The General Association of Koreans in Japan (Chongryun) have made a video about foreign direct investment and joint venture companies in the DPRK. I have posted links to the video below. It features the PyongSu pharmaceutical factory among other things. It is in Korean and Japanese (with Japanese subtitles), so if there are any readers who care to translate, please let me know if there is any interesting information in the videos:
Archive for the ‘Railways’ Category
FDI and JVCs in the DPRK…
Thursday, June 25th, 2009China and N Korea to set up tourism railway
Tuesday, May 5th, 2009Irish Times
Clifford Conan
5/5/2009
Long-term allies China and North Korea have signed an agreement to set up a rail route between the two countries to encourage tourism, the latest sign of lively cross-border trade between the two neighbours.
The line will run between Tumen City in China’s Jilin province and North Hamgyong province in North Korea, Chinese state media reported yesterday. The route will be operated by two travel agencies, one from China and the other from North Korea. Both sides plan to hold an inauguration ceremony for the route’s trial operations later this month.
Kim Jong Il, Urban Planner
Friday, April 24th, 2009Daily NK
Lee Sung Jin
4/24/2009
Hyesan, Yangkang Province: If it had been any other day, on April 18th the entire city would be buzzing with People’s Unit evaluation meetings and cadre lectures. On this particular day, however, influential officials in Yangkang Province, including Kim Kyung Ho, Chief Secretary of the provincial committee of the Party, were gathered together around the railroad tracks in Sungwoo-dong.
The “Ground-Breaking Ceremony” for a project to clear residences near the railroad, so as to fulfill “Supreme Commander Kim Jong Il’s March 4th Decree,” was being held. However, the expressions on the faces of the officials carrying out the decree were grim. The ceremony ended with a few civilians who had been mobilized for the event demolishing an old farmhouse near the railroad and without the top official present making the planned speech. The faces of the bystander officials as well as the gathered civilians betrayed their distress; removal of houses near the railroad has already started, while new homes for residents, whose houses are to be demolished, are not yet prepared.
All of this started with Kim Jong Il’s onsite inspections at Samjiyeon, also in Yangkang Province, on March 4th. Kim, who entered the county along the road connecting Bukchung in North Hamkyung Province and Hyesan, had some choice words for the homes haphazardly clustered around the railroad.
“Why is it so disorderly around here? Get rid of all of the houses surrounding the railroad within the year!”
He also apparently expanded on his beliefs, “Clearing the area around the railway is an important project which improves the image of our country.” Since Kim Jong Il’s words and “instructions” surpass all laws and institutions, his words immediately formed the “March 4th Decree” and were subsequently relayed to all officials in the Yangkang Province region.
Railways in North Korea
In North Korea, there is no protection surrounding railroads, which frequently cut across the center of cities. There are rules that prohibit the construction of public buildings, including residential homes, within 50 meters of railroad tracks, but such rules have existed in name only for a long time.
From the perspective of common citizens, the areas around the railways are some of the most active zones for economic activity. Of course, it is very dangerous when trains are passing, but since they run only once or twice a day at most, the danger is short-lived.
The railroad is a more direct route than the roads, which are in any case not always paved, so it helps conserve time for commuters or those going to markets. It is also convenient to travel on the rails on wooden blocks during the winter! In the border cities of Yangkang and North Hamkyung Provinces, railways running alongside the Yalu and Tumen Rivers serve as important smuggling routes to and from China.
Since the early 2000s, when citizens began to prefer convenient locations around railroads for selling goods or commuting to and from work, the North Korean authorities permitted the construction of residential homes, though bribes had to be offered to officials. In small and mid-size cities, many homes were built within 10 meters of railway tracks.
A source from Yangkang Province explained in a phone conversation with Daily NK on the 23rd while relaying the news of the groundbreaking ceremony, “Workers have to spend most of the year constructing homes. Many people will then be forcibly evacuated from the danger areas.”
