The Plot Thickens: Documenting the DPRK-Xiyang Spat
by Adam Cathcart
If the North Koreans are ever to go successfully go toe-to-toe with a disputing major Chinese multinational company in the field of public persuasion (i.e., propaganda), they might want to consider a few simple steps like translating their press releases into Chinese first.
As Reuters reported on September 5, the DPRK state media has finally mounted a counter-attack on the disgruntled/expropriated/deported members of the Xiyang Group, a Chinese minerals corporation located in Haicheng city, Liaoning province, near the North Korean border. 
North Korea’s rhetorical counter-strike at Xiyang was carried on KCNA’s homepage a full month after the original throwing down of the gauntlet by the Chinese company. The document implicitly lashed out at the Chinese government for fanning the flames about the incident in state media rather than presumably telling Xiyang to “take one for the team” (i.e., a 2.4 billion RMB loss) and censoring all of the Xiyang discussion in Chinese media — mass, social, and otherwise.
The Korean version of the KCNA is here; but where is the Chinese version? On KCNA’s much-vaunted Chinese-language service, the North Korean response to the Xiyang allegations is there, lighted up in Chinese, but the link only goes to the Korean-language version.
As everyone knows, the best way to reach a wide audience in the People’s Republic in China is to write in Korean, or, failing that, to follow the example of Lord MacCartney and render one’s ideas in English.
If the North Koreans actually paid heed to Kim Il Song’s explicit directive to reach out to the Chinese masses (see With the Century), perhaps they could get a more up-to-date communications team in place so that their broadsides against Chinese multinationals could actually get an audience over the Yalu and Tumen rivers. 
I compared the English KCNA dispatch with the Korean version and have added in some of the choice phrases in hangul. I have also added in some Chinese terms, translated from the Korean as a small reward to myself, but also to get a sense of how the Chinese translators who first approached the document felt. As Ernest Hemingway would say, “What the hell.” Here it is.
KCNA, “Media Should Maintain Impartiality in Report about DPRK [조선합영투자위 중국 서양집단에 치명적인 책임-합영계약분쟁문제／朝鲜对外经济投资协力委员会发言人：新闻媒体不得作可被利用于敌对势力反朝宣传的行为],” September 5, 2012.
Pyongyang, September 5 (KCNA) — A spokesman for the DPRK Commission for Joint Venture and Investment [합영투자위원회/朝鲜对外经济投资协力委员会] on September 5 issued the following statement:
The Xiyang Group [서양집단／西洋集团] of the Haicheng City, Liaoning Province [료녕성/해성시] of China on August 2 posted on its Internet website an article criticizing the DPRK over the disputes that cropped up between the Group and the Korean Ryongbong Corporation [조선령봉련합회사朝鲜联合会社] in the course of implementing a joint venture contract for the development of magnetite concentrated ore.
After the article was published, some media [일부 보도매체/这些媒体报导] echoed it before and after the report about the results of the third meeting of the DPRK-China Guidance Committee for developing two economic zones was made public.
They added their own analyses to the article posted by the Group. They even aired what the anti-DPRK hostile forces reported in the past to malignantly slander the inviolable social system and policy of the DPRK [우리의 신성한 제도/我们神圣的制度和政策].
Generally, it is international usage and commercial ethics to settle disputes that occurred in the course of economic relations in line with the relevant arbitration item of the contract.
But the media have kicked off massive propaganda campaign [대대적인 선전/大大的敌人宣传], defying international usage and commercial order [국제관례와 상업질서/国际惯列和商议程序]. This cannot be interpreted otherwise than an act of fanning up the dishonest forces in their moves [불순적대세력들의 책동／不纯势力敌对的策动] to drive a wedge between the two countries in their economic cooperation and chill the atmosphere for investment.
Media should comply with the standards for fairness and objectivity, create an atmosphere helpful to settling the disputes between the two contracting parties and refrain from an act that can be misused by the hostile forces for their vicious propaganda.
Under the condition that the security of the country is guaranteed by dint of Songun, we will in the future, too, improve and round off the investment environment to further expand the international investment relations to meet the demand of the developing times and the lawful requirement of the international investment relations. [Syntax, not content, of previous sentence modified to better reflect original Korean version. The DPRK’s compliance begins with Songun. – Ed.] We will also ensure the legitimate rights and interests of all investors willing to develop international investment relations on the principles of mutual respects, equality, reciprocity and law-observance.
Perhaps most astonishingly, the North Korean missive ends with an instruction to the PRC about how to do business in the contemporary world.
