North Korean Economy Watch

According to the Choson Ilbo:

The United States is offering $750,000 in emergency aid to North Korea to help aid recovery from devastating floods.

The U.S. Special Envoy for North Korea Human Rights, Robert King, told VOA Wednesday that the money will be given to three U.S. non-governmental organizations — Samaritan’s Purse, Global Resource Services, and Mercy Corps.

He said the organizations will use the money primarily for medical supplies and will fly the aid into Pyongyang beginning later this week.

Read the full story here:
U.S. Offers Flood Aid to N.Korea
Choson Ilbo
9/2/2010

According to Medical News Today:

In a country where good news is scarce, a pioneering agroforestry project in the Democratic People’s Republic of Korea is restoring heavily degraded landscapes and providing much-needed food for communities living on the sloping lands.

Jianchu Xu, East-Asia Coordinator for the World Agroforestry Centre, which has been providing technical expertise and training for the project since 2008, said agroforestry – in this case the growing of trees on sloping land – is uniquely suited to DPR Korea for addressing food security and protecting the environment.

“What we have managed to achieve so far has had a dramatic impact on people’s lives and the local environment,” Jianchu explains.

“Previously malnourished communities are now producing their own trees and growing chestnut, walnut, peaches, pears and other fruits and berries as well as medicinal bushes,” Jianchu explains. “They have more food and vitamins and are earning income through trading”.

Following the collapse of the socialist bloc in 1989 and a lack of subsidies for agriculture in DPR Korea, famine and malnutrition became widespread in rural areas.

DPR Korea is a harsh mountainous country where only 16% of the land area is suitable for cultivation. In desperation in the 1990s, people turned to the marginal sloping lands but this had a price: deforestation for cropping land and fuelwood left entire landscapes denuded and depleted of nutrients.

In an effort to reverse the situation, an innovative and pioneering project began in 2002 involving the Swiss Agency for Development and Cooperation (SDC) and Korea’s Ministry of Land and Environmental Protection. The World Agroforestry Centre was later brought in to provide technical advice.

Suan County has since expanded to 65 user groups in seven counties, with several hundred hectares of sloping land now under sustainable management. And the project is still growing.

A system of establishing user groups with one representative from each family has enabled demonstration plots to be set up and a large number of households to benefit from knowledge about growing multi-purpose trees. Such trees can improve and stabilize soils as well as provide fertilizer, fodder or fruits.

Most of the people farming the sloping lands are pension workers with little agricultural experience. The agroforestry systems they are now implementing and the techniques they have learnt are significantly increasing tree cover on the slopes as well giving them a diversity of crops.

Several of the user groups have started their own nurseries so that they can be self-sufficient and produce their own planting materials.

Initially a European consultant was engaged to provide advice on sloping land management, but in 2008 SDC brought the World Agroforestry Centre’s China office into the project.

“With similar experiences and history, our Chinese staff were well-placed to work in DPR Korea,” explains Jianchu. “It was important to have people with an understanding of the technical, institutional and socio-political context.”

There are very few international organizations operating in DPR Korea, and most of these are providing emergency relief. “With our strong focus on capacity development, we have established a good reputation,” adds Jianchu. So much so that the Centre is now negotiating a memorandum of understanding with the government and there are plans to establish an office in the country.

According to Jianchu, one of the most important aspects to ensuring the project is sustained is capacity development at all levels.

“As well as the user groups, we are providing training to multi-disciplinary working groups comprising representatives from the national academy, agricultural universities, forestry research and planning institutes, and staff of the Ministry.”

“There is an enormous need to improve knowledge and skills in DPR Korea in the area of natural resource management and to nurture young scientists,” says Jianchu. SDC is now investing in this area. Each year over the past few years, a handful of students from DPR Korea have undertaken studies with the Center for Mountain Ecosystem Studies, jointly run by the World Agroforestry Centre and the Chinese Academy of Sciences and hosted by the Kunming Institute of Botany in China. Some could be considered for a doctoral program in the future.

