North Korean Economy Watch

According to Arirang News:

It has emerged that five North Korean defectors entered the United States as refugees during the months of October and November.

A U.S. State Department report published on Monday shows the five individuals were admitted into the states of Colorado, Illinois and Utah.

Four North Korean refugees were admitted into the U.S in July.

The number of North Korean refugees allowed into the U.S. peaked in 2008 at 37 and has been on a downslide since then, recording just eight last year.

Since 2006, when North Korean nationals were first granted refugee status in the U.S., a total of one-hundred-91 have started new lives in the United States.

Read the full story here:
Five refugees from N. Korea entered U.S. in Oct. & Nov.: U.S. State Dept.
Arirang News
2015-12-8

By Benjamin Katzeff Silberstein 

A lot of things are going on in North Korean agriculture and food production these days. First, there was the drought. I haven’t seen any unequivocal assessments showing with certainty that the damage wasn’t as bad as feared, but both outside and regime sources certainly seem to be indicating this. Then, a few weeks ago, a regime source said that food production had even increased this year, thanks to management reforms in agriculture. And now, international relief agencies are reporting that the nearly yearly flooding has hit the country once again, damaging food production.

How can one reconcile all these events?

It may of course be that the earlier assessment published in Tongil Sinbo, with an optimistic forecast of food production, took the coming flooding into account and assumed that food production, overall, would still be up. Crop damage so far seems far smaller than it has been in previous years. 4,000 hectares have been reported as damaged this year, while the equivalent figure in 2013 was 13,300.

It may also be that the Tongil Sinbo claims were premature, but it is difficult to see why a North Korean regime source would claim production increases without taking potential damage from torrential rains into account. After all, they keep on coming year after year. Still, it seems risky to claim success for agricultural production before the August rains. North Korean publication routines are too murky to tell exactly how it is decided what information should be released and when.

It could also be that regions were agricultural reforms have been implemented have seen harvests increase, while others have been hit worse by both the drought and the floods. Reforms have so far been implemented on a local experimental basis and it could be that the success has been so great in localities where they have been tried that production has increased overall, despite both the flooding and the drought.

Hopefully, some of the confusion will clear as more information becomes available about the flooding damage. Natural disasters, after all, tend to increase the information flow from North Korea somewhat through the extended work of relief agencies.

By Benjamin Katzeff Silberstein

Just like most summers for the past few years, North Korea has once again been hit by flooding. According to the International Red Cross (IFRC):

The Democratic People’s Republic of  Korea (DPRK) is experiencing flooding associated with seasonal rains, hitting areas like Hwanghae and the south and north Hamgyong provinces since early August. According to the State Committee on Emergency and Disaster Management (SCEDM), the Government of  DPRK and DPRK Red Cross Society, 3,455 people were affected, 21 were reported dead while 9 others remain missing. The floods have damaged or destroyed 968 houses and are expected to worsen in the coming days as the rainy season continues.

So far, the damage seems far smaller than the floods of both 2012 and 2013. For example, the number of people “affected” is reported as 3,455 people and 968 houses have been destroyed (see above quote), but in 2013, about 4,000 families lost their homes and 50,000 people were displaced. The number of deaths is also far smaller than in 2013 (33) and 2012 (169).

The South Korean government is thinking about stepping in. Korea Herald reports:

The Unification Ministry said that the government is reviewing whether to help North Korea cope with the flood.

“We are checking the damage from the flood in North Korea, based on data by the weather agency and international organizations,” Jeong Joon-hee, the ministry’s spokesman, told a regular press briefing.

Jeong said that the government would take into account various factors, including the level of the damage and the North’s reaction before making its decision.

Either the Red Cross and the UN Office for Coordination of Humanitarian Affairs (OCHA) are using different assessment methods, or the counts have been upped in between August 10th and 12th. Of course, it is also possible that more rain has fallen and increased the damage. The OCHA reported in their “Snapshot” document for the period between August 4th and 10th that “over 698 houses” had been destroyed while the Red Cross gave the figure 968.

The UPI also reports on the flooding, citing the OCHA figures:

North Korea is recovering from torrential rains that caused 21 deaths between Aug. 1 and 5, according to the U.N. Office for the Coordination of Humanitarian Affairs.

The OCHA report published Monday said rains and subsequent flooding in South Hwanghae, South Hamgyong and North Hamgyong provinces affected 3,400 people.

The U.N. said 21 have died and nine are still missing. The floods destroyed 690 houses and brought down public infrastructure, including roads, bridges and dams.

Crops also were seriously damaged – 4,000 hectares in total, according to the report.

The U.N. agency said the North Korean Red Cross is closely cooperating with local authorities to assess the scope of the damage. The International Federation of Red Cross and Red Crescent Societies is working with Pyongyang’s Red Cross to distribute relief aid to seven communities across the three provinces.

Rodong Sinmun also reports on the flood damage today, saying that the previously purged but resurrected Premier Pak Pong-ju has surveyed the flooding damage:

DPRK Premier Pak Pong Ju made a field survey of the flood damage in South Hwanghae Province.

Torrential rain and tsunami hit the province early this month, leaving breakwaters partially destroyed and dwelling houses, roads, railways and bridges inundated and damaged.

Farmland in some areas was inundated and washed away, making it hard to expect any harvest.

Going round several afflicted areas in Haeju City, Pyoksong and Sinwon counties, he learned about the damage there.

The consultative meeting convened on the spot discussed the issue of conducting the work for recovering from damage, directing primary efforts to bringing the living of the people in the afflicted areas to normal.

As the summer moves on, more is sure to follow.

(UPDATE): Here is the report from KCNA (2015-8-12):

Flood Damage in DPRK

Pyongyang, August 12, 2015 19:51 KST (KCNA) — South Hwanghae Province of the DPRK was hit hard by flood.

Early this month, the province witnessed downpour and tidal waves due to the seasonal rainy front that swept over the whole country.

