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Report: North Korea state companies accelerate mining activities

More business is being directed to state-sanctioned firms and away from private traders.

By
Elizabeth Shim
North Koreans wait to cross part of the Yalu River at a makeshift pontoon dock near Sinuiju, across the Yalu River from Dandong, China's largest border city with North Korea. Pyongyang’s state enterprises are competing for trade permits and industrial activity has subsequently increased, a North Korea source said.
 File Photo by Stephen Shaver/UPI
North Koreans wait to cross part of the Yalu River at a makeshift pontoon dock near Sinuiju, across the Yalu River from Dandong, China's largest border city with North Korea. Pyongyang’s state enterprises are competing for trade permits and industrial activity has subsequently increased, a North Korea source said. File Photo by Stephen Shaver/UPI | License Photo

SEOUL, June 20 (UPI) -- North Korean state enterprises, earning foreign currency for the regime, are in fierce competition for trade permits, but new activities in mining are endangering the environment.

A North Korea source who spoke to Radio Free Asia on the condition of anonymity said the latest trends indicate policies have changed since Kim Jong Un fully assumed power in 2012.

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"Even in the Kim Jong Il era, permission to export timber was given exclusively to the Maebong Co., which is under the administration of the Reconnaissance Bureau. But now the timber export permit has also been granted to the 8 Administrations Foreign Currency Earning Co. and the Sambaek Co.," the source said.

In Ryanggang Province, adjacent to China, about 30 trading companies operate at the border.

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Other institutions, including a mining union and a trade bureau, are in engaged in cross-border enterprise, the source said.

"These trade organizations are competing for a permit to trade in tungsten and gold from the city of Hyesan," the source said.

No mineral is prohibited from trade with a permit in hand, according to the source.

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One organization that is under the supervision of Room or Office 39, which handles Kim Jong Un's cash reserves, has won a permit to trade in molybdenum, a silver-gray metal, that can be found at Ryonghwa Mine, the source said.

The strategy, however, may be related to other motives, including Pyongyang's desire to keep a check on North Korea's emerging entrepreneurs who have done well for themselves by trading with Chinese firms.

By granting the state trading companies the permits, Pyongyang is securing the status of its enterprises over private businesses.

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North Korea has also cracked down on private trading activities, but the entrepreneurs are now in response trading with the state enterprises. Businessmen must "donate" about $1,500 monthly to a state trading company, the source said.

Natural resources are being depleted as a result of the increased mining activity, the report stated.

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