The source further commented, “In Hyesan, several hundred households have to be relocated even if only the residential homes within 50 meters of the railway are demolished. Since land is available only on the outskirts of the cities, citizens slated for evacuation have been putting up strong resistance.”
The source also commented dryly, “In resettlement projects, homes are usually built very sloppily. It would be better if the state provided resources to the individuals to build the homes themselves.”
In the areas surrounding the railroad in Hyesan proper, where one-bedroom rentals by university students recently discharged from the army are commonplace, frustration has been running high. The source relayed that while the People’s Units around the railways have been holding daily meetings to decide on the households to be relocated, angry words and even fistfights have been rampant, making mutual agreement difficult if not impossible.
The Party in Hyesan allotted responsibility for the construction of new residences to each factory and enterprises. However, the construction materials provided by the North Korean authorities amounted to just 300kg of cement, which is barely enough for the under-floor heating of a house. Additional materials and means of transportation have to be provided in their entirety by the factories and the enterprises.
Even the citizens who do not live in the vicinity of the railways are incensed by the recent decree. Each household in Hyesan was ordered to make and offer 500 bricks of mud and straw. The factories, in order to secure fuel and other materials, have had to reduce the wages of workers, which at best are not even equivalent to two kilograms of rice, by half.
The source explained, “In 1992, 1,000 homes were built for the discharged soldiers who had been stationed in the Hyesan mine, but in less than three years, at least half had abandoned their homes. Residential homes built in Potae-ri, Samjiyeon or in Daehongdan look great on the outside, but they were all built sloppily, so the soldiers are living in poor conditions to this day.”
North Korea Google Earth
Wednesday, March 11th, 2009North Korea Uncovered v.16
Download it here
The most recent version of North Korea Uncovered (North Korea Google Earth) has been published. Since being launched, this project has been continuously expanded and to date has been downloaded over 32,000 times.
Pictured to the left is a statue of Laurent Kabila of the Democratic Republic of Congo. This statue, as well as many others identified in this version of the project, was built by the North Koreans. According to a visitor:
From the neck down, the Kabila monument looks strangely like Kim Jong Il: baggy uniform, creased pants, the raised arm, a little book in his left hand. From the neck up, the statue is the thick, grim bald mug of Laurent Kabila (his son Joseph is the current president). “The body was made in North Korea,” explains my driver Felix. In other words, the body is Kim Jong Il’s, but with a fat, scowling Kabila head simply welded on.
This is particularly interesting because there are no known pictures of a Kim Jong il statue. The only KJI statue that is reported to exist is in front of the National Security Agency in Pyongyang. If a Kim Jong il statue does in fact exist, it might look something like this.
Thanks again to the anonymous contributors, readers, and fans of this project for your helpful advice and location information. This project would not be successful without your contributions.
Version 16 contains the following additions: Rakwon Machine Complex, Sinuiju Cosmetics Factory, Manpo Restaurant, Worker’s Party No. 3 Building (including Central Committee and Guidance Dept.), Pukchang Aluminum Factory, Pusan-ri Aluminum Factory, Pukchung Machine Complex, Mirim Block Factory, Pyongyang General Textile Factory, Chonnae Cement Factory, Pyongsu Rx Joint Venture, Tongbong Cooperative Farm, Chusang Cooperative Farm, Hoeryong Essential Foodstuff Factory, Kim Ki-song Hoeryong First Middle School , Mirim War University, electricity grid expansion, Tonghae Satellite Launching Ground (TSLG)” is also known as the “Musudan-ri Launching Station,” rebuilt electricity grid, Kumchang-ri suspected underground nuclear site, Wangjaesan Grand Monument, Phothae Revolutionary Site, Naedong Revolutionary Site, Kunja Revolutionary Site, Junggang Revolutionary Site, Phophyong Revolutionary Site, Samdung Revolutionary Site, Phyongsan Granite Mine, Songjin Iron and Steel Complex (Kimchaek), Swedish, German and British embassy building, Taehongdan Potato Processing Factory, Pyongyang Muyseum of Film and Theatrical Arts, Overseas Monuments built by DPRK: Rice Museum (Muzium Padi) in Malaysia, Statue de Patrice Lumumba (Kinshasa, DR Congo), National Heroes Acre (Windhoek, Namibia), Derg Monument (Addis Ababa, Ethiopia), National Heroes Acre (Harare, Zimbabwe), New State House (Windhoek, Namibia), Three Dikgosi (Chiefs) Monument (Gaborone, Botswana), 1st of May Square Statue of Agostinho Neto (Luanda, Angola), Momunment Heroinas Angolas (Luanda, Angola), Monument to the Martyrs of Kifangondo Battle (Luanda, Angola), Place de l’étoile rouge, (Porto Novo, Benin), Statue of King Béhanzin (Abomey, Benin), Monument to the African Renaissance (Dakar, Senegal), Monument to Laurent Kabila [pictured above] (Kinshasa, DR Congo).
