Archive for the ‘Worker’s Party’ Category

Kim Jong-il on an economic on site instruction blitz

Monday, August 9th, 2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-08-09-1
8/9/2010

This year, North Korean leader Kim Jong Il has been very active in giving on-site guidance at economically-important venues. As recently as July 31, Kim visited the Ganggye and Huicheon areas of Jagang Province, inspecting and providing instruction at a number of facilities, including the Ganggye Tractor Complex, the Jangja River Construction Instrument Factory, the September Textile Factory, the Jangja Mountain Food Complex, and the Ganggye Basic Foods Factory. Between August 2-5, Kim Jong Il spent several days visiting venues in South Hamgyeong Province, including the February 8 Vinalon Complex, the Ryongseong Instrument Complex Military First Foundry, the People’s Consumables Exhibit Hall, and the Geumya River Power Station Construction Office.

Just by looking at Kim Jong Il’s public outings, one can see that he is focusing his efforts on economic recovery. From the beginning of the year until August 5, Kim has made a total of 90 public appearances, with 42 (46.7%) being to economic venues, 23 (25.6%) to military venues, 19 (21.1%) to theaters or other performance halls, and 6 (6.6%) to reception halls or other venues for foreign guests and dignitaries. Compared to the same period last year, Kim has made 4.7 percent more public appearances, and visits to economic venues increased by 7.2 percent. In 2009, he made 34 (39.5%) visits to economic venues, 23 (26.7%) to military installations, and 4 (4.7%) visits related to foreign diplomacy. The other 25 (29.1%) visits were to various other facilities. Reviews of artistic performances were down 8 percent (29.1%  21.1%) and inspections of military facilities fell 1.1 percent (26.7%  25.6%), while appearances at foreign diplomatic venues were up 1.9 percent (4.7 6.6%).

Kim Jong Il’s focus on the economy comes in a year in which the Workers’ Party of Korea celebrates its 65th anniversary (October 10), and the WPK party representatives are expected to meet in September for the first time in forty-four years, increasing pressure on Kim for visible economic improvements. Furthermore, reviving the stagnant economy is essential to providing a stable succession system for his third son, Kim Jong Eun. In the spirit of the movement, North Korea’s mass media outlets have also joined the campaign, encouraging the residents of North Korea to put forth more effort daily. An editorial in the WPK newspaper, Rodong Sinmun, on August 2 urged all the people of North Korea to strive harder to achieve the goals set forth in this year’s New Year’s Joint Editorial, and tied this to the upcoming “historic” WPK representatives meeting and the 65th anniversary, encouraging “glorious efforts” worthy of such political milestones.

On a different note, Kim Jong Il also launched a ‘good health’ campaign in the second half of July, inspecting health and wellness-related sights and promoting better health for all North Koreans. Kim has been making frequent site visits, but the fact that they have been only in a relatively limited area has raised questions as to just how healthy the leader is. Last month, after travelling frequently during the first two weeks, Kim’s travels toward the end of the month slowed down, with him making only three visits, all to artistic performances. Some wonder if it is not poor health that has slowed him down.

Share

UN report explains sanctions decisions

Friday, August 6th, 2010

According to the Daily NK:

The 1718 Committee of the UN Security Council has published the final version of its “Report to the Security Council from the Panel of Experts established Pursuant to Resolution 1874,”

In the report, of which the Daily NK has obtained a copy, the 1718 Committee revealed North Korean overseas accounts which had likely been used for North Korea’s illicit activities such as conventional weapons transactions and luxury goods, and the names of entities and individuals involved in those activities. The lists were submitted by UN member states.

The report singles out 17 North Korean officials thought likely to violate UN Resolutions 1718 and 1874, and outlines the reasons why they were designated by the UN member states.

They are Jang Sung Taek, Vice-chairman of the National Defense Commission and the closest associate of Kim Jong Il, Vice-chairman of the National Defense Commission Oh Keuk Ryul, Kim Young Chun, the Minister for the People’s Armed Forces, Director of No. 39 Department Kim Dong Woon, Military Supplies Secretary in the Central Committee of the Party Jeon Byung Ho, former Yongbyon technical director Jeon Chi Bu, First Vice-director of the Ministry of the Munitions Industry Chu Kyu Chang, Standing Vice-director of the People’s Army’s General Political Department Hyun Cheul Hae, President of the Tanchon Commercial Bank Kim Dong Myung, Member of the National Defence Commission Baek Se Bong, Deputy Director of the General Political Department of the People’s Armed Forces Park Jae Kyung, President of the Academy of Science Byeon Youong Rip, Director of the General Bureau of Atomic Energy Ryeom Young, Head of the Department of Nuclear Physics of Kim Il Sung University Seo Sang Il, President of Kohas AG Jacop Steiger and Alex H.T. Tsai, who is known to have provided financial, technological and other support for KOMID, and his wife, Su Lu-chi.

