RoK ends Sunshine Policy

November 18th, 2010

According to Voice of America:

The South Korean Unification Ministry’s annual report calls the Sunshine Policy of peaceful engagement with North Korea a failure.

The ministry’s white paper, issued Thursday, contends a decade of cooperation, cross-border exchanges and billions of dollars in aid did not change Pyongyang’s behavior or improve the lives of North Korean citizens.

Lee Jong-joo, a ministry spokeswoman, says South Korea’s goal is to see North Korea prosper, but Seoul must respond appropriately to any provocations from Pyongyang.

Compared with the previous two administrations here, North-South relations have significantly cooled under President Lee Myung-bak.

Mr. Lee, since taking office in 2008, has insisted North Korea give up its pursuit of nuclear weapons if it wants badly needed food and other aid from Seoul.

His conservative government points to North Korea’s continued nuclear programs and this year’s sinking of a South Korean warship as examples of deception by Pyongyang.

The white paper’s publication was delayed six months to include information on the sinking of the Cheonan navy ship in March.

Pyongyang denies responsibility for the sinking. An international investigation concluded the ship was hit by a North Korean torpedo.

Park Young-Ho is a senior research fellow at the government-funded Korea Institute for National Unification. He says Mr. Lee’s administration is trying to establish a relationship based on rules with the North.

Park says this is a shift, in response to four decades of Pyongyang’s questionable attitude towards inter-Korean engagement.

The ministry’s report complains about the lack of progress on other critical issues, including reuniting separated families and the release or information about South Korean prisoners of war, as well as citizens abducted by the North’s agents.

Referring to huge payments Seoul secretly made to Pyongyang to bring about a 2000 summit of the countries’ leaders, the Unification Ministry says any future engagement must be done transparently.

The policy document does stress the importance of dialogue between Seoul and Pyongyang.

On Thursday, Pyongyang sent a message to Seoul saying it is prepared to discuss the status of a jointly run resort in the North when their Red Cross societies hold talks next week.

South Korea’s government has asked Pyongyang to release assets it seized in Seoul’s portion of the Mount Kumgang resort.

Tours to the resort were a rare source of hard currency for the impoverished North. Seoul suspended the program in 2008 when a North Korean guard shot and killed a South Korean tourist near the resort.

Read the full story here:
South Korea Formally Declares End to Sunshine Policy
Voice of America
11/18/2010

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Posted in International Aid, Korea Institute for National Unification, South Korea | Comments Closed

N.Korea faces 542,000 t grain deficit in 2010/11

November 17th, 2010

Acording to Reuters:

North Korea is facing a grain deficit of 542,000 tonnes in the 2010/11 marketing year after the government only partially provided for grain import cover, the United Nations’ food agencies said on Tuesday.

North Korea’s cereal import requirement in 2010/11 is estimated at 867,000 tonnes, while the government plans to import commercially only about 325,000 tonnes, the Food and Agriculture Organisation and the World Food Programme said .

“The mission recommended to provide some 305,000 tonnes of international food assistance to the most vulnerable population,” the FAO and WFP said in a report after a joint mission to the country.

According to the New York Times:

Despite a relatively good autumn harvest in North Korea, the reclusive communist nation remains in dire need of food aid, especially for its youngest children, pregnant women and the elderly, according to two United Nations agencies.

In a new joint report, the World Food Program and the Food and Agriculture Organization said that North Korea, even after substantial imports, would have a shortfall in staple crops — mostly rice, grains and soybeans — of more than half a million tons.

The 2010 harvest was 3 percent higher than last year, the agencies said, despite an unusually harsh winter and alternating drought and flood conditions over the summer.

But even in the best of years North Korea is unable to feed itself. Government food distribution provides only half the necessary daily calories, the report said. People are thus left to fend for themselves with small hillside plots, kitchen gardens and the buying of or bartering for food on the black market.

Aid officials have estimated that the food aid program for North Korea was 80 percent underfunded and that nearly half the country’s children are malnourished.

“I saw a lot of children already losing the battle against malnutrition,” said Josette Sheeran, executive director of the World Food Program, after a visit to North Korea earlier this month.

