Kwangmyong LED Lamp and Solar Battery Factory

September 25th, 2014

Kwangmyong-Solar-Cell-Factory

Pictured Above (Pyongyang Times): The Kwangmyong LED Lamp and Solar Battery Factory

Below are several stories about the factory in the North Korean media:

Pyongyang Times (2014-12-6):

Kwangmyong LED and solar cell factory

The was built last year as a reflection of fierce competition for technology-intensive economy and green architecture in the DPRK.

It is equipped with a full set of latest facilities for the production of LED lamps and solar cells, in which development, production and sales of products are integrated to meet the requirements of the knowledge economy age.

The LED lamp production process, in which temperature and humidity are regulated automatically and which is dust free, is streamlined from the manufacture of LED light source to assembling and trial run, and intelligent equipment guarantee perfect quality of products.

All the factory products conform to international standards and they are many and varied. They include circular, flat, concave, mobile, concentrating lamps of 1 to 5W and 200W large-capacity module LEDs and LED floodlight, ornamental lamps for walls, gardens and tunnels, sensor and functional LED lamps of various styles and shapes. In a word, it can produce a variety of products on an assembly line.

The factory products are on sale through the exhibition in the compound and the commercial network across the country and it can get immediate feedback on its work from the purchasers.

The factory’s institute staffed with dozens of promising researchers and technicians is playing the leading part in closely combining the development of new products with production. They are now working on the development of new chips, LED and LED lamps, chip materials and solar cells. In particular, they have made notable achievements in solving technological problems for the production of all kinds of components of LED lamp with local raw and other materials and technology.

The solar cell workshop is stepping up the development of 3-G solar cell.

The building of the factory is a green one, as befits a producer of energy-saving products.

The photovoltaic collector panels, wind-driven generators and solar water heaters on both sides of the road to the entrance of the factory, in the compound and on the roof provide enough electricity for the lighting of the factory and hot water for the factory canteen and bathroom. And the geotherm that comes through the advanced geothermal facilities constantly provides favourble temperature for the people’s life by radiating heat in winter and absorbing it in summer.

The factory will be greatly helpful to the development of lighting industry, as it embodies the requirements of knowledge economy in both content and style.

KCNA (2014-6-23):

Kwangmyong LED Lamp and Solar Battery Factory

Pyongyang, June 23 (KCNA) — The Kwangmyong LED Lamp and Solar Battery Factory, built in the outskirts of Pyongyang, has begun operation.

The factory is all powered by wind, solar heat and geotherm. It is also perfect from the architectural and formative points of view.

It has several computerized assembly lines with an integral system of research, production, technical service and sale.

It is producing scores of kinds of LED lamps in accordance with the standards recommended by the International Organization for Standardization (ISO).

The institute of the factory is paying its primary attention to manufacturing all its products with locally available materials, while channeling efforts to the development of third-generation solar battery.

KCNA (2014-9-25):

Functional LED Lamps Developed

The Kwangmyong LED Lamp and Solar Battery Factory in the DPRK has recently developed diverse functional LED lamps effective for the production of livestock and vegetable.

They include lamps that help promote egg-laying and plant growth.

The egg-laying promotion lamp emits yellowish red light, with consumption of 18W electricity and wavelength of 590-600㎛. Its introduction made it possible for the Mangyongdae Chicken Farm to raise the egg output 3-4 percent.

The LED lamp for promoting the plant growth uses 9W of electricity, emitting blue light with 420-460㎛ in wavelength.

There is also a kind of LED lamp for fishing.

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Second session of 13th Supreme People’s Assembly

September 25th, 2014

UPDATE 3 (2014-9-25): Kim Jong-un did not attend the SPA meeting.

According to the Wall Street Journal:

North Korea’s young leader wasn’t in his customary seat as the country convened its rubber-stamp parliament Thursday, adding to South Korean media speculation that Kim Jong Un may be ill.

Only part of the meeting of the Supreme People’s Assembly was shown on state TV, but Mr. Kim wasn’t present and apparently missed the meeting for the first time since he took power after the death of his father Kim Jong Il in December 2011, according to an official for the South’s Unification Ministry who spoke on condition of anonymity because of office rules.

The usually ubiquitous Mr. Kim, the third member of his family to rule the country, hasn’t been seen in state media since attending a Pyongyang concert on Sept. 3. He was shown limping on television in July and again earlier this month, and South Korean media have speculated that Kim has been ill, although there has been no discussion of the absence in the North’s state-run media.

According to Reuters:

Kim, who is considerably overweight, has not featured in state media broadcasts since appearing at a concert alongside his wife and former state entertainer Ri Sol Ju this month.