Already the Huanqiu Shibao, the loud-mouthed and angry — but never estranged — bastard child of Beijing People’s Daily and China’s post-Tiananmen-nationalism-on-steroids, better known as the Global Times and headed by the lobotomized-Mahanian-meets-rectified-Yan’anite Hu Xijin, has responded with an extended look at the case.
Hu Xijin may be a poor successor to true nationalist-internationalist Chinese journalist-editors of yore, but his big tabloid enterprise, superior to the New York Post, will occasionally do something well, and its article on the Xiyang case is indeed one such remarkable case.
No less than its top reporters in Pyongyang worked on this Huanqiu Shibao story, and it represents precisely the kind of writing from within the DPRK that our friend Joshua Stanton has been so aching for in his takedowns of the Associated Press venture in the DPRK. In other words, this article appears to display a spirit of critical writing by foreign reporters in Pyongyang who are unafraid of expulsion or mythical “loss of access” in a country where access is never really granted in the first place.
The Huanqiu piece is too long for me to properly translate in detail (perhaps it will end up in some abused English idiom through some other means) but suffice it to say, it’s worth reading. Here are a few choice excerpts, with some super rough translation/summaries, abridged for efficiency’s sake:
Zhou Zhiran, Cheng Gang, et. al., “中企称在朝投资是噩梦朝驳中企“投资被骗”指责 [Chinese company says it had an investment nightmare in North Korea; DPRK refutes Chinese company’s accusation of ‘having been cheated out of investment’,”Huanqiu Shibao, September 6, 2012.
韩国《东亚日报》当时曾发表社论称，西洋集团的遭遇是正常国家的商业交易中难以想象的，“中国等同于朝鲜的救命恩人，连中国企业也敲诈的朝鲜肯定会不把与其他外国企业签订的合同当回事”。但也有人质疑，西洋集团投资朝鲜的计划过于急功近利，因为据其董事长周福仁称，在其看来，投资朝鲜该铁矿项目，每年利润可达15亿人民币。South Korean Dong-A Ilbo published an editorial stating that it appeared that the Xiyang group had suffered badly…“China is North Korea’s savior, but it experienced extortion that makes it difficult for North Korea to sign commercial agreements with companies from other countries.” But some other people speculate that Xiyang’s investment plan for North Korea was to make a fast buck, based on the statements of the company’s head Zhou Furan, who said his goal was to make 1.5 billion RMB annually in the North Korean mine.
一个月后，朝鲜开始反击。A month later, North Korea has started to strike back.
The Huanqiu article goes on to highlight DPRK statement’s emphasis on moving forward with the Songun (military-first) policy. Because Reuters didn't bother to read the original Korean version, this point didn’t come out as strongly in their story -- the Korean version makes much more clear that Songun (read: the unmolested nuclear capability) is held up as the ultimate condition for North Korea’s cooperation with China on the economic and investment front. Obviously, Chinese journalists take note of this point. They also channel a quote from a Xiyang official given to Reuters about North Korea not protecting or guaranteeing the commercial rights of companies doing business in the DPRK. However, then the North Korean point of view gets some sympathy in the form of a (probably not entirely manufactured) anonymous quote from a Chinese businessman.
《环球时报》记者在投资朝鲜的中国商人中有一些朋友，对朝鲜投资环境有一定了解。在相当一段时间里，朝鲜的投资环境都不尽如人意，但现在，这一切都在发生较大的改变。对一家企业在朝鲜投资失败发出的抱怨，朝鲜政府能给予回应，是不多见的。这也从一个侧面表明，朝鲜现在非常在意本国投资环境的形象，开始重视中国民间资本对朝鲜的投资。对中国企业来说，投资前必须对朝鲜的政策和法律有全面详细的了解，同时意识到朝鲜的管理结构和中国有非常大的不同，谨慎做好风险控制。对于超常的利益回报的诱惑，要保持清醒的判断。Huanqiu Shibao reporters have a few friends among the Chinese businessmen investing in North Korea, people who have a certain understanding of the investment environment in the DPRK. [They said:] “In recent times, North Korea’s investment environment did not at all met people’s expectations, but now it’s made a complete turn, an enormous change. It’s rare to see a single company so frustrated and complaining about losing its investment in North Korea, and the North Korean government having to respond. On the one hand, from this action, one can see that North Korea is now very concerned about the image of the domestic investment environment [非常在意本国投资环境的形象], and starting to focus on the Chinese private capital investment to North Korea [民间资本]. Regarding Chinese enterprises, one can say that a detailed and complete understanding of North Korean policies and laws is necessary; at the same time, understading and awareness that the management structure of the DPRK and China are hugely different, and that risk must be prudently controlled. Facing the enticement of extraordinary gains, one must remain sober in one’s judgment.”
