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NORTH KOREA NEWSLETTER NO. 238 (Nov. 29, 2012)

North Korea's Black Market Swept with Chinese Products

SEOUL (Yonhap) -- North Korea's black markets are saturated with Chinese products, sending the North's trade deficit with China soring to a record high level this year, a report in Seoul said on Nov. 23.

   "Chinese goods conquered the black markets and Chinese yuan is more popularly used than the North Korean won currency," said the report by the (South) Korea Trade-Investment Promotion Agency, or KOTRA. "Groceries, clothes and electronic devices sold in the biggest commerce center, which opened last January in the Kwangbok Area in Pyongyang, are mostly made in China," the report said.

   The report by the South Korean trade agency also noted that the rising popularity of the Chinese currency reflects North Korean citizens' skepticism over their own currency. During the country's botched currency reform attempt in 2009, many North Koreans failed to convert to new bills, a factor which wiped out their savings, and now they rely more on the Chinese currency, according to the report.

   Despite the North's ongoing efforts to prop up its currency and curb inflation, the popularity of the North Korean currency has been on the downturn while inflation continues to gain traction, the report said.

   One Chinese yuan changed hands for 15.89 North Korean won in North Korean hotels and the official foreign exchange market as of early October, but in private money exchanges, one yuan could buy as much as 940 North Korean won, the report noted.
While an average government employee in the North brings home 3,000 to 10,000 North Korean won every month, a cup of Chinese instant noodles costs 6,500 won in a regular North Korean supermarket in Pyongyang, it said.

   As a result of the rising inflow of Chinese goods, North Korea's deficit from trading with China amounted to a record high of US$651 million during the January-August period, according to recent customs figures from China.


U.S. Officials Say Little Change on Policy toward N. Korea

SEOUL (Yonhap) -- U.S. officials involved with North Korea policy have told the South Korean government that there will be little change in American policy toward the North during U.S. President Barack Obama's second term, a Seoul official said on Nov. 25.

   "U.S. officials delivered their stance that there will be no particular change in the policy on the Korean Peninsula," said the foreign ministry official who visited the U.S. accompanying Seoul's deputy chief nuclear envoy.

   Lee Do-hoon, Seoul's deputy chief envoy for the six-nation talks aimed at ending the North's nuclear weapons program, met with Clifford Hart, Washington's special envoy for the six-party talks, and other U.S. officials last week.

   South Koreans will go to the polls on Dec. 19 to elect a new leader.

   Last Friday, South Korea's military and government officials confirmed that North Korea is preparing to launch a new long-range missile at a launch pad that has been used for previous rocket launches.

   Responding to a report by Japan's Asahi Shimbun that U.S. satellites detected possible preparations by the North to test a long-range ballistic missile at the Dongchang-ri base, a senior government official said Seoul was closely watching the North's preparations.

   North Korea has said it will continue to put a "working satellite" into orbit and South Korea is "judging that the North's side will go ahead as it has declared," according to the government official.

   U.S. satellites recently detected images of cargo believed to be missile parts similar to those shown in the April launch, and Pyongyang could be technically ready to fire off a missile as early as this month, the Japanese newspaper said.

   North Korea's failed launch of a long-range rocket in April drew strong condemnation from the U.N. Security Council, which said the launch was a disguised test of a ballistic missile.

   The six-party talks, which put together the two Koreas, the U.S., China, Russia and Japan, have been stalled since late 2008 following disagreement over an aid-for-denuclearization deal.


N. Korea's Infant, Maternal Mortality Rates Higher Than 1990s

SEOUL (Yonhap) -- The mortality rate in North Korea has risen sharply in recent years amid a lack of medical help in the isolated country, a South Korean aid group said on Nov. 26.

   About 19.3 out of 1,000 babies under the age of one died in 2008 in the North, while the figure was 14.1 in 1993, according to data compiled by Medical Aid for Children.

