Institutions and businesses require legal documents to describe the securities they offer to both the participants and buyers. This legal document is referred to as a prospectus which normally contains promotional and informational materials. This means that the prospectus is a formal legal document that gives the details of cooperation and may also include the facts about a company which are vital to the perceived investors. In this paper we will focus on the development of a prospect us in North Korea.
We will first focus on the promotional and informational materials relevant to the investors, traders, foreign government’s tourists and the general public. We will then highlight the country’s (North Korea) assets, attractions, and economy trends. Investors North Korea encourages international foreign direct investment. This is done through the Democratic People’s Republic of Korea (DPRK). The DPRK encourages export and manufacturing which is controlled by state organized companies. These state organized trading companies are actually responsible for the distribution of goods onto the local market.
Food and fuel are most vital need the country requires. At present, the country is still suffering due to food shortages. This implies that one can bring in back up generators and fuel since all imports of fuel, food or materials should be kept operational and they are also duty free(Flake & Snyder 36). Investors should also note that there are no minimum levels of investment required. This means that negotiation, agreement of a feasibility report and provision with a committee which is a branch of the Ministry of Foreign. Trade is what one requires to accomplish.
It has also been discovered that most of the foreign investors tend to process operations, handle imported materials and even add value then re-export the goods with some domestic sales through the trading companies. This is because they are capitalizing on the lower labour costs, proper dedication to the work as well as the low tax situation. Traders The trading pattern of North Korea reflects the nature of its local economy. The country is well known for the availability of raw materials namely iron ore, non ferrous metals as well as minerals.
However, North Korea suffers from inadequate capital stock, crude oil and sophisticated technology. Most businesses in DPRK are controlled by the government. This is done through state trading companies and businesses of by Armed Forces since they are usually having a marked business interest hence involved in almost everything. The outside companies do develop project which can bring revenue (Cornell 64). These projects may include running hotels, restaurants and even bars.
When people travel to big cities, they will stay in these foreign hotels or restaurants and pay very high prices. Therefore, foreign companies can bring luxury goods for instance liquor, cosmetics and other items such as American goods for use in the stores. Although we have put a stress on the goods having an impact on the visitors, they are also utilized by the local population and the number may increase in future. Traders should also realize that a private business such as fruit seller and other intra village trade is usually overlooked.
If these small businesses are properly tapped and nurtured, they are likely to develop to the real businesses. As traders, we need at this point to ask ourselves what the North Koreans need? Clearly, on a large scale, everything is needed but only lots of micro opportunities are needed on small scale. For instance, second hand Japanese and America automobiles form China have been imported. Again, we note that consumer goods in small packs such as chocolates, cookies peanuts and even almonds are needed.
This demand may increase in future due to the expected political change. Industries North Korea’s priories the development of agricultural and light industries. This policy is made possible by the fact that the preferential allocation of the investment funds by the state to the heavy industry. A substancial economy entirely depends on the quantity of the extraction of its main mineral resources. These mineral resources are mainly used as fuels, raw materials in the industry, metal processing and export (Hughes 74).
North Korea wholly depends on coal as its main energy source since it lacks reserves of oil or gas. However, the production of coal has not been able to adequately rising demands and hence the persistent shortage of energy in the country. Tourist Attraction North Korea has much to offer tourists. These include the beautiful nature of the Miohang Mountains; Museums of Pyongyang, parks and monuments; the socialist society that preserves its own way of living the old heritage as well as the traditional of Korean culture.
It is therefore important to realize the excellent tourist opportunities available in this rapidly developing country. The beautiful monuments such as palace of culture, national ark (which encloses the Diamond Mountains) and the ancient buildings form good scenery that attracts tourists. However, it is worth nothing that the main demerit in the tourist industry is the difficult in gaining entry to North Korea which is a closed country. Turning on the climate, it is established that North Korea has a moderate climate with four distinct seasons.
These include the hotter summer season which also comprises of the monsoon season which runs form July to August; although quite sever in the northern parts of the country, the winter is generally chilly. The autumn and spring are usually considered as the best time to visit since the weather is dry and mild. The outstanding site of the country lies on the border with China which displays an enormous extinct volcano. This unique beautiful natural landmark is taken to be a sacred site to both North Koreans and South Koreans.
This is because they believe that this site was where the son of the Lord of Heaven descended and established the first Korean Kingdom. Local traveling (inside North Korea) is strictly controlled by the government. Although some domestic flights are scheduled, they are only provided to foreigners. Again, trains do serve the major tourist destination but tickets are usually arranged through a tour operator since the timetables are not usually published. Buses are rare in the county and therefore the only way a tourist will get around to see the various sceneries is by oar.
This implies that the tourist(s) will have to be in the accompaniment of an official driver and a guide. It is only unfortunate that one may not choose his or her accommodation while in North Korea. This means that the foreigner must stay in the specified tourist hotel since this is a strict rule of the country. The hotels are of reasonable standards although they come in four types; deluxe, first class, second and third classes. The tour operators usually organize accommodation for the tourists and therefore the visitors are not given a choice.
In North Korea (even in Pyongyang) the healthcare standards are markedly lower than West Europe. This implies that all invasive procedures need to be prevented and especially ones travel insurance should be sufficient to cover any costs. For instance cholera is a risk in the country and therefore vaccination prior to travel is a must. Polio and Typhoid vaccinations should be considered. Again, it is vital to consider all water as a possible health risk and this means only bottled water is recommended for both washing and consumption.
Tap water should only be used if it is boiled or properly sterilized. All dirty products should be avoided and if one has to eat meat then it should be thoroughly cooked. This will ensure that as a tourist, one stay healthy in North Korea. Infrastructure The domestic network of rail roads in North Korea operates on the axes of the Kaesung – Sariwon – Pyongyang – Shinuiju line along the West coast, the wonisan – Haungnam – Chongi in –Rajin line along the east coast, and the Pyongyang – Wonsan line linking the east and west.
