Digging North Korea Out of a Hole

Chosun Central News Agency (KCNA) reported Saturday on a recent visit by Kim Jong Il to two mines in Dancheon, a city on the coast of South Hamgyung Province south of Kimchaek.

The KCNA report noted that Kim was briefed on the introduction of new technology and state of production at the two mines, Daeheung Youth Heroes Mine and Ryongyang Mine, after which he spoke to workers, encouraging them to increase production levels. He supposedly wrapped up the visit with a trip to a noodle restaurant in the city.

Kim reportedly told his audience at one of the mines, “You must be proactive in exploration to secure greater reserves while unstintingly developing a comprehensive mining policy based on the latest science and technology.” He also stressed the need for constant updating of mining equipment.

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One of the two mines visited by Kim, Daeheung Youth Heroes Mine is sometimes called ‘Baekgeumsan’ (White Gold Mountain) for its large deposits of magnesite. Indeed, South Korea’s Korea Resources believes the Dancheon area contains approximately 3.6 billion tons of magnesite, while KCNA claimed in its report, “More than 25% of the natural deposits of high-grade magnesite in the entire world are concentrated in Daeheung Youth Heroes Mine.”

Other mineral deposits in North Korea are also impressive. Last December’s key-indicators report from Statistics Korea estimated mineral reserves in North Korea at 2,000 tons of gold, 500 billion tons of iron and 6 billion tons of magnesite, with a total value running into the trillions of US Dollars.

However, last year North Korea exported just US$860m worth of minerals to China, $80m to the EU and $11m to Russia, according to the Korea International Trade Association. It is thus obvious that if power supply and technical limitations can be overcome, mining for export represents one way North Korea could spur relatively rapid economic growth.

This was not Kim’s first trip to Dancheon in recent memory; he gave similar onsite guidance in the city on October 4th when he toured a magnesium processing facility and Dancheon Port. Reviewing construction of the port, Kim is said to have remarked, “We have been able to correct the illogical system of the former era whereby products from Geomdeok and Dancheon had to be moved by automobile or train to far away ports,” adding that the recent developments represented “the honorable fruits of the people’s indefatigable will to forge a powerful nation.”

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