   Corresponding figures for South Korea were 3.5 in 2008 and 9.9 in 1993, according to the data.

   The average for member countries of the Organization for Economic Cooperation and Development was 4.7 in 2008.

   The North has also seen maternal mortality gain ground during the same period, with 77 out of 100,000 mothers dying while giving birth in 2008, compared with only 54 mothers in 1993, the local aid group said.

   In 1960, 37 out of 1,000 children under the age of five didn't make it, while the number fell to 14 in 1998 before jumping to 48.8 in 2000 and 26.7 in 2008, according to the data.

   "Many parts of North Korea are suffering from the collapse of medical services," the aid group said, calling for medical assistance to the impoverished country.


N. Korea Halts Name-calling against Ruling Party Candidate Park

SEOUL (Yonhap) -- With South Korea's presidential election less than a month away, North Korea appears to have suspended its critical campaign against conservative party candidate Park Geun-hye, analysts said on Nov. 26, triggering speculation the communist state may eye a potential opportunity to mend ties with the South under a new administration.

   Since last publishing an article accusing Park, the presidential candidate on the ruling Saenuri Party ticket, of leading an anti-North Korea policy line on Nov. 10, the country's leading Rodong Sinmun has discontinued its name-calling against Park in recent issues of the newspaper monitored in Seoul.

   Except for a Nov. 13 dispatch critiquing Park's North Korean policy, the North's state-run Korean Central News Agency (KCNA) has also halted its frequent criticism of the conservative candidate whom the news agency used to accuse of copying President Lee Myung-bak's hard-line policy toward the North.

   The North's propaganda Web site Uriminzokkiri has also toned down its usually harsh language on Park, describing her only as "the Saenuri Party candidate" in a Monday article, instead of repudiating her as it has previously done.

   North Korea watchers in Seoul said the recent low-key moves shown by the North indicate a wait-and-see stance ahead of the South's Dec. 19 presidential election in which Park is in a neck-and-neck competition with Moon Jae-in, the liberal camp candidate.

   They stressed the North behaved similarly ahead of the 2007 presidential election in the South, by temporarily ceasing its campaign against Lee.

   North Korea suspended its criticism of Lee even after he took office in late February, 2008, before resuming its condemnation against his hard-line policy.

   "A possible assumption is that the North has reduced its name-calling against Park in order to prepare for (potential) negotiations with the next administration in the South," said Chang Yong-suk, a researcher at the Institute for Peace and Unification Studies at Seoul National University.

   Seoul's recent condemnation of Pyongyang's alleged attempts to meddle in the December election may have also led to the toned-down media stance, experts noted.

   Professor Yang Moo-jin of the University of North Korean Studies in Seoul said, "It is too early to determine the North's strategy over the name-calling suspension." The country could resume its condemnation of Park's hard-line policy any time as it had with the Lee administration, experts said.


N. Korean Ship Captured in Somalia over Sea Dumping: Media

SEOUL (Yonhap) -- Somali authorities have seized a North Korean vessel for allegedly dumping cement off the country's coast, and plan to bring its crew to a local court, a U.S. news Web site monitoring North Korean issues reported on Nov. 26.
A North Korean-flagged ship and its crew were captured by the quasi-government of Puntland near the coast of the Puntland port city of Bossaso while discharging some 5,000 tons of cement, NK News said, citing Somali radio station, Radio Gaalkacyo.

   It did not specify the day of seizure or the number and nationality of crew members.

   The M.V. Daesan vessel had been headed to Mogadishu but its cargo was rejected by businessmen there because the cement had been spoiled by water leakage, the radio report said.

   Somali authorities condemned the dumping as "illegal" and "environmentally destructive."

   The radio said the crew will be brought to a local court for indictment "soon," citing an unidentified source.

   In July of this year, 33 crew members on board the M.V. Daesan were rescued by Oman's naval forces near the Suez canal.


