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NORTH KOREA NEWSLETTER NO. 236 (Nov. 15, 2012)

S. Korea's Defense Chief Says N. Korea Made 'Smooth' Power Transition

SEOUL (Yonhap) -- South Korea's defense minister said on Nov. 8 North Korea has made a rather smooth power transition to young leader Kim Jong-un, but the socialist state still faces tough challenges to revive its moribund economy.

   "At present, North Korea's power shift appears to have gone smoothly," Kim Kwan-jin said in a meeting with a group of senior journalists at the defense ministry.

   The defense chief said the largely untested leader, who took power in December following death of his father Kim Jong-il, was trying to introduce economic reforms, even though it is not clear they can succeed.

   "A key task for Kim Jong-un is the economy." Kim said. "(He) is making various attempts, but it is very unclear whether those efforts could produce visible outcomes soon or the economic reform measures could benefit the North Korean people."

   But when it comes to the armed forces, Kim said the North Korean leader appears to be moving ahead with the Songun (military-first) politics of his father.

   As shown in Pyongyang's belligerent rhetoric against the South, recently highlighted by a warning to attack defectors' attempting to send propaganda leaflets to the North, Kim said Pyongyang will continue to give top priority to military strength above all and seek nuclear weapons.

   "North Korea has prepared a third nuclear test and will conduct it pending a political decision," Kim said. "It will conduct long-range missile tests in the future."

   Pyongyang conducted nuclear tests in 2006 and 2009, which sparked international outcry and economic sanctions on the reclusive state. It unsuccessfully fired off a long-range rocket in April, which was seen as an apparent attempt to test its missile technology.

   A top North Korean military official's appearance wearing the insignia of the four-star rank, which spurred speculation of degradation from the vice marshal rank, also seems as part of efforts to cement his grip on power after a series of North Korean soldiers' defections in recent months raised questions over the lax military discipline, the South Korean official said.

   In July, Army Chief Hyon Yong-chol was promoted to the rank of vice marshal, a day after the former chief Ri Yong-ho was removed from his post. But a picture from an October event showed him carrying the insignia of the four-star rank.


Re-election of Obama, Xi Jinping's Rise to Usher in Favorable Changes in N.K.

SEOUL (Yonhap) -- The re-election of liberal-minded U.S. President Barack Obama and the rise of a new leadership in China, led by soon-to-be-president Xi Jinping, are expected to help induce North Korea to ease confrontational policies and possibly adopt an engagement stance, experts in Seoul said on Nov. 8.

   Obama's victory gave breathing room to North Korea, whose policy options would have been far more limited if Republican rival Mitt Romney, a hard-liner, had been elected, observers said.

   The North may temporarily decide not to take provocative measures, like conducting another nuclear test, and take time out to explore possible policy options acceptable to the second term Obama administration, which may opt for an engagement stance that can lead to tangible achievements in Washington's North Korean policies, experts well versed on the communist country said.

   "(The North) could possibly take preemptive steps to improve relations with the U.S. by deciding to restore the Feb. 29 agreement, rather than (engaging in) provocations," said Yoo Ho-yeol, a North Korean studies professor at Korea University. The 2012 agreement calls on Pyongyang to stop nuclear tests, uranium enrichment and a long-range missile launch. The North conducted a missile test in April in a breach of the pact.

   South Korea's new president, to be elected in December, is also likely to reverse the current Lee Myung-bak administration's hard-line policy, and shift toward engagement policies with the communist country, contributing to relation-mending efforts by the North, now struggling to solidify the power of the newly-established regime under Kim Jong-un.

   "Why Obama's North Korean policies did not work out is linked to the South Korean government's (hard-line) stance. Since the U.S. and South Korea should have governments that stress dialogue with the North (rather than pressure), things may be different from the past," said Hong Hyun-ik, an analyst at Sejong Institute.

   South Korea's three main presidential candidates -- Park Geun-hye, Moon Jae-in and Ahn Cheol-soo -- have expressed willingness to open talks with the North as part of their election pledges.

   But the North will still maintain the option of a provocation in case the new governments in the U.S. and the South do not take visible steps to engage with the reclusive country, experts warned.

   Regarding the North's relations with China, the inauguration of a Xi Jinping administration in the ally country is forecast to give a powerful boost to economic cooperation between the two partners, international affairs analysts claimed.

   On Nov. 8, China opened a week-long congress in which President Hu Jintao is to relinquish his power to his appointed heir Xi, currently the vice president of the country.

   As China prefers the stable maintenance of the status quo on the Korean Peninsula, the country may put its focus on increasing economic ties mainly by developing special economic zones in border areas in the North.

