Category: Long reads

Chinese-North Korean joint ventures in constru…

With the recent restoration of DPRK-China relations, North Korea’s Rason special economic zone (SEZ) is being transformed into a city of modern skyscrapers, according to an April 13 report by Radio Free Asia.

China-North Korea bilateral joint ventures had been stalled for a while due to the sanctions being imposed by China and the international community. Slowly, however, there are signs that these joint ventures are being revitalized, at least in the Rason Economic and Trade Zone.

In Rason, there is a high demand for apartment buildings. North Korean trading companies are providing the sites, with the Chinese investors supplying the funds for such construction.

“The latest models of high-rise apartment have recently started to change the skyline in Rason. The joint ventures had slowed down last year as the China-North Korean relations became strained. However, the joint venture constructions were resumed recently and many buildings are now about to be completed,” an informed source from North Hamkyong province told Radio Free Asia.

High-rise apartments started to appear in Rason last year, but their construction slowed down when the Chinese government stepped up its enforcement of sanctions against North Korea. Consequently, most ongoing constructions had come to a halt, and the industry had paused to catch its breath.

At present, most of those apartments in the Rason special economic zone that are already completed or about to be completed are over twenty-stories high. North Korean trading companies often provide the construction sites and workers, while their Chinese partners are responsible for supplying construction materials and design of the buildings. The profits raised from the sales are shared between the two.

Because many high-ranking government and party officials and the new rich North Koreans known as “donju” are buying up these expensive apartments in Rason, the supply can hardly catch up with the demand. Depending on its location, direction, and the floor it is on, an apartment unit is sold at a price ranging from $30,000 to $50,000. Nevertheless, they are in short supply.

Although for the average North Koreans, these buildings are so expensive that they can hardly dream of owning one, they are often sold out even before their completion. Consequently, the trading companies are allegedly pocketing huge sums of foreign currency.

– The Institute for Far Eastern Studies


North Korea Going All Out to Attract Foreign Tourists

North Korea is making strong efforts to attract foreign tourists. The State General Bureau of Tourist Guidance advertised on its website ‘DPR Korea Tour’ that the Korea International Travel Company (KITC) will run a Korean language program at the Pyongyang Tourism College (PTC) from July 14 to August 4, the Seoul-based Seoul-Pyongyang News said on April 4.

The language program advertises three levels of instruction—beginner, intermediate and advanced—with tourists to attend three hours of in-class language lessons each morning, followed by tours in the afternoon of famous attractions and scenic spots in Pyongyang, Kaesong, Nampho and Mt. Myohyang.

The state agency remarked that the PTC has produced many talented workers who now staff the tourism industry. PTC has also expanded the scope of knowledge in the industry by providing to its students a wide range of lectures by both local and foreign instructors. The website also features a film clip, which shows a group of college students from Hong Kong taking the Korean language program at the PTC last December. It added that KITC offers many interesting itineraries combining various themed tour programs, including bike riding around the city of Pyongyang, experiencing daily life on the Migok Collective Farm in Sariwon, learning North Korean cooking, and boating on the Taedong River. Having overhauled its website in mid-March, the state agency is demonstrating efforts to attract foreign tourists by newly introducing a flower festival, exhibitions, sports events, and various other tourist products. Language programs for tourists are not an entirely new product for North Korea. For example, in summer 2017, Kim Hyong Jik University—located in the capital and well-known for producing teachers—held a Korean language summer study program in conjunction with the academically-focused international travel agency Tongil Tours, who is offering their summer program again in 2018 at the same venue. This year, international travel companies such as Koryo Tours, Korea Konsult, and KTG DPRK Tours & Information all appear to be advertising the Pyongyang Tourism College language program, while the company Young Pioneer Tours is offering a very short program (four classes) to take place in July primarily at the School of Foreign Languages in Chongjin, and Juche Travel Services is advertising a three-week program at Kim Hyong Jik University in Pyongyang.

“We would never give up our nuclear program,” …

“Hoping that North Korea will abandon its nuclear program is more foolish than waiting for the sea to dry up,” according to North Korea’s media mouthpiece, Rodong Sinmun.

While North Korea watchers debate the possibility of negotiation and dialogue taking place between North Korea and the United States, Rodong Sinmun made it clear in an op-ed commentary that Pyongyang has no intention to give up its nuclear weapons. “Neither sanctions nor provocations nor threats can ever undermine North Korea’s position as a nuclear weapons state,” it asserted. “It would be a wise option to take the stand to peacefully coexist with North Korea, which has quickly emerged as a nation with a strategic nuclear capability,” the news agency reiterated.

