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.
Hana Electronics and the Hana Music Information Center, one of the last places reported to have been visited by Kim Jong Il before his death, was one of the locations used on Thursday to mourn his passing.
State TV pictures showed a crowd that appeared to be at least in the thousands standing outside the building on the city’s Tongil Street, south of the Taedong River and next to the Tongil Market.
Hana Electronics is one of Pyongyang’s best known electronics companies and produces DVD players.
A large picture of Kim Jong Il was placed in front of the building.
Kim’s visit to Hana Electronics was his penultimate guidance tour and was reported by state-run media on December 15.
He expressed great satisfaction over the fact that the company has produced many various kinds of articles for cultural use after building the production process of electronic products with an annual capacity of hundreds of thousands of products.
Watching DVDs being fitted in the streamline process, he said that products are of high quality and very perfect.
In particular, portable DVD with function of TV is well designed, he said. — KCNA, December 15, 2011
On the same day he was also reported to have visited the Kwangbok Department Store. It was a photo of him on an escalator at the department store that was the last issued of him alive.
TV images also appeared to show several tens of thousands of mourners on Kwangbok Road, several hundred meters south east of the department store.
The two areas were shown in addition to the main memorial ceremony that was talking place in Kim Il Sung Square in the heart of Pyongyang.
TV pictures showed amazing scenes of tens of thousands of people lined up in the square.
It was during that service that Kim Yong Nam said of Kim Jong Un:
Standing at the helm of the Korean revolution is Kim Jong Un, the successor to the revolutionary cause of Juche.
Kim Jong Un is the supreme leader of our party and army and people as he fully personified the ideas and leadership, personality, virtues, grit and courage of Kim Jong Il. — Kim Yong Nam, Pyongyang, Dec. 29, 2011
A three-minute silence was observed across the country at noon. During that silence trains and ships sounded their horns.
Here are some more images of the memorial service from Pyongyang, as shown on Korea Central Television.
North Korean state media has reported on a visit by Kim Jong Il to the “May 11 Factory,” which it described as “a modern scientific research and production center which researches and develops varieties of electronic goods including liquid crystal display TV sets.”
The KCNA report mentioned the LCD televisions several times and was accompanied with many photos of the TVs, so they appear to be something the North Korean government is proud of. There’s a gallery of stills from the KRT evening news report below.
Look through them and you’ll notice the pictures all appear to show the final stages of assembly where the case is put around the electronics and screen. There are no pictures showing earlier stages in the assembly process or the prior stages to that, such as the fitting of components to circuit boards.
There is also a lack of parts around the workers. In a typical LCD TV factory there would be crates of spare parts and casings nearby, so the workers don’t have to walk far. It’s quite possible the layout of this factory is different, but if so it’s probably not as efficient.
It’s reminiscent of a March television report that purported to show North Korea’s first laptop PC factory. It turned out at least one of the laptops is likely being made in China and shipped to North Korea.
As in the case of the laptops, it’s impossible to tell if they are from an outside source unless someone can identify the televisions on show. The front designs of the TVs are rather generic so they’re difficult to identify. In any case copying of popular designs is rampant in the LCD TV industry.
Perhaps the best clue is picture 17 in the upper right. A TV is lying on its face in the foreground and the rear of the case is visible. The rear panels are mre unique and much less likely to be copied than the front panels.
The factory, said KCNA, “is capable of producing hundreds of thousands of liquid crystal display TV sets in a year.”
Whether or not the factory actually makes the TV sets in question, or other devices, the report underlines it’s part of North Korea’s drive to improve the level of science and technology in the country.
These shining achievements are a clear proof of the validity and vitality of the Party’s policy on taking hold on science and technology as the lifeline for the building of an economic power, he added. – Korea Central News Agency, Pyongyang, July 28, 2011.
Kim Jong Il was accompanied on the visit by next-in-line son Kim Jong Un.
North Korea Leadership Watch also spotted the presence of Jon Il Chun in official photographs. Jon, according to the website, is daily manager of Office #39 under the party’s Finance and Accounting Department. Office #39 is widely believed to be the organization through which North Korea brings in much of its foreign currency. More details on NK Leadership Watch here and NK Econwatch here.