“Their bodies and minds are stunted, and so we really feel the need there,” she said. , Agriculture is “the main contributor to the national income” in the North, the agencies said, although its percentage of gross domestic product has declined in the past decade to 21 percent from 30 percent. A lack of foreign currency and credit, made worse by international sanctions against the regime, prevented significant imports of fertilizer and pesticides as well as tires and spare parts for farm trucks and tractors.

In remarks before the Group of 20 summit meeting in Seoul last week, U.N. Secretary General Ban Ki-moon said he had “very serious concerns about the humanitarian situation” in North Korea, “especially for the very young children.”

Mr. Ban said the South Korean president, Lee Myung-bak, had pledged to him that the South would provide humanitarian assistance to the North’s children.

…

The two U.N. agencies said their report, which was released Tuesday, was produced by teams that went to most of North Korea’s principal agricultural regions.

As the teams traveled around, the report said, “it was evident that there were no cereals in stock in the warehouses visited.”

…

Additional Information:
1. Here is a link to stories about South Korean aid provided this year. 

2. The DPRK has recently expressed skepticism over the motivations of foreign aid agencies.

3. Here is a PDF of the UN Special Report.  It is full of data and has been added to my Economic Statistics Page.

4. Here is a link to the UN report which you can read on line.

Read the full sotries here:
N.Korea faces 542,000 t grain deficit in 2010/11-UN
Reuters
11/16/2010

U.N. Urges Food Aid for North Korea
New York Times
Mark McDonald and Kevin Drew
11/17/2010

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Posted in Agriculture, Food, Public Distribiution System (PDS), South Korea, UN, UN Food and Agriculture Organization, UN World Food Program | 1 Comment »

DPRK signals strengthening central government

November 17th, 2010

According to the Choson Ilbo:

The North Korean regime is enacting sweeping changes to the law to bolster state control. A source familiar with North Korean affairs on Tuesday said four North Korean laws covering economic planning were revised in April and laws governing management of Pyongyang were revised in March.

The revised laws, which the source claims to have seen, “show the central regime’s intention to control everything, from the economy to the daily lives of the people.” North Korea has changed or enacted at least 17 different laws since November last year, just before a botched currency reform.

The revised economic planning law deletes a phrase in Article 17, which stipulated that the economy is planned “in line with methods that are presented from lower levels.” According to the source, the regime inserted the phrase when it announced timid economic reforms in July 2001 in order to give more authority over production to individual factories and businesses. “The deletion of the phrase demonstrates the intention to retrieve that authority,” the source said.

Instead, the terms “provisional figures” and “control figures” were revived after their omission in 2001. “The term ‘provisional figures’ refers to the potential output each factory sets, while ‘control figures’ represent the actual output amount assessed by the central government,” the source said. “So the terms strengthen the centralized economic planning regulations of the past.”

In Article 27, a new clause was inserted which reads, “The planning of the people’s economy is a legal task.” The source said, “This means that the partial freedom given to individual factories over production has now been taken away completely.”

The law on the management of Pyongyang, which was revised on March 30, also stresses the role of the state. Originally, maintenance and management of the capital were up to the Pyongyang City People’s Committee. But under the revision it falls into the hands of the State Planning Committee and the Cabinet. Also, all Pyongyang residents over the age of 17 have been ordered to carry their resident identification cards at all times.

Also added were articles that bind the central government to guarantee housing and the supply of necessities for the residents of Pyongyang. This shows the clear intention of the regime to take charge of housing and goods supply. “Labor and commercial laws also contain clear intentions to bolster government control,” the source said.

Kim Yong-hyun of Dongguk University, said as conditions worsened after the failed currency reform and North Korean leader Kim Jong-il’s son has been lined up to succeed his father, “the regime seems to feel that tighter internal control is better than aggressive reform. Even if North Korea is looking to partially open up through economic cooperation with China, this will be difficult to achieve with such a conservative approach.”

The Donga Ilbo also covered the story.

