North Korea has worked out a special law to set up another free trade zone on a river island on its western border with China, a report said Monday. The law will be made public when China completes negotiations on its investment in the zone on the Yalu River, the South's Yonhap news agency said. The island, called Hwanggumpyong in Korean and Huangjinping in Chinese, is separated by a narrow waterway from the jurisdiction of the Chinese city of Dandong.
A memorandum of understanding on joint development of the zone mainly with Chinese money was signed last December, it said, citing a Chinese source who recently visited Pyongyang. The North's state media said last February that the two sides had signed a deal to build a new cross-border bridge on the Yalu River as part of a major economic package announced by Beijing.
The isolated North has also strived to revitalise a free trade zone in Rason near its border with China and Russia. Rason became a special economic zone in 1991 but never fulfilled its proposed role as a transport hub. A Chinese state company plans to invest about $2 billion in a project to build up Rason into a regional export base, a Seoul newspaper reported earlier this month.
Tough United Nations sanctions brought by the North's pursuit of ballistic missiles and atomic weapons have hurt its economy, restricting the communist state's access to international credit. But China, Pyongyang's sole major ally, has actively explored investment opportunities in North Korea.
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