North Korea has also six lines linking with China and a line with Russia and this forms the international network of railroads. Currently, only four lines are in operation. These include the Shinuifu – Tandong (China) line, the Tumen River – Hassan (Russia) line, the Namyang – Tumen (China) line and the Manpo – jian (china). In North Korea, roads do play a secondary role in joining major harbors and railroads stations or even by places. However, roads also serve as major means of transportation where there marine and railroad transport is unavailable.
Transportation of bulk cargo between regions faces a lot of difficult due to the mountainous terrain as well as the country’s industrial structure. This has been made more difficult due to the government’s transportation. This is because the government wants to control the people’s free movements as well as the use of oil. Also, trunk roads have been well constructed along the railroads. Economy Korea had once has timber resources. In the North conservation and reforestation programs assisted in the curbing of the impact of excessive cutting that was evident during the Japanese occupation.
As mentioned earlier, North Korea has a great mineral wealth, which includes gold, iron ore, coal tungsten and graphite modern mining methods has therefore been instituted in the country. The minerals and metals therefore account for a substancial portion of the country’s export revenue. North Korea is specifically rich in iron and coal and other minerals such as copper, lead, zinc uranium, manganese, Gold and Silver which are of high economic value. The country comprises of the mountainous and rocky terrain which makes the Koreans land arable. This means that rice is the chief crop.
We note that before dividing Korea, the colder and less fertile north primarily depended upon the South for food. This meant that Agricultural self – sufficient became the key focus of North Korean government and mechanized methods has to be introduced. However, North Korea has still suffered severe good shortages. In North Korea, livestock plays a minor role in agriculture because of the unsuitable for large-scale grazing. North Korea has drastically changed from a mainly agricultural society to an industrial one due to the availability of mineral resources as well as hydropower.
This implies that majority of the national products is currently derived form mining and manufacturing. However, development in the North Korea has been impeded by the rigid economic system as well as the loss of trading partners after the collapse of the communist world. The government has again instituted a chain of economic reforms which are aimed at reviving the economy. As stated earlier, the major North Korea products include iron, steel, machinery, military products; textiles (synthetics, wool, cotton silk); and even chemicals. Industrialization of North Korea has been accompanied by improved infrastructure.
We note that by the end of the Korean War, the railroad and paved highways were almost non-existent. The railroads have therefore been extensively reconstructed to pave way for industrialization. The Military economy in North Korea gives an unusually large share of national output. This means that the planners or designers have primarily focused on the heavy industry. North Korea is therefore a substantially urban economy therefore a giant portion of its total output comes form the cities. The urban assets in North Korea are therefore accepted to form the key component of DPRK national wealth.
When importing raw materials and then processing them to produce products such as shoes or even soap, one should be aware of the process through which the products will be supplied to North Korea. This implies that a proper supply process should be known. If for instance, North Korea wishes to provide with less processed raw and intermediate materials, then such provisions should be available. This means that technical cooperation is very vital and this should be known by investors, traders, foreign governments, tourists, and even the general public.
Again, to utilize the supplied materials adequately, production abilities plus technical levels need to be enhanced. The economic collapse in North Korea has led to the biggest crisis ever since the country was founded. However, North Korea authorities have held strong claims that natural disasters are responsible for the deteriorated economy. The rapid decline in foreign aid might have even worsened the economic development (An 95). This means that all of the sectors no longer function properly.
Shortages of foreign exchange food, energy, daily necessities and raw materials seem to be a permanent problem in North Korea. A detailed analysis of the economic and living conditions in North Korea points out that most of citizens currently depend on the farmers’ markets and any other market transactions for basic needs. This may be one of the reasons as to why the authorities in North Korea have been unable to execute a detailed economic planning and hence weakening the country’s socialist planning system (Scalapino & Lee 20). This economic difficulty in the country automatically limits its policy options.
This point out that North Korea needs foreign assistance to remedy its current economic difficulties. The North Korea government has therefore recognized that it is becoming increasingly difficult to maintain its policy of self-reliance and thus changed towards foreign investment. However, prospect for the North Korean economy seem to remain clouded by much uncertainty. The future prospects of the North Korean economy may be shaped through South Korean policy towards North Korea, the North’s intention to open and reform its ailing economy and the response of the United State and Japan.
North Korea is currently showing an increasing tendency to embrace diplomatic relations with non –socialist countries a move some consider to be due to its need for foreign assistance. Promotion of foreign investment into its domestic market and an increase in North Korea’s exports could also boost the falling level of the foreign reserves. This implies that North Korea continues to become dependent on foreign assistance and trade (Lee & Yoo 73). North Korea’s economic activities have remained under state control. This means collective agriculture and state –owned companied account for the majority of all economic activities.
Apart from the political changes in China and Russia which adversely affected much of the financial support form these countries, floods and famine also led to serious disruption of the industrial structure (Suh & Lee 33). North Korea’s coastline has a mixture of warm and cold ocean currents. It also has many rivers, lakes and streams hence the development of fisheries. Therefore, the major fishing grounds are in the coastal areas. Most large-scale storage and canning facilities are also located on the east coast. Smaller fishery cooperatives are also located along both coasts in traditional fishing centers besides the fisheries station.
These aquaculture and fresh water fishing entirely takes place on regular cooperative farms. Modernization of fishing industry is necessary for North Korea to expand marine products. The government has therefore called for introduction of modern fishing implements and rationalizing the fishery labor system. This will also involve the expansion and modernization of the cold – storage and processing facilities in order to facilitate faster processing of catches. However, the slow progress in state investment and shortage of oil are the limiting factors in the marine output.