North Korea has long asked for peaceful coexistence with the international community, once the latter recognizes it as a nuclear power. In particular, it has underlined that the United States should abandon its hostile policies toward Pyongyang.

On the same day, in a commentary titled “The Strong Sword of Justice to Tame the Nuclear Weapons of Oppression,” Rodong Sinmun asserted that North Korea’s nuclear force is “the powerful sword for defending peace as it can decisively tackle the nuclear threats and blackmail from the United States.” The state-run newspaper stressed that North Korea is “fully prepared to make the deadliest nuclear strike on the United States as it pleases at any random time and space.”

Claiming that North Korea has “intercontinental ballistic missiles (ICBM) and submarine-launched ballistic missiles, along with a hydrogen bomb known as the ‘Tsar-Bomba (or the King of Bombs)’, which it has succeeded in loading onto an ICBM,” the newspaper said that North Korea has “demonstrated its powerful nuclear strike capability to the world, not in words, but in reality.”

“The United States and other hostile forces that have denied and disparaged North Korea’s nuclear deterrent in the past became no longer able to make much ado about nothing,” it added.

Rodong Sinmun insisted that North Korea has developed its nuclear deterrent to “ultimately overwhelm and crush the violent and flagitious nuclear threats of the United States… . The nuclear weapons are our most reliable means of deterrence to prevent the United States from playing perilously with fire in the Korean peninsula,” it asserted.

It furthermore stated that because the United States would “never give up its malicious ambition to conquer the world by virtue of its superior nuclear power,” North Korea is “entirely just … to bolster up its strength with a much stronger determination.“

– The Institute For Far Eastern Studies

Major local cities introduce call taxis, on th…

As they were in Pyongyang, call taxis are now popular in other major North Korean cities. According to a source from North Pyongan Province, “Nowadays there are new taxis in Sinuiju that rush to you on one phone call,” the Seoul-Pyongyang News reported on January 3.

“They are known to arrive at the point of departure within ten minutes of call, day or night,” the same source told the South Korea-based online newspaper Daily NK. “The call taxi charges one US dollar for the basic fare, while the ordinary taxi specialized in short-distance service within the city of Sinuiju charges a basic fare of 3,000 North Korean won,” it added.

At the present exchange rate in North Korea, one US dollar is equivalent to 8,000 North Korean won, making the call taxis about three times more expensive than the ordinary taxis. Nevertheless, demand for call taxi is constantly on the increase.

In the meantime, an inside source from South Pyongan Province said that call taxis were first introduced in Pyongsong as early as a few years ago, and became widespread now. According to the source, on a national holiday or family’s birthday, well-to-do North Korean families use a call-taxi service even to family restaurants. The competition between taxi companies is so fierce that individual taxi drivers are trying to attract the customers by handing out a slip of paper with their phone number.

In addition, the call taxi service first appeared in Pyongyang in 2014. In an article introducing the Taedonggang Passenger Transportation Company in Pyongyang at the time, The Choson Sinbo, a newspaper published by the pro-North Korean General Association of Korean Residents in Japan, reported that the company was equipped with a “prompt dispatch system” that receives customers’ calls and sends the taxi to the require location.

The taxi cabs in Pyongyang are formally known as “Taedonggang,” but often called by their nickname “Alagi” because their body is splashed with patches of light green and yellow. Passengers may dial 186 on their cellular or landline phone to call a Taedonggang taxi. The dispatcher then contacts the taxi nearest the location and sends it to the customer.

In fact, the introduction and expansion of the call taxi service may reflect a rise in the level of consumption in the North Korean society. It may also suggest that competition among taxi companies is growing fiercer.

– The Institute for Far Eastern Studies

North Korea Optimistic About Its Five-year Str…

North Korea evaluated 2017 as one of the most important and meaningful years in which it has achieved the historical feat of completing its nuclear forces and making it a strong “rocket” power.

Looking back on the year in a December 12 editorial titled “The Socialist Korea, Which Is Advancing With the Power of Self-help, Is Invincible,” Rodong Sinmun (North Korea’s largest newspaper) declared that the country “has surged up high as one of the most powerful nuclear powers in the world, having the strongest mobile intercontinental ballistic rockets, super-strong thermonuclear weapons and strategic submarine-launched ballistic missiles, all of which are made 100 percent on its own and capable of striking all across the mainland United States, the evil empire, as it pleases.”