It also released a list of autonomous designations provided by member states, covering 19 North Korean entities. That list was made based on information collected as of April 30th this year.

They are Amroggang Development Banking Corporation, Global Interface Company Inc., Hesong Trading Corporation, Korea Complex Equipment Import Corporation, Kohas AG, Korea International Chemical Joint Venture Company, Korea Kwangson Banking Corp, Korea Kwangsong Trading Corporation, Korea Pugang Trading Corporation, Korea Pugang Mining and Machinery Corporation ltd., Korea Ryongwang Trading Corporation, Korea Ryonha Machinery Joint Venture Corporation, Korea Tonghae Shipping Company, Ponghwa Hospital, Pyongyang Informatics Centre, Sobaeku United Corp., Tosong Technology Trading Corporation, Trans Merits Co. Ltd., and Yongbyon Nuclear Research Centre.

13 out of the 19 have direct or indirect links to Tanchon Commercial Bank and Korea Mining Development Trading Corporation (KOMID).

Amroggang Development Banking Corporation is the financial arm of KOMID and related to Tanchon Commercial Bank, which has also been designated by the 1718 Committee. Additionally, Global Interface Company Inc. is owned by Alex Tsai, who is thought to have provided, or attempted to provide, support to KOMID.

Sobaeku United Corp. is involved in activities related to natural graphite, producing graphite blocks that can be used in missiles.

The report points out, “North Korea has established a highly sophisticated international network for the acquisition, marketing and sale of arms and military equipment, and arms exports have become one of the country’s principal sources for obtaining foreign exchange,” and goes on to say, “Agencies under the National Defense Commission (NDC), the Workers’ Party of Korea (WPK) and the Korean People’s Army (KPA) are most active in this regard.”

The report explains, “The Second Economic Committee of the National Defense Commission plays the largest and most prominent role in nuclear, other WMD and missile-related development programs as well as in arranging and conducting arms-related exports.”

It adds, “The General Bureau of Surveillance of the Korean People’s Army is involved in the production and sale of conventional armaments.”

The report points out that North Korea has opened 39 accounts with 18 overseas banks in 14 countries. 17 of which are held with Chinese banks.

Besides China, 11 banks in eight European and former Soviet countries (Russia, Switzerland, Denmark, Hungary, Poland, Italy, German, Belarus and Kazakhstan) hold 18 North Korean accounts. There is one account in Malaysia.

“The DPRK also employs a broad range of techniques to mask its financial transactions, including the use of overseas entities, shell companies, informal transfer mechanisms, cash couriers and barter arrangements,” the report notes.

According to experts on North Korea, since North Korean overseas illegal activities are all led by the loyal group surrounding Kim Jong Il, U.S. financial sanctions in accordance with UN Security Council resolutions 1817 and 1874 and also U.S. Executive Order (E.O.) 13382 have the potential to be a great pressure on the Kim Jong Il regime.

The Panel of Experts, which was appointed by the UN Secretary-General on 12 August 2009 to author the report, are David J. Birch (United Kingdom of Great Britain and Northern Ireland, coordinator), Masahiko Asada (Japan), Victor D. Comras (United States of America), Erik Marzolf (France), Young Wan Song (Republic of Korea), Alexander Vilnin (Russian Federation), and Xiaodong Xue (People’s Republic of China).

Read the full story here:
Report Explains Sanctions Decisions
Daily NK
Kim Yong Hun
8/6/2010

Share

KWP acsends in September

Wednesday, July 14th, 2010

UPDATE:  The Daily NK also offers some propaganda posters leading up to the event.

ORIGINAL POST: According to the Daily NK:

Hwang Jang Yop, President of the Committee for the Democratization of North Korea, believes the motivation behind the Chosun Workers’ Party (KWP) delegates’ conference, which is to be held for the first time in 44 years this September, is Kim Jong Il’s belief that the power of the Party needs to be increased since too much authority is currently concentrated in the National Defense Commission, and this could represent an obstacle to the establishment of Kim Jong Eun’s succession.

Hwang, who was speaking at a forum in Seoul on July 13th, explained, “Kim Jong Il relies on the military to reign, and the core of that power is the National Defense Commission, but he is trying to solve the succession issue by strengthening the authority of the Party.”

“Kim wants to return the National Defense Commission to its previous role, which was to devote itself to military duty,” he added.

Hwang stated, “Kim Jong Il believes that Kim Jong Eun’s succession cannot be same as his own, which was done through the military. He believes that Kim Jong Eun cannot manage the military as well as he could, and therefore, if Kim Jong Il dies with power concentrated in the National Defense Commission, stabilizing the succession will be difficult.”

