Friday, August 10, 2012

What Will North Korea Do With Its $6 Trillion Worth of Rare Earths and Other Minerals?

From RT*:
North Korea could rival China on rare earths reserves – study
North Korea is sitting on around 200 different minerals, including a large number of rare earth metals, hidden in its mountains. The prized resources are attracting companies from China and South Korea, despite the political tension.

­In recent years the isolated country has shown no signs of economic improvement such as large-scale construction projects, modern cars and improved infrastructure, apart from the rumors of a nuclear weapons programme, Leonid A Petrov, a lecturer in Korean studies at the University of Sydney, wrote in an article in Asian times.

The country’s economic recovery after famine and natural disasters could come from the exploration of its rich mineral resources, he stressed.

North Korea's is set to have the world’s second-largest magnesite reserves, and its tungsten deposits are almost the world's sixth-largest. The country also holds sizeable deposits of coal, iron ore, gold, zinc, copper, limestone, molybdenum, and graphite.

About 40% of the 138 Chinese companies registered as doing business in North Korea in 2010, are engaged in extracting minerals, according to the U.S. Korea Institute at Johns Hopkins University.
Rich rare earths deposits are considered the most lucrative piece of the North Korean resource pie. Rare earths include 17 minerals used for many modern technologies like hybrid cars, weapons, flat-screen TVs, mobile phones, and mercury lights.

China has about 30% of the rare earths deposits and currently accounts for more than 90% of global supply. REM prices have become more costly after Beijing imposed export quotas and limited the number of companies licensed to sell them abroad.

The growing rise in REM prices and strong demand gives the young leader Kim Jong-Un a good chance to improve the economic standing of North Korea without actually reforming its economy,” Petrov said in the article....MORE
*As I said in another post that was sourced from RT:
...Back in the day Russian Life was part of the Soviet propaganda and dezinformatsiya apparatus, albeit a very subdued part showing happy peasants on the new tractor. Today RT is unapologetic:
Is Russia Today Just Propaganda for Uposcrabblenyk?

Here's the Asia Times article mentioned above:
Rare earths bankroll North Korea's future
Those who travel to North Korea regularly might have noticed that the last couple of years have brought significant improvement in the country's economic situation. Newly built high-rise apartments, modern cars on the roads and improved infrastructure come as a surprise to visitors. It begs the question, where does Pyongyang get the money from?

The ambitious rocket and nuclear programs, which North Korea continues to pursue despite international condemnation, are expensive and harmful to its economy. International sanctions continue to bite the Democratic People's Republic of Korea's foreign trade and investment prospects. Regular floods and droughts, animal epidemics and other natural disasters hit the fragile economy even harder.

According to expert estimations, the DPRK should have ceased to exist in the mid-1990s, after the Communist Bloc collapsed and Kim Il-Sung died. But North Korea has fully recovered after the famine and even shows steady signs of economic growth.

Foreign critics looked everywhere with hope to unravel the mystery. After 2008, the stalled inter-Korean cooperation left North Korea without South Korean financial assistance. Western humanitarian aid has also been exhausted or reduced to a number of goods with little market value. Although the volume of North Korea's foreign trade is negligible, the domestic economic situation continues to improve. Pyongyang is routinely suspected of violating international sanctions by trading arms, smuggling drugs, counterfeiting US dollars and other crimes.

These activities would be expected to refill the impoverished state with badly needed foreign exchange. However, anti-proliferation operations and bank account arrests have never disclosed anything criminal nor did they manage to answer the main question: where does the money come from?

In fact, North Korea is sitting on the goldmine. The northern side of the Korean peninsula is well known for its rocky terrain, with 85% of the country composed of mountains. It hosts sizeable deposits of more than 200 different minerals, of which deposits of coal, iron ore, magnesite, gold ore, zinc ore, copper ore, limestone, molybdenum, and graphite are the largest and have the potential for the development of large-scale mines.

After China, North Korea's magnesite reserves are the second-largest in the world, and its tungsten deposits are almost the world's sixth-largest. Still the value of all these resources pales in comparison to prospects that promise the exploration and export of rare earth metals....MORE
Finally, an update. The folks who brought us "Kim Jong Il looking at things" inspired another tumblr blog, "Kim Jong-Un looking at things":

This is the 100th post here at KJULAT.  As of this moment we have 8765 followers.  We want to thank each and every one of you for your comments, re-posts, messages and emails, as well as keeping the greatest of all DPRK-related memes afloat these past months.  To celebrate, we will deviate slightly from the standard.  We like order and uniformity here at KJULAT (what else?) but we had to make use of this pic somehow.  Therefore, we present:
looking at a laughing soldier while standing in front of a ridiculously huge fish