In current months, Kim Jong Un has targeted important consideration on the cement business; he particularly highlighted it in his speech to the Eighth Social gathering Congress in January and set a cement manufacturing purpose of eight million tons within the not too long ago introduced five-year financial plan. Nonetheless, as of now, the business just isn’t more likely to turn out to be a cornerstone of the North Korean financial system. The present border closure and lack of onerous foreign money make it tough for the nation to import key supplies for increasing the business in a significant approach, and cement manufacturing is unlikely to achieve enough high quality for export anytime quickly.
The Cement Trade
The cement business has an extended custom in North Korea. Cement grew to become a popular building materials early within the nation’s historical past. Forests on the peninsula have been badly broken in the course of the Korean Warfare (1950–1953), and wooden was thus briefly provide as a constructing materials. Most building within the nation, subsequently, is completed with cement in addition to brick and stone, which require mortar (the place cement is a central ingredient).
The cement business has figured prominently in Kim Jong Un’s current remarks and North Korean media protection of the Eighth Social gathering Congress; in his concluding speech there, Kim declared that the state should present “10,000 tons of cement to each native metropolis and county” yearly. The emphasis on cement is partially tied to one of many key manufacturing targets of the not too long ago introduced five-year financial plan: building of fifty,000 new residences in Pyongyang (or 10,000 per yr), in addition to 25,000 new flats in Komdok, a mining city badly hit by flooding final yr. To underscore the significance of hitting this goal, in late March, Kim attended a groundbreaking ceremony for the development of 10,000 new residences in Pyongyang.
To satisfy these targets, the state has set targets to replace current factories and construct new ones to supply eight million tons of cement and guarantee self-sufficiency in building supplies inside the five-year plan. These plans even have a political rationale: to indicate most of the people that the state takes significantly its guarantees to enhance the standard of life. A rise in cement manufacturing is a way towards this finish—and, subsequently, to bolstering Kim’s legitimacy.
Cement is used for an array of building initiatives, together with hospitals, industrial buildings, housing, new roads, and dams to manage water circulate and supply important hydroelectric energy to assist meet the nation’s vitality wants. Cement can also be doubtless used for asphalt in North Korea to a higher extent than in different international locations since asphalt manufacturing requires crude oil, which North Korea has lengthy struggled to import in enough portions.
Given its pure useful resource belongings, cement manufacturing in some ways is sensible for North Korea. It has an estimated 100 billion tons of limestone, one of many central elements for cement manufacturing. Furthermore, North Korea’s high-quality river sand, used within the making of concrete, is equally plentiful.
In early March of this yr, a North Korean enterprise delegation visited central China to examine a number of chemical business corporations, together with a cement producer. Such visits have been extraordinarily uncommon since North Korea closed its border to China in early 2020 because of the COVID-19 pandemic and present that the state presently prioritizes the business.
The quite a few building initiatives that dot the North Korean panorama, usually with excessive propaganda worth, require giant quantities of cement, making cement manufacturing capability very important. Along with the promised condominium building, the Pyongyang Basic Hospital is one other instance of the connection between cement manufacturing and extremely publicized building initiatives. In Rodong Sinmun in March 2020, the supervisor of the Sunchon Cement Complicated—one of many nation’s largest cement-producing services—wrote an article with the headline “Extra Cement to Pyongyang!” vowing to heed Kim’s name to hurry up manufacturing efforts for the hospital.
Like a lot of the current five-year plan, the emphasis on the cement business is probably going born out of necessity. The quantitative purpose of eight million tons would entail solely a modest enhance of about one-third from the present manufacturing stage of six million tons per yr. Moreover, home manufacturing of cement is comparatively straightforward to manage; manufacturing could be accelerated shortly to fulfill quantitative targets, offering Kim with a straightforward “win” the place different financial positive factors are tough to realize.
Prior to now, North Korea has each imported and exported cement, nearly solely in commerce with China. These exports, nevertheless, have amounted to just a few hundred thousand tons per yr, round 5 % of the annual manufacturing. It’s unlikely the federal government envisions any critical enhance in cement exports. Any wholesale improve of the business would require costly investments in gear that might even be tough to accumulate in the course of the present border closure and sanctions regime. Furthermore, working prices akin to electrical energy have reportedly risen with the upper value of gas. Using anthracite coal for cement manufacturing requires heavy gas oil as an enter, which compelled the state early final yr to order factories, when oil provides dwindled, to alter to a unique kind of coal that wants much less gas oil. In different phrases, North Korea’s principal purpose is home manufacturing and use; certainly, research present that the quality of its cement just isn’t enough for export to clients apart from ones whose principal concern is to seek out the bottom potential value.
The North Korean authorities has emphasised elevated cement manufacturing for the reason that Eighth Social gathering Congress. Whereas there’s a actual home want for enhanced cement manufacturing, it’s unlikely to contribute considerably to the financial system as an entire. Nevertheless, it seems that the cement business has a better precedence on the federal government’s agenda primarily as a result of assembly elevated manufacturing targets could be achieved comparatively simply even beneath the dismal financial circumstances the nation faces, and with principally domestically sourced inputs.