North Korea Opens Rail Sector (UPDATED)

In FTB Asia, an article from January 12 and written by Paul French based in Shanghai briefly discusses the relationship between North Korea and China in regards to railways.

Many readers are probably aware that Kim Jong-Il makes trips to China and Russia by rail. The most recent trip touring several sectors of China caught a lot of attention in the Japanese press, although it was officially classified until Kim returned to Pyongyang.

The Korean Central News Agency, in an article titled "Kim Jong Il's China Visit Hailed," opened its praise of the China trip with the following paragraph:

"Newspapers here today come out with editorials saying that spectacular successes and immortal feats registered by leader Kim Jong Il during his visit to China will shine long along with the history of the DPRK-China friendship. Rodong Sinmun says that Kim Jong Il's recent China visit offered a momentous occasion as it provided a new landmark in boosting the unbreakable friendship and solidarity and developing the sincere and comradely cooperation between the parties and peoples of the two countries despite the whirlpool of the turbulent 21st century."

Unfortunately, Kim hasn't been able to perform any "immortal feats" or "spectacular successes" in his country's rail sector, as Paul French states:

In a desparate attempt to try and reverse decades of decline and to enhance cooperation with its largest trading partner, North Korea (DPRK) is to open its rail sector to Chinese rail companies and organizations. A consortium of Chinese railway companies and the North Korean Ministry of Railways have agreed to open all railway lines in North Korea to Chinese corporations.

The details illustrate the one-sided nature of this deal, a real call for help from the North Koreans:

As well as freight, the trade includes consignments of humanitarian aid from China to prop up the DPRK's ailing economy and precarious food situation. The joint railway venture will initially buy 200 used trains from North Korea to initiate trade with a long-term plan of purchasing an additional 500 to 1000 trains. These will most likely be Chineses given the lack of available trains in the North and the generally run-down state of its train building facilities.

Despite their weak position, the North Koreans still drive a hard bargain:

However, discussions have bogged down over differences in user charges.

COMMENT: Actually, I am very interested in this story even given its brevity and lack of attention elsewhere. One of my hopes in the long-term future is to work in a position where I can be engaged in any efforts to bring North Korea into full-fledged economic cooperation with the rest of the globalized world, perhaps in the mold of modern China. Just as in China currently, there will be a significant need for logistics expertise in rebuilding infrastructure and the links to trade. This news illustrates that this process is in its most infantile state, but nevertheless a start in the right direction.

UPDATE: The Korea Liberator points out that North Korea has taken a new approach to opening up its rail sector. The country has shot itself in the foot so many times, it is only standing on the "prosthetics" slipped to it via China. When will China graduate from this nonsense?