Much rainfall was registered in all parts of the province. In particular, rainfall of 397 millimeters was observed in Pyoksong County between 18:00 of August 4 and 12:00 of August 5, 205 mm in Haeju City, 152 mm in Ongjin County and 125 mm in Sinwon County.

The downpour left more than 10 people dead, hundreds of dwelling houses destroyed and more than 1 000 hectares of arable land inundated or washed away.

Meanwhile, tidal waves left the dykes partially destroyed and roads, railways and bridges inundated or ruined.

At present servicepersons and inhabitants in the afflicted areas are working hard to clear away the flood damage.

(UPDATE): Radio Free Asia (2015-8-14) reports that river barriers ordered built by the government have come to exacerbate the flooding damage:

River barriers that North Korean authorities built to help irrigate crops affected by a recent drought may have contributed to the destruction caused by floods in certain parts of the country, sources inside the isolated nation said.

The barriers constructed by authorities in spring blocked the flow of water through gorges, so that torrential rains which fell in parts of the country at a high elevation in early August overflowed, destroying farmland and houses, said a source in North Hamgyong province, one of the affected areas.

“Despite strong opinions that the barriers to enable irrigation should be eliminated to prevent flood damage, nobody took any action,” he said. “Since the barriers were set up under [North Korean leader] Kim Jong Un’s order, no executive order could bring them down.”

Before the river barriers were built, some North Koreans pointed out that building them could cause greater flood damage, he said, but the warning fell on deaf ears.

The city of Hoeryong in North Hamgying province experienced downpours from late July to early August, and authorities declared Hwadea, Kiljou, and Myongchon counties flood-affected areas, he said.

They also declared the city of Tanchon and Heocheon and Riwon counties in South Hamgyong province flood-affected areas, he said.

The drought damage has become worse because of Kim Jong Un’s inflexible instructions, the source added.

Read the full story here:

North Korean flood Damage Made Worse by River Barriers

Sung-hui Moon

Radio Free Asia

2015-8-14

Aram Pan visited the new Golden Triangle Bank building (it has recently moved offices) in Rason and took some interesting pictures of the interior.

However, my favorite is probably the giant pile of new US $100 notes:

That looks like $1.8 million to me. When was the last time you saw that much cash sitting on a counter?

Mr. Pan also shows that the Golden Triangle Bank has established a pre-pay card (similar to the Narae Card or the Koryo Bank Card). I say “pre-pay card” (not debit card) because a debit card is linked to a personal account whereas a pre-pay card is drawn from a bank-owned account. I do not suspect that card holders have actually opened personal accounts at these banks but have instead topped off a card that draws from a bank-owned account (In other words, I don’t think it is easy to get your cash back, and the bank earns the float from investing the currency while the card holder carries a positive balance).

Mr. Pan claims to have put RMB25 into his account, which can be spent in the Rason SEZ, but not outside of it.

Here is a closeup of the front and back of the card:

Here is a translation of the card:

“Seon Bong” is how a South Korean translates “Sonbong”.

The card appears to be equipped with an EMV chip. I am not sure how that works.

UPDATE (2015-8-17): The Daily Mail did a follow up piece here.

UPDATE 7 (2016-8-18): I recently received a KOTRA report on the DPRK’s international trade in 2015. You can download the report here. Below are two images that show North Korea’s 2015 trade in relation to previous years and a second of North Korea’s top ten trading partners in 2015:

UPDATE 6 (2016-6-21): N. Korea’s economic reliance on China deepens in 2015. According to Yonhap:

North Korea’s economic reliance on China deepened last year as prolonged international sanctions and frozen economic exchanges with South Korea further jolted its moribund economy, a report showed Tuesday.

Bilateral trade between North Korea and China was estimated at US$5.71 billion in 2015, accounting for 91.3 percent of the North’s total trade, according to Hyundai Research Institute.

The amount jumped from $488 million in 2000, with the ratio more than tripling from 24.8 percent, the Seoul-based think tank said.

“North Korea’s trade is relying more on China in the wake of continued international sanctions and soured inter-Korean relations,” the institute said.

China’s share in North Korea’s exports had skyrocketed from 6.7 percent in 2000 to 92.1 percent in 2015, with the amount rising from $40 million to $2.48 billion.

Imports from China rose from $450 million in 2000 to $2.95 billion in 2015, with the reliance ratio increasing from 31.9 percent to 77.6 percent.

The share of raw materials in North Korea’s export to China rose from 37.9 percent in 2000 to 53.3 percent in 2015, while the share of raw materials in the North’s imports from China tumbled from 28 percent to 1.5 percent during the period.

Sales of mineral resources, such as iron ore and coal, were the biggest source of hard currency for the reclusive state, while Chinese electronics topped the list of imports last year, the institute said.

“North Korea have expanded imports of intermediate goods and sold them as finished goods,” said Lee Yong-hwa, a researcher at Hyundai Research Institute. “North Korea’s income level is believed to have improved as it has expanded imports of Chinese consumer goods and capital goods.”

Pyongyang’s reliance on China is expected to further rise this year as it was slapped with additional U.N. sanctions in early March following its fourth nuclear test and long range missile launch earlier this year.

The U.N. sanctions ban exports of mineral resources, including coal, iron, gold and rare earth metals, from North Korea, if the proceeds are used for its nuclear or arms program.

UPDATE 5 (2016-5-23): According to UPI:

North Korea’s trade with China shrank for the first time in six years, according to a South Korean government think tank.

According to a report from the Korea Institute for International Economic Policy, bilateral trade stood at $5.43 billion in 2015, down by 14.7 percent from 2014.

North Korea exports to China were estimated to total $2.95 billion, a decrease of 16.4 percent, and imports, excluding crude oil, were reported at $2.49 billion, a 12.6 percent decrease from 2014, local newspaper Kyunghyang Shinmun reported.

…

But the data from 2015 indicates North Korea was hit hard by a collapse in coal and iron ore prices in the commodities markets, according to the report.

North Korea iron ore initially remained competitive in the Chinese market, staying at a price that was 73 percent of market rates, but became less of a bargain in 2015 when it was priced at 84 percent of market rates, which also dropped precipitously last year.