North Korea’s transformation: A legal perspective
Thursday, February 12th, 2009The Institute for Far Eastern Studies (IFES) published an interesting paper (with the above title) on legal reform in the DPRK. Below are some highlights. Links to the entire paper at the bottom.
As citizens have been left without state provisions for subsistence since the state did not have the material resources to supply the people through its central rationing system, the vast majority of individuals and organizations had to support themselves. Legitimizing commercial and market activity and expanding the scope of private ownership were a part of this effort. One of the most important laws reflecting this transformation is the Damage Compensation Law (sonhae bosang-beop), which is the North Korean version of a general torts law. This law holds an individual or any legal entity liable for its tort when damage is inflicted. Monetary compensation is the rule, while restoration is allowed when possible.
Under the socialist system, where the state is responsible for the provision of a citizen’s livelihood, tort law was of little use. Even in the case of death, one’s family would not suffer economically since the state provided sustenance rations. However, with the collapse of the public distribution system, the North Korean authorities could no longer maintain their socialist system. Since an individual now has to rely on his or her own devices, the loss of the employment, for example, directly inflicts a financial burden on the individual or family. Therefore, damage to property or person should be compensated for by the responsible party. Therefore, the new damage compensation law acts as a new mechanism for the protection of private property, and strengthens individual responsibility for negligent acts that inflict damage on others.
and…
Relaxation of law and order, along with the laxity of organizational control due to economic difficulties, changed individual attitudes toward government authorities and organizations in which these individuals were members. Individuals became more independent from the state and its organizations, since both the state and more directly engaged organizations lost important means of control over individuals in society due to the lack of resources and the inability to provide basic necessities to the people.
Under these circumstances, individual victims had no appropriate method to seek compensation for damage through an official dispute resolution process. This has led to an environment in which self-remedy has become the rule, rather than the exception. Although new criminal law punishes those who have used force in asserting their rights, there is no effective means of dispute resolution outside of taking advantage of officials willing to look the other way in exchange for favors, or hiring thugs to more directly resolve disagreements. Citizens can buy justice through bribes, and law enforcement officials are especially helpful in these endeavors when their palms are greased. This is much more economical as well as effective than bringing a case to the relevant official agency, which is generally incapable of resolving problems and instead further exploits the situation.
On courts and lawyers…
For example, the most prominent role of the court in North Korea, where other types of lawsuit are very unusual, was to handle divorce settlements, since divorce through simple agreement of the two parties was not allowed. Ordinary citizens went so far as to perceive settlement of divorce to be the most important role of the court. Criminal cases were also unusual. Political crime is handled through a non-judicial process, while many deviances are resolved through unofficial processes within more local organizations. The role of the court in resolving disputes was negligible, aside from divorce. Since the role of law enforcement agencies is to protect the state and secure the socialist system, the most important qualification for them is not legal expertise, but rather, loyalty and devotion to the North Korean ideology and system.