U.N. Committee Slams North Korea's Human Rights Record

NEW YORK (Yonhap) -- A key U.N. committee on Nov. 27 adopted a resolution denouncing North Korea for its "systematic, widespread and grave" human rights violations.

   In the EU-drafted resolution passed by consensus, the Third Committee of the 193-member U.N. General Assembly criticized the North Korean regime for its "systematic, widespread and grave violations of civil, political, economic, social and cultural rights."

   The committee covers social, humanitarian and cultural issues.

   It has adopted such a resolution against North Korea's human rights abuses every year since 2005. But it is the first time that a resolution has been passed by consensus without a vote, according to U.N. officials.

   The North Korean delegation to the session described the resolution as an "act of the state political terrorism" that reflects "interference in internal affairs."

   North Korea's U.N. envoy, Kim Song, denied any human rights violations in his socialist nation.

   The Pyongyang government strongly resisted the U.N. resolution, calling it a "politically motivated" one.

   "The Western forces are blindly following the U.S. hostile policy toward the DPRK out of inveterate repugnance toward its socialist system," the KCNA on Nov. 28 said in a recent dispatch citing a spokesman for the foreign ministry.

   "The DPRK (North Korea) flatly rejects and vehemently denounces the anti-DPRK human rights resolution which the hostile forces adopted to bring down the Korean-style socialist system centered on the popular masses by abusing the noble idea of human rights, prompted by their sinister political purposes," the news agency added.


N. Korea, Japan to Hold Talks in Beijing in Early December

TOKYO (Yonhap) -- North Korea and Japan will hold senior-level talks in Beijing on Dec. 5-6, the Japanese government said on Nov. 27, the second meeting of its kind aimed at improving their bilateral relations.

   "Through persistent negotiations, the two nations will make solid progress," Japanese Foreign Minister Koichiro Genba said, adding that both parties will engage in a "deep exchanges of opinions" over long-standing issues.

   Senior diplomats of North Korea and Japan previously held their first round of talks in Ulan Bator, Mongolia on Nov. 15-16, to discuss the North's past abductions of Japanese nationals, marking the first dialogue since they stalled four years ago.

   The abductions by North Korea, which took place in the 1970s and 1980s, remain a major obstacle to normalizing ties between the two countries, as Pyongyang promised in August 2008 to reinvestigate the issue, but later walked away from the promise.

   North Korea's chief delegate to the talks Song Il-ho, and his counterpart Shinsuke Sugiyama, director general of the Foreign Ministry's Asian and Oceanian Affairs Bureau, will again head the meeting in December.

   Both parties are also are expected to discuss ways to cooperate in collecting the remains of Japanese who died decades ago in what is now North Korea.

   According to Japanese government sources, North Korea earlier expressed its wish to hold the second consultations as early as possible.


S. Korea's Unification Church to wind up auto venture in N. Korea

SEOUL (Yonhap) -- The Unification Church foundation in South Korea is likely to wind up its joint auto-making venture with North Korea and instead try to tap into the distribution sector there, a source said on Nov. 28.

   The source said, "As far as I know, Pyeonghwa Motors is seeking to sell its factory in Nampo for about US$20 million in order to end its auto business."

   Pyeonghwa Motors, a joint auto-making venture in North Korea between the North and the church founded by the late Rev. Sun Myung Moon, started operations in 2002, producing about 2,000 vehicles every year.

   However, increasing cooperation between the North and China in the auto sector is believed to have weighed down the North's venture with the South Korean entity.

   "The (South Korean) president of the auto firm appears to be eyeing the distribution sector" in North Korea, an official at the foundation said, adding the president may move to a new industry after liquidating the auto business. "But nothing has been determined so far," the official said.

   Pyeonghwa Motors president Park Sang-Kwon is widely expected to hold discussions with the North over the business shift during a North Korean visit scheduled for mid-December, to mark the first anniversary of the death of late North Korean leader Kim Jong-il, who died on Dec. 17.