Read the full story here:
N.Korea Reverts to Hardline State Control
Choson Ilbo
11/17/2010

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Posted in 2012 Strong and Prosperous Nation (Kangsong Taeguk), Cabinet, Economic reform, Planning and Fiscal Affairs (KWP), Real estate | 1 Comment »

Report of Kim Jong-un’s domestic purges

November 17th, 2010

North Korea Intellectuals Solidarity has reported that Kim Jong-un is carrying out a purge of local officials to cement his ascention to power.  According to the AFP:

North Korea’s young heir apparent has launched a purge of senior party and military officials in an apparent attempt to cement his grip on power, a North Korean defectors’ group said Wednesday.

Pyongyang this month began a crackdown on senior officials suspected of corruption, starting in Musan county in the northeastern province of North Hamkyong, said the Seoul-based North Korea Intellectuals Solidarity.

A spokesman said the information came from North Korean sources whom he described as senior party officials closely connected with the investigation.

“About 15 heavyweight officials, many of them military, are being investigated for turning a blind eye to people fleeing the country and being involved in smuggling activities,” the spokesman told AFP.

He said the investigation was being led by Kim Jong-Un, youngest son and chosen successor to leader Kim Jong-Il.

The crackdown, which would be expanded into a nationwide campaign, was a “politically-motivated purge” aimed at replacing longstanding military members with younger officials more loyal to Jong-Un, said the spokesman.

“This is a purge for generational change… senior officials are trembling with fear because they don’t know where heads are going to roll,” he said.

Seoul’s intelligence agency declined to comment on the report.

The Kim dynasty, which has ruled the communist country with an iron fist for more than six decades, has long used purges to maintain its grip on power.

Founding president Kim Il-Sung reportedly executed hundreds of dissidents during the early years of his leadership and often persecuted senior officials showing signs of rebelliousness.

Kim Jong-Il, after taking over from his father, is known to have executed several hundred soldiers for showing “suspicious movements”, Wednesday’s Chosun Ilbo newspaper reported.

Jong-Un, believed to be aged 27, was made a general and given powerful party posts at the country’s largest political gathering for 30 years in September.

Kim Jong-Il, 68, is believed to be accelerating preparations for another hereditary power transfer due to worsening health after he suffered a stroke in 2008.

Additional Information
1. The Korea Times also reported this story.

2. Previously the Daily NK reported a reorganization of the DPRK’s external patronage networks.

Read the full story here:
N.Korea heir apparent purges officials: defectors
AFP
11/17/2010

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Posted in Kim Jong Un, Military, Political economy | Comments Closed

The DPRK’s Damn Dams

November 15th, 2010

Kumya Dam
A dam is being constructed in Kumya County, South Hamgyong Province, to provide electrical power. Kim Jong-il last visited in August 4, 2010. It is just one of several dams under currently under construction in the DPRK.

Here is a satellite image of the Kumya dam’s construction (Google Earth: 11/25/2008,  39.574232°, 127.104736°)

This new reservoir will flood the locations of three villages (리): Ryongnam-ri (룡남리), Ryongsang-ri (룡상리), and Ryongchon-ri (룡천리).

Estimates of the reservoir size are made by me, but it is fairly obvious where the North Korean engineers expect the reservoir to flood because they have already relocated the villages from their former locations in the flood zone.

Here are the former locations of Ryongchon-ri, Ryongsong-ri, and Ryongnam-ri:

All of the homes, buildings, and factories have been moved (lock, stock, and barrel) to another location. I am not sure where.

Imnam Reservoir
The dislocation caused by the Kumya Dam, however, pails in comparison to the dislocation caused by the creation of the Imnam Reservoir (임남저수지) in Changdo County (창도군).

The Imnam Reservoir bisected the county and flooded nearly half of it, including its capital city and at least 14 villages (리): Jisok-ri (지석리), Pankyo-ri (판교리), Sinsong-ri (신성리), Songdo-ri (성도리), Kisong-ri (기성리), Tangsan-ri (당산리), Tohwa-ri (도화리), Tumok-ri (두목리), Myongchon-ri (면천리), Imnam-ri (임남리), Taejong-ri (대정리), Jon-ri (전리), Onpae-ri (언패리), and Cholpaek-ri (철벽리).