In addition, the state newspaper praised the state’s economic achievements: “Raising the banner of byungjin, North Korea has achieved a strong economic growth while taking a series of great victories in its national history amid the most severe sanctions and blockade.” The year 2017 is, it asserted, a year in which North Korea has “exhaustively showed off the strength of its self-reliant economy and its potential for unlimited development.”

According to the article, North Korea has further perfected the technological foundations of its self-sustaining economy and its self-sufficient economic structure and achieved a remarkable increase in production in every sector, based on its own strengths, technologies and resources. “Even in the midst of unscrupulous sanctions and devastating natural disasters, the number of units which have achieved their annual targets in the key sectors of the people’s economy has increased dramatically and a breakthrough was made in grain and fruit production.”

In relations to economic development, the state media boasted the “great strides” made in science and technology, in particular inventions and research achievements that can contribute to strengthening the self-reliance of the economy and facilitating production, including the introduction of high yield crops.

It added that the country’s capacity for self-help has grown stronger, noting that prospects have brightened in all sectors for the implementation of the five-year strategy of national economic development. “Our ability to self-rehabilitate is stronger than the sanctions pressure of hostile forces, and the last victory is for a socialist Korea led by the great party,” the newspaper asserted. Moreover, it encouraged the readers to make greater miracles in the New Year when the North Korean regime celebrates the 70th anniversary of its foundation.

This insinuates that, in 2018, North Korea will adhere to its economic development strategy led by science and technology and focus more on making economic accomplishments as its regime turns 70.

– The Institute for Far Eastern Studies

Amid International Sanctions, North Korea Says Economy is Booming

North Korea’s domestic economy is booming amid international sanctions, as reported on October 11 from Pyongyang by the Choson Sinbo, a Tokyo-based pro-North Korean newspaper.

According to Tongil News, a Seoul-based cable and pay television service, one example of the booming North Korean economy is the 13th Pyongyang Autumn International Trade Fair, which took place at the Three-Revolution Exhibition House between September 25 and 28.

The pro-Pyongyang newspaper said that the annual trade fair demonstrated “local companies’ high performance in constantly expanding the scale and scope of their businesses to meet the people’s ever-increasing demand for commodities.”

At the fair, many local companies, including the Bukchonggang Trading Company, the Chongkyechon Technology and Trading Company, the Rason Ryongson Joint Venture Company, and the Songchongang Trading Company, attracted people’s attention with their new products.

The Bukchonggang Trading Company, which participated in the fair for the first time, presented a high-quality food ingredient made with the essence of sea cucumbers. The product is advertised to be good for the prevention of cardiovascular diseases. It is the first North Korean company to produce a health food using sea cucumber extract.

The Chongkyechon Technology and Trading Company introduced Korean ginseng tea, ginseng powder, ginseng coffee, and various other popular ginseng products developed by the ginseng research center in Kaesong.

In particular, it was said that many visitors to the trade fair showed interest in a variety of products, especially those with functional benefits. For example, the Kyongsubong Trading Company, which is known for its research and development as well as production and sales of toothpaste, introduced more than twenty different types of toothpaste fortified with vitamins, nanosilver, aloe vera, and common bamboo. The Oil Trading Company, a manufacturer of various foodstuffs, also captured visitors’ attention with its new ‘functional’ beverage, Susosu.

In the area of cosmetics, while brand products such as ‘Bomhyanggi’ (Spring Fragrance) – produced by the Sinuiju Cosmetics Factory – and ‘Unhasu’ (the Milky Way) – produced by the Pyongyang Cosmetics Factory – had long been popular among North Korean women, the newly-introduced ‘Palsonnyo’ (Eight Heavenly Fairies) appeared a favorite at this year’s fair.

Overall, more than 250 companies from North Korea, Syria, China, Cuba, Iran, Italy, Indonesia, Vietnam, and Taiwan introduced electronic products, machinery, building materials, consumer products, foodstuffs, and other daily necessities at the trade fair. Over 20,000 people were said to have visited the Three Revolution Exhibition House every day to attend the fair.

Of note is that in recent years both the number of local North Korean companies participating in the fair and the number of their products on display have constantly increased.

As well, one noteworthy trend is that not only companies in Pyongyang but also those in provincial cities are beginning to exhibit their products at the international fair. Furthermore, as North Korean consumers’ concern for health seems to be rising, the introduction of new health products also seems to be increasing.

– The Institute for Far Eastern Studies

North Korea’s real GDP grew by 3.9% in 2016

Despite international sanctions, North Korea’s real gross domestic product (GDP) increased substantially last year.