In July, he was seen walking with a limp at an event with key officials.

But analysts warned against reading too much into Kim’s absence.

“Kim Jong Il didn’t attend every time, either,” said Chris Green, a North Korea expert at Seoul-based Daily NK website. “Moreover, we know that the SPA primarily performs a demonstrative function, it is not a true decision-making body.”

UPDATE 2 (2104-9-25): KCNA reports on the second session of the 13th SPA. Most of the copy is dedicated to continuing education reforms, however at the end of the article, personnel changes at the National Defense Commission are announced:

It recalled Deputy Choe Ryong Hae from the post of vice-chairman of the National Defence Commission (NDC) of the DPRK due to his transfer to other post and Deputy Jang Jong Nam from the post of member of the NDC of the DPRK due to his transfer to other post.

It elected Deputy Hwang Pyong So to fill the vacancy as vice-chairman of the NDC of the DPRK and Deputies Hyon Yong Chol and Ri Pyong Chol to fill the vacancy as members of the NDC of the DPRK at the proposal of Marshal Kim Jong Un.

This list of NDC members (as of October 2013 )can be found here.

Reuters notes:

At the meeting, state media said, Choe Ryong Hae had been removed from the post of vice chairman of the National Defence Commission, a body chaired by Kim, and was replaced by Hwang Pyong So.

Hwang is a member of a powerful faction created in the 1970s under former leader Kim Jong Il, the father of the current leader, to boost a personality cult around his family.

Choe had been widely seen as a new right-hand man to Kim Jong Un after he purged his uncle last year, but had since fallen back into the shadows.

“Hwang’s appointment as NDC Vice Chairman shows that he has truly risen to become the regime’s de facto number two official,” said Michael Madden, a North Korean leadership expert and contributor to the 38 North website.

Hwang was appointed “according to the wishes of Marshall Kim Jong Un”, the North’s official KCNA news agency said.

Here is the full story:

2nd Session of 13th Supreme People’s Assembly of DPRK Held

Pyongyang, September 25 (KCNA) — The 2nd Session of the 13th Supreme People’s Assembly (SPA) of the DPRK was held at the Mansudae Assembly Hall Thursday.

Present there were deputies to the SPA.

Officials of the party, armed forces and power organs, public organizations, ministries, national institutions and the fields of science, education, literature and art, public health and media attended it as observers.

All the participants observed a moment’s silence in memory of President Kim Il Sung and leader Kim Jong Il.

SPA Chairman Choe Thae Bok made an opening address.

The session discussed agenda items on summing up the implementation of “On Enforcing Universal 12-Year Compulsory Education”, the Ordinance of the SPA of the DPRK, and an organizational matter.

Deputy Pak Pong Ju, premier of the Cabinet, made a report on the first agenda item.

The reporter said that the 6th Session of the 12th SPA held in September, Juche 101 (2012) promulgated Ordinance on Enforcing Universal 12-Year Compulsory Education in line with the new requirements of the developing revolution.

According to the report, a work for successfully enforcing the schooling has been dynamically pushed forward as the one involving the whole state, all people and the whole society and signal successes have been made in it.

The work for operating the six-year secondary schools by dividing them into three-year junior secondary schools and three-year senior secondary schools has been wound up in a brief span of time. The first phase programs for the universal 12-year compulsory education were worked out in a matter of one and half years and textbooks of new contents and style were compiled.

Expenditure has been increased in educational field at the state budget, the State Planning Commission, the Ministry of Finance, provincial people’s committees and relevant institutions have ensured funds needed for educational work as planned, thus strengthening the material and technological foundation of schools.

Over the past two years since the promulgation of the ordinance new classrooms have been built or constructed on an expansion basis at schools across the country and many school things produced.

The reporter referred to the tasks facing the field of education.

He underlined the need to build well the ranks of teachers and decisively raise their qualifications and roles.

The general senior secondary schools should teach students with main emphasis on general secondary knowledge and senior secondary technical schools should make preparations in a responsible manner for giving education in basic technology to suit the economic and geographical peculiarities of the relevant areas while giving general education in conformity with the operation of senior secondary technical schools, new type schooling, on a trial basis, he noted.

He also underlined the need to positively push ahead with the work for putting the nation’s universal general secondary education including genius education on a new high stage, reinforce the research forces at educational and scientific research institutions and increase their responsibilities and roles.

He called for improving the conditions and environment for education to be fit for the appearance of a highly civilized socialist country.

Speakers at the session renewed their resolution to decisively improve the quality of education to meet the realistic requirements of the developing education in the age of knowledge-based economy and suit the trend of the world and thus train the younger generation as more dependable revolutionary talents of Juche type equipped with perfect general secondary knowledge, modern basic technological knowledge and creative ability.

