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Revamping North Korean Railroads Could Cost 8 Trillion Won

Revamping North Korean Railroads Could Cost 8 Trillion Won

Posted May. 19, 2007 04:06,   


There is a growing interest in the cost to modernize the decrepit North Korean railway system as plans to develop the Trans Korea Railway and Trans Siberian Railway move forward following the successful test-run of cross-border rail links on the Gyeongeui and Donghae lines on May 17.

Unification Minister Lee Jae-jung said on a SBS radio program yesterday, “I cannot tell you how much it would cost because different experts disagree and more studies are underway. No matter how much it costs, however, it would be an investment for our economy.”

As for how to finance the modernization, Lee talked about the possibility of calling for investment by or receiving loans from the international community, hinting that the cost could involve an astronomical amount of money.

The most trustworthy information from reports released so far comes from Russia, which launched a three-year study in 2001. It estimated that revamping the Pyongyang line along the East Coast (Pyongyang-Wonsan-Heungnam-Chongjin-Najin) would cost $2.49 billion (2325.9 billion won) to $3 billion (2802.3 billion won).

However, the total renovation cost is likely to go up to the 6.5-8 trillion won range if the Gyeongeui line, another North Korean railway artery (Gaesong-Sariwon-Pyongyang-Shinuiju), is added to the list.

Minister Lee also said, “The Gyeongwon line is inoperable now, but the Gyeongeui line, despite its slow speed, can be used for cross-border rail links as the railroad between Gaesong and Shinuiju is currently operational in the North.” He expected great benefits and the capacity to handle an enormous amount of trade volume if the continental link is connected to the Chinese rail net.

On the issue of military security for the railroad renovations, he said that the two Koreas had agreed on the opening of railways beyond test-runs at the fifth round of inter-Korean general-level talks and that the procedure for military security guarantees should be done step-by-step, not all at once.