The report stated China’s economic slowdown and new environmental policies targeting the coal industry played a role in the decline in North Korea coal and other exports, local newspaper Maeil Business reported.

In 2015, commodity prices dropped by more than 20 percent for coal and about 31 percent for iron ore.

Note that these trade data were recorded before new sanctions were implemented in 2016.

Read the full story here:
North Korea trade with China shrinks 15 percent
UPI
2016-5-23

UPDATE 4 (2016-2-1): DPRK – China trade is down. According to Yonhap:

North Korea’s trade with China dipped nearly 15 percent last year apparently due to a chilly bilateral relationship between the two neighboring countries, a report showed Sunday.

The North-China trade volume reached US$4.9 billion in the January-November period, down 14.8 percent from $5.76 billion a year earlier, marking the first double-digit on-year drop since 2000, according to a report by state-run think tank Korea Development Institute (KDI).

Pyongyang’s shipments to its neighbor sank 12.3 percent to $2.28 billion over the cited period, while imports from China plunged 16.8 percent to $2.63 billion.

The trade between the allies has risen an average of 22.4 percent between 2000 and 2014. Only in 2009 and 2014 did it shrink on-year.

The KDI report attributed the sharp decline to sluggish raw material exports, as shipments of anthracite coal and iron ore fell 6.3 percent and 68.5 percent, respectively.

“The chilly relationship between Pyongyang and Beijing and a slowdown in the Chinese economy seemed to affect North Korea’s sluggish trade with China,” said the report. “North Korean leader Kim Jong-un’s New Year message, which called for using home-made products and rejecting foreign-made ones, also had some influence on the downbeat trend.”

The alliance between Pyongyang and Beijing had been described as being “forged in blood,” since China fought alongside North Korea in the 1950-53 Korean War. China is the only country that provides crude oil to the reclusive North.

But their political relations have become strained since 2013, partly because of the North’s defiant pursuit of nuclear weapons and a series of purges of pro-Chinese officials in North Korea.

For 2016, the KDI report noted that there is a higher possibility that bilateral trade will contract further following Pyongyang’s nuclear tests on Jan. 6, as the global community including the United Nations is set to impose sanctions against the reclusive regime.

“North Korean trade will be dragged down by international economic sanctions sparked by the North’s latest nuclear test in the first half of this year,” the KDI said. ” North Korea-China trade has shrank to some extent, following sanctions by the U.N.”

Output at the Kaesong Industrial Complex is up in 2015. According to the Yonhap (via Korea Herald):

Production of companies at the inter-Korean industrial complex in North Korea exceeded $500 million last year for the first time since its opening in 2004, the government said Sunday.

According to the Unification Ministry, a total of 124 South Korean factories operating in the complex produced $515.49 million worth of goods in the first 11 months of last year, up more than 20 percent from the previous year and the highest yearly output even excluding the December tally.

The figure for the entire year is estimated to reach $560 million, given that their monthly production averaged around $50 million in the year, it said.

“The Gaeseong Industrial Complex managed to grow stably, recording more than a 20 percent increase in total output despite North Korea’s shelling in August across the border and various other incidents in and out of the country,” a ministry official said.

There were 54,763 North Korean workers and 803 South Korean managers at the factories in the industrial park located in the North’s border city of Gaeseong as of November.

Here is additional information in the JoongAng Ilbo.

Read the full story here:
N Korea’s trade with China contracts in 2015
Yonhap
Kim Boram
2016-1-31

UPDATE 3 (2016-1-12): Arirang News reports that DPRK-China Trade is off 15% in 2015 to $4.9 billion. China’s exports and imports to North Korea fell 17% and 13%. North Korea’s exports of iron ore to China fell 68%, while shipments of anthracite fell 6.3%.

UPDATE 2 (2015-8-17): Marcus Noland weighs in on the H1 2015 KDI report.

UPDATE 1 (2015-8-11): KDI reports that DPRK-China trade continues to fall in 2015. According to Yonhap:

North Korea’s trade with China plunged more than 10 percent in the first five months of 2015 due mainly to a drop in raw material prices, a report showed Tuesday.

North Korea’s outbound shipments to its neighbor sank 10.3 percent on-year to US$954 million in the January-May period, while imports plunged 14.3 percent to $1.09 billion, according to the report by the Korea Development Institute (KDI).

“Bilateral trade was down 12.5 percent compared to the year before with exports of anthracite coal and iron ore affecting overall numbers,” KDI said. “Compared to the year before, when trade fell 4.8 percent, this year’s drop is more pronounced.”

The think tank based its assessment on data provided by the International Monetary Fund, the United Nations and the Korea International Trade Association.

North Korea’s exports of coal to China declined 1.6 percent in dollar terms, with the number for iron ore nosediving 70.3 percent.

Falling exports and a subsequent drop in earnings were probably felt by Pyongyang, which will have to consider other means of generating hard currency.

Compared to 2013, when the North’s exports of coal reached its peak, this year’s numbers represent a 24.6 percent drop.

“The contraction is noteworthy because the North actually diversified the places it shipped coal to in China,” the KDI said.

In regards to iron ore, exports declined, both in terms of volume and prices, with the weakening of China’s steel industry directly impacting trade. Exports stood at 600,000 tons, down from 1.11 million tons, with the value standing at $22.96 million.

The KDI said Pyongyang’s No. 1 import item from its neighbor was filament yarn, followed by cargo trucks and petroleum products. Imports of yarn and petroleum products were down, while shipments of cargo trucks rose.

In bold above I have highlighted what appears to be bad news for North Korean coal exporters. I was surprised to see this because an earlier report by Bloomberg indicated that North Korean coal exports to China had increased by 25% this year (over 2014).  However, it is worth pointing out that the Bloomberg report focuses on the actual quantity of coal crossing the border and KDI  reports on the value of the coal crossing the border. The only way both reports can be true is if the North Koreans are again taking lower prices from the Chinese for their coal compared to their international competitors. Another explanation for the conflicting reports could arise if there was a significant difference between Chinese customs data (Bloomberg) and that used by the International Monetary Fund, the United Nations and the Korea International Trade Association (KDI). I don’t have enough experience with these data sets to know how consistent they are.

