Hana Electronics, one of North Korea’s best-known and only electronics companies, is profiled in the latest edition of “Foreign Trade” magazine.
The company was established in May 2003 as a joint venture between the U.K.’s Phoenix Commercial Ventures and the trading department of North Korea’s Ministry of Culture.
It’s been making, or at least assembling, DVD and Video CD players for many years. The actual level of production that goes on at the factory is unknown. The only pictures that have been issued are of what appear to be quality control stations, where finished products are checked. It’s likely the company’s products or major components like circuit boards are made overseas and imported.
Almost 70 companies publicly traded on U.S. stock markets have found North Korean gold in their manufacturing supply chains.
Among the more prominent names are electronics companies IBM, HP, Garmin, Philips and Seagate, U.S. kitchenware retailer Willams Sonoma.
The discoveries were disclosed in reports to the U.S. Securities and Exchange Commission that are the result of a new law that mandates companies audit their suppliers and identify sources of so-called conflict minerals: gold, tin, tungsten and tantalum.
The companies all named North Korea’s central bank as the source of some gold that made its way into their products.
The 17th annual Pyongyang’s Spring International Trade Fair (평양봄철국제상품전람회) was held last week and attracted around 300 companies, according to domestic media reports.
The 2014 fair appears to have significantly grown in size from 140 companies in 2013 and for the first time occupied two halls at the Three-Revolution Exhibition House: the New Technology Innovation Hall and the Heavy Industry Hall.
“The fair is more diverse in style of display than the past, and it witnesses more active consultation among companies for economic and technological exchanges and businesses,” KCNA reported.
North Korea began construction this week on a new industrial zone in Kaesong that it hopes will attract high-tech companies.
The ground-breaking ceremony for the Kaesong Hi-Tech Industrial Park took place on Monday, less than a month after three foreign companies signed a deal with the government to work on design and construction of the park.
North Korea’s state media hasn’t said much about its plans for the zone since it announced it at an international conference on special economic zones that took place in Pyongyang in October.
But this week, state media reported on both the high-tech park and ground breaking.
“The park will have an IT center, hotel, dwelling houses, school and other buildings, as well as a power plant,” the Korean Central News Agency said in a report.
A month ago when the project was first disclosed, KCNA named three companies that had signed on to design and develop the park. They were Singapore’s Jurong Consultants, a building design and management company, and OKP Holdings, a construction and road maintenance company, and Hong Kong’s P&T Architects and Engineers.
This week, KCNA said the park is being built by an organization called the “Peace and Economy Development Group.” The group, the news agency said, is made up of companies from Hong Kong, Singapore, Australia, the Middle East and Africa.
It named two staff members of the group. Jang Su Nam, who was named a “representative,” and Heh Teck Siong, the general manager.
The exact location of the high-tech zone wasn’t disclosed in a Korean Central News Agency report, but it would make logistic sense for it to be within reach of the infrastructure built for the general-purpose Kaesong Industrial Complex, which opened in 2005.
North Korea recently reopened the existing Kaesong Industrial Complex after a five-month long work halt prompted by tensions between North and South Korea.
The North Korean government appears to be planning a high-tech industrial park close to the current industrial park at Kaesong, on the North-South border.
No official announcement of the project had been made, but on Thursday the state-run Korean Central News Agency said several foreign companies would be investing on such a park.
The companies listed in the brief news article include Singapore’s Jurong Consultants, a building design and management company, and OKP Holdings, a construction and road maintenance company, and Hong Kong’s P&T Architects and Engineers.
To-date, none of the companies have the project listed on their websites and attempts to contact them for information were unsuccessful.
“The consortium agreed with the DPRK’s related organs on collaboration in building the Kaesong Hi-Tech Industrial Park and Highway Toll Road from Capital Airport to Pyongyang City,” KCNA said. “The projects will soon begin.”
The announcement by KCNA comes as an international conference on special economic zones was wrapping up in Pyongyang.
The newly formed Korea Economic Development Association (KEDA) ran the conference, which brought domestic participants together with attendees from several overseas universities.
“The conference takes place at a time when the DPRK is paying deep attention to developing special economic zones in local areas, as the Rason Economic and Trade Zone,” KCNA quoted Ri Chol Sok, vice-president of KEDA, as saying.
A high-tech industrial park at Kaesong would appear to be an attempt to bring some of South Korea’s tech manufacturing industry to the city, which lies just over the border and was a former capital of Korea.
LG Display, the flat-panel display manufacturer associated with LG Electronics, has one of the world’s biggest LCD (liquid crystal display) factories just south of the border in Paju so high-tech manufacturing in the border zone isn’t unheard of.
However, the North Korean government might find it difficult to attract companies given the summer’s problems at the existing Kaesong Industrial Park. The park has only just begun operating again after being closed for five months as the result of North Korea’s withdraw of workers in May.
Competition in the high-tech industry is cut throat and companies cannot typically afford a single day’s shutdown without incurring sizable losses. A multi-month shutdown could spell disaster for a company’s market share.