To further support the up-skilling of DPR Korea scientists and the up-scaling of agroforestry, the Centre will soon publish an agroforestry manual. Work is also underway on an agroforestry policy for sloping lands management and an agroforestry inventory.

Read the full story here:
Agroforestry A Success In North Korea
Medical News Today
Kate Langford
8/31/2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-08-31-1
8/31/2010

An organization representing several major South Korean religious organizations crossed the DMZ on August 27 to deliver over 300 tons (thirteen 25-ton trucks) of flour to the city of Kaesong, with plans to distribute the aid to North Korea’s children and poverty-stricken. This is the first overland delivery of aid since Seoul’s May 24 measures restricting exchanges in response to the Cheonan incident.

Nine members of the organization, representing Buddhism, Catholicism, and Protestantism, travelled to the North. The group intends to visit one or two nurseries, and distribute flour to Kaesong City as well as Jangpung, Keumchon, Daechon, Chongdan and Yondan districts. The delegation is also delivering six boxes of nutrition supplements for children in Kaesong’s nurseries. Before crossing over into North Korea, the group held a press conference in Paju City’s Imjin Park. At the conference, a representative stated that while the aid shipment was later than desired, the organization thanked the South Korean government for making the decision to allow the delivery while facing a difficult situation in the aftermath of the Cheonan incident.

The organization also stated, “Peninsular denuclearization is also important for bringing peace and security to the Korean Peninsula,” but it is necessary to make ensuring the lives of those in both North and South Korea a top priority, and the group “earnestly hopes that the [South Korean] governments’ active support of humanitarian assistance can save the lives of North Korean residents and help to realize inter-Korean reconciliation and peace.”

The organization also stressed that religious teachings emphasized the need to exert all efforts for the desolate and the starving. The group is devoted to helping resolve the North Korean plight caused by starvation and malnutrition, and through these efforts, bringing about peace on the Korean peninsula. The organization, representing those of Jewish, Catholic, Buddhist, Protestant, Korean Buddhist, and Chongdo religions, as well as the United Religions Initiative of Korea, continues to pursue renewed government assistance to North Korea.

The Korean Conference of Religion and Peace (KCRP) issued a statement on August 27 declaring that the South Korean government needed to send aid to the North not only in response to the critical situation caused by recent flooding, but in order to help resolve the chronic food shortages causing ongoing hardship for the people of North Korea. In highlighting the plight of North Koreans, the group emphasizes familial and national ties, stressing Korean unity in calling for government assistance for ‘brethren’ in the North. The group also calls for both Seoul and Pyongyang to “open [their] hearts and hold talks on peninsular peace and unification” rather than continue with the current confrontational policies.

Institutie for Far Eastern Studies (IFES)
NK Brief No. 10-08-25-1
8/25/2010

The quality of life among North Korea’s agricultural workers has reportedly worsened sharply in recent times. It appears that the aftermath of last November’s currency reform measure has finally reached as far as the farmhouse. According to a report by the group Daily NK, in the town of Onsong, North Hamgyong Province, only 4~5 families per neighborhood unit (around 30 families) manage to eat rice, in the way of ‘corn rice’, three times per day. Most households eat boiled ears of corn or gruel-like corn soup.

While it was thought that the currency reforms would ease the food shortages of farming households, their lives have grown more difficult due to the sudden fluctuations of market prices, driving down the number of farmers able to sell their yields at market. In the Onsong market, rice sold for an average of 1050 won per kilogram on August 20. Compared to the beginning of the month, prices were down approximately 100 won, but are still more than twice as high as just a few months ago. This is, in part, due to the foreign currency exchange rate. One Chinese Yuan is trading for 215 North Korean won.

Actually, North Korean farmers were about the only beneficiaries of the currency reform. Last December saw the biggest public distribution of goods ever. Commerce was up around 15~20 percent over the year prior. In addition, follow-up measures allowed families to collect 10,000-20,000 won each. However, as market prices became increasingly unstable during the first half of this year, it became harder for farmers to sell their goods. Because rice prices would double or triple, then drop again, month after month, it was difficult for a farmer to take 20~30 kilograms of corn to market and get the price they wanted. On top of this, the price of household goods was climbing, driving up the cost of living.

