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Eyeing Pipeline, Russia Forgives North Korean Debt

Tyler Durden's picture




 

Submitted by Zachary Zeck via The Diplomat,

On Friday Russia’s parliament voted to write off roughly 90 percent of North Korea’s debt as Moscow seeks to build a gas pipeline through the Hermit Kingdom.

This weekend Reuters reported that Russia’s Duma voted to write off roughly $10 billion worth of the debt that North Korea owes Moscow from the days of the Soviet Union. The vote ratified an agreement made in September 2012, after a meeting between then-President Dmitry Medvedev and then-North Korean leader Kim Jong-il in Siberia in the summer of 2011.

At the time the agreement was first announced, The Guardian reported, citing Russia’s Finance Minister Sergei Storchak, that Moscow would forgive “90% of the debt and reinvest $1bn as part of a debt-for-aid plan to develop energy, health care and educational projects in North Korea.” Russian experts hailed the agreement as a sign that North Korea’s leadership was looking to initiate market style reforms in the reclusive country.

The Reuters report from this weekend said the deal ratified by the Duma on Friday would leave North Korea with about $1.09 billion worth of debt to Russia. North Korea would pay off that amount in six-month installations over the next twenty years. It also summarized Storchak as saying that the money Pyongyang pays back would be reinvested into North Korea.

North Korea was a strong ally of the Soviet Union during the Cold War, and Russia has forgiven the debt incurred by other Soviet allies like Cuba. However, the decision to forgive Pyongyang’s Soviet-era debt is most likely geared toward trying to bolster Russia’s plans to build a gas pipeline from its Sakhalin Island fields to South Korea via the North. The pipeline, which would also be accompanied by a railway, would reportedly carry 10 billion cubic meters of gas to South Korea annually. The gas would come from Russia’s state-owned energy company, Gazprom.

Moscow has been pushing for the Korean gas pipeline and railway for years as part of its strategy to diversify its energy markets away from Europe and toward Asia. This general goal has gained new urgency in the wake of Russia’s clash with the West over the Ukraine and Crimea.

The plan got a boost from Seoul over the weekend when South Korea’s Unification Ministry announced on Sunday that it had approved a trip to Pyongyang by Choi Yeon-hye, the president and CEO of the Korea Railroad Corp. Choi will lead a South Korean delegation to the Organization for Co-Operation between Railways (OSJD) meeting in the North Korean capital scheduled for April 24-28. Chinese and Russian rail officials will also be at the meeting, according to South Korean media outlets.

+++++++++

This appears to play right into the fictional letter we published here regarding the real state of Russia and their strategy.

 

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Tue, 04/22/2014 - 23:15 | 4685342 Truther
Truther's picture

Fuck JPM, Nuland and the rest of the banker bitches. Check mate assholes

Tue, 04/22/2014 - 23:21 | 4685361 Newsboy
Newsboy's picture

I forgive North Korean debt, too.

:-)

Tue, 04/22/2014 - 23:21 | 4685364 Tengri Temujin
Tengri Temujin's picture

Don't stop there forgive our student loan debt also :)

Wed, 04/23/2014 - 00:33 | 4685489 Soul Glow
Soul Glow's picture

The only way to ask for debt is with a tank.  New Cold War bitchez.

Wed, 04/23/2014 - 04:06 | 4685696 HardAssets
HardAssets's picture

If he'd buy up the debt of Americans and then forgive it . . .

well Putin would have a lot of people in the heart of the USA ready to become Russian citizens

Wed, 04/23/2014 - 06:14 | 4685787 Super Broccoli
Super Broccoli's picture

so you mean americans are bitches one can buy ?

Wed, 04/23/2014 - 08:12 | 4686020 actionjacksonbrownie
actionjacksonbrownie's picture

.gov

Tue, 04/22/2014 - 23:40 | 4685402 wee-weed up
wee-weed up's picture

A Ruskie pipeline! The Nork Pillsbury-Doughboy ought to love this! What better way to make sure the US will think twice before attacking his little hell-hole country.

Tue, 04/22/2014 - 23:42 | 4685417 SnobGobbler
SnobGobbler's picture

...smells like a sanction..

Wed, 04/23/2014 - 00:03 | 4685449 DoChenRollingBearing
DoChenRollingBearing's picture

 

 

Snip from the article:

"Russian experts hailed the agreement as a sign that North Korea’s leadership was looking to initiate market style reforms in the reclusive country."

Aha ha ha ha ha ha ha ha  !!!!

Wed, 04/23/2014 - 00:21 | 4685472 remain calm
remain calm's picture

10 Billion dollars. That ain't shit, wait till we write off our 17 trillion dollars. We will show all you ass holes when we default on all those IOU's. We won't ask for forgiveness, We don't want forgiveness, we arej ust going to shit on you one last time. USA USA.

Wed, 04/23/2014 - 11:32 | 4686670 Leaping Lizard
Leaping Lizard's picture

No need to write off the USSA debt.  Just buy up all the Zimbabwe fiat not in the septic and stamp USSA on it.  Why bother to default when we all can be rich?

Wed, 04/23/2014 - 10:32 | 4686408 TheFourthStooge-ing
TheFourthStooge-ing's picture

.

Snip from the article:

"Russian experts hailed the agreement as a sign that North Korea’s leadership was looking to initiate market style reforms in the reclusive country."

Aha ha ha ha ha ha ha ha  !!!!

Remember, it's from The Diplomat, so any connection to reality is purely accidental.

Wed, 04/23/2014 - 00:05 | 4685450 DoChenRollingBearing
DoChenRollingBearing's picture

Yes!  Like they could pay it off, even just 10%.

Wed, 04/23/2014 - 00:09 | 4685457 CrashisOptimistic
CrashisOptimistic's picture

A few FYIs.

N Korea actually pays for the oil it burns (which isn't much).  They pay in coal, of which they have a lot.

S. Korea has one of the largest LNG import terminals in the world.  That's good, though clearly it's not enough for them.  And there is the rule of thumb that about 25% of the energy in a barrel of natural gas is used up freezing it down to LNG temps.  So this pipeline makes for cheaper gas for them.

N Korea will become a spigot holder, like Ukraine to southern Europe.  Nothing good will come of this for S. Korea.