“The military is difficult to control if there is a problem, and since Kim Jong Il understands this fact, he is intending to control the military through the Party. Also, Kim will want to announce the succession issue to the North Korean people through the Party rather than the military.”

“The previous Military Commission of the Chosun Worker’s Party served the role of an administrative organization,” Hwang reminded listeners. “Taking the opportunity offered by the Chosun Workers’ Party delegates’ conference, the functions of the Party will be acknowledged and strengthened, while the military will be refocused on military work.”

He also commented, “Kim Jong Il has threatened the international community through the military in difficult political and economic times, and run North Korea by directly mobilizing the army. However, the cultural and ideological unification of North Korean citizens is impossible through the military so, Kim Jong Il will actively use the Party in the establishment of the succession.”

“Kim Jong Il believes that only the Party can unite the North Korean people ideologically during the establishment of the succession, so therefore he is hosting the Chosun Workers’ Party delegates’ conference to begin the process by reinforcing Party authority,” Hwang concluded, returning to the main theme.

Previous posts on September conference here and here.

Read the full story here:
KWP to Take the Power Back in September
Daily NK
Kim Yong Hun
7/14/2010

Share

DPRK says upcoming party meeting will be historic

Tuesday, July 13th, 2010

According to Yonhap:

North Korea stressed on Tuesday the historical importance of its upcoming meeting of core ruling party delegates, urging the younger generation of party members to be as loyal to the leadership as their predecessors.

In September, the communist state will hold its first meeting of senior Workers’ Party delegates in 44 years, a move that observers say may be aimed at paving the ground for leader Kim Jong-il to transfer his power to his third son, Jong-un.

Kim, 68, made his first public appearance in a 1980 convention, considered to be more authoritative, and sealed himself as the successor to his father, Kim Il-sung, who founded the North and died in 1994.

In an editorial seen here on Tuesday, the Rodong Sinmun, the party’s daily, heaped praise on party members who died loyal to the founder and called on new members to “follow suit.”

The paper, considered to be Pyongyang’s main mouthpiece, also described the September meeting as one that will “shine as a notable event in the history of the holy Workers’ Party.”

Late last month, the paper said that the party will expand its role and function through the meeting, stressing the importance of the central party organ that had once served as a venue for Kim Jong-il to rise up the power ladder when he was young.

Kim is believed to be quickening his power transfer after suffering a stroke two years ago. Earlier this year, North Korea promoted Kim’s brother-in-law as a vice head of the National Defense Commission, the highest seat of power. Jang Song-thaek is believed to be the central figure behind the succession process.

Read the full story here:
N. Korea says upcoming party meeting will be historic
Yonhap
Sam Kim
7/13/2010

Share

Aidan Foster-Carter offers DPRK current events summary…

Thursday, July 8th, 2010

In the East Asia Forum:

June 2010 saw two major anniversaries on the Korean peninsula. On June 25 sixty years ago the Korean People’s Army (KPA) invaded the South launching a bitter three-year war. North Korea still denies culpability, claiming it was repelling a Southern invasion; despite overwhelming evidence, now backed by Soviet archives, that it was the aggressor. No less mendaciously Pyongyang nonetheless celebrates the July 27, 1953 Armistice which ended open hostilities as a ‘brilliant victory in the Fatherland Liberation War’ — even though this left the North bombed and napalmed to ruination.

China still formally backs the North’s version, but this year some brave soul decided to take seriously the late Deng Xiaoping’s instruction to ‘Seek truth from facts.’ The International Herald Leader, an affiliate of Xinhua news agency let the cat out of the bag. It featured interviews with Chinese historians telling the true story, and a timeline stating that ‘The North Korean military crossed the parallel on June 25 1950 and Seoul was taken in four days.’ Naturally, the article rapidly vanished from the web. But many Chinese now are openly critical of the DPRK, and embarrassed that Beijing continues to toe Pyongyang’s line.

North Korea itself sticks to the old tunes. On June 22 the Korean Central News Agency (KCNA) reported what it headlined as ‘Revenge-vowing Meetings.’

Youth and students and agricultural workers gathered in Susan-ri… and in Sinchon … Tuesday to vow to take revenge upon the U.S. imperialists on the occasion of the ‘June 25, the day of the struggle against the U.S. imperialists’.

The reporters and speakers at the meetings recalled that the U.S. imperialists brutally destroyed cities, villages, factories and farms and killed innocent civilians…denouncing the Yankees as a herd of wolves in human skin and the Koreans’ sworn-enemy with whom they cannot live under the same sky…

They bitterly condemned the U.S. imperialists and the Lee group of traitors for totally negating the historic June 15 North-South Joint….

If the U.S. imperialists intrude into the DPRK even an inch, all the servicepersons and people will mercilessly wipe out the aggressors.

Rhetoric like the above is clearly intended to fan the flames of hatred.

