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S. Korean Dream Line: Rail Link Via N.Korean Eco Zone To Russia - Forbes
Imagine a railroad linking the great industries of South Korea with Europe. The dream might some day come true as the South drafts elaborate plans for shipping goods through North Korea’s Rason special economic zone adjacent to the North’s 10-mile-long Tumen River border with Russia.
The South Koreans have the enthusiastic support of the Russians, who have long dreamed of shipping goods by rail from South Korean factories, through North Korea and then onto the trans-Siberian railway. They’ve already rebuilt the railroad into North Korea over which they once shipped oil and other products at prices way below their real costs.
The oil stopped flowing with the demise of the Soviet Union in 1991, but Russia has never abandoned its historic interest in the Korean peninsula.
South Korean vehicles, electronic products and all else manufactured in the South would move by rail a few short miles, across the Tumen River into Russia and then across Siberia. Overall tonnage would be a fraction of all that goes by ship from Busan and lesser ports, but the shipments would skyrocket were North and South Korea ever to cooperate on rebuilding the line along the North’s east coast, linking it to South Korea’s own advanced network.
South Korea ’s unification ministry, while trying to get North Korea to agree to more reunions of families divided by the Korean War, is actively looking for ways to penetrate the North Korean economy. That’s increasingly possible considering the North’s need for funding for the Rason zone, set up in a burst of optimism in the early 1990s but never a success. The North also wants to earn far more from two other special economic zones, one at Sinuiju near the mouth of the Yalu River opposite the Chinese city of Dandong , the other at Kaesong , 40 miles north of Seoul just above the North-South line, and from 13 lesser zones it’s hoping to set up around the country.
“If thing go smoothly,” Unification Minister Ryoo Kihl-jae predicted in a talk in Seoul , goods might begin flowing through the Rason region a year or so from now. By September he expects “major progress.”
North Korea, Rason zone in northeast (Wikipedia)
Three of South Korea’s biggest companies, Posco PKX -2.1%, the steel-maker; Korail, the state-invested Korea Railroad Corporation, and Hyundai Merchant Marine had their people taking a look at the Rason zone last month and reportedly were pleased with what they saw.
The interest shown by Posco and Hyundai Merchant Marine seems logical considering the possibilities for shipping steel from the Posco plant at Pohang, on the South’s east coast, and exporting it through Rason, but why Korail?
Could it be that North Korea wants South Korea to participate in the vast repairs needed to revive North Korea ’s decrepit rail system? The roadbeds are so weak in much of the system that trains have to creep at 20 miles an hour, and almost nothing moves on the line going south through Hamhung, the North’s decrepit but leading industrial center on the central east coast, and the southeast port of Wonsan.
Hyundai Engineering and Construction built lines to the Kaesong zone and the Mount Kumkang zone but neither railroad is used at all. If backed up by South Korean government funding, Hyundai Construction would undoubtedly be glad to work on the rest of the North’s railroads in conjunction with Korail and maybe the Russians.
Tumen River at the border between North Korea and China, from the Chinese side at Tumen City (Wikipedia)
Such scenarios may seem fanciful but are not out of the question. “As a result of constant persuasion toward North Korea ,” says Ryoo, “a small but meaningful outcome has been made.”
In other words, despite the draconian punishment meted out to perceived foes of the regime of the North’s young Supreme Leader Kim Jong-un, North Korea may want to cooperate with the South for the sake of economic survival. Or, as Ryoo puts it, cooperation may happen “in a way that mutually benefits both countries and helps build up trust.”
The bottom line is funding. Ryoo predicts that South Korea may be ready to provide humanitarian assistance, mostly suspended when the the conservative Lee Myung-bak came into office in 2008. Lee’s successor, President Park Geun-hye, in office for slightly more than a year, is also conservative but definitely open to ideas for reconciliation with an eye on getting into the Rason and Sinuiju zones in addition to the Kaesong zone.
Hopes are also high for improving conditions in Kaesong , where upwards of 120 South Korean companies run factories staffed by 50,000 North Koreans. Few of them are making money, and they’re having difficulty persuading the North of the need for routine fax, phone and Internet privileges. North Korea , moreover, insists on products moving by truck across the line to the South rather than by the railroad built by Hyundai.
Whatever’s driving moves toward cooperation? “They realize they can’t rely entirely on the Chinese,” Dean Ouellette at the University of North Korean Studies in Seoul told me. “They’ve shown increasing disillusionment–the Chinese can limit aid. The only place the aid will come from is South Korea.”
Confidence-building, of course, won’t be easy. “They’ve got a lot to apologize for,” Ouelette went on. “They’re going to have to prove that confidence can be built. Family reunions are a start.”