The session adopted “On Comprehensively Enforcing Universal 12-Year Compulsory Education and Decisively Improving Its Quality”, the Decision of the SPA of the DPRK.

It discussed the second agenda item.

It recalled Deputy Choe Ryong Hae from the post of vice-chairman of the National Defence Commission (NDC) of the DPRK due to his transfer to other post and Deputy Jang Jong Nam from the post of member of the NDC of the DPRK due to his transfer to other post.

It elected Deputy Hwang Pyong So to fill the vacancy as vice-chairman of the NDC of the DPRK and Deputies Hyon Yong Chol and Ri Pyong Chol to fill the vacancy as members of the NDC of the DPRK at the proposal of Marshal Kim Jong Un.

UPDATE 1 (2014-9-18): The Institute for Far Eastern Studies (IFES) reports on the DPRK’s education policy:

North Korea Prioritizes Budget Support for the Modernization of Education in the Age of Knowledge-Based Economy

A September 6, 2014 article in the Rodong Sinmun reported that First Chairman of the National Defence Commission Kim Jong Un has begun to usher in a “revolution in education for the new century” and emphasized the need to construct a “world power of socialist education in the 21st century” at the 13th National Meeting of Educators held on Sept. 5.

At the meeting, Kim Jong Un’s work, entitled, “Let Us Make a Revolution in Education in the New Century to Glorify Our Country as the One of Education and a Power of Talents” was presented to participants.

In his work, Kim Jong Un advocates for this “revolution in education for the new century,” saying, “Education is part of an unending patriotic plan for the wealth and prosperity of the nation and the people.” The work emphasizes, “How we educate our posterity will be the determining factor of the nation’s power and the propagation of the revolution.”

Kim Jong Un also stated, “The goal to be attained by the revolution in education in the new century is to turn the country into a power of socialist education in the 21st century by bringing up all school youth and children as reliable pillars for the building of a thriving nation and educating all the people to be well versed in science and technology.” To achieve this, Kim Jong Un emphasized that the “decisive strengthening” of secondary education is the fundamental link of the education revolution.

He states, “Just as how trees with the strongest roots grow the perfect fruit, secondary education must be strengthened in order to produce talented individuals and raise the overall level of intelligence of workers.”

He continues, “In order to realize the grand goal of the revolution in education for the new century, the strong leadership guidance provided by the Party’s Juche-based education ideology and policy must be implemented according to the demands of the generation and the development of the revolution.”

More specifically, his work mentions the importance of improving the education system: “An important task facing the revolution in education in the new century is to round off the educational system and improve the guidance and management of the educational work in order to successfully train talents of new type required by the era.”

Kim Jong Un also emphasized the need to rear wholesome, well-rounded children from the time they are young while at home, school, and out in society. Furthermore, he stated, “The education in the age of knowledge-based economy should not be the one for letting students learn existing knowledge but it should be developed in the direction of putting its contents on a practical, comprehensive and modern basis so that students may grasp faster new and useful knowledge and more successfully apply them in practice.”

In order to accomplish this, Kim Jong Un said, “All the fields should regard the educational work as part of their work, always pay deep attention to it and help solve the issues arising in the field of education in a responsible manner.”

ORIGINAL POST (2014-9-4): According to KCNA:

DPRK Supreme People’s Assembly to Be Convened

Pyongyang, September 5 (KCNA) — The Second Session of the 13th Supreme People’s Assembly of the Democratic People’s Republic of Korea will be held in Pyongyang on September 25, Juche 103 (2014).

A relevant decision of the Presidium of the Supreme People’s Assembly was promulgated on Sept. 4.

Information on the first session of the 13th SPA can be found here.

Information on the election of the 13th SPA can be found here.

Here is what the Daily NK has to say:

It is the norm for the SPA to convene each spring to carry out the core responsibilities of ratifying personnel changes and hearing budgetary reports. Two of the more noteworthy results of the meeting in April this year were then-Director of the KPA General Political Department Choe Ryong Hae being made a deputy in the National Defense Commission, and Ri Su Yong being handed the foreign affairs portfolio. Ri, a seasoned diplomat, is scheduled to speak to the UN General Assembly later this month.

Conversely, second sessions do not occur every year as a matter of course; rather, they are convened when necessary for the accomplishment of Workers’ Party objectives. One such session convened on September 25th, 2012, for instance, resulted in wide-ranging changes to the state education system, most notably the addition of a 12th year of mandatory schooling.

As a result, attention is set to focus on personnel shifts and the possibility of major policy announcements.