 

 

Wed, 04/23/2014 - 01:12 | 4685539 DoChenRollingBearing
DoChenRollingBearing's picture

"Nothing good will come of this for S. Korea."

I think you are right.

Wed, 04/23/2014 - 07:31 | 4685930 Wahooo
Wahooo's picture

Until they unify with the north and align with china. There is little in the future for sticking with post-war alignment with the US.

Wed, 04/23/2014 - 02:39 | 4685641 SDShack
SDShack's picture

N.Korea just becomes a bigger pawn on the chessboard. Scratch that, probably like a Knight or a Bishop. S.Korea isn't the only one that will regret this. I have said for a long time that Taiwan will be the first Asia Domino to fall. I still stand by that. China will use "containing" the Norks as the ultimate leverage for the West to abandon Taiwan. S.Korea and Japan come after that.

Wed, 04/23/2014 - 10:00 | 4686293 Omen IV
Omen IV's picture

Wrong!

with Russia at the other end of the string the Maximum Leader in N Korea will be a good boy and ...this is a game changer for Soth Korea and then Japan across the channel

S Korea since the 60's have been Naptha based for Fertilizer production (just one example) - like Namhae Chemical - N very very expensive - lower cost for LNG feedstock but still high coming from SA, Qatar and USA - with compression, decompression eating up north of 25% of energy plus capital cost very high for ships and facilities both ends - this will lower their cost by at least $3.00 MMCF probably more

same with Japan

so USA Cheneire Business Plan......busted -  the rest aint going anywhere building other facilities - BK time!

Chess is not a game for amateurs like Kerry and Obama - Rope a Dope Time  - for aging Palookas like Kerry just like Sonny Liston -

time after time as you watch the decisions from Nuland forward it is clear they dont have critical path analysis for all possible permutations / outcomes and how the counter will work - CIA / NSA / State Dept are all dinosaurs only suitable for small countries that can be easily bullied  --- go back to Venezuela boys or Iraq! 

one country after another is slipping from the US orbit -  final turn of the screw will be the reserve currency

Barack Bretton Woods Hussien Obama is not coming out of the woods!

Wed, 04/23/2014 - 10:03 | 4686301 Omen IV
Omen IV's picture

Wrong!

with Russia at the other end of the string the Maximum Leader in N Korea will be a good boy and ...this is a game changer for Soth Korea and then Japan across the channel

S Korea since the 60's have been Naptha based for Fertilizer production (just one example) - like Namhae Chemical - N very very expensive - lower cost for LNG feedstock but still high coming from SA, Qatar and USA - with compression, decompression eating up north of 25% of energy plus capital cost very high for ships and facilities both ends - this will lower their cost by at least $3.00 MMCF probably more

same with Japan

so USA Cheneire Business Plan......busted -  the rest aint going anywhere building other facilities - BK time!

Chess is not a game for amateurs like Kerry and Obama - Rope a Dope Time  - for aging Palookas like Kerry just like Sonny Liston -

time after time as you watch the decisions from Nuland forward it is clear they dont have critical path analysis for all possible permutations / outcomes and how the counter will work - CIA / NSA / State Dept are all dinosaurs only suitable for small countries that can be easily bullied  --- go back to Venezuela boys or Iraq! 

one country after another is slipping from the US orbit -  final turn of the screw will be the reserve currency

Barack Bretton Woods Hussien Obama is not coming out of the woods!

Tue, 04/22/2014 - 23:21 | 4685362 Tengri Temujin
Tengri Temujin's picture

Now with Eastern Ukraine down the line looking to join back up with the motherland, all those pipe making steel mills and Railway and railcar manufacturing factories will be put to good use.  What is also great is that some punk ass oligarch will lose most of his value.

Wed, 04/23/2014 - 07:11 | 4685897 neidermeyer
neidermeyer's picture

90% ,, hahahahahahahaha ... never let them off the hook entirely ... leave them with that 10% open balance ,, let them borrow more .. then take 3x what they owe... THAT'S THE WAY!

Wed, 04/23/2014 - 14:23 | 4687342 Jumbotron
Jumbotron's picture

Yeah....I'm all good with the whole fuck the bankers meme.

But the ugly paradox that is Peak Cheap Energy is once you tap more sources to provide energy to more people....and especially if the price drops because of that opening up of new supplies....the quicker you drain the existing resource.

Then you are in a vicious loop of sticking more straws into the ground in ever more hostile environments thus driving the cost right back up to historical highs and beyond.

Russian and China will be checkmating themselves in our lifetimes.

Tue, 04/22/2014 - 23:18 | 4685352 Cognitive Dissonance
Cognitive Dissonance's picture

Events appear to be accelerating. Never in my memory do I remember the USA sucking so much hind teat. It seems everything is going to plan.

Tue, 04/22/2014 - 23:20 | 4685357 g'kar
g'kar's picture

Surrendering hegemony hoping no one notices?

Tue, 04/22/2014 - 23:32 | 4685392 KickIce
KickIce's picture

I don't think they're surrendering it as much as having it jerked out from under their feet.  The East has figured out that the West brings nothing but misery.

Wed, 04/23/2014 - 00:13 | 4685463 palmereldritch
palmereldritch's picture

So when the petro-dollar reserve currency finally collapses (as planned) there will now be another evil cartoon villain to blame, demonize and name as a suspect in global terror events yet to be planned...errr...discovered

I thought the CIA/MIC ran that NK douche nozzle keeping him supplied with enough low-level nukes to keep SE China and Japan off-balance?  Or perhaps they do and Vlad is all about the petro-dollar demise theatre.

Gonna have to blame someone when this shit show catches on fire I guess...certainly not the FED, BOE and BIS for their financial tyranny and mismanagement to date...

...a fiat/theft system they constructed as an unavoidably limited ponzi set to implode and now to have that cataclysm potentially covered by the economic chaos provided by The Amazing Vlad as he does his illusion act and pulls the petro-dollar rug out from underneath an already collapsing reserve currency with impeccable timing...and look over there...he just  pulled a gold-backed SDR global currency out of his hat.