Below is a picture of the Imnam Reservoir along with locations of the various population centers that were flooded.

It appears that the North Koreans constructed a new county capital north of the reservior at 38.652243°, 127.711817° (although this city is not on any maps of North Korea that I have seen). This new city, however, has itself seen severe flood damage (caused by excessive rainfall).  Some of this devastation can bee seen on Google Earth, but the full extent of it is not available with current imagery.

The poor people of Changdo county can’t seem to catch a break.

Lake Paekma
Lake Paekma lies at the head of the Paekma-Cholsan Waterway in Phihyon County ( 40.082356°, 124.695685°).  Two villages were lost to the construction of this reservoir: Sangko-ri(상고리) and Ryongun-ri(룡운리).  In the images below you can see the locations of the remnants of these villages as well as their disappearance under the waters.

Military losses to dam construction
Civilians are not the only ones to have suffered dislocation at the hands of the DPRK’s energy policy. The airforce lost a couple of facilities as well.

Thaechon County:
The North Korean air force lost one training facility to a  new dam on the Taeryong River (대령강) in Thaechon County ( 39.865138°, 125.562139°).  Here and here are the before and after pictures.

Tongrim County:
And most recently, the an airfield and heliport in Tongrim County ( 39.918570°, 124.840542°) appears to be in danger of flooding as a result of the rising Maepong Reservoir (매봉저수지)–a lake on which “someone” has a very nice house:

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Posted in Dams/hydro, Electricity, Energy, Google Earth, Military, Uncategorized | 3 Comments »

MacArthur Foundation working papers on DPRK collapse

November 15th, 2010

Here is the text from the MacArthur Foundation:

North Korean Contingency and Prospects of China’s Military Intervention (PDF)
Park Changhee considers whether China would intervene with its military in the event of breakdown. A number of contingencies could occur in North Korea which could pose a direct threat to Chinese security and, Park argues, the prospect that the reunification of North and South Korea could result in a unified Korea as a U.S. ally means that China’s security is at stake even without direct threats in the form of refugee flows or instability among China’s Korean community. He concludes that given what is at stake on the peninsula for China, South Korea should expect and plan for Chinese involvement in a regime crisis in North Korea.

A Review of the Legacies associated with a Sudden Change in North Korea (PDF)
Shin Beomchul reviews legal issues surrounding regime collapse and reunification. Regime breakdown and reunification pose challenges in light of international law and South Korean domestic law. The latter especially could be problematic as South Korea will have to determine how to integrate the civil, criminal, and public legal codes of the two countries, and could also have to draft and enact a new constitution.

The Economic Impacts of a North Korean Collapse (PDF)
Deok Ryong Yoon considers the economic consequences of regime collapse. Regime collapse followed by rapid reunification could shock South Korea’s economy in the short term, producing a capital outflow, devaluation of the won, and asset market crashes. Over the longer term, South Korea will have to manage the unification of labor markets and currencies, and will have to cope with the potentially steep administrative costs of national reunification.

Here is a link to the Ilmin International Relations Institute (IIRI) which produced the papers.

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Posted in Economic reform | 2 Comments »

DPRK re-freezes Kumgang facilities

November 15th, 2010

According to the Donga Ilbo:

North Korea has re-frozen and re-seized South Korean facilities at the Mount Kumgang resort that were reopened in the latest reunions of inter-Korean separated families.

An official at the South Korean Unification Ministry said Sunday that the North attached “frozen” labels on dining and container-type lodging facilities and a vehicle maintenance plant at the resort owned by Hyundai Asan Corp. of South Korea.

Pyongyang will also likely attach “seized” labels on a family reunion center owned by the South Korean government where the reunions took place.

You can read about the family reunions here.

Read the full story here:
NK Re-freezes S. Korean Facilities at Mount Kumgang
Donga Ilbo
11/15/2010

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Posted in Mt. Kumgang Tourist Special Zone, South Korea, Special Economic Zones (Established before 2013), Tourism | Comments Closed

DPRK manufacturing mobile phones

November 15th, 2010

According to Bernama:

North Korea has started to mass-produce cellular phones while trying to customize their operating systems to satisfy local needs, Yonhap news agency reported, citing a pro-Pyongyang newspaper as saying.