On July 21, the (South Korean) Bank of Korea (BOK) released an estimate of North Korea’s rate of economic growth in 2016. According to its estimate, the country’s real GDP grew by 3.9 percent from 2015 to 2016. This is the highest growth rate North Korea has registered in 17 years since its economy recorded a 6.1 percent growth in 1999.

Some of its industries have shown remarkable improvements, shifting from negative growth in 2015 to rapid positive growth in 2016. In particular, the growth rate in the mining industry soared from negative 2.6 percent to 8.4 percent; in the manufacturing industry, from negative 3.4 percent to 4.8 percent; in the agricultural and fishery industry, from negative 0.8 percent to 2.5 percent; and in the utility industry, from negative 12.7 percent to a resounding 22.3 percent.

Trade between South and North Korea declined substantially in the same year, however. The bilateral trade volume was 330 million dollars in 2016, plunging by 87.7 percent from 2015. The rapid drop was mainly due to the suspension of shipment across the inter-Korean border following the shutdown of the Gaeseong Industrial Complex on February 10, 2016.

In the meantime, North Korea’s trade with foreign countries other than South Korea increased by 4.7 percent from the previous year, totaling 6.55 billion dollars in 2016. Both export and import have equally increased, registering 2.82 billion dollars and 3.73 billion dollars, respectively. The DPRK mainly exported animal products, while importing lots of plant products and textiles.

The BOK concludes that the “base effect” led to the recovery of the DPRK economy, which had faced difficulties until 2015. North Korea was able to see, it says, a sharp increase in growth rates as its economy was set back in order. In fact, the bank’s estimates for North Korea’s real GDP growth rates had fluctuated mostly between negative 1.1 percent to positive 1.3 percent over the last seven years. With an average growth rate of 1.3 percent per year, North Korea maintained slow economic growth during 2015–2016. “The easing of such negative factors as severe drought has seemingly made a considerable influence on the country’s economic growth,” says the BOK.

In comparison, South Korea recorded a 2.8 percent growth in GDP last year. However, the BOK cautions against making a direct comparison of North Korea with other countries based on these estimates because the bank’s estimation of North Korean economic indicators is based on South Korean prices and value added ratios.

– The Institute For Far Eastern Studies

Ramping up Production of Solar Technologies

On February 10, 2017 the North Korean website Korea Today reported on the domestic development and production of solar-powered lighting that can be installed along roadsides and in parks.

These panels are said to have safety features to prevent overcharging, and operate automatically according to the light conditions. The website article went on to explain that even after two days of overcast skies, solar-powered street lighting can continue to operate for two consecutive days.

The lights are said to have a useful lifespan of over 25 years, while the batteries can be functional for upwards of 4 years. They are also said to cost half as much as imported rivals, have a unique design, come in various colors, and can emit variable amounts of light.

Among these solar-power products, the streetlights are 120w and reach up to 6 meters in height, while garden lighting are 40w and a height of 2.5 meters. Solar lighting for grasslands is also being produced.

For some time, North Korean residents themselves have been turning to solar photovoltaic systems to deal with the country’s chronic electricity shortages. Many households would pay the high cost to purchase a Chinese-made system. Eventually, North Korea began its own domestic production of solar products.

Back in March 2015, North Korea’s official wire service, the Korean Central News Agency (KCNA), stated that the country had succeeded in industrial production of solar energy products. KCNA indicated that the departments of electronic automation, physics, the life sciences and the material sciences had developed a solar energy generation system that produced electricity via integrated process utilizing computer technology.

The integrated power generation system is said to have illumination intensity monitors, load controls, and battery storage facilities. There are 1-5kW capacity for households, 10-30kW for state institutions and service facilities, and even 50-500kW capacity for industrial uses.

North Korea claims that, with the development of high efficiency solar panels and other solar power products, they have achieved the ability to generate large amounts of power via solar technologies.

The KCNA report further stated that “the mass production of necessary products by industrial means for a Korean-style solar energy generation framework has resulted in a leap-forward [in energy generation capacity].”

Over the last few years, North Korea state policy has emphasized the development and use of green technologies. Various efforts have been made in these regards. In fall 2015, the introduction in the city of Nampo of a public bus powered by solar panels is one example. The country also has sought foreign investment in the domestic production of renewable energy products. For instance, at an investment briefing in May 2015 held by the Wonsan Zone Development Corporation, North Korea pitched the construction of a photovoltaic cell assembly factory in the Ponngmak-dong area of Wonsan, with the aim to produce various solar cell products to meet the demand in the domestic market.