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DPRK textile exports to China surge in 2014

September 23rd, 2014

According to Yonhap:

North Korean textile exports to China are expected to surge four-fold to US$800 million this year compared to 2010, indicating a declining dependence on raw materials exports to earn foreign cash, a report said Tuesday.

The report by Korea International Trade Association (KITA)’s Beijing office showed shipments of textiles reached $410 million in the January-July period, up from just $190 million in 2010.

The international traders’ organization said textiles also accounted for 26.3 percent of all North Korean exports to China, up more than 10 percentage points from 16 percent reached four years earlier.

“Export growth reached 40 percent coming into this year, so it should not be too difficult to surpass the $800 million mark,” KITA said.

It said growth is being fueled primarily by the lower wages of North Korean workers compared to their Chinese counterparts.

On average, a North Korean worker earns $244 per month compared to $440 for a Chinese worker employed in Jilin province north of the border.

KITA said that, starting last year, some Chinese companies began shipping materials to North Korea to be made into finished products there.

In contrast, exports of raw materials, which made up 71.4 percent of all commodities shipped by North Korea to China in 2011, dropped to 60.7 percent of total exports in the January-July period. Trade data showed sharp drops in exports of coal, iron ore and pig iron.

The trade agency then said that with Chinese labor costs expected to rise steadily and the country suffering from a shortage of workers in certain sectors, North Korea may be able to capitalize on its advantage to build up its labor intensive sector.

You can read the whole story here:
N.Korean textile exports to China surge in 2014
Yonhap
2014-9-23

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10th Pyongyang Autumn International Trade Fair opens

September 22nd, 2014

According to KCNA:

10th Pyongyang Autumn Int’l Trade Fair Opens

Pyongyang, September 22, 2014 (KCNA) — The 10th Pyongyang Autumn International Trade Fair opened with due ceremony at the Three-Revolution Exhibition House on Monday.

Present at the opening ceremony were Vice-Premier Ro Tu Chol who doubles as chairman of the State Planning Commission, Ri Ryong Nam, minister of External Economic Relations, Kim Song Dok, vice-chairman of the Pyongyang City People’s Committee, Ri Hak Gwon, head of the DPRK Chamber of Commerce, officials in the field of foreign trade, delegations of different countries and regions, foreign diplomatic envoys and staff members of their embassies here.

Pak Ung Sik, director of the Korean International Exhibition Corporation, made an opening address which was followed by a congratulatory speech by Ri Myong San, vice-minister of External Economic Relations.

The speakers said the fair would offer a good opportunity to promote friendship and cooperation among countries and boost the wide-ranging economic and trade transactions and scientific and technological exchange.

They expressed the will to boost bilateral and multilateral cooperation with various countries and regions of the world in the fields of the economy and foreign trade on the principle of equality and mutual benefit in the days ahead.

The participants looked round products presented by companies of various countries and regions including the DPRK, Germany, Russia, Malaysia, Mongolia, Singapore, China, Cuba, Italy and Taipei of China.

The fair will run through Thursday.

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DPRK holds investor forum in Dalian

September 22nd, 2014

According to the JoongAng Ilbo:

North Korea held a rare investors relations event over the weekend and its more capitalistic and entrepreneurial manner hinted at a new openness to foreign investors and economic reform in general.

“The door is wide open. Come on in any time,” said Oh Eung-gil, president of North Korea’s Wonsan District Development General Corporation.

Oh was inviting South Koreans to invest in the North as he addressed a group of businessmen at an investors relations session at the Shangri-La Hotel in Dalian, China, on Saturday.

“We prepared all the conditions to develop Mount Kumgang and waited for the South to change its attitude,” said Oh. “But we can no longer wait, so we are trying to attract foreign investors. We have no intention to exclude the South.”

The investors relations event was arranged by the Dalian chapter of the World Federation of Overseas Korea Traders Association. About 200 Korean businessmen from around the world including Australia, China and the United States attended.

From North Korea, five delegates including Oh joined the event.

The North started its event with a presentation by Oh on the country’s laws governing foreign investments and the business environment.

“We have already simplified the investment application procedures and created regulations that meet international standards,” Oh said.

He spent a considerable amount of time to assuring businessmen that their investments, if made, will not vanish overnight.

“With Article 19 of the Foreign Investment Act, we promise that the assets of foreign investors and their companies won’t be nationalized,” he said. “If they are nationalized for an unavoidable reason, then we will make compensation for all costs.”

He also stressed that the North has abundant mineral and fisheries resources. With its 2 million educated workforce, who graduated from 300 universities, Oh said North Korea is the best place to make investments in Asia.