   China and North have recently struck major economic deals such as projects to develop North Korean ports, mineral mines as well as joint economic zones.

   "Xi Jinping tends to be outspoken. He has the possibility of openly expressing his willingness to support and assist the Kim Jong-un regime," Professor Yang Moo-jin of the University of North Korean Studies in Seoul, predicting sharply enhanced North-China relations under the new regime in China.


North Koreans Shift to Cheap Food to Cope with Food Crisis

SEOUL (Yonhap) -- North Koreans are shifting their food staples to cheaper ones due to the chronic shortage of food, a recent survey by the World Food Program (WFP) showed.

   Radio Free Asia based in the United States reported most of the North Koreans who were polled said they had shifted to cheaper food in an effort to survive the food crisis. Those who said they asked their friends or relatives for help came next followed by those who said they slashed their intake of the food or skipped meals.

   The survey was conducted by the WFP on seven occasions in May, August and November last year and February, May, July and August this year. WFP surveyors visited North Korean families in person and asked the questions, the RFA said.

   The WFP has 59 resident officials in six North Korean cities, including Pyongyang, Chongjin, Hamhung and Haeju, to assist in the offering of food assistance to North Koreans.


N. Korea Estimated to Secure 4.4 Million Tons of Rice, Corn in 2013

SEOUL (Yonhap) -- North Korea is estimated to secure a total of 4.4 million tons of rice and corn to feed its people next year, an international organization said on Nov. 9.

   The Food and Agriculture Organization of the United Nations said in a report that the North may be able to produce 1.8 million tons of rice in 2013, while importing another 300,000 tons to secure a total of 2.1 million tons.

   About 100,000 tons will likely be set aside for emergency use, the report said.

   The organization said the country is also predicted to secure 2.3 million tons of corn by yielding 2.1 million tons and importing the rest.

   The estimated food amount would allow a North Korean to consume 74.4 kilograms of rice as well as 80.3 kilograms of corn next year, up slightly from 72.2 kilograms of rice and 68.3 kilograms of corn in 2012.

   The organization also predicted South Korea will secure the annual rice inventory of 4.5 million tons for next year.


Egypt's Orascom Invests US$150 Million in North Korea's Telecom Biz

SEOUL (Yonhap) -- Orascom Telecom Media and Technology (OTMT) of Egypt has invested more than US$150 million in North Korea's telecom business since its made inroads into the socialist state in 2008, Radio Free Asia (RFA) reported on Nov. 10.

   Quoting a business Web site based in the Middle East, RFA said Orascom has invested a sum of $153 million in North Korea since 2008, of which the lion's share was used to establish the telecom network in the country.

   Orascom has established Koryolink, a joint venture mobile phone service company, with the North Korean government. The Egyptian company owns 75 percent of the sole 3G cellular operator in North Korea with the rest being held by the North Korean government.

   The Cairo-based Orascom also invested in the construction of Ryugyong Hotel in Pyongyang, Kempinski AG Chief Executive Officer Reto Wittwer said at a recent forum in Seoul. Wittwer said Orascom invested $180 million in the 105-story pyramid-shaped Ryugyong Hotel to complete the hotel's facade.


U.S. Military Chief Visits DMZ, Says Alliance Changing

WASHINGTON (Yonhap) -- The top U.S. military officer, Army Gen. Martin E. Dempsey, caught some North Korean soldiers off guard earlier this week as he traveled to the Demilitarized Zone (DMZ) that divides the two Koreas, according to the Pentagon.

   Several stories, carried on Nov. 12 on the Web site of the Defense Department, gave detailed accounts of Dempsey's visits to Seoul and the DMZ along with Army Gen. James D. Thurman, who leads the U.S. Forces Korea.

   Dempsey, the chairman of the Joint Chiefs of Staff, and Thurman toured the Freedom House and a conference room at the truce village of Panmunjom in the DMZ on Nov. 11 (Seoul time).

   "North Korean soldiers hurried down to the buildings with cameras when Dempsey and Thurman arrived," a story read. "North Korean soldiers stared in the window as Dempsey walked to the northern side of the building."

   Panmunjom is a vivid reminder of the reality that the two Koreas remain technically at war as their 1950-53 conflict ended in a cease-fire, not a formal peace treaty. The truce was signed in Panmunjom, which is guarded jointly by South Korean and U.S. troops on the southern side.

   "As he and Thurman visited the DMZ, Dempsey noted that they both started their military careers in Germany, guarding the border between the Warsaw Pact and NATO. That heavily guarded border now is a thing of the past," the story added.

   Another article by the American Forces Press Service introduced Dempsey's meeting with his South Korean counterpart, Jung Seung-jo, after the DMZ tour.

