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Introduction to Investment Projects in Wonsan-Mt. Kumgang International Tourist Zone (2015)

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Introduction to Investment Projects in Wonsan-Mt. Kumgang International Tourist Zone (2015) Introduction to Investment Projects in Wonsan-Mt. Kumgang International Tourist Zone (2015) Wonsan Zone Development Corporation, DPRK Contents 1. Introduction to Wonsan-Mt. Kumgang International Tourist Zone········································································2 2. Investment Projects ·······································································5 2.1. Infrastructure ·············································································· 5 2.2. Lodgings ··································································································10 2.3. Public Catering Services ········································································18 2.4. Commercial Networks············································································26 2.5. Service Facilities·····················································································28 2.6. Public Health Facilities ······································································ 46 2.7. Industrial Establishments ·································································· 49 3. List of DPRK Laws and Regulations of Foreign Investment··60 1 1. Introduction to Wonsan-Mt. Kumgang International Tourist Zone The Wonsan-Mt. Kumgang area on the east coast of Korea boasts of Masikryong Ski Resort, Songdowon International Children’s Camp and other monumental edifices. The areas of Wonsan, Ullim Falls, Sogwang Temple, Thongchon and Mt. Kumgang are being facelifted as cultural resorts for people. The expectation and interest of the Korean people and world peoples in Mt. Kumgang and other beauty spots in these areas are increasing with each passing day. In a bid to further enliven the international sightseeing tour of the Wonsan area and other beauty spots on the east coast of the country including Mt. Kumgang, a noted mountain of Korea, which are developing into world-famous tourist destinations, the Presidium of the Supreme People’s Assembly of the DPRK issued a decree on naming this region the Wonsan-Mt. Kumgang International Tourist Zone (hereinafter called ‘the Zone’) on June 11, Juche 103 (2014). The Zone includes the areas of Wonsan, Masikryong Ski Resort, Ullim Falls, Sogwang Temple, Thongchon and Mt. Kumgang covering an area of some 400 km². The Wosan area includes part of Wonsan City and Anbyon County; the Masikryong Ski Resort area, part of Wonsan City and Poptong County; the Ullim Falls area, part of Munchon City and Chonnae County; the Sogwang Temple area, part of Kosan County, the Thongchon area, part of Thongchon County; and the Mt. Kumgang area, the Mt. Kumgang Special Zone for International Tourism and part of Kosong and Kumgang counties. In the Zone there are approximately 140 historical relics, 10 sand beaches, 680 tourist attractions, 4 mineral springs, several bathing resorts and natural lakes and more than 3.3 million tons of mud with therapeutic properties for neuralgia and colitis. Wonsan is the seat of Kangwon Province and a beautiful port city. The total area of the city is over 300 km², and in the sea off the city there are beautiful islands all of which cover an area of 4 km². The annual average temperature of Wonsan is 10.4 °C. The city is subject to oceanic climate and is relatively warm. Wonsan, located in the centre of the Zone, is 1-2 hours’ flight from such neighbouring countries as Russia, China and Japan, and 3-4 hours’ flight from various cities in East Asia. 2 Meanwhile, the city, a major railway junction linking the east and west coasts of the DPRK, is connected to Dandong, Liaoning Province, China, on the west across Pyongyang and Sinuiju, and to Khasan of Russia on the north across Hamhung and Chongjin. From Pyongyang to Wonsan extends a tourist road spanning about 200 km, and from Hamhung to Wonsan a 110-km-long highway. Wonsan boasts world-famous Myongsasimni Sand Beach, Songdowon Sand Beach, Songdowon International Children’s Camp, a traditional park, pleasure grounds, zoological and botanical gardens, Jangdoksom Pleasure Resort and other tourist and cultural resorts. In the Masikryong Mountains 25 km northwest of Wonsan there is the Masikryong Ski Resort completed in 2013. The resort consists of 10 ski slopes with an area of 2,200 hectares and a total length of 49.6 km, an outdoor ice rink, an outdoor swimming pool, Masikryong Hotel and other tourist facilities. It has been built so magnificently that an international game can be held. In the Ullim Falls area 68 km northwest of Wonsan there are 75-m-high Ullim Falls over an area of 1,000 hectares, Kusul Falls, Pidan Falls and other ponds. In the Sogwang Temple area 47 km southwest of Wonsan