The report by Chosun Sinbo, run by a group of pro-North Korea residents in Tokyo and monitored in Seoul, came after Cairo-based Orascom Telecom Holding announced earlier this month that its mobile business in the communist state is rapidly expanding.

The number of mobile phone subscribers has at least quadrupled over the period of one year in North Korea, according to Orascom. The expansion doesn’t mean that the regime has eased its rules aimed at restricting the flow of information in and out of the country.

Chosun Sinbo said Monday in its report from Pyongyang that a firm known as Checom Technology Joint Venture Company has set up a “flow manufacturing process and is producing hundreds of high-performance cellular phones each day.”

Checom is a Pyongyang-based electronics and communications company, according to the Web site of Songsang Company, a Dandong, China-based firm that trades with North Korea.

Flow manufacturing is a build-to-order process aimed at minimizing inventory.

“Related sectors are testing new devices and actively working on a project aimed at modifying the operating software to suit the needs of local users,” Chosun Sinbo said.

“Central engineering rooms for mobile communications are also pushing a program to develop software for their main machines to meet the domestic environment.”

The report added that a video calling service has also been made available while “hundreds of base stations” that transmit signals have been set up across the country.

Orascom, which operates jointly with the local Koryolink, had said in its earnings report that video calling “resulted in a high level of demand, especially from the youth segment.”

North Korea first launched a mobile phone service in Pyongyang in November 2002, but banned it after a deadly explosion in the northern Ryongchon train station in April 2004, possibly out of concern that it could be used in a plot against the regime.

In 2008, the country reversed its policy and introduced a 3G mobile phone network in the joint venture with Orascom.

However, the overall “mobile penetration” remains at 1 percent in the country that has a per-capita GDP of US$1,900 and a population of 22.8 million, according to Orascom.

Read the full story here:
North Korea begins mass-producing cell phones to meet local demands
Bernama (Malaysia)
11/15/2010

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Posted in Cell phones, Checom Technology Joint Venture Company, Communications, Light Industry, Manufacturing, Orascom Telecom Holding | 1 Comment »

DPRK defectors to South reaches 20,000

November 15th, 2010

According to the AP:

The number of North Koreans defecting to South Korea has surged in recent years because of economic suffering in the North, with more than 10,000 defections over the past three years, South Korea’s Unification Ministry said Monday.

About as many North Koreans have defected to the South since the end of 2007 as the number who had fled over the entire previous period since the 1950-53 Korean War ended with an armistice, the ministry said in a statement. The overall total stands now at 20,050.

Ministry official Han Dong-ki said the rise in defections reflects North Korea’s worsening economy.

North Korea has relied on outside food aid since natural disasters and mismanagement wrecked its economy in the mid-1990s, when an estimated 2 million people died of famine. The North’s economic troubles are thought to have worsened following a botched attempt at currency reform last year.

Most defectors reach South Korea after crossing over a shared border with China, where activists say tens of thousands of North Koreans are hiding. About 2,500 defectors arrived in the South in 2007, and the number has risen each year since. More than 2,900 defected last year, the ministry statement said.

Many North Korean defectors have trouble adjusting to their new lives in the South, which is one of Asia’s richest countries. They report job discrimination and difficulty finding work, and say they aren’t being paid fairly or getting promotions.

South Korea runs resettlement centers where North Korean asylum-seekers take a three-month course that teaches them computer skills and such everyday lessons as how to use ATMs and shop in supermarkets. South Korean intelligence officials typically question defectors for about three months before they are sent to the centers.

The two Koreas share a common language, but there are often differences in word meanings after more than a half-century of division following the war. The South is also awash in Western influences compared to the isolated North.

The Unification Ministry said it is working to help defectors resettle in the South more smoothly, offering greater tax reduction and medical benefits.

Defectors are a point of friction between North and South Korea. Two North Korean army majors were sentenced to prison in South Korea earlier this year for plotting to assassinate a high-profile defector. The defector later died of heart failure, and police said there was no connection between his death and the plot.