A further KCNA item on June 24 purported to list the ‘Tremendous Damage Done to DPRK by US.’ The KCNA, with unusual precision, computed a total of nearly 65 trillion dollars for human and material losses inflicted from 1945 up to the present. Considering the state of US public finances, Kim Jong-il should not expect a cheque any time soon. There is also a degree of inflation; last time KCNA published such an exercise, in November 2003, the bill was a mere US$ 43 trillion. One can only wonder what is the point of such grandstanding.

So savage a mood has torpedoed a second anniversary; one which should have been happier. On June 13 2000 South Korea’s then president, the veteran democrat Kim Dae-jung flew to Pyongyang for the first ever inter-Korean summit with the North’s leader, Kim Jong-il. On June 15 they signed a North-South Joint Declaration; Kim Dae-jung was awarded that year’s Nobel Peace Prize. Thus began a decade of unprecedented North-South cooperation, albeit patchy and one-sided. This ‘sunshine’ policy was ended by South Korea’s current president, Lee Myung-bak, who insists that the North must give up its nuclear weapons first if it wants better ties with the South. That sounds fine in theory, but few expect it will ever happen.

North Korea made much of the June 15 anniversary, even while excoriating the ‘traitor’ Lee Myung-bak for trampling on it. Pyongyang warmly welcomed a South Korean radical priest, Han Song-ryeol, who made the trip illegally to mark the occasion.

South Korea by contrast played up the war anniversary more than the inter-Korean one. Lee Myung-bak used this occasion to once again call on the North to admit that it sank the ROK corvette Cheonan on March 26, and to apologise.

Will the Cheonan go unpunished?
Nevertheless, it looks increasingly like Pyongyang has got away with it. June brought Lee Myung-bak little joy on the issue, at home or abroad. Local elections in South Korea on June 2 saw his ruling Grand National Party (GNP) rebuffed. Many voters saw Lee’s tough first reactions, which roiled global markets, as adding to rather than reducing risk.

Abroad too Lee has met obstacles. Assured of firm US and other Western support he is struggling to convince Russia and China. That was predictable: for Beijing and Moscow, unwillingness to paint Pyongyang into a corner was always going to trump the facts. A Russian naval team visited Seoul to inspect the Cheonan wreckage, including DPRK torpedo parts, but is not expected to report until July. In this light the ROK government will be relieved that the G-8 summit in Canada on June 25 issued a strong statement on the Cheonan – after energetic lobbying by Japan’s new prime minister Naoto Kan, which will get his relations with Lee Myung-bak off to a good start. Connoisseurs of diplomatic wordplay noted that while the G-8 condemned the attack, noted that an international team had blamed it on Pyongyang, and called on the DPRK to avoid any attacks against the ROK, it did not quite join up all those dots; doubtless at Moscow’s behest. Lee may lobby similarly when he arrives for the ensuing G-20 summit; although since South Korea chairs the group and will host its next jamboree in Seoul in November, it may look bad if he were perceived as acting in too particularist a way.

Earlier, on June 4 South Korea formally referred the Cheonan incident to the UN Security Council (UNSC). On June 14 both Korean states briefed the UNSC, with the North as ever denying all responsibility and urging the Council not to consider the matter. No official response is expected until July. With Russia and China likely to abstain at best, whatever the Security Council eventually comes up with looks set to be a damp squib. South Korea has already said it will not seek further sanctions, on top of those already in force under earlier UNSC resolutions from 2006 and 2009 after the North’s two nuclear tests. But it would like a clear, resounding condemnation, preferably in the form of a resolution.

Looking ahead, it is not too soon to wonder how the two Koreas will get past Cheonan. Record numbers of DPRK workers at the Kaesong Industrial Zone (KIZ) – 44,000 as of June, according to the ROK unification ministry (MOU) – are seen in Seoul as a sign that at some level Pyongyang remains committed to this joint venture at least.

A big event in September
Meanwhile North Korea looks more preoccupied with the succession issue than in reaching out to South Korea.

On June 26 KCNA reported that ‘the Political Bureau of the WPK [Workers’ Party of Korea] Central Committee decides to convene early in September … a conference of the WPK for electing its highest leading body reflecting the new requirements of the WPK.’

Though nominally it is North Korea’s ruling communist party, and still an important tool of control at lower echelons, the WPK has seen its topmost organs atrophy under Kim Jong-il. Neither the rarely mentioned Politburo nor the Central Committee (CC) is known to have met at all in the 16 years since Kim Il-sung died. Kim Jong-il has favoured the army, ruling through the NDC and informally via a kitchen cabinet of trusted cronies. The dear leader is also of course secretary-general of the WPK, but he acquired that post irregularly: by acclamation at a series of local Party meetings, rather than being duly elected by the CC.

