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Russia Eyes Ailing N. Korean Infrastructure

FILE - North Korean farmers pass along a road past farm fields at a collective farm near the town of Sariwon, in North Hwanghae province, North Korea.

North Korea’s ailing infrastructure is regarded as the most favorable area for Russian investment, according to the head of a business council tasked with promoting business between Moscow and Pyongyang.

In an e-mail response to the VOA Korean service this week, Vitaly Survillo, the chairman of Russia’s Business Council for Cooperation with North Korea, wrote: “It seems to me the most promising areas of cooperation between our countries are infrastructure projects - roads, utility networks, [and] tourism.”

Moscow established the council last week to increase trade between Pyongyang and Moscow.

The council plans to work on the first stage through the support of government agencies in both countries, according to Survillo. The main goal is to find new channels of communication with the North Korean partners.

The council is currently focusing its efforts on working with Russian organizations to ensure their interests in the structure of state bodies of both countries.

Russia is also eyeing North Korea’s resources, including minerals, for new business opportunities.

“North Korea has significant reserves of natural and labor resources,” Survillo said.

In October 2014, the two sides began a rare joint project that would overhaul the North’s railway system. The project calls for Russia to upgrade North Korea’s railway network in return for access to the North’s mineral resources.

“If someone needs our support, we will be glad to assist in facing the challenges of successful development of the project,” Survillo said in reference to the railway project.

When asked about the biggest challenge his team faces, Survillo answered, “the loss of the habit of mutual economic cooperation.”

“Much needs to be recovered from scratch,” he added.

Recently, Russia and North Korea have expanded economic and political ties.

In May 2014, Moscow canceled $10 billion of Pyongyang’s $11 billion debt. Last month, the office of the Russian president said North Korean leader Kim Jong Un will travel to Moscow in May to attend an event celebrating the 70th anniversary of Russia’s victory over Nazi Germany.

Jee Abbey Lee contributed to this report, which was produced in collaboration with the VOA Korean service.