North Korea denies involvement, accusing South Korea of staging the arrests to stoke public anger against the North.

The defector, Hwang Jang-yop, was one of the North’s most powerful officials when he fled in 1997. He was chief architect of North Korea’s guiding “juche” philosophy of self-reliance and had tutored North Korea’s supreme leader, Kim Jong Il, on the ideology.

UPDATE 1: The New York Times also published a story on this trend.

UPDATE 2: The Economist offers coverage.

Read the full story here:
Number of NKorean defectors to SKorea tops 20,000
AP (via Washington Post)
Kim Hyung-Jin
11/15/2010

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Posted in Emigration, Emigration statistics, RoK Ministry of Unification, Statistics | Comments Closed

6 new industrial parks worth 44 billion Won for construction industry

November 13th, 2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-11-13-1
11/13/2010

The construction cost for six inter-Korean cooperative industrial parks like the Kaesong Industrial Complex would carry a construction bill of 44 billion Won. According to “Analysis of Examples of Inter-Korean Cooperation in the Construction Field and the Direction of Industrial Park Development within North Korea,” a recent report by the Construction Economy Research Institute of Korea, “Promotion of the North Korean construction market by the [South Korean] construction industry would not only increase the limited demand for the South Korean construction [field], but will also provide new growth to our economy.”

According to the report, there has been almost no cooperative construction project within the construction field since 1988. On the other hand, tourism, industrial parks, physical fitness and religious projects have provided opportunities for construction companies. These projects generally call for construction equipment, materials, technicians and designs from South Korea, and land, labor, aggregate, etc. from the North. If six industrial parks on the same scale as the KIC were to be built, it would cost 43.09 billion Won. Of this, 4.07 billion won would cover government costs, while the actual cost of construction would be 39.02 billion won.

If the KIC, currently undergoing the first phase of construction, were to complete all three phases of the original plan, the 19.9 square-kilometer complex would house 2,000 businesses. The research institute calls for the completion of phases 2 and 3 in the KIC, as well as the construction of industrial parks at Rajin-Sonbong, Sinuiju, Haeju, Nampo, and Wonsan.

Rajin-Sonbong and Sinuiju are both ‘Free Economic Trade Zones’, and as special administrative zones, they offer large-scale industrial plots in an effort to attract foreign capital. In addition, it was agreed at the second inter-Korean summit, in October 2007, that Haeju would be developed. Furthermore, a light-industrial complex in Nampo, on the West Sea, and a heavy and chemical industry in Wonsan have been established.

The industrial zones, however, constitute only part of the construction demand. Roads and rails connecting the complexes, port facilities, power generation plants, cities to support production workers, and other derivative projects would also need to be constructed. In other words, the building of an industrial zone would lead to significant peripheral construction demand, as well.

Assuming that inter-Korean tensions were eased and North Korea decided to open itself up to the South, if construction on the six industrial zones could begin by the middle of next year, it is expected that they could all be completed by 2021. In addition, the construction and operation of the six zones could provide the impetus for quickly improving the North Korean economy, while also boosting the importance of South Korea to the North’s economy.

In order to see this accomplished, the research institute found that the government needs to boost activity in the KIC; expand the distribution network between the KIC, Kimpo, and Kangwa; guarantee free management authority in the KIC; iron out customs and transportation procedures; ensure a steady supply of North Korean laborers; and strengthen the ties between the KIC and North Korea’s domestic economy.

If, in the future, North Korea is to open its doors to cooperation, it is expected that foreign companies will also participate. Therefore, when considering long-term profits, it is necessary to spur interest in North Korea’s construction market. The research institute suggested that it was also necessary to construct a training center to teach North Korean construction workers the technical skills needed to ensure maximum potential.

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Posted in Construction, Economic reform, Foreign direct investment, Institute for Far Eastern Studies, Kaesong Industrial Complex (KIC), Rason Economic and Trade Zone (Rajin-Sonbong), South Korea, Special Economic Zones (Established before 2013) | Comments Closed

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