   Dempsey was quoted as saying that the alliance is successful, but it is going to change. He was apparently referring to the transfer of wartime operational control (OPCON) of South Korean troops to Seoul in 2015.

   The transition will lead to the dismantling of the Combined Forces Korea, the control tower of joint military operations between the allies. The two sides are in consultations over an alternative joint command system.

   Dempsey also said he and Jung discussed North Korea, which carried out two deadly attacks on the South in 2010 and other provocative acts.

   "We took stock of activities over time, whether it's the obvious ones like the shelling of islands and the sinking of the Cheonan, or GPS jamming or the missile tests," he added.

   Dempsey is on a swing through Asia-Pacific, which also took him to Japan and Australia.


U.S. Vows Close Consultations with S. Korea's New Leader on N. Korea

SEOUL (Yonhap) -- U.S. President Barack Obama in his second term is ready to consult closely with the winner of next month's presidential election in South Korea on how to deal with North Korea's nuclear weapons program, a Seoul official said on Nov. 13.

   The foreign ministry official made the remarks after he met with senior U.S. diplomats in Washington, including James Zumwalt, deputy assistant secretary for East Asian and Pacific affairs and Clifford Hart, Washington's special envoy for the six-nation talks on ending the North's nuclear program. The meetings took place shortly after Obama won re-election.

   Some analysts have expressed concern that the current lockstep alliance between South Korea and the U.S. is unlikely to be sustainable, particularly for North Korea policy. Whoever wins the Dec. 19 presidential election in South Korea, a new leader is expected to take a more conciliatory stance toward North Korea than outgoing President Lee Myung-bak.
Obama, in his second term, "is willing to hold close consultations with South Korea on its policy on North Korea, based on the spirit of alliance," the official said on the condition of anonymity.

   The Obama second term is not expected to adopt a major change in its policy on North Korea, the official said, adding that a looming reshuffle of his foreign-policy and security team would be an indicator of which direction Obama plans to go with regard to the North's nuclear issue.

   "U.S. officials are watching the presidential election in South Korea with great interest, but they expressed their willingness to fine-tune policies with the next Korean government," the official said.

   Diplomatic efforts to reopen the six-party talks, which were last held in late 2008, have been frozen since the North's April rocket launch, but analysts expect regional powers to resume diplomacy with North Korea sometime next year.

   The six-party talks aimed at diplomatically persuading the North to give up its nuclear ambitions include the two Koreas, the U.S., China, Russia and Japan.


North Korean Missile Parts Heading to Syria Seized in May

NEW YORK/ WASHINGTON (Yonhap) -- South Korea intercepted a Chinese ship in May bound for Syria carrying parts that could be used for missile production, a news report said on Nov. 13.

   The case, included in a U.N. report, came amid lingering concerns over North Korea's ties with Syria -- and China's commitment to U.N. sanctions on Pyongyang, according to Japan's Kyodo News Service.

   Citing U.N. diplomats, Kyodo said the Chinese-registered freighter, based in Shanghai, was seized by South Korean authorities in Busan. The ship was carrying 445 graphite cylinders, which are convertible to ballistic missile components, bound for a Syrian company with North Korean ties, it added.

   The goods are believed to be made in North Korea, the report said.

   Kyodo's article has not been independently confirmed.

   The U.S. State Department said on Nov. 13 it "cannot comment" on the issue.

   A U.N. diplomat also pointed out that it is a matter that relates to a U.N. report neither finalized nor released publicly.

   North Korea is subject to tough U.N. resolutions that ban the secretive communist nation from exporting and importing any materials associated with nuclear and missile technology.

   The U.N. Security Council has a panel of experts to assess the implementation of sanctions on North Korea for its missile and nuclear tests.

   The panel submits reports to the council on a regular basis.

   While strong sanctions on the North are in place, many question their effectiveness without China's active cooperation. Beijing, the last remaining ally of Pyongyang, provides food, energy and other assistance to its impoverished neighbor.

   Meanwhile, a security think tank in Washington suggested the North is continuing long-range missile development after a failed launch in April.

   Citing an analysis of satellite imagery, the U.S.-Korea Institute at Johns Hopkins University said Pyongyang appears to have conducted "at least two, and possibly more, tests of large rocket motors," the most recent in mid-September.

   The institute added that construction activity on a launch pad was also detected.

   "In the aftermath of the U.S. and South Korean presidential elections, Pyongyang may embark on a new round of activities in the first half of 2013, including rocket and nuclear tests that will contribute to further development of its nuclear deterrent," the institute said on its blog specializing in North Korea.

   But it added, "Whether the testing of large rocket motors or construction at the launch pad are in preparation for such activities remains unclear at this point."

   The State Department would not talk about the institute's report.