Hence while the precise nature of September’s meeting remains vague, like its exact date, it looks like a long overdue effort to restore a measure of due process to the Party. If this is in fact a full formal WPK congress, it would be the first since the Sixth Congress thirty years ago in October 1980. It was then that Kim Jong-il, hitherto veiled behind coded references to a mysterious ‘Party Centre’, was finally revealed in the flesh. The speculation is that this new meeting similarly will finally give the world a glimpse of the enigmatic Kim Jong-eun.

While all rumours emanating from Seoul should be treated carefully it’s hard not to link this news with reports that Kim Jong-il’s health is worsening. There are claims that on some aides including his son are duping him with Potemkin factories to hide from him how dire the economy really is. An already tardy succession can clearly brook no further delay, or else regime stability and continuity may be gravely imperilled.

The economy shrank again last year
If Kim Jong-il wants to know how his economy is really doing, he could look at the latest estimates from the enemy.

The (southern) Bank of Korea (BOK) published its latest estimates, covering 2009, on June 24, just in time for Seoul to crow about them as it marked the Korean War anniversary. By this reckoning North Korea’s real annual gross domestic product (GDP) shrank by 0.9 per cent last year. Unlike most other countries this had little to do with the global financial crisis. Rather it reflected local conditions, natural and man-made.

The gaps just get wider
The result is a huge and ever widening gap. North Korea’s gross national income (GNI) in 2009 was a mere 2.7 per cent of the South’s. BOK cites Northern GNI in 2009 was US$22.4 billion, compared to US$837 billion for the South. True, the South has over twice as many people. But the average North Korean per capita income too is a minute fraction of the South’s, with the ROK topping US$17,000 while the DPRK’s is a paltry US960. (Some experts, including a former unification minister, think even this is too high and posit a figure nearer US$300, putting North Korea among the poorest nations on earth.)

With trade figures the gap is even wider. This year inter-Korean trade will fall, since Seoul has banned most of it (except the Kaesong zone, which accounts for over half) as punishment for the Cheonan. Peanuts to the South, this has been crucial for the North: South Korea is its largest market, taking almost half of its meagre total exports. Last year inter-Korean trade like DPRK trade overall fell slightly, from US$1.82 to US$1.68 billion. Yet Northern exports crept up, from US$932 to 934 million.

In 2009 North Korea’s real trade totals were just under US$2 billion in exports and US$3.1 billion in imports. They are still dwarfed by South Korea’s respective figures of US$364 and US$324 billion – and this in a bad year for the South, due to the downturn.

Every year the gap widens further, yet still Kim Jong-il refuses economic reform. It is hard to fathom a mind-set which can inflict such disaster and tragedy on a once proud land and people – and whose idea of a way out of its self-dug hole is to fire a sneaky torpedo.

Good losers
It was left to North Korea’s footballers to remind the world that their country does not lack for talent and virtue. As one would expect, North Korea were a disciplined team. They kept to themselves and avoided the press – with one striking exception, Jong Tae-se. Born in Japan to a South Korean father and a pro-North Korean mother, and having attended schools run by Chongryun – the organisation of pro-North Koreans in Japan – he elected to play for the DPRK; although he still holds ROK nationality, lives in Japan and plays in the J-League for Kawasaki Frontale.

A young man whose talk is as uninhibited as his style of play, Jong cried when the DPRK anthem was played before the Brazil match. Yet his love for his adopted homeland is not uncritical. ‘Everybody thinks about our country as being closed and mysterious, so we have to change that,’ he told AFP. ‘We can change for the better if we are more open with the way we talk to people and it would make a better team.’

It would make a better country too. If North Korea’s fate must rest in the hands of an untried youth, better it were the warm-hearted and wised-up Jong Tae-se than Kim Jong-eun.

Read the full story here:
North Korea: Unhappy anniversaries
East Asia Forum
Aidan Foster-Carter
7/6/2010

Share

Kim Jong Il, the reformer?

Monday, June 28th, 2010

Bradley Martin, author of Under the Loving Care of the Fatherly Leader, writes in the Global Post:

Now that food shortages reportedly have forced North Korea to reverse its crackdown on capitalist-style markets, more systematic reforms for its collapsed economy may not be far behind.

The markets policy reversal came May 26 in directives issued by the cabinet and the ruling Workers’ Party to subordinate organizations, according to a report by the Seoul-based newsletter North Korea Today, which gets its information from officials and ordinary citizens inside the North. “The government cannot take any immediate measures” to relieve a food shortage that is “worse than expected,” the newsletter quoted one of the directives as saying in explanation for the policy change.