He said foreign companies that invest in special economic zones will only have to pay 14 percent corporate income tax and that the tax is even lower for some advanced technology industries. Making investments in the North’s infrastructure will also be tax-free, he said.

The North also held an unprecedented question and answer session. At similar events in the past, the North only made presentations without answering investors’ questions.

A businessman said he was afraid that the North Korean government could confiscate his investments, and Oh assured him that the government guarantees all legal investments by laws.

Oh even used humor to answer one businessman’s question.

“I would like to invest in hospitals,” the businessman said.

“Our [Democratic People’s] Republic of Korea offers free medical services, so it will be hard for you to make money,” Oh joked. “Please reconsider.”

Following Oh’s presentation, Ri Sing-ryol, vice president of the Wonsan District Development General Corporation, unveiled a development plan for the Wonsan-Mount Kumgang international tourism zone. He said the zone has 142 historic sites, 11 white-sand coasts and nine lakes, as well as 676 tourist venues.

The North’s Standing Committee of the Supreme People’s Assembly announced in June an ambitious plan to develop the area as an international tourism zone.

“Now that the Kim Jong-un regime is settled, the North’s top priority is resolving economic hardships and strong economic reform is being pushed forward,” said Jin Jiang, chairman of the Dalian Chapter of the World Federation of Overseas Korea Traders Association.

According to the Donga-Ilbo, the patchy subject of Hyundai Asan’s assets came up:

North Korea requested South Korea to make additional investment in Mount Kumgang and Wonsan areas, claiming that “it never confiscated the South’s property,” which it had forfeited and frozen in April 2010. Oh Eung Kil, general president of Wonsan district development company under the North’s external economy ministry, told South Korean reporters at an informational session on investment in the North in Dalian, Liaoning Province, China on Saturday.

“We did not confiscate Hyundai (Asan)’s asset. We will not confiscate and will wait (going forward). We have waited for long (thus far),” Oh said. “The South’s asset is just in our territory because it is real estate, and the property is registered in Hyundai’s name.”

Notably, citing the North’s foreign investment act providing that Pyongyang does not nationalize foreigners’ asset, Oh said, “Because we cannot afford to continue waiting, blindly trusting the South, we will form ties with investors from various countries. Still, we are not excluding the South. The door is open.”

In April 2010, the North implemented a slew of measures, including forfeiture of the South Korean government’s assets such as a separated family reunion house, freezing of private sector assets including duty-free shops, and deportation of management staff. In 2011, the North enacted the “Mount Kumgang international tourism district act,” and deprived Hyundai Asan of the exclusive right to tourism projects. Hotels and other assets that were owned by Hyundai are currently operated by the North Korean authority. Experts say, “The North’s move is aimed at denying its forfeiture of Hyundai Asan’s assets, which was negatively regarded by foreigners, and displaying situation of improved investment environment.”

Meanwhile, Oh said, “Foreign shipment of unprocessed natural resources has been designated as an additional item subject to restriction of investment into North Korea.” While banning shipment of coals and others without processing in North Korea by foreign investors, the North intends to allow processing of such resources within the Stalinist country. Since the North Korean authority singled out “sale of valuable natural resources at bargain prices as a unpatriotic act” as one of the crimes allegedly committed by Jang Song Thaek who was executed late last year, Pyongyang is believed to have strictly restricted foreign shipment of natural resources.

Here is additional coverage in the Choson Ilbo.

Other posts on the Wonsan-Mt. Kumgang International Tourist Zone here. See the category tab on the right for more.

Read the full stories here:
Pyongyang woos foreign investors
JoongAng Ilbo
Choi Hyung-Kyu
2014-9-22

N.K.: ‘We never confiscated facilities from Hyundai Asan’
Donga-Ilbo
2014-9-22

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DPRK reports progress on Sepho tableland project

September 21st, 2014

According to KCNA (2014-9-21):

Achievements Made in Sepho Tableland for Two Years

Pyongyang, September 21, 2014 14:24 KST (KCNA) — It is two years since the new history of change started in Sepho area.

Service personnel and people of the DPRK turned out as one under the grandiose plan of Marshal Kim Jong Un who initiated the reclamation of the tableland as the first grand nature-remaking project in the new century of Juche on September 22, Juche 101(2012). As a result, the barren land is now undergoing change beyond recognition thanks to their heroic struggle.

For the past two years the members of Construction Shock Brigade 922 made eye-opening achievements, going through manifold difficulties.

They finished reclaiming more than 50 000 hectares of tableland covering Sepho, Phyonggang and Ichon counties and created man-made pasture amounting to 98 percent of the project and nature-made pasture equivalent to 77 percent of the project.