Benjamin Katzeff Silberstein offers a link to the report here (in Korean only).

Read the full story here:
N. Korea’s trade with China tumbles this year: KDI
Yonhap
2015-8-11

ORIGINAL POST (2015-4-26): Yonhap reports that DPRK – China trade has fallen in the first quarter of 2015:

Trade between North Korea and China, its economic lifeline, slipped 13.4 percent on-year in the first three months of this year amid frayed bilateral ties, data showed Sunday.

Bilateral trade volume fell to US$1.1 billion in the January-March period, compared with $1.27 billion for the same period last year, the Beijing unit of South’s Korea Trade and Investment Promotion Agency (KOTRA) said, citing Chinese customs data.

China is North Korea’s top economic benefactor, but its political ties with Pyongyang have been strained since the North’s third nuclear test in February 2013.

No crude oil was officially sent to North Korea from China for all of last year.

China’s shipments of crude oil to North Korea were also absent during the first quarter of this year.

South Korean diplomatic sources in Beijing, however, have cautioned against reading too much into the official Chinese trade figures because China has provided crude oil to North Korea in the form of grant aid in the past and such shipments were not recorded on paper.

Read the full story here:
N. Korea’s trade with China dips 13.4 pct in Q1
Yonhap
2015-4-26

According to NK News:

A Chinese-state affiliated and Singaporean investment group, the latter of which is allegedly directly connected to the DPRK, is calling for large-scale investment in 12 projects spanning nearly every major sector in North Korea, from transport to mining to internet and cable television development.

The ambitious plans, outlined in an August 2 press release from China Railway Investments Group, welcome foreign participation in 12 “world class opportunities” in North Korea.

“The Democratic People’s Republic of Korea (DPRK) through its window company Daegian Pte Limited of Singapore in cooperation with China Railway Investments Group Ltd (CRIG) has established a joint venture investment company in Hong Kong,” the press release says.

The joint venture, called Heuimang Investments Group Limited, will be capable of providing a “direct and exclusive conduit to the highest levels of decision making in the government of the DPRK,” the release continues. “Only the most significant of opportunities will be available through this channel which can only be accessed through Heuimang/Han Wang.”

Here is a PDF of the press release posted to the China Railway Investment Group Web Page.

Here is the full text:

韩旺投资集团有限公司
Heuimang Investments Group Ltd (In Chinese pinyin Han Wang Touzi Jituan Youxian Gongsi)
公告 Announcement:
发布时间：2015-8-2

朝鲜民主人民共和国（朝鲜）致力于大力推进其经济发展，并欢迎外国投资参与该国的世界级的机会, 促进经济发展.
The DPRK is committed to progressing its economic development, and welcomes the participation of foreign companies in investing in world class opportunities in the country.

朝鲜欢迎中国的公司投资参与. 朝鲜通过它在新加坡注册的窗口公司Daegian 私人有限公司, 与中铁多经投资集团有限公司合作在香港建立了融投资平台—招商公司.
The Democratic People’s Republic of Korea (DPRK) through its window company Daegian Pte Limited of Singapore in cooperation with China Railway Investments Group Ltd (CRIG) has established a joint venture investment company in Hong Kong.

朝鲜政府已正式批准Daegian 与中铁多经投资集团有限公司(CRIG)合作成立旺投资集团有限公司.
The DPRK Government has formally approved the joint venture between Daegian and CRIG and their joint venture company called Heuimang (or Han Wang in Pinyin Chinese) Investments Group Limited.

Daegian和韩旺是朝鲜”走出去“、”引进来“的直接和专属通道，是朝鲜政府最高等决策层的直属机构. 只有最显著的机遇将可通过这一渠道，而且只能通过韩旺办理.
Daegian provides a discrete, direct and exclusive conduit to the highest levels of decision making in the government of the DPRK. Only the most significant of opportunities will be available through this channel which can only be accessed through Heuimang/Han Wang.

朝鲜决定与中方共同搭建经贸等合作更方便更快捷的工作平台，利用香港的优势宣传推广、项目招商、商务服务，支援朝鲜建设。韩旺将在中朝两国间发挥经贸合作的强大和充满活力的桥梁作用.
Heuimang/Han Wang will concentrate on creating a strong and robust platform for economic and trade co-operation between the countries. It will also take advantage of the flexibility afforded to a commercial entity registered in Hong Kong.

各方股东及合作公司将依照国际法和国际惯例运作，在透明的基础上配套韩旺发展.
All parties to this joint venture are committed to supporting Heuimang/Han Wang in operating on a transparent basis within international laws and practices.

其主要目标是优势互补、资源共享、利益均沾、合作共赢、商业运作.
The primary objective is commercial engagement through mutual cooperation for shared benefit.

里程碑:
Milestones:

2015年1月29日: 中铁和Daegian 签订了框架合作协议, 其中确定了互惠和显著利于中国和朝鲜，尤其是基础设施发展的若干项目. 通过韩旺, 中铁致力于引领中国企业组成的联合体参加朝鲜民主人民共和国的经济和基础设施发展.
January 29, 2015: CRIG and Daegian executed a framework cooperation agreement which identified certain projects of mutual and significant benefit to China and the DPRK, particularly infrastructure development. CRIG is committed to lead through Heuimang/Han Wang a consortium of investors from China to participate in the economic and infrastructure development of the Democratic People’s Republic of Korea.

2015年3月20日：中铁和Daegian签署公约设立融投资控股公司，以协调和管理投资朝鲜.
March 20, 2015: CRIG and Daegian signed a convention to establish an investment holdings company to coordinate and manage investment in the DPRK.

2015年4月8日: 朝鲜政府的执行委员会正式批准为创建韩旺作为的中铁和Daegian 之间的合作平台公司.
April 8, 2015: The Executive Committee of the DPRK Government granted formal approval for the creation of Heuimang/Han Wang as the joint venture company between CRIG and Daegian.