Imagine a railroad linking the great industries of South Korea with Europe. The dream might some day come true as the South drafts elaborate plans for shipping goods through North Korea’s Rason special economic zone adjacent to the North’s 10-mile-long Tumen River border with Russia.
The South Koreans have the enthusiastic support of the Russians, who have long dreamed of shipping goods by rail from South Korean factories, through North Korea and then onto the trans-Siberian railway. They’ve already rebuilt the railroad into North Korea over which they once shipped oil and other products at prices way below their real costs.
The oil stopped flowing with the demise of the Soviet Union in 1991, but Russia has never abandoned its historic interest in the Korean peninsula.
South Korean vehicles, electronic products and all else manufactured in the South would move by rail a few short miles, across the Tumen River into Russia and then across Siberia. Overall tonnage would be a fraction of all that goes by ship from Busan and lesser ports, but the shipments would skyrocket were North and South Korea ever to cooperate on rebuilding the line along the North’s east coast, linking it to South Korea’s own advanced network.
South Korea ’s unification ministry, while trying to get North Korea to agree to more reunions of families divided by the Korean War, is actively looking for ways to penetrate the North Korean economy. That’s increasingly possible considering the North’s need for funding for the Rason zone, set up in a burst of optimism in the early 1990s but never a success. The North also wants to earn far more from two other special economic zones, one at Sinuiju near the mouth of the Yalu River opposite the Chinese city of Dandong , the other at Kaesong , 40 miles north of Seoul just above the North-South line, and from 13 lesser zones it’s hoping to set up around the country.
“If thing go smoothly,” Unification Minister Ryoo Kihl-jae predicted in a talk in Seoul , goods might begin flowing through the Rason region a year or so from now. By September he expects “major progress.”
North Korea, Rason zone in northeast (Wikipedia)
Three of South Korea’s biggest companies, Posco PKX -2.1%, the steel-maker; Korail, the state-invested Korea Railroad Corporation, and Hyundai Merchant Marine had their people taking a look at the Rason zone last month and reportedly were pleased with what they saw.
The interest shown by Posco and Hyundai Merchant Marine seems logical considering the possibilities for shipping steel from the Posco plant at Pohang, on the South’s east coast, and exporting it through Rason, but why Korail?
Could it be that North Korea wants South Korea to participate in the vast repairs needed to revive North Korea ’s decrepit rail system? The roadbeds are so weak in much of the system that trains have to creep at 20 miles an hour, and almost nothing moves on the line going south through Hamhung, the North’s decrepit but leading industrial center on the central east coast, and the southeast port of Wonsan.
Hyundai Engineering and Construction built lines to the Kaesong zone and the Mount Kumkang zone but neither railroad is used at all. If backed up by South Korean government funding, Hyundai Construction would undoubtedly be glad to work on the rest of the North’s railroads in conjunction with Korail and maybe the Russians.
Tumen River at the border between North Korea and China, from the Chinese side at Tumen City (Wikipedia)
Such scenarios may seem fanciful but are not out of the question. “As a result of constant persuasion toward North Korea ,” says Ryoo, “a small but meaningful outcome has been made.”
In other words, despite the draconian punishment meted out to perceived foes of the regime of the North’s young Supreme Leader Kim Jong-un, North Korea may want to cooperate with the South for the sake of economic survival. Or, as Ryoo puts it, cooperation may happen “in a way that mutually benefits both countries and helps build up trust.”
The bottom line is funding. Ryoo predicts that South Korea may be ready to provide humanitarian assistance, mostly suspended when the the conservative Lee Myung-bak came into office in 2008. Lee’s successor, President Park Geun-hye, in office for slightly more than a year, is also conservative but definitely open to ideas for reconciliation with an eye on getting into the Rason and Sinuiju zones in addition to the Kaesong zone.
Hopes are also high for improving conditions in Kaesong , where upwards of 120 South Korean companies run factories staffed by 50,000 North Koreans. Few of them are making money, and they’re having difficulty persuading the North of the need for routine fax, phone and Internet privileges. North Korea , moreover, insists on products moving by truck across the line to the South rather than by the railroad built by Hyundai.
Whatever’s driving moves toward cooperation? “They realize they can’t rely entirely on the Chinese,” Dean Ouellette at the University of North Korean Studies in Seoul told me. “They’ve shown increasing disillusionment–the Chinese can limit aid. The only place the aid will come from is South Korea.”
Confidence-building, of course, won’t be easy. “They’ve got a lot to apologize for,” Ouelette went on. “They’re going to have to prove that confidence can be built. Family reunions are a start.”