They also created more than 600 hectares of windbreak and more than 12 700 hectares of pasture protection forest and pushed forward the construction of reservoirs, dwelling houses, hotels, stockbreeding research institute, epizootic prevention center, domestic animal sties and roads extending more than one thousand of kilometers, thus opening a bright prospect for building a large-scale stockbreeding base.

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First bonded processing area to be set up

September 20th, 2014

From the Pyongyang Times (2014-9-20) No. 38 (2813), p4:

The Presidium of the Supreme People’s Assembly issued a decree establishing Jindo export processing area in Nampho on July 23.

The second SEZ in Nampho after the Waudo export processing area which was set up last year, the Jindo export processing area will be the first bonded processing trade hub among the 24 special economic zones built in the country.

Part of Ryongnam-ri in Waudo-District sitting on both sides of the road leading to the West Sea Barrage from the lower reaches of the Taedong River in southwest Nampho, it covers an area of 1.8 sq kilometers and has very favorable conditions of infrastructure.

It is also near Nampho Port, trade port directly leading to China and southeast Asia, and Pyongyang and Nampho cities boasting machine-building , electronic and light industries. It will provide the region with every potential for industrial growth and enough manpower.

The area is aimed at bringing in raw materials duty free and producing light industrial and chemical goods for export.

To this end, it plans to build a bonded processing trade area that encourages processing export by allowing businesses to be built on the principle of environmental protection and energy saving and promoting technology transfer and introducing new products and industrial sectors from other countries.

According to the first-stage development plan, the area will cover 180 hectares, which will be divided into 10 sections of electric and electronic appliances , leather, shoes and other light industrial goods, machine and metal products, chemical, rubber and plastic goods, fibre and clothes-making, bonded warehouses and and exhibitions, management and service, power station and reserve area.

Premiums and privileges will be offered to investors in the area according to the law on economic development zones and its enforcement rules and regulations.

The master plan of the processing area is now under examination and investors are making field surveys.

By Cha Chol

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Taxis grow in popularity in the DPRK

September 12th, 2014

According to the Daily NK:

Independently owned taxi services have emerged in South Pyongan Province, Daily NK has learned. This is the only other confirmed location of such a service in North Korea, outside of Pyongyang and Rasun.

A source in South Pyongan Province reported to Daily NK on September 11th, “Taxis have appeared in Pyungsung [Phyongsong] and Suncheon [Sunchon] Cities and are quickly gaining popularity,” adding that, “Privately owned taxis are emerging as a new way to make money and the donju [new affluent classes] are quick to invest in the opportunity.”

Taxis managed by the Daedong River Passenger Transport Service Company in Pyongyang are widespread in the capital city as well as Rasun [Rason], but the cabs operating in Pyungsung and Suncheon only require registration with the Transport Service Company, after which they and are free to operate independently.

Originally, Daedong River Passenger Transport Service Company had plans to expand its operations to other regions, but budget shortages stymied these efforts, and the source surmised this as cause for the organization to begin issuing operating licenses, for a fee, to individually owned taxis instead.

As these privately owned taxis become more prevalent in Pyongnam [South Phyongan Province], Pyongsung, and Suncheon, vehicle sales, automobile parts, and recruitment and hiring of drivers continues to rise. The source estimated approximately 18 privately owned taxis in Pyungsung currently, with at least 8-10 operating in Suncheon.

A report by the pro-North publication Choson Sinbo [run by The General Association of Korean Residents in Japan] proclaimed last year that there were 400 taxis operating in Pyongyang. A taxi dispatching service [known as “call taxis” in South Korea] were among the other purported features offered to customers by the Transport Company in the capital city.

“These independently-owned cabs are not part of a state-run enterprise; they are personal businesses,” he explained. “After being granted an operating license, the donju are keen to purchase vehicles to employ as taxis. Cars imported for use as taxis through official trading licenses are taxed at high rates, so most use smuggled cars instead.”

In Sinuiju City, the Kangsung Port sees high volumes of exports serving to procure foreign currency that funnels back into the Chosun Workers’ Party, in addition to highly active smuggling operations. Members of the donju usually request a vehicle to utilize as a cab through the appropriate trading company and receive it through the Kangsung Port.

New vehicles to service as taxis sold at Suncheon Market cost approximately $12,000, while used cars are priced in the region of $6,000-7,000 USD, with additional payments of $500 sellers who have the connections to throw in an accompanying license plate.

Even those who receive the license plate in the market must go through the proper channels to start offering their services. “Taxis purchased by individuals must be registered with the Daedong River Passenger Transport Company in Pyongyang,” he said, nothing it to be a fairly simple procedure, “After being issued an operating license and license plate, they pass through the “No. 10 Checkpoint and they are immediately able to begin business operations.”