这是中国- 朝鲜最高领导人讨论2010年5月的巅峰之作, 于经贸合作，成立一个指导委员会，共同开发和管理提名的项目, 包括特别经济贸易区.
These represent the culmination of China-DPRK economic and trade cooperation discussions dating back to May 2010, when the top leaders of both countries established a steering committee to jointly develop and manage nominated projects,including special economic trade zones.

基本的经济发展计划是底层要求支持能力建设，机构规划和物流相关立法的起草工作。此外，为提高海关程序，通信和赞助农业和其他指定项目在朝鲜.
Fundamental to the programme is the underlying requirement to support capacity building, institutional planning and logistics and the drafting of relevant legislation. Also, to improve customs procedures, communications and sponsor agriculture and other specified projects in the DPRK.

中国和朝鲜都致力于取得进展的合作和友谊通过鼓励基于一个企业的市场经济的互利两国人民.
China and the DPRK are committed to progressing their cooperation and friendship by encouraging an enterprise based market economy for the mutual benefit their two peoples.

韩旺利用中国政府鼓励中国企业“走出去”、以及建立境外经济贸易合作区的各种优惠政策，支持朝鲜建设，开发前述项目。
In supporting the DPRK in the development of the nominated projects (see below), China Railway will be taking advantage of the preferential policies of the Chinese Government’s ‘Go Global’ strategy and its model of ‘co-operation between nations’ to create Economic and Trade Cooperation Zones.

提名项目:
Nominated Projects:

下面的项目已被选定为首批发展:
The following have been selected for initial development:
1. 罗先经济贸易区等经济贸易区
Rason Economic Trade Zone and other Special Economic Trade Zones
2. 罗津港, 运输和物流
Rajin Port, Transport and Logistics
3. 东海岸高铁和互连服务
East Coast High-speed Rail and interconnecting services
4. 发电厂和服务
Power Generation
5. 国家石油和天然气战略计划，包括
National Oil and Gas Strategy, including
a. 现有的两个炼油厂和技术升级翻新
Refurbishment of the two existing refineries and technological upgrade
b. 更多的处理能力，存储和仓储设施建设，以满足当地和出口需求
Construction of more processing capacity and storage and warehousing facilities to meet local and export demand
c. 贸易销售和市场营销
Trade sales and marketing
d. 勘探和开采当地资源
Exploration and exploitation of local reserves
6. 黄金开采和加工;以及建立金银行
Gold mining and processing; and establishment of a gold bank
7. 稀土的开采和加工
Rare earth elements mining and processing
8. 金属和矿物开采和加工，包括:
Metals and minerals mining and processing including:
a. 铁钢 Iron and steel
b. 锌Zinc
c. 钨Tungsten
d. 锡Tin
e. 菱镁矿 Magnesite
f. 石墨 Graphite
g. 煤Coal
9. 电信和有线电视
Telecommunications & cable television
10. 互联网服务, 国家经济信息电子中心及电子支付平台
Internet services, a national information centre and electronic payment platforms
11. 金融服务，包括一个完整的商业全服务银行和保险
Financial Services including a full commercial full services bank and insurance
12. 农业包括菌草种植, 牛羊养殖和捕鱼,
Agriculture including bacteria grass, sheep and cattle breeding and fishing
和等项目，招商引资开发.

附加信息:
Additional Information:
罗先经济贸易区和罗津港: 由罗先经济合作局管理，位于朝鲜北东部，毗邻中国吉林省延边地区. 罗先的主要商业机会是罗津港，该港作为主要的物流和交通枢纽为东北亚的潜力. 中国、俄罗斯、蒙古承认其优点，罗津港可提供最北端的全年温水冷冻自由港. 俄罗斯和蒙古已经从罗津港运送大宗商品，通过铁路连结由俄罗斯建造的港区.
The Rason Economic Trade Zone and Rajin Port: is managed by the Rason Economic Cooperation Bureau, located in the North-East of DPRK, adjacent to the Yanbian area, Jilin province, China. The major commercial opportunity in Rason is the potential that Rajin port offers as a major logistics and transport hub for north-east Asia. China, Russia and Mongolia acknowledge the advantages that the northern most all-year round port can provide. Russia and Mongolia are already shipping bulk commodities from Rajin through a railway link built by Russia.

拟议的铁路连接新丝路网络，将为中国东部、俄罗斯、韩国、日本, 进入中亚欧洲及其他新兴经济体. 一个便捷的陆路货物通道，这将减少旅行时间只需15天，而不是原来45天的海上运输，太有吸引力了, 区域商家不能忽视.
A proposed rail connection to the New Silk Road network will provide Eastern China, Russia, South Korea and Japan access to the emerging economies of Central Asia and Europe beyond. A land route for the transport of goods that will reduce travel time to just 15 days as opposed to 45 days by sea will be too attractive for regional manufacturers to ignore.

罗先的潜力作为一个主要的工业和商业中心，是由计划的石油和天然气管道从西伯利亚到韩国釜山而增强. 坐落在通往发展最快、最具活力的世界经济区域上，它是一个可预见的展示，可以肯定的未来，罗先会成为最重要的区域之一。
Rason’s potential as a major industrial and commercial centre is further enhanced by the planned oil and gas pipeline from Siberia down to Pusan in South Korea. Situated as it is at the gateway to the fastest growing and most dynamic economic region in the world, it is a virtual certainty that Rason will become one of the most important cities in the region.

有许多小到中型中外合资企业已经建立在罗先. 这是肯定的, 由于贸易的增加, 这将很快被更大的企业来加盟。
There are many small to medium sized foreign joint ventures already established in Rason, which will soon be joined by larger enterprises that will inevitably follow as trade increases.