In North Korea, all farmers are obligated to work on cooperative farms, but are also allowed private plots to raise goods for supplementary income. Therefore, when they have an opportunity, most make their way to a local market to sell their goods. The regime considers this ‘supplementary’ income, but actually, the money earned from this practice is what most live off of, using profits from their corn sales to buy other food or necessities. For these farmers, not only is it difficult to sell their crops, but circumstances make it tough even to harvest them. In the case of one farmer in Onsong who works a 1500 pyong private plot, he harvests approximately three tons of corn per year. As those at the cooperative farm receive only 300 kilograms of corn in rations, three tons is not an insignificant amount. However, due to the cost of fertilizer, bribes to authorities, bribes to inspectors, etc., he is left with only around one ton. With fertilizer shortages this spring, considerably less fertilizer was available for private plots.

Even if the farmer saw yields similar to last fall, at today’s prices, he would be able to make only around 500,000 won. This is little more than the 40,000 won/month market traders can make. Farmers with plots of only 500~600 pyong have an even more difficult time. A source explained, “As stories of growing starvation in Kangwon Province spread, people are becoming more distraught,” and, “a family of four lives off of gruel made from one kilogram of potatoes or corn per day.”

According to the Korea Times:

Christian Friends of Korea (CFK) said on its website last week that the North asked them to respond to a need for food, medicine and construction materials to the “fullest extent possible” to deal with “significant” flood damage.

The organization said it will follow through on a planned visit to North Korea later this month and assess flash flood destruction in the areas it works in.

This marks the first time a U.S.-based NGO has reported receiving an aid request directly from the North Korean government.

“We know from visits in years past of the damage and misery that (can) occur in the DPRK following heavy flooding,” it said.

The North’s official KNCA reported earlier this month that the flooding, brought on by torrential rain, had destroyed homes, roads and buildings. Almost 15,000 hectares of farmland were submerged, it said.

It reported casualties in Jagang and South Hamgyong provinces near its border with China but did not elaborate on how many, nor if people had died. China has also been coping with its worst flooding in decades.

The report did not indicate the level of need for outside help.

CFK is currently working to treat and control tuberculosis in the North, including refurbishing clinics and providing training. It said that in requesting aid, the government asked that it not divert from the medical work.

The original purpose of the planned trip was to confirm earlier aid shipments that included food, medical supplies, greenhouses and farming equipment.

The aid request came amid concerns regarding rivers near the border with China, which have swollen to dangerous levels. Xinhua News Agency reported earlier in the week that more heavy rain is expected in China.

Read the full story here:
N. Korea requests flood aid from U.S.-based NGO
Korea Times
Kim Young-jin
8/17/2010

Information can be found on the European Business Association web page.

General information here (PDF).

Registration information here (PDF).

According to the GPI web page (PDF):

Exploring new business opportunities
European trade & investment mission to North-Korea
(11 – 18 September 2010)

Rotterdam, 29 June 2010
The Democratic People’s Republic of Korea (DPRK, also known as North-Korea) finds itself at a new era of international economic cooperation, and it especially welcomes business with Europe. The DPRK is offering various products and services to export markets, while the country is also in need for many foreign products and investments.

In the current financial and economic situation, European companies face many challenges. They must cut costs, develop new products and find new markets.

In these fields, North-Korea is an interesting option.

It established several free trade zones to attract foreign investors and there are several sectors, including renewable energy, textile, shipbuilding, agro business, fishing, horticulture, logistics, mining, stone processing, restaurants and Information Technology, that can be considered for trade and investment. DPRK is competing with other Asian countries by offering skilled labour for very low monthly wages. In particular companies with production facilities in China, where the wages are rising fast, are currently investigating alternative options in North-Korea.

Do you want to explore new business opportunities for your company? From 11 to 18 September 2010, GPI Consultancy will organize again a trade & investment mission in order to investigate these business opportunities. This tour is open for business participants from all European countries. Note: in case this date is not convenient for you, other trade missions will take place in 2011.