On the other hand, the Lawyer’s Act of 1993 prescribes the required qualifications of a lawyer. Those who are eligible to work as lawyers are those who are certified legal professionals, those who have working experience of no less than 5 years in legal affairs, or those who have a professional license in a certain area and have passed the bar examination after a short-term course in legal education. This qualification for working as a lawyer signifies that the state wants to equip the judicial system with legal professionals. Although there is no explicit professional qualification for a judge or prosecutor, we may assume that legal professionals have been elected or recruited in practice. This trend is likely to be reinforced as these social changes continue to unfold.
New provisions were also introduced to reinforce the judicial system. For example, interference with a law enforcement official’s performance of duties is now a punishable offence ; Threatening a witness or exacting revenge has been criminalized ; Non-execution of judgment will now be punished. Although the introduction of these provisions was an expression of the government’s effort to bring in a more effective judicial system, it would not be an easy task under the vague status of transformation. The state is very cautious and reluctant to undertake bold or fundamental changes due to concerns about political instability. Therefore, it takes time for various coherent mechanisms to fully support a market system.
Daily NK reports DPRK train wreck
Tuesday, January 27th, 2009From the Daily NK:
A source from Yangkang Province reported on the 27th in a telephone conversation with the Daily NK that, “On the 15th in Woonheung, 8 freight wagons carrying a total of 480 tons of gasoline and diesel overturned at dawn. The National Security Agency and the provincial security agency are examining the causes of the incident.”
In Youngha Workers-gu, which adjoins Baekam where this incident occurred, a train on the Hyesan-Pyongyang line overturned on March 27th, 2008, killing or wounding hundreds.
According to the source, there were 16 casualties, including merchants and an engineer on the freight train. 8 freight wagons completely overturned, causing the spill.
Right after the incident, North Korean authorities mobilized citizens to deal with it and dispatched the NSA to examine the causes.
The source said that, “As the train was going down a slope, a blackout occurred so the brakes did not work. However, the NSA presumes it happened deliberately, because similar incidents have occurred in this region.”
The North Korean authorities have been claiming to citizens that such incidents, which happen every year in Youngha Workers-gu, Woonheung and Baekam in Yangkang Province, are maneuvers by enemies. However, no criminals have been detained.
Thoughts:
1. The DPRK’s railway system is outdated to say the least. Many of the lines were laid during the Japanese occupation of the peninsula (pre-WWII). After the Korean war, large sections were reconstructed, but needless to day, for the last 50+ years the system has suffered severe under-investment. Recently it has been targeted as a major focus of the policy to create a “strong and prosperous nation” by 2012.
2. We know from multiple tourists that the Pyongyang-Sinuiju line is operational. We now know that the line from the Russian border to Pyongyang is operational. Other than these two lines, the functionality of the DPRK’s railway system is largely a mystery to the outside world.
3. The Daily NK also reported a DPRK railway accident in April 2008 (here and here).
4. No word yet on whether the DPRK purchased life insurance for the passengers!
5. An excellent map of the DPRK’s railway system can be downloaded to Google Earth here.
6. You can read past blog posts about the DPRK’s railway system here.
You can read the full Daily NK story here:
Freight Train Overturned in Yangkang, 16 Casualties
Daily NK
Lee Sung Jin
1/27/2009
DPRK outlines region-specific economic growth plans
Saturday, January 24th, 2009Institute for Far Eastern Studies (IFES)
Nk Brief No. 09-1-23-1
1/23/2009
Following the recent North Korean New Year’s Joint Editorial and its calls for economic measures, on January 5, more than 100,000 people attended a rally in Pyongyang at which customized economic tasks were presented for each of the North’s provinces, taking into account each region’s particular industrial concentration or specialty.
According to North Korean media reports on January 20, Pyongyang stressed reforms in steel, power, coal, railway, and other sectors it considers ‘Priority Sectors of the People’s Economy.” It also presented tasks for the promotion of housing construction, refurbishment of pig farms, and the increase in production of farms and light industries providing daily necessities to the people of the North.
South Pyongan Province was tasked with increasing the production of ‘Juche’ steel’ at the Chollima Steel Complex, which kicked off the “new revolutionary upsurge” late last year during an on-site inspection by Kim Jong Il, as well as full operation of the newly built ‘superpower electric furnace’, and called on all the people of the province to increase production of organic fertilizer in order to boost food production.