中国企业有数十家与朝鲜公司在进行经济和贸易活动，在建材、食品加工、机械、金融、投资、物流等领域谈判合作。交通运输集团，中国铁建集团，中国招商局集团，亚洲集团等大型企业纷纷表示了在罗先经贸等各领域的兴趣.
Dozens of Chinese enterprises are in negotiations with North Korean companies for economic and trade activities in building materials, food processing, machinery, finance, investment, logistics and other fields. Transportation Group, China Railway Construction Group, China Merchants Group, the Asian Group and other large enterprises have expressed interest in the Rason economic and trade areas.

中国的北大荒集团在朝鲜建立了一个高效的农业科技示范园区500公顷的水稻种植实验.
The Beidahuang Group of China set up a highly efficient agricultural demonstration zone, 500 hectares of rice growing experiments.

该商业机会将只能通过韩旺可用.
The commercial opportunities will only be available through Heuimang.

朝鲜国家石油和天然气战略: 是赖以投资者可以利用朝鲜的优越位置，并推出营销活动成为东北亚地区的重要平台。朝鲜有两个炼油厂，其中只有一个目前正在运作。
DPRK’s National Oil and Gas Strategy: is the platform upon which investors could take advantage of the DPRK’s location and launch a marketing campaign into north-east Asia. The DPRK has two refineries only one of which is currently operational.

在新义州的蓬华炼油厂每年生产的柴油和汽油约150万吨, 这是满足本地区的需求远不够的. 该炼油厂坐落在一个很好的位置，跨过鸭绿江丹东，那里有一个油码头和管道组成的国际网络的支线
The Bungwha [Ponghwa] Refinery in Sinuiju [Note: it is in Phihyon, not Sinuiju] produces about 1.5 million tonnes of diesel and gasoline a year which is well below local demand. It is well situated across the Yalu River from Dandong where there is an oil terminal and a spur line of an international network of pipelines.

韩旺拥有的授权权利，新指定的特殊经济贸易区，位于在鸭绿江河口的新都岛。这里是理想的建立一个油库和新的处理设施之地.
Heuimang holds rights to a newly designated special economic trade zone which is Sindo Island in the Yalu estuary. The site is ideal to create a tank farm and new processing facility.

罗先的胜利炼油厂在东北部，已有20多年经营，现停止，由于缺乏原料和适当保养及维修。它最初被设计为每年生产各种石油化工产品2.0万吨。罗津和罗先潜力将见证燃料和某些石化产品必须满足该地区日益增长的需求.
The Seungri Refinery in Rason in the north-east, has been silent for 20 years for a lack of feedstock and proper maintenance and repairs. It was designed to produce 2.0 million tonnes a year of a variety of petrochemical products. The potential that is Rajin/Rason will see a growing demand for fuel and certain petrochemical products in the region which must be met.

金属和矿物: 矿产开采和加工是朝鲜经济的支柱. 通过韩旺的国家协议的过程中，任期安全是有保证的，因为它的设计满足国际融资需求。有铁矿石，煤，金，菱镁矿，石墨，稀土元素和许多世界级的沉积物。
Metals and Minerals: mining and processing is the backbone of the DPRK economy. There are world class deposits of iron ore, coal, gold, magnesite, graphite, rare earth elements and many more. Through Heuimang’s state agreement process security of tenure is assured as it is designed to satisfy international financing requirements.

详细信息，请联系:
For more information, please contact:

(1) 与中铁投资集团有限公司, 主席, 王先生
Mr. Wang Jing, Chairman of China Railway Investments Group Ltd
电子邮件Email: crighk1@gmail.com

(2) Daegian 私人有限公司, 主席, Rudi Sirr先生
Rudi Sirr, Executive Chairman of Daegian Pte Ltd
电子邮件Email: rudi.sirr@daegian.com

(3) 韩旺投资集团有限公司, 首席执行官, 沈思翠小姐
Jyn Sim Baker, Chief Executive Officer of Heuimang Investments Group Limited
电子邮件Email: jynbaker@crimsonant.com

Here is additional reporting in NK News and by Marcus Noland.

By Benjamin Katzeff Silberstein

During the past few months, the World Food Program (WFP) has made reoccurring pleas for increased food assistance to North Korea to alleviate the food shortages expected from a severe summer drought. The North Korean government made similar statements and claimed that the drought was the worst one to occur in 100 years. Aid to the country was subsequently increased from the originally planned level, due to the drought. But now, one North Korean official is saying that food production ended up increasing, after all, thanks to agricultural reforms.

A recent brief by the Institute for Far Eastern Studies at Kyungnam University (IFES) cites a July issue of Tongil Sinbo, a North Korean state-run weekly newspaper. There, Chi Myong Su, director of the Agricultural Research Institute of the Academy of Agricultural Sciences in the country, says that

“the effectiveness of field management system (pojon) from cooperative farm production unit system (bunjo) is noticeable and succeeded in increasing grain production despite the adverse weather conditions.”

The article cited by IFES highlights the smaller work-team structure as key to the success of the reforms. Also, it almost outright states that greater economic incentives were the main factor (although they call it “enthusiasm” and “patriotism”):

“Despite the adverse weather conditions last year, the high grain yield was possible due to implementation of scientific farming methods and field management system to increase enthusiasm of farmers,” and “based on this experience, many cooperative farms across the country will expand subworkteam management system to field management system.”

This is interesting for several reasons.

First, the agricultural reforms seem increasingly pronounced. Though other reforms were reportedly backtracked earlier this year, the government seems eager to claim success for the road travelled in agriculture.

I have written elsewhere that the data doesn’t necessarily support a claim that reforms are working. There is still reason to be skeptical – after all, a North Korean government official claiming that his government’s policies are working is not surprising – but even the claim itself is interesting.

Second, the statement raises questions about monitoring and data gathering capacities, both of the regime and relief organizations in Pyongyang. Again, just a few months ago, alarm bells were ringing about a potential food shortage, and now, a regime official claims that food production has increased. What was the basis of the WFP and regime claims that a food shortage was imminent a few months ago, and what has changed since those claims were made?

Another recent IFES brief also deals with North Korean press reports about the agricultural reforms. It quotes a Rodong Sinmun article from earlier in the summer that brings up some adjustment problems that farmers have had, such as learning how to properly use fertilizers. The most interesting part in my opinion is the following:

The newspaper stressed that “when all farmers claim ownership of their field and subworkteam, one can create innovation in the farming operations.”