According to the source, the majority of individuals purchasing taxis are female, while the drivers are procured from the Transport Company or personal connections. The taxi owners generally conduct personal interviews before hiring the drivers, who are mostly males in their 30s and 40s; it is fiercely competitive process–one must pass through a competition of 50:1 to secure the job.

Potential benefits of the position are enough to ensure no shortage of applicants. With the exception of those areas off limits without a special license, namely border regions and Pyongyang, it is within taxis’ rights to go to most areas. These taxis fetch approximately $100 USD [80,000 KPW] per day, excluding fuel expenses, and cab owners pay the driver roughly 50% of these profits [including gas] as a monthly salary.

The exact amount that individual taxi workers owe the transport company in Pyongyang cannot yet be verified, though the source reported that a monthly offering in the region of $500 USD, for “the sake of formality,” must be contributed to management officials there.

Taxi fees run about 15,000 KPW for a 4km ride; bus fees are approximately 2000 KPW to go the same distance. A Pyungsung-Suncheon trip costs the passenger in the region of 75,000 KPW–extremely expensive compared to the 10,000 KPW bus fee to make the same trip. However, for those doing a great deal of business and working against time, taxis are the easiest option, explaining the increase in those employing their services.

The source asserts that the North Korean authorities’ inability to expand taxi operations due to budget shortages will inevitably lead to the spread of these individually owned cab services through the North. The ease of and lack of restriction on running such an operation will also see them continue to spread, “Everyone doing business will start to use them,” he said. “There aren’t that many taxis at the moment, and the price is expensive, but as the number of those owning the vehicles increases, the price will drop, as will the cost of motorcycles and bicycles.”

Read the full story here:
Taxis Take Off in South Pyongan Province
Daily NK
Seol Song Ah
2014-9-12

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Rason Port gets competition from Zarubino Port

September 11th, 2014

Zarubino-port

Pictured above (Google Earth) the relative locations of Rason and Zarubino Ports

According to Port Technology International:

China and Russia are to join forces and morph Russia’s Zarubino Port into one of the biggest ports in northeast Asia, according to the Chinese People’s Daily.

Zarubino Port is at the far south-eastern tip of Russia and a stones throw from North Korea, and only 18km from China.

North-east China’s Jilin province and Russia’s Summa Group reportedly signed a joint-agreement concerning the rejuvenation of the port at the fourth Conference on Interaction and Confidence-Building Measures in Asia (CICA), in Shanghai in May, 2014.

It is planned that the Zarubino Port will have the ability to handle 60 million tonnes of cargo once construction is completed.

ECNS, an English-language Chinese news source, reported a Summa deputy president as stating the planned port will be multifunctional, and is intended to “hugely benefit China and Russia”.

The port will be used to serve as a key port in ensuring the security of food provisions.

Read more at Voice of America.

Zarubina port is only 80km (directly) north-east of Rason. It will be interesting to see what kind of effect this project will have on development at Rason.

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Energy supply in the DPRK’s SEZs

September 11th, 2014

The Nautilus Institute has published an interesting paper on energy infrastructure in the DPRK’s initial four special economic zones: Rason, Hwanggumphyong, Kaesong, Kaesong, and Kumgang.

Here is the publication information and  a link:

“Supplying Energy Needs for the DPRK’s Special Economic Zones and Special Administrative Regions: Electricity Infrastructure Requirements”
Nautilus Institute
Roger Cavazos & David von Hippel
2014-8-19

Here is the introduction:

The Democratic Peoples’ Republic of Korea (DPRK) uses special economic zones as a mechanism for engaging in commercial activity with other nations without substantially converting its economy to a market model; earning hard currency while reducing some of the social and political risks associated with a broader opening of the DPRK economy. The DPRK recently announced its intent to increase the number of Special Designated Zones, including Special Economic Zones (SEZ) and Special Administrative Regions (SAR) in the country by fourteen.[1] In most cases, these Special Designated Zones (we will use “Special Zone”, or “SZ”,as the generic term in this Working Paper to apply to Special Designated Zones) will require energy supply (and demand) infrastructure that is now missing, or insufficient, at all existing and proposed Special Zone sites. Even though past is not prologue—and the mechanisms for supplying energy needs to new SZs may be different than those used in the past, this paper seeks to briefly describe already existing Special Zones in terms of their present energy requirements. Present requirements provide rough estimates of the energy requirements of the newly proposed zones. Specifically we examine: the Rason Special Economic Zone and Special Administrative Region, the Hwanggumphyong Special Economic Zone, the Wihwado Special Economic Zone, the Kumgang Mountain Tourist Area, and finally, the Kaesong Industrial Zone. These specially designated zones ideally contribute to economic development in North Korea as well as provide economic benefits to the Chinese and Russian provinces bordering North Korea. Chinese plans to resuscitate and/or invigorate the economies of their three Northeast provinces bordering North Korea would certainly be moved forward by trade with a richer North Korea and access to strategic North Korean ports just across the border. Although this paper does not cover Russian plans, the motivations for Russian investments in North Korean SZs are likely similar—the desire to boost the economies of the areas of the Russian Far East that adjoin the DPRK, and to improve access to markets in Asia.