The same authorities only late last year decreed a sudden currency revaluation that crippled the “anti-socialist” markets, where stallholders had been trading for individual profit, by confiscating the traders’ wealth. The new decrees bless and deregulate what’s left of the markets, which have shrunk and in some cases closed completely in the interim, in the hope that market trading will keep people from starving. And the directives instruct managers of state-run enterprises to pursue lucrative deals — especially in foreign trade — that could help feed their employees.

This could all turn out to be the big event that finally pushes the very reluctant leadership into a multi-year campaign of serious reforms of the sort that began decades ago in Vietnam and China, according to Felix Abt, a Swiss involved in North Korean joint ventures in pharmaceutical manufacturing and computer software.

“Given an industrial stock and an infrastructure beyond repair, and the impossible task of maintaining a huge army, economic reforms appear unavoidable in the very near future,” Abt, a former president of Pyongyang’s European Business Association, wrote in an email exchange.

“It looks intriguing and it reminds me of Vietnam’s history of reforms,” said Abt, who did business for years in Vietnam before going to Pyongyang and recently has moved back to Vietnam while maintaining his involvement in North Korea.

“The Vietnamese economic situation looked dire at the beginning of the 1980s,” he explained. “Nguyen Van Linh, party secretary in Ho Chi Minh City, favored moderate economic reforms. He tried too early, lost his job and left the political bureau in 1982.

“Le Duan, secretary general of the Communist Party, was categorically against any economic reforms. He died in 1986, the year of the five-year party congress which brought Nguyen Van Linh back and elected him as his successor. The new party secretary general immediately launched the Doi Moi policy — ‘reforms.’”

Abt ventured the lesson that triggering reforms “takes something big like the death of a leading politician” in Vietnam — or, in North Korea, a “ruinous” currency revaluation.

Not every foreigner who has had firsthand economic dealings with North Korea is convinced the recent events constitute that trigger. Some worry that U.S.-led sanctions could nip any flowering of capitalism in the bud.

“The problem is still U.S. Treasury’s attitude,” said one such foreigner, who asked not to be identified further. Treasury Department officials began working several years ago to take North Korea “out of the international banking system,” discouraging trade, he noted.

Some U.S.-sponsored sanctions subsequently were eased in an effort to persuade Kim Jong Il to negotiate away his nuclear weapons capability, but after those talks went nowhere — and especially after North Korea allegedly torpedoed a South Korean warship earlier this year — enthusiasm for compromise cooled. Recent reports say Washington is moving toward aggressively strangling cash flow into the country.

There is also the argument that Kim believes he cannot afford to reform the economy because it would let in information and influences that would undermine his family’s rule by letting his isolated subjects learn that the rival South Korean system works much better.

According to Abt, one answer to both concerns could be China, which “will provide all the support necessary to the DPRK party and government to enable economic reforms without regime change.” He used the abbreviation of Democratic People’s Republic of Korea, the country’s official name. “The DPRK may expect support from other quarters, for example, the European Union, too,” he said.

“I think the dilemma of the leadership — economic upsurge versus the inflow of ‘subversive’ system-destabilizing information and ideas, particularly regarding the South — can be overcome with the necessary Chinese support,” Abt said. “Though the division of Korea can only be compared with that of Germany before 1990, China’s division — capitalist Hong Kong, capitalist Taiwan — was a sort of challenge to Deng Xiaoping and successors, too, but they learnt to manage that quite well.”

Read the full the story here:
Analysis: Kim Jong Il, the reformer?
Global Post
Bradley Martin
6/24/2010

Share

Mansudae Overseas Development Group Projects

Wednesday, June 23rd, 2010

According to the Daily NK:

North Korea has earned more than $160 million in the last ten years thanks to the construction of sculptures and other edifices in countries across Africa.

A Daily NK source in China revealed on the 18th, “Since 2000, North Korea has been earning colossal quantities of dollars through contracts for the Mansudae Overseas Project Group of Companies under the Mansudae Art Institute to construct sculptures.”

Mansudae Art Institute is an organization primarily dedicated to the idolization of Kim Il Sung and Kim Jong Il through public works, one whose construction of edifices such as the Juche Tower and Arch of Triumph in Pyongyang has added to the status of the country.

It has also been building revolutionary monuments in African countries such as Ethiopia since the 1970s in order to maintain cordial relations with socialist states, but in the early 2000s started doing work in African countries to earn foreign currency as well.

According to the source, North Korea has earned $66.03 million from Namibia alone thanks to the construction of the Presidential Palace ($49 million); the Cemetery of National Heroes ($5.23 million); a military museum ($1.8 million); and Independence Hall ($10 million).

It has also earned almost $55 million from Angola via the António Agostinho Neto culture center ($40 million); Cabinda Park ($13 million); and the Peace Monument ($1.5 million).

Additionally, the North has constructed a basketball stadium ($14.4 million) and an athlete academic center ($4.8 million) in the Congo, earning almost $20 million dollars in total.