Our previous economic missions to Pyongyang were informative and successful. The participants found the program, with tailor made business meetings and company visits, interesting and well-varied. In addition, there were many opportunities for informal meetings. A report of such a mission can be found at: www.gpic.nl/NK-report2009.pdf

During our upcoming trip in September, the annual Autumn International Trade Fair in Pyongyang will be held. A visit to this interesting trade fair will be included; participation with a booth is also possible.

Business mission September 2010: short overview
Members of our business delegation will be able to discuss trade opportunities in several areas, including light industry (e.g. textiles, garments, ceramics), agribusiness, fishing, mining, energy and Information Technology / Business Process Outsourcing. We will also receive information about investment opportunities in a number of sectors, and several projects will be offered.

Taking part in a business mission is a very informative way to explore business opportunities in DPRK in detail, and to meet new potential business partners. Participation is also useful for those European companies already doing business with DPRK, since it gives them an easy option to meet their Korean trade partners personally.

Itinerary
Saturday 11 September: Departure of European participants to Beijing (note: departure at an earlier date is possible).

Sunday 12 September: The participants will meet; informal welcome reception and dinner at a local restaurant. Introduction to the studytour.

Monday 13 September: In the morning: visa collection at the DPRK Embassy in Beijing. Receiving Air Koryo airplane tickets. Afternoon: available for individual program. Tentative: the seminar: “Doing business with DPRK” takes place. The event, with several speakers, will address various aspects of doing business in DPRK.

Tuesday 14 September: Transport from the hotel to the airport will be provided. Departure from Beijing to Pyongyang, using the national airline Air Koryo. Upon arrival, we meet representatives of the DPRK Chamber of Commerce. Transport will be arranged to the hotel. Schedules of business meetings will be handed out to the participants, after which a welcome dinner will take place.

Wednesday 15 – Friday 17 September: In the mornings, business meetings with representatives of North-Korean companies will commence in the hotel. These meetings will be arranged, on request by the participants, by the DPRK Chamber of Commerce. In the afternoons, the delegates can visit firms in and around Pyongyang from a range of sectors, including agriculture, textiles and garments, ceramics, computer software, art, animation and cartoons.

A visit to the 6th Pyongyang Autumn International Trade Fair is included. This fair takes place from 13 – 16 September and is organized by the Korea International Exhibition Corporation. In addition, we meet members of EBA (European Business Association): European business people working and living in DPRK.  There is also some time available for informal activities, such as a citytour in and around Pyongyang, a visit to an art gallery and the spectacular Arirang Massgame.

Saturday 18 September: In the morning, departure from Pyongyang to Beijing. Upon arrival, participants can take a connecting flight to Europe, or decide to spent more time in China.

(h/t CanKor)  According tot he Concern Worldwide web page, they are engaged in the following projects in the DPRK:

Sanitation
Concern has recently begun work on an EU-funded programme in Phyongan province.

This work is focusing on sanitation and waste disposal in Hoichang town. We’re building water systems and improving sewage treatment systems and latrines in the area.

Over 55,000 people will benefit from this work.

Nutrition
Another EU-funded Concern programme is focusing on nutrition. We are aiming to increase sustainable food production in Hoichang and Koksan, and in two neighbouring cooperative farms. 

To do this, we are establishing urban greenhouses, irrigation systems and goat milk processing facilities. We are also working with locals to increase their technical and management skills.

This programme will benefit over 43,000 people.

Water works
An important part of our work is focused on water, sanitation and hygiene promotion.

Between 2004 and 2009, Concern provided 252,500 people in the country with clean drinking water. We did this by renovating pump stations and providing household connections. Key innovations have included gravity-fed water systems and the use of solar powered water pumping systems.
 
In addition, 46,800 people have benefitted from improved sanitation facilities, especially in institutions such as schools, kindergartens, nurseries and the county hospital.

Forestry
In the rural communities where we work, our focus has been on halting deforestation and improving farming techniques.

We have provided 270,000 potted tree seedlings to three community-run nurseries. These potted seedlings grow quickly – in three to nine months – with undamaged root systems.