Thus, it seems like Pyongyang wants to encourage experimentation and diversity in production methods. This would be a potentially important step towards more efficient agriculture. Perhaps it is part of a pattern. Provinces have reportedly gotten significant leeway in setting up their respective special economic development zones, which could also be a way to encourage experimentation in policies and management methods.

According to the Tongil Sinbo article, reforms are set to expand further in the country given the alleged success. Perhaps it won’t be too long before we can learn more about them through assessments by multilateral organizations like WFP.

Kim Jong-un has committed significant construction resources to improving the lives of children (particularly orphans) in the DPRK. Now you can share Kim Jong-un’s love of the children (sarcasm) with the people you know by collecting and sending stamps of the Songdowon International Children’s Camp and the new Pyongyang Baby Home and Orphanage:

Although the stamps are meant for foreign collectors, they are denominated as KPW 30. If the cost of a first class letter in the DPRK is 30 won, that translates into appx $.30 at the official rate and $.00375 at the black market rate (nearly 1/3 of a US penny).

But the Pyongyang Baby Home stamp booklet shows four stamps on a post card, so maybe the official price of sending a postcard is KPW120, or $1.20 at the official rate and $.015 at the black market rate. That seems a bit more reasonable, but it is still probably likely that, as in the USA, mail delivery is a drain on the government’s budget (subsidized activity). I wonder how hard it is to raise postal rates in the DPRK?

Luckily the Ministry of Post and Telecommunication (체신성) does not have to rely on the cabinet for its complete budget. There is always the international stamp-collecting market…and a small venture known as KoryoLink.

I also doubt that any of the money generated from the sale of these stamps actually goes to supporting the budgets of the Pyongyang Baby Home and Orphanage and Songdowon International Children’s Camp, but you never know.

UPDATE 3 (2015-8-20): Pyongyang Time reportedly causing confusion along inter-Korean border. According to the Korea Times:

North Korea’s new standard time is making it difficult for some South Korean firms operating in the Gaeseong Industrial Complex (GIC) to transport their goods on time to their customers in the South, officials here said Thursday.

The two Koreas have been missing hotline calls from each other since Saturday when the North’s regime unilaterally pronounced its new standard time by turning their clocks back 30 minutes behind the time zone in the South.

“The 30-minute time difference is making us late in transporting our goods produced at the GIC to our customers although we’re working under a schedule as usual,” a manager at a garment manufacturer in Seoul said, declining to be named.

The firm is one of 124 small and medium-sized enterprises (SMEs) that hire some 53,000 North Koreans at the inter-Korean industrial park in Gaeseong. The border city is about 53 kilometers northwest of Seoul.

According to the company, it has shipped products from the GIC via trucks every day at 11:50 a.m. This is one of the daily time slots set by the two Koreas for the South Koreans to enter or exit the joint industrial complex.

“The problem is that it’s 12:20 p.m. in South Korea. And we’ve seen that the 30-minute time difference can cause a significant delay in delivering the goods to our sub-contractors in Gyeonggi Province and those in the outer regions,” the manager said.

He added his company, which only operates factories in Gaeseong, may re-open a plant in the South, which was closed in 2004 when the GIC opened, if the government fails to settle the time-related issues.

“We decided to close our plant in the South to capitalize on cheap labor of skilled North Korean workers. Now is time to give a second thought,” the manager said.

Some other firms said the so-called “Pyongyang Time” does not have any impact on their business.

“We ship all components to assemble paragliders to our inventory in Yongin, Gyeonggi Province and we don’t see any difference before and after Pyongyang Time,” said a staff at Gin Gliders.

A public relations official for Good People, an underwear manufacturer, said only 2 percent of the firm’s products are from the GIC while the rest are made in Jeonju and Cambodia.

“We used to make 30 percent of our products at the GIC, but not any longer since 2013,” said the official, who has asked not to be named.

The operation hours of the Seoul-Pyongyang hotline have been from 9 a.m. to 4 p.m. on weekdays since 1992 when the two enemies set up the direct communication system using non-dial phones across the Demilitarized Zone (DMZ)

The Ministry of Unification said the North Koreans have not been picking their hotline phone set up at their side of Panmumjeom, the inter-Korean truce village at the DMZ, until 9:30 a.m. from Monday.

The unification ministry also said North Koreans have asked its officials to stay at Panmunjeom until 4:30 p.m. instead of pulling out at 4 p.m.

“We still begin work at 9 a.m. and call it a day at 4 p.m. in accordance with the Greenwich Mean Time (GMT)+9 time zone,” a ministry official said on condition of anonymity.

“And we obviously wouldn’t know how North Koreans will handle things in case of emergencies after our officials left for home.”

UPDATE 2 (2015-8-15): Pyongyang Standard Time has launched. According to Yonhap:

North Korea set itself a new time zone Saturday in a move expected to complicate relations with South Korea.

North Korea’s time zone is now 30 minutes behind that of the South.

“The Presidium of the Supreme People’s Assembly of the DPRK decided to set the standard time of the Republic with 127 degrees 30 minutes east longitude as a standard and to apply it from August 15,” the North’s official Korean Central News Agency said in a dispatch, referring to the country’s rubberstamp parliament.

DPRK is the acronym of North Korea’s official name, the Democratic People’s Republic of Korea.

North Korea marked the start of the new time zone by ringing the Pyongyang Bell at the Pyongyang Astronomical Observatory at the stroke of midnight, according to KCNA.

“At the same time, all industrial establishments, trains and ships across the country sounded sirens and whistles,” it said. “Service personnel of the Korean People’s Army on their duties of defending the country, scientists working on satellites to explore a new area of conquering space and all other people of the country set their clock and watches according to Pyongyang time amid excitement and delight at the national event.”

On Aug. 7, North Korea announced it would turn back its clocks by 30 minutes to rid itself of the legacy of Japan’s 1910-45 colonial rule of Korea.