History shows that all ponzis must end.  The ponzi artist know this and typically will just flee with the money hoping to avoid arrest and prison.  This particular group of Globalists, being the sophisticated criminals that a century of corruption and deceit have refined, lack the technology (one assumes) or desire to flee the planet so they would plan a collapse of this scale with misdirection, multiple benefit and resurrection in mind.  

They will be offering the solutions or synthesis so it is logical that they must invoke a palatable anti-thesis to avoid any connection to themselves...So then, cue Putin et al? Something to consider perhaps in light of recent experiences where a careful reading of official history through the lens of newly discovered perspectives thanks to the Internet (See Antony Sutton) means the apparent is rarely the truth.

Wed, 04/23/2014 - 07:38 | 4685942 KickIce
KickIce's picture

No one's exactly pure and innocent in this game, the East's record on human rights is less than stellar but at least up until this point they've been minding their own business.  (I'm talking since the cold war and perhaps the main reasoning is because we've become the dominant super power.)  The problem is we've been using the bully pulpit for so long that I'm sure there's a lot of resentment built up, and everyone enjoys watching the bully fall.

As far as the West as long as we allow the Rothchilds to remain in control we'll eventually become a nation of renters and ironically more and more like the East.  The plan is to cause so much misery and then to repackage the same system in different wrapping.  The politicians will of course take the blame while the money changers are content to remain in the background.  It'll be something on par with when JP Morgan offered to bail out the United States in 1907.

Wed, 04/23/2014 - 03:58 | 4685692 The Navigator
The Navigator's picture

CD, agreed. Everyday brings 100 new unbelievables compared to 30 years ago or 50 years ago when it was just 1 "the Cuban missle crisis"

Now there's 100 different "fronts" (economic, political, geopolitical, financial) that we have to be concerned with to just maintain OUR status quo (retain our 2nd, 1st, 4th amendment rights and our IRAs, SS funds, property rights).

The battle is on on fronts and a normal guy can't keep up with all that's going on, yet prepare for what may come.

I need 2 of me to keep up on the real news, 4 of me to make the money I need, and 8 of me to prepare against the shit these guys are bringing at me.

I'm out numbered and through taxes, I'm paying for this out-numbering.

"I've seen the enemy, and it's me"

Wed, 04/23/2014 - 14:25 | 4687351 Jumbotron
Jumbotron's picture

Events ARE accelerating but not really to any "plan".

It's simply a matter of the cost of "input resources".  And the one input resource that rules them all is Cheap Energy.  That is now gone.

Everything else is derived from that.

Tue, 04/22/2014 - 23:19 | 4685356 Kirk2NCC1701
Kirk2NCC1701's picture

Chekhov has raised three thumbs up for a Czech mate.

Wed, 04/23/2014 - 01:46 | 4685588 UGrev
UGrev's picture

But he still can't say "Nuclear Vessel" correctly.. :)

Tue, 04/22/2014 - 23:24 | 4685373 SilverIsMoney
SilverIsMoney's picture

Every day we get closer... the USA will not outright collapse but it will not remain the sole Superpower much longer either. No one has a chance at our military but if you can collapse our economy and currency it matters little how advanced we are militarily if we cannot pay our slaves to die for our corporations, banks, and resources.

Tue, 04/22/2014 - 23:32 | 4685391 john39
john39's picture

The roman legions were once unstoppable.

Wed, 04/23/2014 - 01:51 | 4685590 UGrev
UGrev's picture

Perhaps not from a monetary hit like that alone, but the repercussions of the loss of purchasing power by another 5, 10, 15% as all that petro-dollar money comes slushing back into play, would send people into sticker shock. 

An already struggling lower class would start to go hungry real quick.. and when a huge demographic goes hungry.. they go looking for ways to eat; not all of them are friendly.

Wed, 04/23/2014 - 04:33 | 4685707 intric8
intric8's picture

Fuck, boys! This is why life is so irking. Putin is loyal to the sovereignty of Russia, even to the point where he's patronized washington as a show of good faith. The man wants peace, plain and simple. Discontent with peace, America has fucked putin over and over since the early days of W., circa 2001. Now Putin is at wits end, sick of u.s. meddling, and tries to work out a deal having cheifly economic considerations with pyongyang. question now is, is putin playing right into the hands of the nc warplanners? The media can label him an old commie even further now, and say he's consorting with 'axis of evil' north korea. I feel sorry for that guy. We can have peace boys, its on the table at any given time but our fucking country does NOT want it. Whose grand scheme is really afoot here? Who eschews peace for constant unrest, and what is their fucking end game?

Wed, 04/23/2014 - 10:46 | 4686455 Omen IV
Omen IV's picture

"Now Putin is at wits end"

No he is NOT - he is methodical - every step coming out in sequence but are the type of deals that have been in the works for years

he is "Opening the Kimona" one step at a time

Tue, 04/22/2014 - 23:29 | 4685385 anonnn
anonnn's picture

FYI Jeju 1948 massacre under US military authority:

S. Korea's current president just visited Jeju Island in aftermath of the ferry sinking and she is not popiular there.

FYI Jeju Island was where U S military authorities knowingly encouraged the 1948 massacre of civilians by Korean police/troops under their direct authority. Estimates are that 80,000 Jeju villagers were deliberately shot to death.

Currently, the US military is building a large naval base there which for years has been protested by the citizens of Jeju. Refer to the massacre in above paragraph.

See this documentary for detail:

 

https://www.youtube.com/watch?v=4PAOHsHlXGM 

Tue, 04/22/2014 - 23:34 | 4685396 SWCroaker
SWCroaker's picture

Um, where are they trying to get the pipeline to?   South Korea? 

So, let me get this straight.   Russia wants to sell gas to South Korea, and is going to pay to construct a pipeline thru South Korea's most ardent enemy, North Korea, who will never never ever even think about shutting that pipeline down or blowing a section or two up to kick South Korea in the nads.

I'm on planet stoopid.

Tue, 04/22/2014 - 23:43 | 4685418 Comebackkid
Comebackkid's picture

I think you have identified an important half of the big picture. I think one of the benefits for both N. Korea and Russia would be to get S. Korea energy dependent on resources from the North. Hopefully, even bring Japan into the sway of those benefiting from the Russian pipelines.  Make them dependent and they will be much more likely to play ball in the future when you can eliminate the energy that they have come to depend on. 