This is a major improvement on the more traditional bed-grown seedlings that were previously used. Traditional seedlings usually take one to three years to grow and often suffer from damaged roots.

As a result of the success of the potted seedlings, the Ministry of Lands and Environmental Protection is now keen to extend their use countrywide.

As part of our forestry work, we have also supplied nurseries with tools, pots and fuel.

Improving crops
With supervision from the Academy of Agricultural Research, we undertook a series of crop trials. We wanted to find out what types of crops could flourish on the lower slopes of hills and mountains.

The crops included new varieties of rice, sweet potato, sorghum, soya bean, millet, hybrid maize and ground nuts.

The trials were successful. There were positive results: the hybrid maize produced twice the normal yield; the millet produced standard yields using only half the normal amount of fertiliser. These crops are now being incorporated into the annual co-operative crop plans.

The ability to grow these crops on lower slopes will alleviate the pressure to produce crops on the higher steeper slopes.

Food production
Another EU-funded project aims at improving food production for people living on sloping land.

As part of this project, we are introducing conservation agriculture, which will increase yields, reduce soil erosion and reduce labour requirements to produce food.

We are also improving crop storage to reduce the post-harvest losses, and conducting crop trials for improved varieties of maize, winter wheat, soya bean, upland rice and potatoes.

According to the Korea Times:

The number of North Koreans with a state-approved cell phone topped 185,000 as of the end of June, operator Orascom Telecom said Thursday, as more citizens have mobile access after a recent government expansion of services.

Egypt’s Orascom, which operates the mobile operator Koryolink in partnership with the North Korean regime, said in a first-half report that services have expanded to several cities other than Pyongyang and that 184,531 subscribers had signed up as of June 30.

Sixty percent of citizens now technically have access to the services, the firm said. But the network reportedly excludes cities near the border with South Korea as authorities fear the proximity could allow cross-border communication.

The number of subscribers has increased by some 60,000 since March and almost quadrupled from the same month last year, the report said, making a significant contribution to Orascom’s first half customer base growth.

It also showed an increase in usage, with the average mobile phone user spending 16 more minutes on the phone per month in the second quarter of the year than the first.

According to the Egyptian firm, foreigners, middle-class citizens and young people are all taking advantage of the new services.

But Radio Free Asia said Wednesday that North Koreans have to pay a steep price to go mobile. Customers must pay up to the equivalent of $250 for a phone in addition to high-priced prepaid minutes, it reported, citing sources in the North.

Still, Orascom’s numbers suggest that legal cell phone use could be gaining its strongest foothold yet.

In late 2002, a limited mobile service was launched, but citizens were banned from using them again just eighteen months later.

But in a major industry surprise, Orascom was awarded a 3G license in 2008 and started commercial operations in 2009.

The firm is also completing the construction of a towering hotel in the North ahead of the 100th anniversary of the birth of the country’s late founder, Kim Il-sung, through its construction arm.

Read the full story here:
Cell phones become more popular in N. Korea
Korea Times
Kim Young-jin
8/13/2010

According to an update email from Koryo Tours:

Over the 2010 Oct 1st holiday period Koryo Tours has two group departures to Pyongyang and beyond, one short 2 night trip around the highlights of the North Korean capital city, the other a week long trip around the country, seeing not only the capital but places beyond as well, the itineraries, prices, and other details of these tours can be found at the following links;

Mass Games Mini-Break 2: Sept 30 – Oct 2
http://www.koryogroup.com/travel_NEWItinerary_8.php

China National Day Tour: Sept 30 – Oct 6/7
http://www.koryogroup.com/travel_Itinerary_20a.php

The tour is suitable for all ages and almost all nationalities (US citizens are welcome as well), discounts for children, groups, and those who have travelled with us before.  We guarantee an unforgettable experience that can only be brought to you by Koryo
Tours, the only North Korean travel specialist in the world! See for
yourself this Chinese National Day holiday!

 Contact us on info@koryogroup.com if you have any questions at all and if you’d like to sign up the simple process (we don’t need your passport at all) is explained in full detail at http://www.koryogroup.com/travel_bookingATour.php.