DPRK demanding $100 USD residence fee at Kaesong Industrial Complex

March 3rd, 2008

Institute for Far Eastern Studies
NK Brief No. 08-3-7-1
3/7/2008
 
North Korea’s latest demand at the Kaesong Industrial Complex (KIC) is a 100 USD per person registration fee for South Korean workers residing in the complex’s dormitories. The North demanded the fee early in 2007 to cover registration and issuance of registration certificates regarding workers visiting or residing in the complex, and negotiations have been underway the entire year.

An unnamed source close to the South Korean government stated, “At the end of January, the North unilaterally decided on the KIC visiting and residing fees, and when they were not complied with [the North] notified [the South] that they would ban entrance” to the complex, however, “despite this, currently entrance into the complex is freely obtainable.”

The North set a 35 USD fee for registering a short-term stay of up to 90 days, and a 100 USD fee for registering a one-year residency, according to the source. A Unification Ministry official acknowledged, “The fee demanded by the North is not exorbitant, but from the perspective of the businesses in the complex, negotiations on reasonable measures were in progress.”

North Korea is making its demands based on the ‘Kaesong Industrial Zone Entrance, Dwelling and Residence Regulation’ enacted in December 2003. According to this regulation, fees must be paid for issuance and reissuance of registration papers when applying for short term stays up to 90 days, long term visits over 90 days, and residency of one year or more. Currently, there are over 800 South Korean employees who would need to pay fees for visiting or residing at KIC.

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DPRK holds first extended cabinet meeting of the year

March 3rd, 2008

Institute for Far Eastern Studies (IFES)
NK Brief No. 08-3-3-1
3/3/2008

In the latest issue (February 3rd) of the DPRK Cabinet bulletin, “Democratic Chosun”, it was reported that the first extended cabinet meeting of the year opened in the beginning of February, with Premier Kim Young-il presiding. The bulletin stated that the issue of accomplishing this year’s economic plans was discussed.

At the meeting, Vice Premier Kwak Bum-ki stressed that accomplishing this year’s economic goals was “essential for opening the doors to a breakthrough for building an economically strong nation,” and that it was the “fundamental task laid out before the Cabinet.” He went on to reveal the tasks and directives needed to revitalize all realms of socialist construction, which he stated was necessary to create a powerful and prosperous nation by 2012, the centennial anniversary of the birth of the late Kim Il Sung.

In particular, he called for the production of the “lifeline of socialist construction”, and specifically, electricity, coal, metal, and railways, which he referred to as the “four lines for the advance of the people’s economy.”

Accordingly, the goal of carrying out overwhelming repairs to power generation facilities, and at the same time constructing new power plants in order to increase electrical production capabilities by several hundred thousand kilowatts, was proposed.

The meeting also stressed the need for concentrating efforts on geological exploration and exploitation industries in order to reasonably development and use natural resources, for a change in production of goods necessary for daily life, and for a resolution to the people’s ‘eating problem’ alluded to in the recent New Year’s Joint Editorial.

The bulletin also reported that there was discussion on creating a new five-year plan for the development of science and technology, going as far as to say, ”the role of science and technology in the building of an economically powerful nation is decidedly large, and in order to answer the very real calls for development, [the issue of] strengthening international economic projects” was brought up.

Premier Kim Young-il, Vice-Premier Kwak Bum-ki, Chairman Kim Kwang-rin, of the Committee on National Planning, Park Nam-jil, of the Power Supply Industry Bureau, and Kim Yong-sam, from the Railways Bureau, were among cabinet ministers present.

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North Korea’s Cultural Relations Strategy

March 2nd, 2008

The international press (and just about every blogger on the planet-including myself) has written something about the NY Philharmonic’s visit to North Korea last week.  Whether one believes that this event is a significant breakthrough in cultural relations or not, what has evaded direct discussion in the media is the purpose of cultural relations in the North Korean system (and indeed its predecessor – the Soviet system).