Wed, 04/23/2014 - 00:28 | 4685470 mrpxsytin
mrpxsytin's picture

wow... is this seriously the US mindset? Or is your system of propaganda that good that it is able to indoctrinate you so absolutely?

Why do you have to assume such malicious intent with these arrangements? Are Russians like the forces of Sauron or something? 

Can't this simply be free market forces at play between a willing buyer and willing seller? How did our propaganda get so severe that we automatically assume that an economically valid deal is actually some sinister plot? 

God damn the Americans have become paranoid!!!

Apologies if you're not actually a US citizen. But I just can't think of any other nationality that would have such a mindset...

Your comment is just so irrational I had to write this spiel. I'm Australian. Do you think we make our export deals with China because we have some sinister plan to get them hooked on high grade iron ore? "Yeah, let's get those Chinese hooked on our ore and then we'll have them by the balls!"

No, we sell our ore to China because it makes economic sense. That is it. Why must you assume the worst with Russia?

Wed, 04/23/2014 - 00:37 | 4685494 Serenity Now
Serenity Now's picture

You obviously don't know a thing about North Korea.

Wed, 04/23/2014 - 00:48 | 4685508 WMM II
WMM II's picture

hey!!! ask me!!! ask me!!!

i know something about north korea.

its a country whose leader fits finely into the group photo of the smilin putin-czar and his merry band of followers.

:)

Wed, 04/23/2014 - 00:54 | 4685518 Freddie
Freddie's picture

NK already sends "workers" to cut timer in Russia for hard currency.  These workers are essentially slaves.  The pipeline will bring more money into NK and the deal will happen.  NK is a mess but they will gladly accept the pipeline, chape gas and transit fees.

Wed, 04/23/2014 - 02:06 | 4685611 Serenity Now
Serenity Now's picture

Yep, prison camps.  I don't think there will be a pipeline, though.  The NK regime can't be trusted by any nation, and it would be too expensive for Russia.

Wed, 04/23/2014 - 02:41 | 4685643 UselessEater
UselessEater's picture

A good chance the pipeline does go ahead. Russia is very busy making deals at the moment across Asia and Sth America and with China - long term repositioning for financial and geo political gain as the USA sinks.

http://www.reuters.com/article/2014/04/19/uk-russia-northkorea-debt-idIN...

 

Wed, 04/23/2014 - 02:56 | 4685659 Serenity Now
Serenity Now's picture

Maybe so.  But the pipeline through NK story is old.  It's not that I don't believe Russia wants to expand its pipelines.  It's that you have to wonder why Russia wouldn't put a pipeline through Mongolia into China.  It's ridiculous to go through NK to SK.  First of all, NK was decimated after the Soviet Union fell.  They would need to be completely rebuilt (and fed!) for this to happen.  I know everyone here loves Russia these days, but Russia doesn't have the money to take on NK as a satellite state like back in the Soviet Union days.  

South Korea always plays along with these things, by sending delegates and what not, so they can be a part of the information gathering.  That's all.  They don't want NK to have any more power over SK than already exists.  

There's a lot of anti-American sentiment on this website lately, for whatever reason.  But it's a mistake to think that Asia is a cohesive unit in any way.  Those nations despise each other.  It's just a Western media hype that the world only hates the US.  

Wed, 04/23/2014 - 03:41 | 4685687 UselessEater
UselessEater's picture

I'm not being anti-American, while I dislike the MIC, the rise and cooperation of Russia, China and nations across the middle east, asia and sth america etc makes me more nervous.

I distrust the geo-political shift thats starting, the demise of the USA by the hands of a small corrupt "elite" is an artificially created play, bringing together normally opposing or distrusting nations.

Tribes unite when they smell a chance to over throw a strong competitor or enemy. After they win the tribes start fighting again. Those who can't see the risk of Russia and China rising are foolish.

 

Wed, 04/23/2014 - 04:08 | 4685697 Serenity Now
Serenity Now's picture

UselessEater,

Okay, I understand you a little bit better.  I'm glad you're not anti-American.  :)

I personally don't think that China, Russia, and the other Asian nations are working together the way the media wants us to believe.  They despise each other.  

It's also true that Russia and China are NOT in good economic shape.  The media lies about that, too.  

Russia is flexing its muscles on the oil and gas front.  But they aren't a superpower on the world stage.  JMHO.

Wed, 04/23/2014 - 10:57 | 4686504 Omen IV
Omen IV's picture

Niave!

pipelines to Europe / China / Korea / Japan - alliances with Syria to block pipeline / Iran as partner / SA gets rid of Bandar and looking to "diversify" and end chechen financing?

Virtually no debt 3% of GDP vs US at 104% - reserve currency in the works with China and China - coordinating  - rattling chains in China Sea

all the while Obama touts LNG which cant be competitive with shale gas that is expensive to drill and ship and he has touted USA world power status and Russia is the "regional power"?

hmmm i dont get it

Wed, 04/23/2014 - 08:35 | 4686070 August
August's picture

Unless you go undersea, the only possible route to SK is via NK, no?

Thu, 04/24/2014 - 03:12 | 4689461 Serenity Now
Serenity Now's picture

Yes, I just meant that it would make more sense for Russia to sell its NG to China than SK by running a pipeline through SK's #1 enemy state, NK.  

I was just trying to flesh out my own thoughts, not start a fight.  It's amazing how one can't express an opinon on ZH anymore without getting blasted (not that you did that!)

Wed, 04/23/2014 - 01:01 | 4685528 Serenity Now
Serenity Now's picture

WMM, I up arrowed you because that's really all most of the world knows about NK.  Half of ZH would fit into that group.  :)

Wed, 04/23/2014 - 01:25 | 4685554 mrpxsytin
mrpxsytin's picture

NSA to American sheeple morons: "You obviously don't know a thing about Al Qaeda. If you knew, then you would be begging us to spy on you."

Daddy to little boy: "You obviously don't know a thing about the boogeyman."

 I hope this highlights the utter nonsense of your 'argument'. You are a cowardly, confused, little boy, who needs to believe that there is a hidden evil force bent on killing you.

Go back to watching 'Red Dawn' (2012).

 

Wed, 04/23/2014 - 01:54 | 4685597 UGrev
UGrev's picture

The best lies are made with the most truth. 

