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North Korea: Witness to Transformation

Slave to the blog: time to get serious again

by and Stephan Haggard | November 28th, 2011 | 06:03 am
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Having recovered from our annual tryptophan binge, some updates on stories that we have been following:

Spies. Back in September, we commented on the arrest of a North Korean agent allegedly sent to assassinate outspoken North Korean defector Park Sang-hak with a poison-tipped needle. The Diplomat has since run a story on North Korea’s clumsy assassins, suggesting that they have lost a step. Well, it appears that they are at it again.  Last week, Yonhap ran a terse story on the arrest of another North Korean agent impersonating a refugee. The problem should not be overexaggerated, but it is exactly the kind of asymmetric warfare and mischief-making that the North Koreans do.

Investment. We have long been bearish on North Korea’s efforts to attract foreign direct investment, arguing that they have shown little interest in protecting property rights and letting investors make money. Well, the following merits a “not satire” tag. According to Dong-a Ilbo, the North Koreans are now involved in the classic “selling the same horse twice” game: double contracts. A double contract is exactly what it sounds like: you sign a contract with one party, then dispose of the assets, lease them to someone else, or sign another contract for the same deal. For example, in April last year, the North granted two foreign companies “exclusive” rights to develop a mine that a European venture capital firm had invested in earlier. Even the Chinese have apparently issued formal complaints.

Unfortunately, this tactic is nothing new. In 1997, during the famine, a zinc for wheat swap with Cargill collapsed when it was revealed that the North Koreans had promised the zinc to two different counterparties.  Given that history, one wonders if this more recent episode signals desperation akin to the famine period.

Pipelines.  Via NAPSNet we were alerted to another story in Dong-A Ilbo, citing an unnamed source in the ruling GNP, that South Korea would provide a gas-fueled power plant to North Korea as part of a pipeline deal.  The argument is that the resources embodied in the power plant would be less fungible than just paying the North Korean government cash.  Left unsaid is whether gas power plants could be regarded as a substitute for the nuclear power plants that North Korea continues to demand. Post-Fukushima this demand is a complete non-starter.

Human rights. In an earlier post, we flagged the visit to Washington of Oh Kil-nam, whose family is allegedly incarcerated in the Norht Korean gulag.  Now, via Grace Oh at the Committee for Human Rights in North Korea, we learn that Marzuki Darusman, UN Special Rapporteur on North Korean Human Rights, met with Oh during  a recent visit to Seoul.

Finally, we note with sadness the passing of Fred Iklé. Fred was the founding chair of the Committee for Human Rights in North Korea and played a central role in ensuring that the organization survived its infancy.  A memorial service on 10 December is being organized by CSIS, where Fred spent many years after leaving government service.  For details please contact Ms. Karen Wong by phone: 202-775-3196 or via email: kwong@csis.org. Fred’s family has asked that in lieu of flowers memorial donations may be mailed to Brookside Gardens, 1800 Glenallan Avenue, Wheaton, Maryland 20902 Attn: Ellen Bennett. Please note on the check ” the Fred Iklé Fund” or The Innocence Project online at http://ip.convio.net/goto/Fred.Ikle.Memorial