At the end of World War II, the DPRK imported many Soviet party, state, and military organizations.  One of these was the USSR All Union Society for Cultural Relations with Foreign Countries (known as ‘VOKS’).  Publicly, the mission of VOKS was to promote peace and understanding between the Soviet people and other peoples of the world.  However, the actual mission of VOKS was to promote Soviet ideology, policy, and influence overseas. 

VOKS began its mission in the 1920s.  It undertook activities such as: Attempting to influence French intellectual circles; bringing sympathetic individuals and groups to tour the Soviet Union to see how the construction of the worker’s paradise was proceeding; bringing students from the developing world to be educated in the Soviet Union; sending Soviet scholars and technicians to undertake development projects overseas, etc.  VOKS was even influential in the USA, where it supported a number of pro-Soviet civil society organizations. 

VOKS also played an important role in establishing the legitimacy of Soviet hegemony in North Korea following World War II.  Cultural delegations of North Koreans were taken to the Soviet Union to bear witness to the great accomplishments of the worker’s revolution.  Their impressions were then distributed to the North Korean population at large, along with many other cultural goods produced by the Soviet Union. 

Although VOKS’ success at swaying public opinion in the west is an unresolved question (as far as I know), the details of their activities are well known to western scholars since Soviet archive materials are readily accessible. Effective or not, the take away from this history lesson is that socialist countries have historically treated cultural relations activities, like everything else, as regime-enhancing activities.  In other words, they promote the political incumbents. 

The North Koreans copied VOKS wholesale from the Soviets, and this organization is still functioning in the DPRK today.  It is the Korean Committee for Cultural Relations with Foreign Countries (CCRFC).  Although this body has been around since the founding of the DPRK, it is perhaps most known in contemporary times for supporting the Korean Friendship Association, numerous pro-Pyongyang “Friendship Societies,” and to a lesser degree, several leftist organizations such as the National Lawyers Guild.  These organizations tend to toe the party line and echo Pyongyang’s perspective in international debates.  At a minimum, they promote a marginal distrust of western media and historiography.

Based on the comments I have made so far, many might be led to believe that I am pessimistic on the positive impact that cultural relations broadly, and the the NY Philharmonic visit specifically, might have in changing the North Korean system.  But this would be a mistake.  Since the Arduous March and Kim Jong Il’s rise to power, North Korean institutions have undergone such a transformation that comparison with their Soviet predecessors might not be useful for understanding their purposes today.

Since 1997, the North Korean CCRFC has been chaired by Mun Jae Chol, a North Korean policy elite.  I just finished watching the NY Phil performance-here-and Mun Jae Chol is indeed in the audience, as are several people who work for him who I have met.  Mun Jae Chol took over the committee in 1997 (as best I can put together from KCNA reports–his promotion was not formally announced in the news), and since then the mission of the organization seems to have changed significantly.  To start with, the cold war is over.  North Korean cultural relations activities are not going to convince the world’s people that the North Korean government is the legitimate governing authority for the whole Korean peninsula.  No one will ever believe that now.

Since the propaganda war is over, and resources are scarce, the CCRFC seems to be  focused on generating foreign exchange revenue from tourism, cultural exchanges, and brokering foreign direct investment (all under the guise of their previous mission, however).  Under established laws and customs, the staff of the CCRFC are permitted to interact with foreigners and make regular trips overseas.  They are the very people who have an incentive to promote interaction with the west because they will directly benefit financially from it.  True these people are not paragons of liberalism, but they all own western clothes, use digital cameras, listen to iPods, broker deals between private North Koreans and foreigners (smuggle goods), and travel to China on a regular basis.  There are procedures in place to control their entrepreneurial tendencies, such as never allowing one guide to be alone with a foreigner, however, these rules can be evaded at minimal cost.  They might repeat what they are told to say, but they certainly know better.