Drive to Modernize/Normalize Thermal and Hydroelectric Power Stations

North Korea is attempting to modernize and normalize electricity production at its thermal and hydroelectric power stations.

The Korean Central News Agency (KCNA), North Korea’s official wire agency, reported on January 17, 2017 that with regard to improvement of circulating water pump technology, in the form of modern measuring equipment, progress is being made at the Pukchang County Thermal Power Complex.

The Pyongyang Thermal Power Complex and East Pyongyang Power Station are both introducing non-heavy oil ignition technology that utilizes anthracite.

Reportedly, a combined production system has also been perfected at hydroelectric plants, and generator efficiency has been raised by a further 2% through the introduction of scientific operational methods.

Construction works aimed at increasing electricity production are approaching completion at Kanggye Youth Power Plant, Pujon River Power Plant, and Sodusu Power Plant. Protective equipment like digital speed governors and exciters are also being installed at Changjin River Power Plant and Orang Stream Power Plant.

The Huichon Power Station in Jagang Province is also being modernized to raise efficiency.

Efforts continue to raise the number of components produced domestically for large-scale hydroelectric power stations – like Hochon River Powerplant, the Wiwon Powerplant, the Changja River Powerplant, and the Taedong River Powerplant – in order to also increase electricity production.

At the same time, the Songbyon Electricity Management Agency is repairing large transformers and trying to correct the problem of loss of electricity in the transformer process.

In Korea during the Japanese colonial period, hydroelectric resources were extensively developed in the northern half to supply the energy needs of much of the peninsula. During the Korean War, many of North Korea’s major hydroelectric facilities and power grid system were heavily damaged due to bombing. In the 1960s, North Korea opted to expand hydroelectric power generation, creating a balance between hydroelectric and thermal power. In the 1970s, the country moved toward coal-fired thermal power facilities to take advantage of underground resource endowments. Despite the tendency for thermal power stations to have higher operational costs and less efficiency, from the mid-1970s North Korea sought to move beyond a power generation system dependent on hydroelectric power.

Uptick in North Korea’s Renewable Energy Production

In North Korea, there are now three solar-powered ferries that sail the Taedong River: the Okryu 1, Okryu 2, and Okryu 3. The North Korean government’s wire service, the Korean Central News Agency (KCNA), reported on November 4, 2016 “The ferries sail between Kim Il Sung Square and the Tower of the Juche Idea, guaranteeing that citizens can travel during the rush hour… . These solar powered-ferries provide ferry services both to workers and for guests from home and abroad in the form of tourist and chartered services.”

According to KCNA, the three ferries were built at Ryongnam Shipyard, each weigh 45 tons, have a maximum speed of 6 knots, and can take up to 50–60 passengers.

According to Yun Hyok, the captain of Okryu 1, “the ferry is powered by the energy of sun light … the driving system was created with the energy and skill of our engineers. The ship can run for around 8 hours when fully charged.”

Since the 1990s, North Korea has expressed determination to achieve energy independence, with Kim Jong Un pointing to resolving electricity difficulties as being a priority back in 2011. Subsequently, in 2013, a law was introduced to encourage research and the production of renewable energy, and at this year’s Seventh Party Congress it was announced that two hydropower stations had been opened. The importance of energy independence was also emphasized at the congress. It has also been confirmed that North Korea has been pursuing a long-term plan to raise the amount of energy produced from renewable sources to 5 million kW. In order to achieve this target, the plan envisages by 2044 that wind power will provide 15 percent of total energy demand.

This plan was discovered through internal materials on display at the Natural Energy Research Centre, formed in November 2014 as a result of an order issued by Kim Jong Un to develop energy resources that do not pollute the environment.

An overseas visitor to the Natural Energy Research Centre said that “the Centre in Pyongyang has a diagram of the 30-year plan to develop renewable energy with the title ‘The dream and ideal of Natural Energy Science development’… . The materials there also indicate plans to train specialists in the science of ‘natural energy’ development, and plans related to the development and trial sites for wind power, geothermal energy, and solar thermal energy.”

Such plans mean that North Korea plans to develop renewable energy, in addition to building hydroelectric power plants and/or using Chinese/Russian power to deal with energy shortages. In other words, they intend to attempt to reduce their consumption of fossil fuels and develop renewable energy. Since Kim Jong Un’s rise to power, a variety of measures have been put in place and investments made to broaden the use of renewable energy.

– The Institute of Far Eastern Studies