For North Pyongan Province, “mass reforms” for the metalworks sector and concentrated efforts to increase electrical production at the Supung and Taechon power plants were called for. In addition, increased production at the Kujang Earth Colliery Complex, Rakwon Machinery Complex, and the Sinuiju Cosmetics Factory were ordered, as was the institution of advanced agricultural management methods.
Efforts in South Hwanghae Province are to be focused on increasing iron ore mining and scrap iron collection at sites such as the Eunryool and Jaeryung mines, and agricultural production goals are to be met through the introduction of high-yield crops and double-cropping.
North Hwanghae Province was ordered to focus on increasing production at the Hwanghae Iron Complex, the Yesong River Youth Power Plant No. 1, the 2.8 Madong Cement Factory, the Sariwon Poultry Farm, and the Sariwon Pig Farm. In addition, high-yield crops are to be introduced and construction of irrigation systems is to begin, as land management efforts are to be implemented in order to expand agricultural land in Mirubol. North Hwanghae Province is also to build a new library, a new arts theater, and a new housing.
In South Hamgyung Province, efforts are focused on construction of the Keumya River and Keumjin River Guchang power plants, as well as improving mining capacity at the mines in the Danchun area while renovating production facilities at the Sudong Mines. Aggressive promotion of construction on the second stage of the 2.8 Vinylon Complex was also emphasized. Provincial authorities were also ordered to complete the initial stage of refurbishment in the Heungnam Pharmaceutical Plant, improve production at the Kwangpo Duck Farm and the Hamju Pig Farm, and accelerate home construction in Hamheung City.
North Hamgyung Province was tasked with perfecting ‘North Korean-style steel production methodology’ at the Kim Chaek Iron Complex and Sungjin Steel Complex, and modernizing exploration, mining and processing equipment at the Musan Mining Complex in order to boost output, along with bringing the Seodusu Power Plant and Chungjin Thermoelectric Power Plant fully on-line. Another important task prioritized was the completion of the second stage of the Urangchun Power Plant.
In Kangwon Province, construction of the Wonsan Army-People Power Plant, increased production at the Munchon River Ironworks, modernization of the Wonsan Shoe Factory and the Wonsan Textiles Factory, and the refurbishment of the Munchon Poultry Processing Plant were emphasized, along with the diversification of management in farming communities in order to resolve food shortage problems.
Ryanggan Province, in the northern Gosan region, was tasked with improving management of the Samsu Power Plant, which entered service in May 2007, and construction of the Baekdu Mountain Military-first Centennial Power Plant and other electrical facilities, and the establishment of a ‘hometown of potatoes’ for the quick increase in potato cropping.
The Jagang Province was tasked with modernizing its metalworks sector and increasing electrical production at the Gangye Youth Power Plant and Janga River Power Plant, construction of small and medium-sized power plants, and increasing its logging production. Jagang Province was also tasked with normalizing production in its pig, duck, and chicken factories, and software development for local organizations was emphasized as a priority task for the Electronic Business Research Institute in Ganggye City, which was visited by Kim Jong Il after its grand opening last year.
DPRK pushes to meet yearly production plans
Wednesday, December 17th, 2008Institute for Far Eastern Studies (IFES)
NK Brief No. 08-12-17-1
2008-12-17
As the end of the year approaches, North Korea has launched a ‘Year-end Battle’ in order to encourage every sector of the economy to meet annual production targets, without exception.
On December 1, (North) Korean Central Broadcasting announced, “workers, laborers and technicians of the harvesting industry sector overcome difficulties and barriers with indomitable moral strength, while thoroughly accomplishing the (New Year) Joint Editorial’s fighting tasks, focusing all strengths on the struggle to brightly wrap up the deeply meaningful year,”while also reporting on the production innovation of the nation’s mining and smelting facilities.
