SHENYANG -- North Korea is moving to give mineral resources development rights to Chinese companies in return for pledges to upgrade its backward infrastructure, sources said Monday.

Sources with ties to North Korea and Chinese businesses, said Pyongyang would give resources development rights to Chinese investors  if they are willing to build social infrastructure such as roads and hotels.

Such moves come as the impoverished North that does not have not  many manufactured goods to sell abroad wants to use its relatively abundant anthracite coal, iron ore and gold reserves as economic bargaining tools.

Outside support and tie-ups have taken on more urgency after South Korea effectively halted all cross-border trade following the sinking of one of its naval vessels by a North Korean torpedo in the Yellow Sea in 2010.

Local Chinese business insiders in Shenyang said Hunan Investment Co., secured the right to develop the Unsan gold mine in North Korea  in exchange for supporting a project to build a 30-story luxury hotel and highway in the country.

China's Hunchun trading company has reached a similar deal with Pyongyang Moranbong Co. to develop a gold mine in Chagang Province near the North Korea-Chinese border, the inside sources said.

The Chinese partner is a player in the management of up-end hotels as well as the development of iron ore, various mines and real estate, they said.

North Korea is also expected to further use its mineral resources to win concessions from foreign companies in 2013, with some predicting Pyongyang may be seeking large-scale investment projects, the sources said.

Despite the few headways made so far, the sources said many Chinese firms have general reservations about signing contracts because of many difficulties in doing business in North Korea, they said.

(Yonhap News)