Wed, 04/23/2014 - 02:45 | 4685648 Serenity Now
Serenity Now's picture

mrpxsytin,

What, pray tell, is your argument?  You didn't exactly make one.  

Do you not believe there is evil in this world?  Do you not believe there are people in this world who wish you harm?  

On what grounds do you support North Korea?  It is one of history's most evil regimes.  There is no freedom there, almost no food, and very little chance of change in the near future.  North Korea has killed millions of its own people.  The world knows this.

Your insults to me are meaningless.  Why don't you take a stab at making an actual point next time?

Wed, 04/23/2014 - 00:55 | 4685519 Thermopylae
Thermopylae's picture

"Confessions of an Economic Hitman" - John Perkins

Read it and you'll see why the distrust runs so deep.

Wed, 04/23/2014 - 01:37 | 4685575 mrpxsytin
mrpxsytin's picture

Thanks for the link. I just had a look at the Wikipedia article about it.

"Perkins' function was to convince the political and financial leadership of underdeveloped countries to accept enormous development loans from institutions like the World Bank and USAID. Saddled with debts they could not hope to pay, those countries were forced to acquiesce to political pressure from the United States on a variety of issues."

I guess this answers my question. It is the mindset of the US. And so you could only interpret other countries actions in the same way. The position seems to be, 'We are evil, so everyone else must be evil'.

Well I'm questioning the logic of that position. Surely, you can see the problem with such a mindset. Is it of any benefit to automatically assume that a gas deal between Russia and S.Korea is for ill purposes? Are there other logical explanations for such a deal? If so, why only focus on the negative explanation? That is a serious bias. 

 

Wed, 04/23/2014 - 02:21 | 4685630 Comebackkid
Comebackkid's picture

Interesting take on my post, but I would merely suggest that we have two different understandings of how business and politics are inter-connected, not only now in our modern world, but have been since the beginning of the two phenomena.

You state that this deal could merely be a free market transaction. I could take that seriously if I believed that any large international Energy deal was devoid of government actors. You must take a large leap of faith on governments to assume they keep their hands out of such deals. If you could demonstrate to me a large energy deal between any two states where government officials are not involved I will take this claim seriously, until then, you lack reliable reference.

You question my clarity of judgment, that is fine. You even go far as to suggest that I view this as a sinister plot. I never said anything of the sort, so don’t use hyperbole, it makes your argument seem weak. However, I do believe it is rather naïve to assume that governments are not involved in large business transactions between nation states. All the more so when those transactions have significant impacts on one of the most critical components of any state, energy. I made no hints that their main goal of this deal would be to get them “hooked on gas.” I did however, note the benefits to the side of the Russians and North Koreans. Do you honestly believe that Russian statesmen do not view this deal and consider the benefits of becoming a main energy supplier to East Asia? Do you think the Russian statesmen do not consider the benefits of having Asia partners dependent on their energy, thus bringing them closer to Russia, more interconnected to Russia. Do you believe that any large trade deal involving critical natural resources is not taken into deep consideration by the acting governments? 

For one of your other questions, yes I am American and I work in East Asia as an Account Manager. My clients are Engineering powerhouse companies like Mitsubishi Heavy, Hyundai Engineering, Samsung Engineering, etc. For an example, I was at Hyundai Engineering HQ in two weeks ago, but I could enter the building when I got there early, want to know why? The foreign ministers of 3 African nations had arrived in a motorcade to speak with the president of Hyundai E & C, after that they went straight to Parliament. These ministers were working with the heads the companies involved in the deal.

So tell me, why is it paranoid to believe that governments take a deep interest in the transfer, control, supply, and withholding of natural resources?

Tue, 04/22/2014 - 23:50 | 4685432 Bazza McKenzie
Bazza McKenzie's picture

Of course the second part of this magnificent strategy, is a railway line running from the north into the south, to aid any NKs  invasion of the south.

And south Korean politicians are abetting this proposal.  Just goes to show the US, EU and Japan don't have a monopoly on stupid politicians willing to sell out their own people.

Wed, 04/23/2014 - 00:32 | 4685488 Aussiekiwi
Aussiekiwi's picture

Yeah I thought the same thing, I can just see Kim thinking, first I let them build their pipeline, then I blackmail them to keep the gas flowing.....mind you Russia might have a more robust response to that sort of crap than the west and perhaps they might make Kimmie aware of that.

Wed, 04/23/2014 - 00:51 | 4685514 Freddie
Freddie's picture

I disagree.  NK versus SK hatred is more show than anything.  It works for both countries.  SK knows unification would be astronmically expensive and they like being rich.   My guess is Russia will pay NK nice money to leave the pipeline alone.  SK will also pay some fee. 

Russia could eventually run a pipeline to Japan possibly.  Russia will have all of Asia, Europe hooked up with pipelines.

Wed, 04/23/2014 - 02:49 | 4685652 SDShack
SDShack's picture

Um, on planet stoopid, the West imposed sanction on the Norks, that only led to the people being destroyed as the commie leaders stole everything. That led the West to give the Norks nuclear technology to provide those poor destroyed masses electricity. That led to the Norks developing Nukes that are now pointed at the West. So why would anyone think there could be a problem with the Norks building a pipeline to the South? As Forrest Gump said..."Stupid is as Stupid does". 

Tue, 04/22/2014 - 23:40 | 4685412 disabledvet
disabledvet's picture

Putin has a strategy? That's news to me.

I seriously think he blew this whole "Ukraine thingy" right out his ass actually.

Still...he's good at the audible...so as INCREDIBLE as the policy of "taking it the man" is...it's still "taking it to the man."

I think it's nice that they're yucking it up in Northeast Asia...but I think it'll be a cold day in Siberian Hell before this boondoggle "breaks free of the geopolitical gravity well."

The irony that the only "no" vote for Putie came from Siberia should not come as a surprise.

So i guess we'll see.
http://www.youtube.com/watch?v=1U7YU9rZS4w

"gate 44, gate 56, gate 72, gate 120...

