DPRK Business Monthly Volume III, No.8

The DPRK Business Monthly, an international business report edited in Beijing, has been made available to CanKor readers by its editor, Paul White. Please check the  current August 2012 edition here: DPRK Business Monthly Vol III, No.8

Chongjin Port [Photo: KCNA]

Titles of articles found in this issue include:

  • First Pacific Nation Opens Office in Pyongyang
  • ROK Firms Get Foothold on NK’s Doorstep
  • China Gets Access to NK East Sea Port
  • DPRK Military Trade Unit In Joint Ventures with China
  • ROK Bars Firms in China Hiring N. Koreans
  • For Outsourcing IT, Have You Considered North Korea?
  • Hwanggumpyong Management Building Initiated

…plus a number of other items, including a selection of North Korean tours by various tour operators.

Comment by the Business Monthly Editor:

Apparently for the first time, last month North Korea issued an official rebuttal of claims by a Chinese company that it had been cheated over a mining venture in the North. Responding to lurid claims on the Internet by the Xiyang Group, the DPRK’s official news agency KCNA carried a statement by the Commission for Joint Ventures and Investment, a North Korean committee in charge of attracting foreign investment: “In the light of the process of implementing the obligations under the contract, the group is chiefly to blame from the legal point of view.” It is, of course, impossible for outsiders to place the blame on one side or the other.

However, the indignant statement by the North Korean side at a time when the latter is particularly anxious for foreign investment enables one to read between the lines.

North Korea is saddled with a problem: monopsony — only one buyer, thanks to foreign embargoes on trade with North Korea and the Seoul government’s antipathy to inter-Korean business. And that buyer is China. It doesn’t take much imagination to grasp the hard bargain a private Chinese company will try to drive when it’s a matter of “You’ll take the price we offer or your kids will continue to starve, because you’ve got no other buyers!” Unfortunately for the Xiyang Group, it didn’t know it was dealing with a proud people.

Also in September, there was good news from Russia. Deputy Finance Minister Sergei Storchak announced that the DPRK’s debt to Russia, outstanding for decades, had been officially settled, with 90 per cent of it cancelled, and the other ten per cent to be used for “debt-for-aid” projects in North Korea.

“The decision on the settlement is a significant step as it removes the obstacles to cooperation. Now credits can be granted,” said Alexander Vorontsov, an expert on North Korea at the Russian Academy of Sciences. The settlement clears the way for a pipeline deal which will send Russian natural gas to South Korea via the North, and railway and electricity development in the DPRK.

At the same time, it further undermines the US and ROK embargoes on the DPRK’s international trade

Please feel free to consult the full issue by clicking on this link: DPRK Business Monthly Vol III, No.8

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