Thanks to the Monument to the African Renaissance in Senegal, the North has made another $12 million dollars.

There are around 19.8㎢ set aside for a vacation spot for the president of Equatorial Guinea, which is supposed to earn Mansudae around $800,000, not to mention a government office building ($1.5 million), Luba Stadium ($6.74 million) and conference halls ($3.5 million).

The source also reported, “The money earned from these construction projects is managed by the No. 39 Department. Some of these dollars are used for domestic governance, while the rest go to secret accounts in Switzerland or Macau to become Kim Jong Il’s secret funds.”

Here are the images from the story including a table of financial data (which I would take with a grain of salt):

dnk-mansudae-1.jpg dnk-mansudae-2.jpg dnk-mansudae-3.jpg dnk-mansudae-4.jpg dnk-mansudae-5.jpg dnk-mansudae-6.jpg dnk-mansudae-7.jpg

Additional Information:

1. I blogged here about the Derg Monument in Ethiopia.

2. I have located some of the Mansudae Overseas projects mentioned in this story (as well as numerous other places not menioned in this story: Egypt and Syria, Zimbabwe, DR Congo). However, here are GeoEye satellite images of some of the Namibia and Angola projects mentioned above courtesy of Google Earth:  

Namibia National Heroes Acre (22°39’46.02″S,  17° 4’41.06″E):

national-heroes-acre-namibia-thumb.jpg

Namibia State House (22°35’28.83″S,  17° 6’2.76″E)

namibia-state-house-thumb.jpg

Cultural Center of António Agostinho Neto (Mausoleum) (8°49’24.73″S,  13°13’8.52″E)

angola-nehro-thumb.jpg

 

Share

Room (Bureau) 38 allegedly restored

Wednesday, June 23rd, 2010

According ot the Choson Ilbo:

North Korea in March restored a special department in the Workers Party codenamed Room 38 which manages leader Kim Jong-il’s coffers and personal slush funds, it emerged Monday. The North last fall merged Room 38 with Room 39, which manages party slush funds.

“Rooms 38 and 39 were merged to simplify Kim Jong-il’s slush funds,” said a North Korean source. “But when it became difficult to secure hard currency due to international sanctions, Room 38 seems to have been restored because there was a feeling that Room 39 alone can’t meet the need.”

Room 38 is reportedly led by Kim Tong-il, who heads three regional departments in charge of earning hard currency.

Room 39 tries to maximize earnings from gold and zinc mining and farming and fisheries. It also manages stores and hotels exclusively for foreigners in Pyongyang. Room 39 seems to have suffered badly due to the recent suspension of inter-Korean trade. “Taesong Bank and Zokwang Trading, which received remittances from Mt. Kumgang tourism, are both controlled by Room 39, and is also in charge of the exports of agricultural and fisheries products,” said a government source.

Kim Jong-il needs dollars to maintain the party elite’s loyalty to him and his heir presumptive. He is said to have told party bigwigs in February, “From now on I will judge your loyalty based on the amount you contribute to the fund.” His son Jong-un is also said to be amassing separate slush funds for his own use.

But international sanctions on exports of weapons, counterfeit dollars, fake cigarettes and drugs remain in place, and the United States is pushing ahead with additional financial sanctions over the North’s sinking of the South Korean Navy corvette Cheonan in March. Pyongyang was dealt a heavy blow in 2005 when the U.S. froze US$25 million in the Banco Delta Asia in Macao which was apparently for Kim’s personal use.

Kim earlier this year appointed his high school friend Jon Il-chun head of Room 39. Jon was also named chairman of the National Development Bank, established early this year with a view to conducting normal international financial transactions to induce foreign investment. “North Korea seems to be planning to divert part of foreign investment to Kim’s slush fund,” said a government official.

NK Leadership Watch has more

Read the full story here:
Kim Jong-il Restores Special Department to Swell Coffers
Choson Ilbo
6/24/2010

Share

DPRK abandons food rations, orders self-sufficiency

Thursday, June 17th, 2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-06-17-1
6/17/2010
 
As North Korea’s food shortages worsen and reports of starvation continue to grow, the Workers’ Party of Korea have acknowledged the failure of the central food ration program. Since the end of May, the Party has permitted the operation of 24-hour markets, and the regime has ordered the people of the North to provide for themselves.

The human rights organization Good Friends reported this move on June 14. According to Good Friends, the Workers’ Party organization and guidance bureau handed down an order on May 26 titled ‘Relating to Korea’s Current Food Situation’ that allowed markets to stay open and ordered North Koreans to purchase their own food. This order, recognizing that the food shortages in the North have continued to worsen over the last six months, since the failed attempts at currency reform, acknowledged the difficulty of providing government food rations. It calls on those who were receiving rations to now feed themselves, while also calling on the Party, Cabinet, security forces and other relevant government agencies to come up with necessary countermeasures. Now, authorities officially allow the 24-hour operation of markets, something that most had already tacitly permitted, and encourage individuals, even those not working in trading companies, to actively import goods from China.

