5th, 2007

Korea Times
Kim Yoo-chul
10/5/2007

Daewoo Shipbuilding Unveils Plan to Build $150 Mil. Shipyard in Northern Coastal City

South Korean shipbuilders and analysts questioned the economic viability of the proposed plan to build a joint shipbuilding complex in the wake of the inter-Korean summit.

The agreement between the two Koreas calls for the two sides to construct a joint shipbuilding complex in the North’s port city of Nampo, near Pyongyang.

Most officials from major South Korean shipbuilders say that too many things are uncertain as of yet though Daewoo Shipbuilding & Marine Engineering (DSME) unveiled a bold plan to build a $150 million block plant in the North’s city of Anbyeon.

“When issues of transportation, communication, customs and capital see improvement, we will build a block plant in the North Korean city with production capacity of 200,000 tons a year,’’ DSME President Nam Sang-tae told reporters Friday.

“We will start to begin the process within this year after certain issues are solved,’’ Nam said, adding the company looks to begin production from early 2009.

He said the company is seriously considering in participating in joint projects by the two Koreas in the North’s western city of Nampo.

Unlike Daewoo Shipbuilding, Hyundai Heavy Industries, the world’s No.1 shipbuilding company, showed reservations.

“The announcement itself is good. But it is not the right time to start business talks with North Korea, given a lack of credibility and geopolitical uncertainties,’’ said a high-ranking official from Hyundai Heavy Industries.

Asked about the possibility of finding another investment area for South Korean shipbuilders in North Korea, the official said it is likely but needed a few years as the building of infrastructure there will need massive funding.

The production capacity in the North’s shipbuilding industry was 258,000 tons in 2004, about 3.1 percent that of the South’s 8.24 million tons in the same year, according to a report from the Korea Development Bank. There are eight shipyards in North Korea, including Wonsan and Najin. Total employees in the industry were 25,000, the report shows.

Analysts also said the announcement is not `fresh material’ to boost share prices in shipbuilders.

“There was no immediate positive impact on stock prices, nor will there be a negative ones in the long term,’’ said Lee Jae-kyu, an analyst from Mirae Asset Securities.

He expects the scale of investments by the South Korean shipbuilder in joint projects to be small in the near future as shipbuilding-related facilities require large amounts of capital and time.

“If the joint projects materialize, the complex will be constructed in the form of a `block plant’ _ repairing vessels or producing components. Therefore there will be no huge momentum in shipbuliding stocks,’’ Ahn Ji-hyun from NH Securities said.

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