Wed, 04/23/2014 - 00:24 | 4685468 TungstenBars
TungstenBars's picture

blah blah blah blah blah

- guy who gave his legs so Goldman Sachs can get richer

 

P.S. Thanks for making America LESS safe, you stormtrooping terrorist 

Wed, 04/23/2014 - 00:38 | 4685495 Serenity Now
Serenity Now's picture

That was over the line, you fucking asshole.

Wed, 04/23/2014 - 01:05 | 4685531 angel_of_joy
angel_of_joy's picture

No, it was only the truth.

If you cannot take it, well that's too fucking bad...

Wed, 04/23/2014 - 01:13 | 4685540 Colonel Klink
Colonel Klink's picture

Fight club!

Wed, 04/23/2014 - 01:42 | 4685584 mrpxsytin
mrpxsytin's picture

You should apply to be Obama's next line drawer. You've got a unique skill there son.

Wed, 04/23/2014 - 03:22 | 4685676 Serenity Now
Serenity Now's picture

It's interesting that you have called me a boy and son all in the same day.  Is that one of your psychological techniques?  

I'll be way more interested in one of your posts if you say something relevant to the topic.

Wed, 04/23/2014 - 04:10 | 4685699 mrpxsytin
mrpxsytin's picture

You're right. I am being demeaning. But then again, you're being demeaning of an entire country... 

Sentarcos told it like it is in his post below. N. Korea are in a seige mentality. You can only be in a seige mentality if there is a beseiger. N. Korea is simply reacting to the very real threats that have and continue to exist. 

I bet you don't even speak Korean, let alone know anything about what goes on in the minds of North Koreans. I don't either. I've thought many times that it would be great to do a PhD on North Korean psychology because the world knows so little about it. 

Language is the conduit of thought, if you don't even know a person's language you cannot possibly know their thoughts. So I would advise you to stop being so damned presumptuous! It really does make you seem like a child. Sorry if that hurts your feelings. 

Wed, 04/23/2014 - 05:12 | 4685724 Serenity Now
Serenity Now's picture

Now here's what's interesting about our conversation tonight.  You have insulted me, implied that you know what I think, and have had the audacity to advise me not to be presumptuous.  That is after calling me a boy and son.  You know what projecting is, right?  LOL.

It amazes me that people like you will come onto a thread like this and state that the person you are talking to doesn't know anything.  Really?  I could be Kim Jung Un for all you know.  I'm not, of course, but I sure know a lot more about NK than you do.

Seige mentality?  You have never read a single book about NK, have you?  You really should, friend.  And yes, I've been to South Korea and can speak some of the language.  And I know about the horrors about NK.  

Look, you responded to me in a halfway decent manner by admitting that you were being demeaning.  So I'm going to do you a favor and tell you that you don't know half of what you think you know.  :)  

But if you want to discuss anything, I'm willing to do so in an honest manner.  :)

Wed, 04/23/2014 - 05:18 | 4685731 Serenity Now
Serenity Now's picture

And if I wasn't clear about this, there are NO threats to North Korea.  North Korea is its own threat.  Read a book, ffs.  

Wed, 04/23/2014 - 09:51 | 4686270 lakecity55
lakecity55's picture

Yes, indeed over the line.

Tue, 04/22/2014 - 23:51 | 4685426 ebworthen
ebworthen's picture

Dollars (Gold?) to doughnuts Russia had assurances from China that North Korea won't get out of line if push comes to shove.

Wed, 04/23/2014 - 00:22 | 4685474 TungstenBars
TungstenBars's picture

has NK gotten out of line?

And no, those "news" stories from CNN about testing rockets isn't out of line. 

Wed, 04/23/2014 - 00:41 | 4685499 Serenity Now
Serenity Now's picture

China doesn't control North Korea.  North Korea is out of line 24/7.  They don't operate within any international concepts, rules, or laws.  

Wed, 04/23/2014 - 02:54 | 4685657 SDShack
SDShack's picture

N.Korea gets the majority of its food and energy from China. N.Korea would cease to exist in a month without China propping it up. N.Korea is nothing but a Chinese Pawn on the global strategic chessboard. N.Korea will be used by China to leverage concessions from the West... namely Taiwan, S.Korea and Japan... to start.

Wed, 04/23/2014 - 03:11 | 4685672 ebworthen
ebworthen's picture

Precisely, well said.

Who supplied intelligence, officers, tanks, missiles, planes, etc. for the North in the Korean War?  China.

We have already had two wars with Communist China; Korea and Vietnam.

Now we've sold out our productive capacity and populace to China.

In short, the U.S.A. was defeated by China.

Now we are pissing off Russia.

Genius.

Wed, 04/23/2014 - 04:16 | 4685702 Serenity Now
Serenity Now's picture

China didn't supply those things.  The Soviet Union did.  China doesn't want anything to do with North Korea now; they run the risk of having millions of refugees on their hands.  South Korea feels the same way.  It's very sad.  A few North Koreans have managed to defect to SK, but life in NK has not changed.  

Wed, 04/23/2014 - 03:30 | 4685679 Serenity Now
Serenity Now's picture

No it doesn't.  Pyongyang gets most of ITS food and energy from China.  The rest of NK doesn't get much of anything, despite SK's efforts and the UN's efforts and the US's efforts.  

Wed, 04/23/2014 - 00:12 | 4685460 vincent
vincent's picture

You reap what you sew.

All Americans are not representative of a fucked up American foreign policy

Nuff said.

Wed, 04/23/2014 - 00:29 | 4685487 Aussiekiwi
Aussiekiwi's picture

Whats sewing got to do with anything?

Wed, 04/23/2014 - 00:18 | 4685466 Smiley
Smiley's picture

Putin is playing chess and Obama is playing CandyLand...

Wed, 04/23/2014 - 00:24 | 4685478 Schmuck Raker
Schmuck Raker's picture

Hahahahah

"Russian experts hailed the agreement as a sign that North Korea’s leadership was looking to initiate market style reforms in the reclusive country."

Yeah, alrightythen; so say the 'Russian' experts, as opposed to  the 'Korean' experts.

Wed, 04/23/2014 - 00:39 | 4685496 WMM II
WMM II's picture

"On Friday Russia’s parliament voted to write off roughly 90 percent of North Korea’s debt as Moscow seeks to build a gas pipeline through the Hermit Kingdom."

 

hey, maybe kim can get rodman to visit putin-land.