South Korean officials have expressed concern the move will complicate inter-Korean affairs, particularly movements in and out of the joint industrial complex in North Korea’s border city of Kaesong.

It could also create confusion in messages exchanged between their militaries.

Here is coverage in KCNA.

Here are some interesting observations by Martyn Williams.

UPDATE 1 (2015-8-12): And the inter-Korean trash-talking over the new time zone has begun. According to the Yonahp:

North Korea slammed President Park Geun-hye Wednesday for condemning the North’s decision to push back its standard time by 30 minutes, saying that her remarks are “unpardonable.”

Park expressed deep regret Monday over Pyongyang’s unilateral move to push its clocks back a half-hour starting Liberation Day, which falls on Saturday. The North claimed that the move is aimed at removing what it called the vestige of Japan’s colonial rule.

Currently, the two Koreas use identical standard time, set under Japan’s 1910-45 colonial rule of the Korean Peninsula.

The North blamed Park for commenting on its decision, saying that what she said is an “unpardonable and politically motivated provocation.”

“All countries have their own standard time. It is the universally accepted practice in the world for each country to fix its own standard time as it is a matter pertaining to the sovereignty of an independent country,” said a spokesman for the North’s Committee for the Peaceful Reunification of Korea.

North Korea claimed its decision to fix the new standard time reflects its “firm faith and will” to make Japan pay for what North Korea called its “hideous crimes.”

The Unification Ministry has said that the North’s move is feared to deepen differences between the two Koreas and to run counter to efforts to promote inter-Korean cooperation and prepare for a peaceful unification.

The time differences could cause some logistical problems, such as the timetables at a joint industrial park in the North Korean city of Kaesong.

Seoul said that South Korea’s choice of the present time zone is based on practical benefits, such as daylight savings, rather than colonial history.

ORIGINAL POST (2015-8-7): According to KCNA:

Pyongyang Time Newly Fixed in DPRK

The DPRK decided to fix a new standard time on the occasion of the 70th anniversary of Korea’s liberation.

A relevant decree promulgated by the Presidium of the Supreme People’s Assembly of the DPRK on Wednesday noted as follows:

It was on August 15 when President Kim Il Sung, benefactor of national resurrection and peerless patriot, crushed the brigandish Japanese imperialists by making long journeys of anti-Japanese bloody battles and liberated Korea. It was the day of historical significance as it put an end to the history of national sufferings and brought about a radical turn in carving out the destiny of the country and its people.

The wicked Japanese imperialists committed such unpardonable crimes as depriving Korea of even its standard time while mercilessly trampling down its land with 5 000 year-long history and culture and pursuing the unheard-of policy of obliterating the Korean nation.

It is the firm faith and will of the DPRK’s service personnel and people to force the Japanese imperialists to pay for the monstrous crimes committed by them for a century, firmly defend the national sovereignty and demonstrate for eternity the dignity and might of the great Paektusan nation shining with the immortal august names of Kim Il Sung and leader Kim Jong Il.

The Presidium of the Supreme People’s Assembly of the DPRK made the following decision reflecting the unshakable faith and will of the service personnel and people on the 70th anniversary of Korea’s liberation:

Firstly, the time at 127 degrees 30 minutes east longitude or 30 minutes later than the present one shall be fixed as the standard time of the DPRK and called Pyongyang time.

Secondly, Pyongyang time shall be applied from Aug. 15, Juche 104 (2015).

Thirdly, the DPRK Cabinet and relevant organs shall take practical steps to carry out this decree.

The media has jumped all over this, so there is not much more to say. But here are my $.02:

NK is a very nationalist society, and the only country as vilified as the US is Japan. August 15 is not celebrated in NK as the end of WWII, but as the victory over Japanese colonialism (brought by Kim Il-sung, not allied forces)

The Kim Jong-un regime has placed a lot of significance on symbolism: Kim resembling his grandfather, building orphanages and water parks to show he cares about the people, etc. So moving the clock back a half-hour is an interesting move. High symbolic value (carrying out the revolution started by his grandfather), but it will not fundamentally deal with the key problems the regime is facing domestically and internationally.

It will also be something that North Korea can prod the south with: “You are still on Colonial time, not Korean time.” South Korea had also reverted to pre-colonial “Korea time” in 1954, but switched back to Japan time in 1961 under Park Chung-Hee (the current president’s father) who received aid from Japan was a US allly.

North Korea has been holding talks with the Japanese in recent years, but little progress has been made. Could this announcement signal that they are done trying with Japan?

As for implementation, this should not be too difficult. North Korea is a small country with a highly urbanized population. The government already controls what time people get out of bed in the morning with loud speakers and patriotic music. Since nothing in the DPRK is automated, there is not any computer code that needs to be adjusted. Finally, infrastructure in North Korea is so unreliable that being on time is not as big a deal there as it is in South Korea or other developed countries.

According to UPI:

A New York marine insurance firm has agreed to pay fines for violating U.S. sanctions against North Korea, Cuba and Iran.

Insurance provider The Navigators Group, Inc. admitted the company provided North Korea vessels with marine insurance, according to a statement from the U.S. Treasury’s Office of Foreign Assets Control on Thursday.

OFAC said Navigators had committed a total of 48 violations: The firm was found in violation of North Korea sanctions including Executive Order No. 13466 and various sanctions against Iran, Cuba and Sudan.

The firm has agreed to pay a reduced fine of $271,000 — down from an initial penalty of $750,000. Of the $750,000 amount, $570,000 was a fine for North Korea sanctions violations.

OFAC said the penalty was reduced after Navigators voluntarily disclosed information of its violations and cooperated with investigators.

Navigators earned $1.1 million in insurance premiums between 2008 and 2011 from 24 individual policies for North Korea vessels.

Between 2009 and 2010, the firm delivered $12,000 in payouts.

Despite sanctions, North Korean ships remain active at sea.

Read the full story here:
New York marine insurance company fined for North Korea dealings
UPI
Elizabeth Shim
2015-8-7