North Korea airline diversifies as threats mount of sanctions | Reuters

By Sue-Lin Wong and James Pearson
| PYONGYANG/SEOUL

PYONGYANG/SEOUL Even after disembarking from North Korea’s Air Koryo plane at Pyongyang airport, it’s difficult to miss the airline’s brand. The Air Koryo conglomerate makes cigarettes and fizzy drinks, besides owning a taxi fleet and petrol stations – and all have the same flying crane logo as the carrier.

The military-controlled airline expanded into consumer products in earnest in recent months, visitors to the isolated country say. It was not clear if the diversification into the domestic market was related to the loss of many international routes when the United Nations slapped economic sanctions on North Korea for its nuclear and ballistic missile programs.

Washington is now considering tougher measures, including a global ban on Air Koryo itself, to punish North Korea for continuing weapons tests, U.S. officials have said.

But any U.S. action on Air Koryo would not be binding on other nations and would have little effect unless joined by China and Russia – both of which have sought to introduce exceptions to United Nations sanctions on North Korea in the past.

“China may indeed agree to this kind of ban on Air Koryo since it seems like China and the U.S. have reached an agreement that North Korea needs to be dealt with in some way. But the question is whether Russia will agree to sanctions against Air Koryo,” said Sun Xingjie, an associate professor at China’s Jilin University.

North Korean officials are rarely accessible to reporters, and it was not possible to get comment from Air Koryo or from the Pyongyang government.

Air Koryo now flies only to Beijing and three other cities in China, and to Vladivostok in Russia. Flights to Bangkok, Kuala Lumpur and Kuwait were dropped last year but just last month, Air Koryo added a route from Pyongyang to the Chinese city of Dandong, the main transit point for trade between the two countries..

Air Koryo has 15 active planes on its fleet, either Russian or Ukrainian-made, and uses refueling, maintenance and repair facilities in China and Russia, according to aviation databases and U.N. documents.

The airline has a number of domestic flights connecting the capital Pyongyang to Orang, Sondok and Samjiyon towns, according to a schedule available last year.

Businesses in secretive North Korea do not publicly share information about revenues or costs, so it was not possible to determine what effect any existing sanctions have had or may have in future.

But visitors to North Korea say the Air Koryo conglomerate, owned by the country’s air force, is clearly expanding.

CABS, GAS STATIONS

In 2015, the conglomerate launched its own brand of sky-blue taxis which now parade the streets of Pyongyang alongside cabs from at least eight other state-owned companies.

Air Koryo colas and cigarettes are available in shops across Pyongyang.   

Air Koryo started branching into…

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