Staff of the CCRFC include influential party members and security personnel.  Raising the frequency and profile of cultural relations activities with North Korea will increase the income of these individuals who can buy support directly through cash transfers, or indirectly through business deals, ultimately greasing the cogs of change in the North Korean bureaucracy towards a greater acceptance of openness.  Maybe.

Comment from Dr. Petrov:
CCRFC (known in North Korea as Taewe Munhwa Ryeollak Wiwonhoe or simply TaeMun) is indeed struggling to survive in the changing economic environment. Although most of the projects they try to lure foreigners into are devoid of economic sense, they are still pretty powerful and even allowed to invite journalists to visit N.Korea. Cooperation with CCRFC is a game of unpredictability but in some cases can lead to success. See a success story here.

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Vienna trains North Korean orchestra conductors…

February 29th, 2008

This week that Washington Post (hat tip Dr. Petrov)published an article which took a unique position on the NY Phil’s performance.  Rather than comment on whether the event was diplomatically significant, or whether it legitimized a regime with a poor human rights record, the columnist denounced it for having a “tinge of benevolent didacticism”…before pointing out that North Korea has no shortage of classically-trained, quality orchestra conductors.  In fact, for years they have been sending students to Vienna:

Asia is a hotbed of Western classical music. This passion has evidently not bypassed North Korea. Much of the West harbors images of North Koreans as either wealthy soldiers or starving peasants. But in Vienna, Austria, there is another image of them: as conducting students. The elite conducting class at the University of Music and Performing Arts there has trained no fewer than 17 North Korean students in the past decade.

According to Mark Stringer, the conductor who leads the class, the North Korean government decides, every few years, that it is time to train a new crop of elite young conductors. In the early 2000s — a few years before Stringer took over in 2005 — the government’s choice fell on this Vienna school. There were considerable bureaucratic hurdles to overcome; North Korean representatives insisted on sitting in on auditions, and had a hard time understanding why not all of their handpicked candidates were accepted by the school. But they were also paying attention.

“The next batch,” Stringer said, “knew what to expect. They were so prepared they could nail every single bit of our ferociously difficult entrance exam.”

The students also do not fulfill anyone’s expectations of politically guarded wards of the state. “They have a completely normal experience,” Stringer says. “Once they’re in the walls of the school, politics disappear. There is no breathing down our necks from the North Korean officials.” He describes the students as generally more open, easygoing and funny than their South Korean counterparts.

“Were they to be allowed to stay in the West,” he says, “a number of the ones I’ve seen would have a serious chance of a prominent international career. It’s phenomenal what they come to Vienna knowing how to do.”

UPDATE email from a reader:

I also visited that performance of the joint North-South Korean student’s orchestra at Vienna Music Universtity (and took a video of this performance).

Contrary to the Washington Post article the ambassadors were not attending the performance, but other staff of the respective embassies [were]. I don’t know, if they drank beer together, but anyhow, when arriving at the hall before performance the consuls (not ambassadors) greeted themselves nicely.

Very interesting the seating arrangement of the South and North Korean spectators in this student concert. The men (Korean, North an[d] south) in rows 2-4, the women in rows 5-6 and the students behind. (very Confucian …)  It was amazing to see how many North Koreans must be living here in Vienna.

In Vienna, there are not only North Korean conductor students, but also piano, violin, biology, architecture or English students. The same in Germany, Italy and maybe France and other countries.

The full article can be read here:
The N.Y. Philharmonic in North Korea: Symbology and the Music
Washington Post
Anne Midgette
Tuesday, February 26, 2008; Page C04

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Russian ship makes it home

February 28th, 2008

UPDATE: Dr. Petrov made some interesting comments that deserve highlighting:

The BBC report is full of mistakes. The name of the ship was “Lidia Demesh”. On board were 23 members of crew and 1 passenger. After being arrested the ship was escorted to the port of Kimchaek.

The situation was resolved quickly thanks to the Russian Consular General, E.Val’kovich, who personally went to Kimchaek and sorted things out. Most Russian diplomats posted to DPRK are fluent in Korean and exempt from travel restrictions. So, no traditional Hawaiian symbol of respect is needed. 