There is a limited but growing amount of information available to understand how these Special Zones are defined by North Korean policy, how they are currently faring in terms of economic performance, and what future zones will likely require in terms of energy usage. There is also a growing body of rules and regulations by which North Korea and China plan to govern these zones. Except for the Kaesong industrial complex, it appears that all these zones are significantly short on the energy infrastructure necessary to supply their modest current demands, let alone any future projected demands. North Korea’s decision to declare several such zones in North Korea’s interior may possibly indicate a desire to stitch together North Korea’s electrical transmission and distribution networks which are currently more a patchwork of regional grids rather than a unified national grid. Previous Special Zones have always been on or near North Korea’s periphery. Because previous zones were located on the DPRK’s frontiers, they were largely able to “plug in” to already developed electricity transmission and distribution systems on the other side of the border (in China, Russia or South Korea). While we present no specific calculations here, the cost to renew the DPRK’s entire transmission and distribution (T&D) system will certainly cost billions to tens of billions of dollars which could consume on the order of 10 percent or more of North Korea’s GDP for 5 to 10 years, assuming, as estimated by Republic of Korea (ROK) sources, that North Korea’s GDP is in the neighborhood of 40 billion dollars. The costs of T&D renewal are thus well beyond anything North Korea is likely to be able to afford to do in the short-term on anything but a piecemeal basis.

Despite gaps in our knowledge of how Special Zones in the DPRK have formed and operate or will operate, there is a substantial amount of information available from English, Chinese and Korean-language sources describing the basic plans for investment and the businesses that North Korean, Chinese, and in some cases Russian partners hope to develop in some Special Economic Zones. What is missing from the plans for which information is available, however, are detailedplans for building the energy infrastructure required to support the amount of economic activity (in factories, ports, hotels, workers quarters, and other elements of the SZs) envisioned. The electricity infrastructure required to support the economic plans is modest by most industrial standards. The existing infrastructure in most of the SZs, however, is grossly inadequate, and thus will require significant international investment to allow the SZs to operate as planned.

Investing in SZ infrastructure is likely to be more complex than a typical industrial investment. Sources of investment funds for SZ infrastructure could include businesses from a number of nations, and/or government or multilateral funds. Each potential lender/investor will have its own criteria for deciding on whether a given investment is reasonable or too risky. In theory, involving a number of different actors from different nations in DPRK SZ infrastructure investments would help to diversify the risk borne by any given company or nation, and to create a broader constituency for working with North Koreans using business practices that comply with international law and standards. In part, a broader constituency of coordinated investors could also help to discourage the “rent-seeking” by officials that is often a part of projects in the DPRK (and in many other countries). Because the amount of infrastructure-building required is high, there is significant potential for illegal rent-seeking, that is, for example, for DPRK authorities to inflate the price of “surveys” or permits, or the cost of securing import rights for equipment needed for the SZs, in order to gain personally from the transaction.

Working conditions in SZs will be another area of concern for investors and for foreign firms seeking to operate facilities in new or existing SZs. Anecdotal reports suggest that industrial facilities in general in the DPRK tend to operate with limited evident concern for worker safety. In the absence of pressure from investing companies, it is also likely that working conditions will remain poor and dangerous, as there does not appear to be a significant set of DPRK regulations related to industrial safety. Nor, for that matter, does there appear to be a well-established and well-funded government body dedicated to establishing, monitoring and enforcing industrial safety regulations.

This paper describes several of the Special Zones now operating in or in the advanced planning process in the DPRK, together with what is known about plans for their development. For each, it provides a description of the likely energy requirements, based on what can be determined regarding planned activities at each site, and examines adjoining energy infrastructure to identify probable degrees of energy shortfalls that foreign investors, working with DPRK counterparts, will need to overcome. Some of issues and policies that policymakers inside and outside of the DPRK will need to consider in order to arrange for the financing and construction of the requisite infrastructure to operate the SZs.

You can download the PDF here.

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