North hikes tax rates
on companies in Kaesong
Korea Joongang Daily.
10/17/12 By Lee Won-jean
North Korea
unilaterally revised taxation rates for the inter-Korean industrial complex in
Kaesong, jacking up taxes
imposed on companies from the South.
The JoongAng Ilbo
found that Pyongyang made revisions of the taxation regulation on running the
Kaesong Industrial Complex on July 18 without the consent of Seoul or companies
running factories there.
The Ministry of
Unification told the JoongAng Ilbo yesterday that the North unilaterally
altered 117 out of 120 clauses in the regulations and notified
the South Korean government of its decision on Aug. 2.
Under the new clauses,
the North Korean regime can unilaterally determine how much tax it will levy on
the Southern companies and demand overdue taxes for up to eight years.
Some Southern
companies are already following the new rules. The Unification Ministry said 19
out of 123 South Korean companies have paid the new tax rates to the regime.
“We have to report all
of our products’ current prices to the North Korean tax office,” a South Korean
businessman told the JoongAng Ilbo. “If they think our claims are
‘inappropriate,’ they unilaterally set the prices by themselves and notify us.”
The businessman said
that last month, his company reported that the price of a certain product was
$2, but the North Korean tax office assessed it at $3 and demand additional
taxes.
The businessman
allegedly paid $30,000 in so-called “overdue” taxes.
If the Southern
companies resist the taxes, the regime threatens to cut off their supplies.
The South Korean
government officially protested the new taxes in September.
Taxation comes under the
Law of the Kaesong Industrial Zone signed by the two Koreas in 2004. The
law requires agreement on both sides.
Chinese Pull Out of
N.Korean Mine
The Chosun Ilbo.
10/17/12
The Chinese partner
has reportedly pulled out of North Korea's Musan Mine, Asia's largest open-air iron mine
with an estimated reserve of 3 billion tons of ore.
The Chinese apparently
baulked at a price increase of more than 20 percent demanded by the North,
although international iron ore prices are plummeting in the wake of the
global recession. They won 50-year extraction rights for the mine in 2005.
A smelter in the
Chinese province of Jilin near the border with North Korea and operated by
Tianchi Industry and Trade, the Chinese partner to the Musan Mine, closed down
in September, according to a source in Yanbian on Tuesday. The smelter used to
process iron ore extracted at the mine.
The source added,
"There's been no progress in the implementation of plans to lay
a railway line and a slurry pipeline between Nanping and Musan."
Tianchi Industry and
Trade turned down the
North's demand, saying it makes hardly any profit as is given wages for North
Korean workers and transportation costs.
Tianchi, a private
trading company based in Yanbian, has served as a conduit for iron ore produced
at the Musan Mine to the Chinese market since the early 1990s. It obtained the
extraction rights to the mine in 2005 after concluding a trilateral
joint-venture contract with Tonghua Iron and Steel, a Chinese state-run
iron and steel mill, and [North] Korea Ferrous Metals Export and Import
Corporation.
Tianchi hired North
Korean workers and extracted 1 to 1.5 million tons of iron ore at Musan every
year, which it supplied to Tonghua and other companies.
But the first cracks
in the deal appeared in 2009, and iron ore production had been intermittent
since then and stopped completely this year.
The Jilin provincial
government has also been hit because it already laid a 41.68 km railway line
leading to the border town of Nanping since November last year.
Capitol Hill Korea
hands retiring, gaps feared
The Korea Times.
10/17/12
WASHINGTON (Yonhap) --
Amid a series of departures of senior Korea specialists in the U.S. Congress,
concerns are growing over possible losses to the formulation of U.S. strategy
on the peninsula.
Keith Luse, Senate Foreign Relations Committee
staff member for East Asia, will soon leave Congress, as Sen. Richard
Lugar, an Indiana Republican, lost the primary for a seventh term earlier
this year, according to congressional sources.
Luse has worked as
Lugar's eyes and ears for nearly 30 years, especially on Asian issues.
The senator has gained
fame for his tireless efforts on diplomatic issues, highlighted by his
proposal, jointly made with former Sen. Sam Nunn of Georgia, to safeguard the
Soviet Union's vast arsenal of nuclear as well as chemical and biological
weapons.
Luse has provided many
policy ideas on Lugar's legislative activities, particularly on the Korean
Peninsula.
Longtime Senate
staffer and respected Asia hand Frank Jannuzi, who was the Democratic
counterpart to Luse, left Congress in March.
Jannuzi, who worked as
a key aide to Sen. John Kerry for East Asian and Pacific affairs, is
currently deputy executive director of Amnesty International of the
U.S., and head of the Washington, D.C., office.
His Senate service
included work on the North Korea Human Rights Act.
Fortunately, however,
key House staffer Dennis Halpin is expected to stay in Congress, added
the source.
Halpin, the former
U.S. consul general in Busan and a Korea expert, is an adviser to the House
Foreign Affairs Committee.
S.Korea Wins UN
Security Council Seat
The Chosun Ilbo.
10/18/12
South Korea was on
Wednesday elected as a non-permanent member of the UN Security Council for the
first time in 15 years. It was one of the three candidates from Asia along with
Bhutan and Cambodia.
The country won
support from 149 nations in the second round of voting, more than two-thirds of
the 193 members, to secure the one available seat for the Asia-Pacific region.
The term starts in 2013 and lasts two years.
Since joining the UN
in 1991, South Korea served as a non-permanent member of the Security Council
once already, from 1996 to 1997. Its second term will allow it to influence
crucial international security issues.
The mandate includes
the right to call for a meeting of the council, boosting stability in tense
times on the Korean Peninsula. The South Korean government hopes to play a
major role in issues such as North Korea's nuclear program and the environment.