 

:)

Wed, 04/23/2014 - 00:46 | 4685505 BKbroiler
BKbroiler's picture

Ah, yes, great PR move Putin.  Ally yourself with the world's only modern despotic dictator, who also just got indicted by the UN with war crimes.  walked right into that one, keep buying that rope.

Wed, 04/23/2014 - 00:53 | 4685516 teslaberry
teslaberry's picture

1 million dollars paid by nk a week for 20 years and then the money would be reinvested into nk again. 

 

well, unless they cut a deal with china, russia's only access to NK by direct pipeline is a few mile stretch on the far eastern coast by tumen river crossing about 50 miles southwest of vladivostok--which for all intents and purposes is russia's vancouver on the pacific coast. 

 

you'd assume there is already a shit ton of offshore oil deposits in the sea of japan and the seak of ohkostk. but unless russia starts pumping a shiton of oil near there, they will have to route that pipeline all the way from european russia, across the continent, then around mongolia, to get to that connection with korea.

thats one hell of an expensive pipeline, even if just to pump to korea. perhaps the same pipelines are being spliter routed to the chinese as well and will bear the burden of the pipeline contruction cost. 

long term goal.....deliver oil and gas to japan?

 

Wed, 04/23/2014 - 01:50 | 4685591 mrpxsytin
mrpxsytin's picture

"long term goal.....deliver oil and gas to japan?"

How long term?

Better not tell that to the likes of Chevron who are building massive natural gas projects in my state of Western Australia with the view of shipping gas to Japan. Chevron has already gone $17billion overbudget in one project: http://www.abc.net.au/news/2013-12-12/gorgon-gas-project-cost-blowout/51..., thanks to the horrifically inefficient Australian contractors. I think it would make them cry if Russia ended up piping directly into Japan.

Wed, 04/23/2014 - 00:56 | 4685522 Serenity Now
Serenity Now's picture

Is Putin going to start feeding North Korea again?

Is he going to rebuild the crumbling infrastructure?  Most of North Korea hasn't seen a light bulb turn on since the Soviet Union fell.

North Korea is full of mountains and often covered in snow. 

That's going to be one expensive pipeline.

Wed, 04/23/2014 - 02:11 | 4685618 Setarcos
Setarcos's picture

Don't you ever feel embarrassed to make comments like this?

Maybe you can find N Korea on a map and read Washington propaganda, but what do you know about pipeline construction?  As much as Gazprom, Shell. BP and other majors in energy fields?

Wed, 04/23/2014 - 02:15 | 4685622 mrpxsytin
mrpxsytin's picture

I think he must be joking. Noone can be that stupid. 

Wed, 04/23/2014 - 02:58 | 4685656 Setarcos
Setarcos's picture

I would like to agree with you, but plenty can be even more stupid.

Dare I say?  Why not?

ZHers who believe that "gold is money", whereas it is a commodity which, unless minted as a coin and stamped with a face (fiat) value, cannot be exchanged for other commoditiies and goods.

Most on ZH worship WB7 and I agree that he is very good, but the gold-bugs in ZH will not like to know that WB7 agreed with me about gold.

Anyone who thinks that gold-is-money per se is stupid

 

Wed, 04/23/2014 - 03:40 | 4685686 Serenity Now
Serenity Now's picture

Haha, really subtle way to bring your agenda in here.  NOT.  

Wed, 04/23/2014 - 03:36 | 4685682 Serenity Now
Serenity Now's picture

Setarcos,

Your comments to me are meaningless.  Every sentence is an attack on me rather than an intelligent comment about North Korea, Russia, pipelines, or energy in general.  If you have something intelligent to add to the discussion, I'm all ears and would love to discuss it with you.  

Wed, 04/23/2014 - 02:57 | 4685660 SDShack
SDShack's picture

Mountains and Snow? OMG. That sounds like Alaska and there sure aren't any pipelines there.

Wed, 04/23/2014 - 03:44 | 4685689 Serenity Now
Serenity Now's picture

Exactly, there aren't very many up there.  What's your asshole sarcastic point?

And by the way, the pipelines in question are for natural gas.  As the experts on here say, you lose a lot of the product in freezing temperatures.  I'm just trying to have an honest conversation about it.  

Wed, 04/23/2014 - 08:35 | 4686069 mrpxsytin
mrpxsytin's picture

You lose a lot taking the gas to freezing temperatures (i.e., converting to liquified natural gas), not piping the gas in freezing temperatures!

You don't lose any product as a function of temperature. What they are trying to say is that it takes energy to convert the gas to liquid. 

Thu, 04/24/2014 - 03:23 | 4689470 Serenity Now
Serenity Now's picture

Ok, point taken.  Like I said, I was trying to have an honest conversation about it.  See how easy it is to make a point without attacking me personally?  :)

Wed, 04/23/2014 - 01:37 | 4685576 Sizzurp
Sizzurp's picture

The EU is going to wake up eventually and realize they made a big mistake pissing off their gas supplier.  Putin is saying "ok dimwits, more gas to Asia, and less to Europe".  Net result, Germany, the economic engine of the EU, will be losing more industry as they vacate to jurisdictions with lower energy prices.  This is all heading to war.

Wed, 04/23/2014 - 09:17 | 4686181 gcjohns1971
gcjohns1971's picture

Yes, all heading to war.

Q: Who loses when suppliers and customers piss each other off?

A: BOTH.

 

The central question is whether Europe needs Russia's energy more, or whether Russia needs Europe's business more.

Putin is clearly saying, "Screw you! We'll deal with the East instead!"

But...

That's not terribly viable for a variety of reasons including:

- Vast distances from well to destination - over the worst terrain on the planet (outside of antarctica).

- Russia would need to transit their COMPETITOR'S TERRITORY and use THEIR COMPETITOR'S INFRASTRUCTURE for portions of the route.

 

Russia tends to think in terms of dominion - ergo, Russia has dominated the Central Asian republics in the past, therefore Russia dominates the Central Asian republics.  

But, that historical fact is largely due to where the most lucrative markets have been over the last 500 years - EUROPE and NOT ASIA.  The very same dynamic that makes Russia WANT to turn East, is the same one that woudl reverse their position vis-a-vis the Central Asian republics. 