It has been reported that government food rations to all regions and all classes of society, even to those in Pyongyang, were suspended in April. The last distribution of food was a 20-day supply provided to each North Korean on April 15, the anniversary of the birth of Kim Il Sung. Because of the difficulty of travelling to markets, the suspension of rations caused many in farming communities to starve to death. When Kim Jong Il’s recent visit to China failed to secure expected food aid, the Workers’ Party had no choice but to hand down the ‘May 26 Party Decree’. While the suspension of rations has considerably extended the economic independence of North Korean people, the regime has significantly stepped up other forms of control over society. Public security officers have begun confiscating knives, saws and other potential weapons over 9 centimeters long in an effort to stem murder and other violent crimes. Additionally, state security officials are cracking down on forcefully resettling some residents of the age most likely to defect, while sending to prison those thought to have contacted relatives in South Korea.

According to Daily NK, North Korean security officials are pushing trading companies to continue trading with China, while calling on Chinese businesses to provide food aid. It also appears that North Korean customs inspections along the Tumen River have been considerably eased, and there is no real attempt to identify the origin or intended use of food imported from China. Sinheung Trading Company has asked Chinese partners investing in the North to send flour, corn and other foodstuffs. The Sinheung Trading Company is operated by the Ministry of State Security, and is responsible for earning the ministry foreign capital. It appears that food acquisition is now a matter of national security, as North Korea is expecting South Korea and the rest of the international community to economically isolate the country.

Share

DPRK shakes up elite in order to meet 2012 “strong and prosperous” goal

Tuesday, June 15th, 2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-06-14-2
6/14/2010

During the third session of the 12th Supreme People’s Assembly, convened on June 7, Kim Jong Il promoted his brother-in-law Jang Sung Thaek to vice-chairman of the National Defense Commission (NDC), named a new premier, and replaced several department heads and ministers. This appears to be an attempt to shore up the regime as it seeks to “open the door to a strong and prosperous nation” by 2012, the 100th anniversary of the birth of Kim Il Sung. Kim Jong Il made a personal appearance at this latest assembly meeting, unlike the SPA meeting held in April. The leader’s presence hints at the importance of the latest gathering.

This promotion of Jang Sung Thaek and shake up of Cabinet positions appears to be part of efforts to realize the quickly approaching goal of establishing a ‘strong and prosperous nation’ by 2012, assigning those most able to positions of responsibility, regardless of age or experience. Most notably, Jang, widely thought to be second-in-command in North Korea, was promoted to vice-chairman of the NDC. He was first appointed to the NDC at the first meeting of the 12th SPA in April 2009, making his climb to vice-chairman in a mere 14 months.

Before the latest promotion, Jang held the position of vice-director of the Workers’ Party of Korea, a newly created position that he was the first to hold. In this position, Jang oversaw national security offices, police, and the courts, putting him in a position of power difficult for anyone else to achieve. Having traveled to both South Korea and China, Jang Sung Thaek was likely promoted to present the image of a strong military and, at the same time, establish stable relations with the international community in order to ensure a smooth transition of power as well as to resurrect the economy by 2012. When Kim Jong Il led a delegation to China last May, the Chinese government treated Jang very well, ignoring standard protocol for someone in his position.

In addition, Choe Yong Rim was named the North’s new premier, and eight new vice-ministers were appointed. Regional Party secretaries were allowed to participate directly, allowing those who are most knowledgeable of local conditions to impact the decisions of the administration. Most of the new appointments were very experienced elites, including Choe Yong Rim (80) as premier, and Kang Neung Su (80), Kim Rak Hui (77), Ri Thae Nam (70), and Jun Ha Chul (82). The regime is promoting a number of veterans who are making their “last stand for the motherland” as part of the effort to ensure stable transformation of power after Kim Jong Il.

With Kim Rak Hui’s appointment as vice-premier and new appointments to the Ministry of Foodstuff and Daily Necessities Industry as well as the head of the Light Industry Ministry, North Korea seems to be pursuing the improvement of standards of living promised in the 2010 New Year’s joint editorial. Pyongyang Party officials appear to be attempting to reassert a centrally planned economy in the aftermath of botched currency reform efforts; however those witnessing regional economic conditions appear much more able to come up with appropriate economic policies. North Korea has been unable to make any significant progress in resolving its food shortages or its inability to provide daily necessities to the public, leading the regime to scapegoat some high-ranking officials. Now, many in and outside of North Korea are watching closely to see if the regime can launch economic efforts capable of successfully ‘opening the door to a Strong and Prosperous Nation’ in the next two years.

Share