One of the authors of the above piece, Huanqiu’s own Zhou Zhiran (周之然) is in Pyongyang, and has been there since the winter, probably waiting to really unload. Why? Because he was more or less bottled up during March and April, two months which this year functioned as a kind of silent “planting season” for Sino-North Korean resentment. Joining Zhou on this story is Cheng Gang (writing in Beijing), who has been on the DPRK beat in various ways since at least 2009. Cheng Gang has written some highly critical stories about North Korean border guards robbing Chinese locals on the Tumen. Such stories aren’t just “critical relative to the Chinese context,” they are critical, if exceedingly rare. Virtually unnoticed in December 2010, Cheng went to Rason and filed a very interesting report (summarized here in English) about the electricity situation, the scuttlebutt in the city about rumors of more provincial/local autonomy, and the fact that there were major military drills going on outside of town.
This Huanqiu story, in other words, is being handled carefully by some rather experienced DPRK hands in the Chinese media, and is unlikely to be expanded on by other, less centrally-connected outlets. The use of Zhou Zhiran to write this story from Pyongyang is a further (relatively) bold move by the Chinese side.
As Stephan Haggard recently noted, the whole Xiyang scenario already represents galling stuff for leaders in Beijing and this recent outburst seems hardly likely to add velocity to Chinese acts of reciprocity and/or aid. But perhaps we underestimate the ability of both sides to multitask and compartmentalize, to work in separate channels without being disturbed by problems in other areas. In other words, a border shooting near Dandong does not derail Chinese support of the Rason deal; a Jang Song-taek visit to Beijing has no impact on the illegal ginseng trade between Ryanggang and Jilin; a Moranbong Band performance for Chinese war veterans does not an SEZ make; and, as ever, a few dozen dead or imprisoned refugees slows down no one.
To put it more simply, even the handover of top leadership positions in Beijing does not seem likely to change the bilateral fundamentals – particularly when it comes to all-important military-military (and intelligence) relations, as our friend Stephan Blancke has argued.
As the current controversy indicates, however, the Xiyang deal might be unique. After all, it has opened up a new public discursive space in China for a debate, softly but certainly encouraged by Beijing, about the present demerits of doing business in the DPRK. Yet the debate is also playing out a backdrop of years of Chinese boosterism for North Korean business, the opportunities for which have been presented in multiple and prominent points in state media in the past weeks. In Shenyang — which according to Bill Gertz is a very scary city full of spies — a couple of weeks ago, I brought out some similar pro-DPRK evidence.
At this point, the thing to watch (the thing we can watch, having no idea what is going on at the actual mine) is the extent to which the CCP media encourages the Chinese public to gang up on North Korea. In the absence of tangible legal remedies or settlements within North Korea that brings Xiyang back from the brink of what appears to be rather understandable hysteria over their lost investment, the prospect of Chinese leaders obtaining some hard-to-come-by international sympathy for difficult efforts to “open up and reform” this “nightmare” of a country, at least, seems possible.
 The company’s home city of Haicheng is occasionally used as shorthand, but most media reports have referred to the company primarily as Xiyang, so we will stick with that moniker from here on. Speaking of names: Reuters pulls off an extended analysis that is downright excellent, until they start quoting some analyst named “Frank Ruediger” — has anyone heard of him? In a remarkable coincidence, Dr. Ruediger appears to be in the same department as Vienna University professor and noted North Korea expert Ruediger Frank.
 One copy of the North Korean document did show up in Chinese on the essential DPRK blog on Hexun. It has read by a couple of thousand people, and also on two little blogs read by literally tens of people. I don’t use this translation in interpreting the KCNA document, because it is far from clear where the information actually came from. Did the Hexun blog itself translate the North Korean document into Chinese?
Tags: Huanqiu Shibao, Stephan Haggard, Xiyang Group, Liaoning businesses in DPRK, Haicheng Liaoning, investments in NOrth KOrea, North Korean minerals trade, North Korean scandal, stealing Chinese property in NOrth Korea, Huanqiu Shibao on North Korea, Cheng Gang, Zhou Zhiran, Chinese reporters in Pyongyang, Associated Press in North Korea, Reuters story on North Korean company, corporate scandals betwe3en China and North Korea, frontier capitalism, North Korean investment, North KOrean investment laws, Wn Jiabao warning to North Korea, what China wants from NOrth Korea, Chinese energy companies in North Korea