ORIGINAL POST: The BBC reported last week that the North Koreans pulled a surprise ‘Pueblo’ on the Russians.

The Lida Demesh, carrying a consignment of cars from Japan, was heading for the Russian port of Vladivostok when it was stopped by patrol near Cape Musudan.

An armed group boarded the ship and ordered the captain to change course and go to a North Korean port [Chongjin],” he told the Russian NTV network.

Mr Yeroshkin said the centre had been told the ship’s 25 crew-members were fine and that there had been no threat to their lives. (BBC)

Strangely, this was not the first time this has happened… 

A similar incident in 2005 took 15 days to resolve through diplomatic channels. (BBC)

Fortunately for the crew, the situation did not last that long.

A Russian cargo ship released by North Korean authorities on Wednesday has arrived in the Far East port of Vladivostok.

Captain Yury Buzanov said on returning to Russia that he was forced to enter North Korean waters to avoid a shipwreck due to a heavy storm.

“To save the crew I decided to enter North Korean waters because the waves in the Sea of Japan were three to four meters high with winds of 25 meters per second. In such stormy conditions, the cargo could have shifted in an instant causing the ship to lurch and sink,” the captain said. (Novosti)

No word if they ever used the traditional Hawaiian symbol of respect.

The full stories can be found here:
North Korea Detains Russian Ships
BBC
2/23/2008

Russian ship arrives home after seizure by North Korea
Novosti
2/28/2008

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NY Philharmonic wrap up (and US national anthem)…

February 27th, 2008

UPDATE 2 (2013-6-24): A documentary was made of the NY Phil’s visit to Pyongyang.  You can watch both parts here:

Part I:

Part II:

UDATE 1 (2008-11-17): Suki Kim wrote about the experience in Harpers.  Download the PDF here:  harpers.pdf

ORIGINAL POST (2008-2-27): Its difficult to say anything about the NY Phil’s performance that has not already been reported on by numerous other forums, but I think I managed to put together enough interesting material to meet the high standards of North Korean Economy Watch readers:

Pyongyang and the Star Spangled Banner

This site claimed that the philharmonic’s performance would likely be the first time that the US national anthem was broadcast on North Korea’s airwaves.  The Joong Ang Daily backs this claim up with a caveat:

The Unification Ministry of South Korea said the U.S. national anthem was played in Pyongyang in 2005 at an international boxing match. It is, however, the first time the Star Spangled Banner has been broadcast live across North Korea. (Joong Ang Daily)

The first public performance of the Star Spangled Banner in Pyongyang was in honor of US female boxer Yvonne Caples (official biography here).  Here is how it was reported in KCNA:

DPRK Female Pro Boxer Choe Un Sun Wins World Championship

Pyongyang, June 28, 2005 (KCNA) — Female pro boxer Choe Un Sun of the Democratic People’s Republic of Korea captured the championship title of the WBCF in the women’s light flyweight category (48.98 kg). Choe Un Sun settled the bout by a unanimous decision over Yvonne Caples of the United States.
The champion belt, trophy and certificate were awarded to Choe.
The match was held at the Ryugyong Jong Ju Yong Gymnasium in Pyongyang Tuesday.

In the interest of fair reporting, here is Ms. Caples’ side of the story:

…Yvonne traveled to Pyongyang, North Korea to be a part of the historic first professional boxing matches in North Korea to fight for the WBCF Jr. Flyweight World Title against North Korean Eun Soon Choi. During Yvonne’s bout the American National Anthem was played for the first time in North Korea. Yvonne knew that in order to get a decision she would probably have to get a knock out. Eun Soon Choi proved to be very strong and skillful. Fighting in front of 13,000 cheering North Koreans, Yvonne fought what she felt was the best fight of her career. Despite the intimidating crowd Yvonne felt relaxed and confident throughout the fight. “I fought the fight of my life and came on very strong in the last five rounds. Even though I felt I won the fight, I knew I wouldn’t get the decision. It is no joke fighting in an arena with 13,000 people cheering against you. I was so proud of myself for keeping my composure and fighting so hard in this fight. I do have to take my hat off to the North Korean fighters. I expected them to be strong and well-conditioned, but they were also very skillful fighters. I don’t think anyone would be able to go over there and completely dominate them or knock them out.”

