Seoul: North Korea will this month sign an agreement to allow Chinese companies to explore its potentially vast mineral wealth, a report said on Sunday, as the poverty-stricken nation seeks to boost its economy.
Yonhap news agency said officials of the two countries will sign a deal to jointly develop the North`s mineral deposits in Beijing on February 15, a day before the birthday of Pyongyang`s leader Kim Jong-Il.
South Korea estimates the total value of mineral deposits in North Korea at USD 6.3 trillion.
"The agreement contains a specific list of mines to be developed...including gold, anthracite coal and rare earth mineral mines," Yonhap quoted a source familiar with North Korean affairs as saying.
Under the agreement the two communist nations will open a Hong Kong-based firm to seek investment from private Chinese companies, the source was quoted as saying.
As well as being North Korea`s sole major ally, China is its biggest trade partner and has been actively exploring investment opportunities in the neighbouring country, sometimes gaining strategic benefits.
Pyongyang`s dependence on Beijing has grown amid a nuclear stand-off with the United States and its allies, and China reportedly gained rights in 2008 to use a pier at the northeastern port of Rason, securing access to the Sea of Japan (East Sea).
Yonhap said bilateral trade in the first 11 months of 2010 stood at USD 3 billion, breaking the previous record of USD 2.7 billion for the whole of 2008.
The North`s botched efforts in 2009 to revalue its currency further worsened the state-controlled economy, which had already been tumbling after years of mismanagement and international sanctions over the nuclear weapons programme.
Bureau Report