there are historical relics, mountaineering routes, medicinal waters, medical treatment facilities and lodging quarters. The Thongchon area is 52 km south of Wonsan. In the area there are Chongsokjong which has been called one of the eight scenic spots in Kwandong district of Korea, four natural lakes including Tongjong and Sijung, and the Sijungho Bathing Resort. In addition, there are six sand beaches, nine tourist attractions, 3.3 million tons of mud efficacious for the treatment of neuralgia and colitis, lodging quarters, clinics, restaurants, shops and other service facilities. For its magnificent, beautiful and fantastic scenery, Mt. Kumgang, over 100 km south of Wonsan, is numbered among the renowned mountains of the world. It has 30- odd natural monuments, 10-odd historical relics, two nature reserves, two bathing resorts and a hot spa. The Mt. Kumgang area is divided into Outer Kumgang, Inner Kumgang and Sea Kumgang. Outer Kumgang includes the scenic spots called Chonbuldong, Manmulsang, Kuryongyon and Sonha with nearly 330 sightseeing places, 10-odd nature stocks, two bathing resorts and a hot spa, an ideal place for the treatment of hypertension and neuralgia. 3 Inner Kumgang area is formed of Manphokdong, Kusong and Manchon scenic spots. Sea Kumgang consists of the areas of Lagoon Samil and Sea Kumgang. At present the Mt. Kumgang area has a golf course, sledge ground, ski training ground, bathing resorts, lodging facilities for tourists, restaurants and a hot spa. The Zone, near to the world-famous Mt. Paektu and Mt. Chilbo tourist regions, is called a pearl on the east coast of Korea which is endowed with lots of peculiar tourist resources. The Zone will be a fine example of a coastal tourist region and bring satisfactory economic profits to all investors in its development. This guide introduces 70 investment projects which are envisaged to be performed in the Zone and to be further expanded. 4 2. Investment Projects 2.1. Infrastructure 2.1.1. Sinsong Sewage Station Location: Sinsong-dong, Wonsan, Kangwon Province In developing Wonsan into an international tourist village the renovation for the Wonsan Sinsong Sewage Station is a very important project. It is of paramount importance in building infrastructure facilities to provide the citizens with a hygienically safe and sound living environment. The existing sewage station is equipped with old-fashioned facilities. Sewage treatment is carried out by natural drying method. The mission of the planned project is to improve urban life and ecological environment, invigorate the local tourist industry, cut down greenhouse gas emissions and produce energies and organic fertilizers from the sewage by improving the sewage network in Wonsan and the existing station. The envisaged goals of the project are as follows: • 50,000 m²/d (first stage), 100,000 m²/d (second stage) • Up to EU sewage emission standard (BOD5≦10mg/L, CODcr≦30mg/L, SS≦10 mg /L, TN≦10mg /L, TP≦ 1mg /L) • Electricity production by means of methane gas produced by anaerobic fermentation • Organic fertilizer production by mechanical dehydration of sewage • Construction of automatic air-tight sewage disposal process Estimated cost: US$ 41.86 million (US$ 21.33 million by our side, US$ 20.53 million by the other side) Type of investment: As agreed by both sides Period of implementation: 24-month construction, 20-year operation Profitability: IRR 12%, NPV US$ 9.67 million (Discount rate 10%) 5 2.1.2. Renovation of Wonsan-Mt. Kumgang Railway Location: The existing coastal Wonsan-Mt. Kumgang Railway from Wonsan, Kangwon Province to Onjong-ri, Kosong County, Kangwon Province The purpose of this project is to renovate the existing railways (118.2 km) between Wonsan and Mt. Kumgang so as to provide safer and more convenient travelling conditions for tourists to the Thongchon area and Mt. Kumgang, a world-famous beauty spot. The Wonsan-Mt. Kumgang line consists of light rails and the conditions of its sleepers and roadbed are poor. The railway bridges and tunnels are out-dated, so the turnover is low. The DPRK government encourages the investment in infrastructure construction in economic development parks more than any others else: The enterprises investing in this sector will be given a preferential right to land choice and exempted from land use fees within a given period. Besides, no tax will be imposed on operating the infrastructure facilities, and a preferential tariff system will be enforced. As it has been already in use, the railway requires less investment and shorter period of construction than when it is to be newly built. The railway lies along the coast line and passes through noted tourist attractions including Lake Sijung. Therefore, the train journey blended with various services can be a major tourist item. The number of foreign tourists is expected to rise to 4,000, 7,000-10,000 at the maximum,
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