Ms. Caples aside, the editor of this site sang the US national anthem on a bus full of tourists and north Korean guides traveling to Wonsan in August 2005. For the record, this counts as the second live, “public” performance of the Star Spangled Banner.  The NY Philharmonic is only now taking the bronze.

Jazz also made its debut.  According to Defector Kim Chol-woong:

[“An American in Paris”] is a masterpiece, a mixture of classical and jazz. I am amazed that they will play jazz, because the genre is strictly forbidden in North Korea.

[W]hat musicians are allowed to perform is strictly political. Jazz is forbidden because it is American music. Jazz is considered lewd and immoral. (Joong Ang Daily)

What are North Korea’s full musical capabillities?
Dr. Petrov sent in a great Washington Post article on North Korea’s musical capabilities on which I wrote a separate post.

How many people heard the performance?
The theater holds 1500.  According to the WSJ, there were a minimum of 150 foreigners likely in the audience (they flew in with the orchestra).  Who knows if any of the small business, NGO, and diplomatic community residing in Pyongyang were able to attend.  There was also a dress rehearsal for 1200 earlier in the day.

The Daily NK reports (Via the Japanese Mainichi) the the performance was not boradcast on radio, only on television.  This means that relatively few people saw it since the penetration of radios is far more significant than television in the DPRK.

Addendum: Who attended?
In the comment section below, “Gag Halfrunt” (clever handle) links to a list of VIP attnedees in KCNA.

Don Kirk notices who did not attend.

Here you can listen to the perfomrance:

In the comment section below, Greg Halfrunt posts a link to http://www.medici.tv/.  Beginning Friday, Feb 29 (happy leap year), 2008.

The full stories cited in this post can be found here:
Americans in Pyongyang
Joong Ang Daily
Kim Ho-joung and Ser Myo-ja
2/27/2008

Philharmonic is hopeful sign for defector
Joong Ang Daily
Ser Myo-ja
2/23/2008

North Korea Criticizes the US during the New York Philharmonic Performance
Daily NK
Park In Ho
2/28/2008

A Sour Note in Pyongyang
Asia Times
Don Kirk
2/29/2008

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Eric Clapton has important fan in North Korea

February 26th, 2008

Anna Fifield (whom I briefly met in Pyongyang in 2005) reports today in the  Financial Times that the DPRK has invited Eric Clapton to make an appearance in Pyongyang:

The New York Philharmonic performed in Pyongyang on Tuesday night. The North Korean State Symphony Orchestra plans to perform in London this summer.

Pyongyang has invited Mr Clapton, whose hits include “Cocaine” and “Tears in Heaven”, as a reciprocal visit for the North Korean orchestra tour, the Financial Times has learnt.

“These cultural exchanges are a way of promoting understanding between countries,” a North Korean official told the FT. “We want our music to be understood by the western world and we want our people to understand western music.” (Financial Times)

Of course, we have known since 2006 that Mr. Clapton has at least one important fan in the DPRK:

While the rest of the world was anxiously following news about North Korea’s recent missile tests, Kim Jong-il’s second son and possible heir apparent, Kim Jong-chul, had his mind focused on entirely different matters. He was among the fans who followed British rock and blues guitarist Eric Clapton on his German tour, which took him to Frankfurt, Stuttgart, Leipzig and Berlin.

