N. Korea Celebrates Founder’s 101th Birth Anniversary Amid Heightened Tensions

North Korea Celebrates Founder’s Birth Amid Heightened Tensions

North Korea marks the 101st birth anniversary of state founder Kim Il Sung today, after the U.S. reached an agreement with China, Japan and South Korea to try to coax the reclusive regime back to talks.

“We’re prepared to reach out,” U.S. Secretary of State John Kerry said yesterday in Tokyo at the conclusion of an Asian tour that left the door open for a U.S. meeting with North Korea’s leader Kim Jong Un. Any meeting would have to be at the “appropriate moment, appropriate circumstance,” he said.

Kim early today paid his respects at the Kumsusan Palace of the Sun, which houses the tomb of both his grandfather Kim Il Sung and his father Kim Jong Il, the official Korean Central News Agency reported. Diplomats are now focused on whether Kim will mark the April 15 anniversary by testing another missile or nuclear device.

North Korea has repeatedly said the region is on the brink of war since its February nuclear test — the third at its Punggye-ri underground site — prompted stronger United Nations sanctions and the U.S. and South Korea began their joint annual military exercises last month.The South has warned previously that North Korea may carry out a provocation at any time, citing a possible window that runs until today. South Korean Defense Ministry spokesman Kim Min Seok said today there are no unusual North Korea troop movements and the North has not fired a missile.

Admiral Samuel Locklear, head of the U.S. Pacific Command, told Congress last week that the North moved at least one medium-range Musudan missile to its eastern coast. The Musudan has a range of 3,000 miles (4,827 kilometers) to 3,500 miles — which is a potential threat to Guam though not to Hawaii or the U.S. mainland, Locklear said.

Shuttered Gaeseong

Operations at the joint Gaeseong industrial complex remained suspended for the seventh day today after the North withdrew its 53,397 workers and denied South Korean access to the complex north of the demilitarized zone.

South Korea’s invitation on April 11 to discuss normalization of operations at Gaeseong is “meaningless” while the U.S. and South Korea’s joint Foal Eagle military exercises continue, the Committee for Peaceful Reunification of Korea said yesterday in a statement carried by KCNA. Those drills conclude at the end of April.

South Korean President Park Geun Hye’s office called the rejection “disappointing” while the Unification Ministry maintained that it needs “more time” to gauge the North’s final response.

‘First Step’

“North Korea won’t take South Korea’s offer to talk, or the U.S. and China’s efforts for a peaceful solution lightly,” said Yang Moo Jin, a professor at the University of North Korean Studies in Seoul. “As a first step, I expect talks between North and South to resume on normalizing Gaeseong industrial complex, once the ‘Day of the Sun’ celebrations are over,” he said, referring to today’s holiday in North Korea.

“The North has already shown everything they can,” Yang said, discounting the possibility of an attack.

New statues of Kim Il Sung and Kim Jong Il, known in North Korea as the “Generalissimos,” were erected at the Ministry of People’s Security in Pyongyang, while mosaics portraying “boundless reverence” for the two were unveiled at various locations in Pyongyang, KCNA reported. Performances and art festivals were also held featuring pieces such as “Cantata to Marshal Kim Il Sung,” KCNA said.

Kim Jong Un, the third son of Kim Jong Il, resembles his grandfather and wears the same dark Mao suits favored by the state founder. His rapid succession to power last year was finalized when he took the top military rank of marshal in July.

Calming Tensions

Kerry devoted his first visit to Asia as the top U.S. diplomat to calming tensions on the Korean peninsula, an effort that has gained some momentum after China, North Korea’s biggest trading partner, agreed to join the U.S. in outlining a road map toward a resolution.

There are signs that China is modestly scaling back economic ties with the North. Chinese exports to North Korea fell 13.8 percent to $720 million in the first three months of 2013, the China customs bureau reported. From December through February, exports of crude oil to North Korea rose 3 percent to 102,002 tons, or $107.7 million, according to Chinese data.

“China is firmly committed to upholding peace and stability and advancing the denuclearization process on the Korean peninsula,” Chinese Foreign Minister Yang Jiechi said on Saturday while accompanied by Kerry at Beijing’s Diaoyutai State Guest House, site of former U.S. President Richard Nixon’s 1972 visit. “The issue should be handled and resolved peacefully through dialogue.”

To contact the reporter on this story: Sangwon Yoon in Seoul at syoon32@bloomberg.net

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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