If the the most lucrative markets are going to be in the East, then the Central Asian Republics will reap more benefits than Russia simply due to location.  Since all power is derivative from economic power, this will - over time- tend to reverse their positions relative to Russia.

Wed, 04/23/2014 - 10:34 | 4686415 Atticus Finch
Atticus Finch's picture

Germany is moving away from the EU and into the Eurasion trade sphere. Queitly of course, but true.

Wed, 04/23/2014 - 01:38 | 4685577 Setarcos
Setarcos's picture

It's easy to take the piss out of N Korea, provided that you ignore history.

E.g Brutally occupied by Japan before and during WW2, then 'liberated'/occupied by the US.

Independence movement, so Washington starts the Korean War, destroys nearly every city, town and village, whilst killing at least a third of the population, only to lose the War.

Washington imposes partition, refuses to sign a peace treaty and conducts economic warfare for over 60 years.

Result?  N Korean isolation, with neither China, nor the USSR originally able to help much as they too tried to recover from WW2.  So what was needed was/is a strong, cultish, ideological leadership to rebuild from ruination.

Not since the Civil War have Usans ever experienced the kind of mass destruction that their Empire has inflicted on so many countries since Lincoln consolidated the mainland Empire.

Ironic that Usans hero-worship their own cult ideologues, from the oligarchical "Founding Fathers" to whomever, but cannot see that other countries have also needed a focus to bring unity in adversity.

Wed, 04/23/2014 - 09:06 | 4686155 gcjohns1971
gcjohns1971's picture

Your information is a few cans short of a six-pack and your sequence of events is all phucked up.

It

Wed, 04/23/2014 - 02:17 | 4685623 Rican
Rican's picture

Putin forgives N. Korean debt. U.S. puts boots on the ground.

One side's playing checkers and the other's playing Galactic Super Chess. 

Wed, 04/23/2014 - 02:40 | 4685642 q99x2
q99x2's picture

Maybe we'll be able to see the lights on in North Korea when looking at satellite images of the earth at night.

Wed, 04/23/2014 - 03:04 | 4685666 Setarcos
Setarcos's picture

Idiot comment.

The day/night that N Korea consumes as much as Usans do of finite resources, you will accept them as part of your fat and bloated Empire.

Thu, 04/24/2014 - 03:36 | 4689482 Serenity Now
Serenity Now's picture

Serious questions:

Are you North Korean?  Of course you don't have to answer.  I respect privacy 100%.  But you are oddly pro-NK, and I am wondering why.  

Also, what do you mean by Usan?  I can't find a decent definition of it.  I'm assuming you mean USA-an, like American.  

Wed, 04/23/2014 - 03:35 | 4685681 kurt
kurt's picture

I think this article is a cobbled together crock o' shit!

Wed, 04/23/2014 - 10:31 | 4686399 Atticus Finch
Atticus Finch's picture

Best go back to reading the New York Times, Wasington Post cobbled together crock.

Wed, 04/23/2014 - 06:14 | 4685788 AdvancingTime
AdvancingTime's picture

Back in the middle of 2012  Putin pledged to strengthen Russia’s economic and political ties with China after skipping a Group of Eight summit in the U.S. the month before.

This unholy alliance between Russia and China may create major problems for America going forward. For more about this meeting and the implications see the article below.

 http://brucewilds.blogspot.com/2012/06/putin-strenghtens-ties-with-china...

Wed, 04/23/2014 - 07:46 | 4685956 youngman
youngman's picture

I know one thing..it will be the cheapest pipeline ever built....done with slave labor....

Wed, 04/23/2014 - 08:00 | 4685993 Bogdog
Bogdog's picture

 "...reinvest $1bn as part of a debt-for-aid plan to develop energy, health care and educational projects in North Korea.”

Rest assured that the bulk of that money goes straight into the personal accounts of the Kim clan and their connected underlings.

Wed, 04/23/2014 - 08:34 | 4686067 Rising Sun
Rising Sun's picture

Russian brilliance strikes again!!!!

 

Love it when the commies get in bed with other commies - they eventually eat their own.

 

One bag of Orville Redenbacher please.

Wed, 04/23/2014 - 09:24 | 4686202 esum
esum's picture

Biden and Kerry and Obama/Jarrett ought to be stationed in ukraine to LEAD the charge.... send their families too.... Here is a douchebag who despises but uses, in the worst sense of the word, the volunteer military. Hey scumbag let's get some draftees.... then you will get the political blowback.... scumbags.... This admin lists returning GI's as TERRORISTS .... muthfukas obama and crew are not worthy to lick the boots of a VET...

First they hire Greystone to rile shit up and now want to escalate it after putin calls their bluff with his spetz crew. wtf good is the enire state department when "diplomacy" is conducted in the NY Times and silly bitches like Nuland, Kerry, Biden, Jarrett dont have the slightest idea what they are doing..

Obumbler is forging an alliance of Russia, China, N Korea, Iran, Venezuela, Cuba and the renegade lawlwess states BUT HAS NO VIABLE COUNTER STRATEGY OTHER THAN WAR... 

Our allies look at what happens to other "allies" and has to ask... when they will be hung out to dry... Ask israel....the people literally cried in the streets when obumbler got reelected... Khadaffy was helping undermine al queda, mubarak was a loyal supporter against the muslim brotherhood. too bad becasue obama supports them and not our allies. He also aupports and supported al queda in syria.. So ask yourself ... where is this terrorist supporter taking the ussa? Domestically to tyrany and internationally to war... 

Wed, 04/23/2014 - 10:28 | 4686380 Atticus Finch
Atticus Finch's picture

"China, N Korea, Iran, Venezuela, Cuba"

You forgot to mention Germany and possibly all of Eastern Europe that has been raped by international bankers.

Wed, 04/23/2014 - 10:24 | 4686373 Atticus Finch
Atticus Finch's picture

"...North Korea with about $1.09 billion worth of debt to Russia. North Korea would pay off that amount in six-month installations over the next twenty years. It also summarized Storchak as saying that the money Pyongyang pays back would be reinvested into North Korea."

What? Forgiving a debtor nation debt? no threat of invasion? Re-investigating in the debtor nation without Austerity?

This sounds like Sanity.

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