Jong-chul, 25, is said to be a diehard Clapton fan, and may have acquired a taste for Western popular music when, in the mid-1990s, he studied at a private international boarding school in Bern, Switzerland. (Asia Times)

The full articles can be found below:
N Korea strikes chord with Clapton invite
Financial Times
Anna Fifield
2/25/2008

Sons and heirs
Asia Times
Bertil Litner
8/18/2006

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More on the DPRK anti-corruption campaign…

February 24th, 2008

Details are starting to emerge on North Korea’s recent anti-corruption drive.   

North Korean authorities have been investigating the chief of a North Korean committee in charge of inter-Korean economic cooperation for months after seizing $20 million from his house, a report said Friday.

Quoting an unidentified Chinese source informed on North Korean affairs, the Dong-A Ilbo newspaper said Pyongyang authorities are intensifying their investigation into Jung Woon-eop and 80 other officials of the committee over where the money came from.

It is possible that this is just a good old fashoned purge.

It is also possible that this campaign is the first stage in a policy shift.

The full article can be found here:
NK Official Suspected of Embezzling Funds From Seoul
Korea Times
Jung Sung-ki
02-22-2008

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North Korean embassies having business problems

February 24th, 2008

As readers of North Korean Economy Watch are well ware, North Korean embassies do not receive all of their operational funding from Pyongyang.  In most cases, the embassy staff do not only generate their own income, they must also remit money back to Pyongyang.

This system might seem strange to westerners, but it has one major benefit to Pyongyang: the embassies actually earn a profit! The down side, however, is that more than one North Korean diplomat has been caught neck deep in some kind of shady business deal.

It might be possible, though, that business for the embassies is not too brisk these days…

This week, the Daily NK reports that Kim Jong il’s half-brother, who is the exiled ambassador to Poland, seems to be making overhead cutbacks at his embassy:

The North Korea embassy in Poland has not been able to hold Kim Jong Il’s birthday party in the embassy since 2006 due to financial problems. Despite this, they have been holding events, ceremonies and parties in pro-North Korean organizations or North Korean branch companies with pro-North Korean figures in Poland.” (Daily NK)

This is the second DPRK emabssy story in the media recently.  Just a few days ago, it was reported the the North Korean ambassy in Australia was also closing

What other DPRK embassy cutbacks are we unuware of?

The full article can be found here:
Kim Pyong Il Says Kim Jong Il System Will Last For a While
Daily NK
Yang Jung A
2/22/2008 

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Energy shortages lead to fall in appliance sales in DPRK state-run stores

February 22nd, 2008

Institute for Far Eastern Studies (IFES)
Nk Brief No. 08-2-22-1
2/22/2008

The South Korean NGO ‘Good Friends’ has reported that government stores in North Korea are mourning the drop in sales of electrical appliance, which appear to be out of favor due to electrical shortages around the country. Good Friends, an organization focused on supplying aid to North Korea, printed in its latest newsletter, “From November of last year to this February electricity has not been available on a regular basis in Chungjin City. At one foreign goods store in the Pohang District, electrical appliances have been barely selling…not only have the store’s sellers have been unable to meet monthly sales targets for several months, sales in February are no different.”

In addition, the newsletter describes the seriousness of the North’s energy shortage, pointing out that “as it becomes more and more difficult for residents to see electricity, they are seeking out Chinese-made 12V batteries, car batteries, candles, and other alternatives.” According to the article, most well-off residents are using car batteries, while average laborers carry flashlights or small battery chargers to work, using electricity slated for industrial use to charge personal items. ”Authorities or people with relatively good jobs usually have around five rechargers in their offices, while some may have more than ten…people with no money or access to industrial-use electricity are buying candles for light.”

The article concluded with, “Electricity has not flown into Soonchun City since October of last year, and five hours of current provided for the people last January 1st, New Year’s Day, was practically the only [electricity]…when returning home after work in the evenings, there is no electricity and nothing to eat, making life difficult.” Along with this, the newsletter reported, “North Korean authorities will no longer permit private dummy corporations…in serious cases, public executions are carried out.”

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