Capitalism - North Korean style...

According to South Korean records, North Korea has been enjoying quite a bit of profit from a virtual monopolization of the sea route between Busan, South Korea, and Najin, North Korea. According to the Chosun Ilbo report, North Korea charges 1,800 USD for every 40-foot container shipped on the Busan-Najin route.

North Korea makes US$1,800 for every 40-foot container shipped on the Busan-Najin route, which is about 4.4 to 12 times more expensive than the charges on the Busan-Shanghai route, a similar distance. A South Korean shipping company charges $150 to $410 per container on that route.

The Chosun Ilbo report states that North Korea charged 1,500 USD per 40-foot container until August 2008, but it notified the South Korean Ministry of Unification that it is raising its fees to 1,800 USD per 40-foot container.

According to the Unification Ministry and other sources, North Korea unilaterally raised the container shipping price from $1,500 to $1,800 in August last year. "North Korea notified us of the raise without prior negotiation, just as they did with the request to raise wages for North Korean workers at the Kaesong Industrial Complex," a South Korean government official said.

Apparently North Korea made 3 million USD in 2008, and 1.55 million the first half of 2009. A North Korean ship reportedly operates between Busan and Najin only three to four times per month.

A quick calculation shows around 2,000 40-foot containers were shipped on this route in 2008 given the price per container.

The volume of inter-Korean trade in first half of 2009 dropped by 26% compared to 2008, but the North Korean income apparently has not declined by much.

Chosun Ilbo attributes this to:

Although the volume of inter-Korean trade in the first half declined by 26 percent from a year ago, the ship's profits did not fall thanks to its virtual monopoly on the route.

North Korea began operating another shipping route between Incheon, South Korea, and Nampo, North Korea along the west coast in May this year. This route is reportedly operated four times a month, and has reported 200,000 USD profit in just two months.

North Korea also operates other ships between the North and the South:

North Korea also operated other ships on an irregular basis to transport agricultural and fisheries products and mineral resources to South Korea, racking up $4.5 million last year.