The program also announced that each North Korean region’s hydroelectric power plants, “brightly bring the year to a close, while the issue more important than any other is ensuring the People’s Economy electrical use, strongly demanding power production, is supported,” reporting that efforts were being focused on ensuring power production equipment was operating at full capacity, and electrical production was being expanded.
Rail transportation in Pyongyang, Kaechun, Anju, and other areas also reported high achievements in distributing coal for electrical production and ores sent to metal factories, as efforts are put into the ‘Year-end Battle’, according to the broadcasters.
One member of the North Korean Cabinet’s office of light industry announced on November 30 that, in accordance with this year’s New Year Joint Editorial’s ‘prioritization of the lives of the people’, the government invested in the Sariwon Weaving Factory, the Haeju Textile Factory, etc., “struggling to produce more good-quality cloth” in textile factories under the guidance of the office of light industry’s department of textile industry management.
North Korea’s broadcasts also reported that the Ranam Coal Mine Cooperative Enterprise, the Musan Mine Cooperative Enterprise, the Chungjin Tractor Accessories Factory and others were also engaged in this ‘Year-end Battle’.
In South Hamgyung Province, a new lecture hall and electronic library were built at the Hamheung Medical Science College, and construction was underway to expand the number of classrooms. Also, the Heungnam Basic Foods Factory, the Hamheung Orthopedic Surgery Hospital and the Sinheung Irrigation were under construction as each locality is pushing forward with selected economic construction projects.
Last call at Kaesong…
Monday, December 1st, 2008The end of sunshine?
According to Yonhap (here and here), Friday, November 28, was the last day of the Kaesong day tours (210 tourists made the trip) and the last day the “train to nowhere” made its inter-Korean trip.
As for the Kaesong Industrial Zone (KIZ)…According to (Bloomberg), on December 1 the DPRK cut the number of “windows” available each day for South Korean vehicles to enter and leave the KIZ from 19 to 6 (though the Donga Ilbo claims just 3), and limited the number of South Koreans allowed in the complex to 880—about 20% of the 4,200 previously permitted to enter the complex.
According to the Donga Ilbo, Pyongyang delivered notice at 11:55pm Sunday saying those allowed to stay in Kaesong are 27 staff of the management committee; four from the (South) Korea Land Corp.; 40 from Hyundai Asan Corp.; five at restaurants and living quarters; two at shops and hospitals; and 800 from South Korean companies. Border crossings are also limited to 250 staff members and 150 vehicles each time.
Jeopardizing more than Kaesong
As previously discussed (here and here), South Korea and Russia are interested in building oil and natural gas pipelines which would cross the DPRK. If these projects went through, the DPRK government would benefit from construction and “rental” fees—in effect taking a cut of all the energy resources that cross their borders. North Korea, is now telling the Russians that the project is not too palatable at the moment.
Still more red than green it seems.
What now?
So while the DPRK chases away investment from the South, they solicit more from Kuwait and Singapore (where Chris Hill is due to stop by):
North Korean Foreign Trade Minister Ri Ryong Nam, now in Singapore, has urged Singapore companies to invest in the isolated country, the Singapore government said Monday.
The North Korean minister “briefed…on economic developments in North Korea and possible investment opportunities for Singapore companies,” in a meeting with Singapore’s former Prime Minister Goh Chok Tong, now a senior minister in the Cabinet, a government statement said.
Goh said, “Singapore would be glad to explore ways to strengthen bilateral cooperation, including in the areas of trade and investment, once international concerns were assuaged and the environment improved.”
Singapore Foreign Minister George Yeo made a trip to North Korea in May, accompanied by a business delegation, in what was the first official visit to North Korea by a Singapore Cabinet minister.
On that trip, Yeo met North Korea’s No. 2 political leader Kim Yong Nam and Ri.
Yeo said at the end of his visit North Korea might be keen to learn from some aspects of the Singapore development model and that Singapore is ready to offer help and ideas. (Kyodo-Japan Economic Newswire)
Chewing gum manufacturers beware!