Silent Partners: Chinese Joint Ventures in North Korea - US-Korea ...

Silent Partners: Chinese Joint Ventures in North Korea Transcript 32
bank working here, like I said, there’s no letters of credit. Now, there is banking facilities, but I
don’t see the government specifically, It’s government, I think the bullet was governmentfacilitated
and led, but not directed. So, I don’t see a lot of direct support, it’s not financed, you
don’t have a big pool, but that said, there’s a lot of capital sloshing around in China that’s been a
result of this constant pump-priming since 1997. And I think that’s given people a lot of access, I
mean there’s been a lot of wealth generated and there’s not a lot of places to put your money in
China. I’m not an economist here, so I hesitate to get into this too deeply but where do you put
your money in China that’s safe Stock market’s volatile, not a lot of access, and again, if you’re
in Jilin Province, what are your choices If you’re a local level, if you’re Hunchun City you’re
not really thinking about how we’re going to get that new deal in Germany, you know. North
Korea’s right there and you’re speaking Korean and you’ve got this competitive advantage. One
of the points in the report is you don’t have a lot of competition in North Korea from other
pockets of Korean speakers. Jae here speaks beautiful Korean, he can’t go open a company in
North Korea. If he could, he’d probably have more to offer than that guy from Hunchun. Well,
according to some of the research, the North Koreans are very careful to weed out South Koreans
posing as ethnic Chinese who are then going in to invest. So, they have a captive market. And I
think that was also mentioned in the John Park report and holds true with all of my findings is
that the North Koreans don’t have a lot of choices either. They’re not able to go and access
international markets, they’re not doing arbitrage on the London Exchange to try to figure out
whether, or even have access enough to the internet or, you know, a cell phone to figure out
whether or not the offer that this Chinese guy just gave per ton of copper is competitive with
market. So, I think what a lot of these traders can do is essentially arbitrage with North Korean
commodities. So you can get coal coming out of North Korea, coal, copper, any easily-tradable
commodity where there’s a high demand. Again, China consumes a quarter of the world’s
copper, so you get any copper out of one of the big mines and, you know, Haesong, Musan are
both two big iron and copper mines and they’re right there on the border so you get decent
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