According to Yonhap:
North Korea’s mineral exports to China have tripled this year compared to a year ago, a study showed Sunday.
A joint study of Chinese data by Yonhap News Agency and Seoul-based IBK Economic Research Institute showed that China imported 8.42 million tons of minerals from North Korea from January to September this year, worth US$852 million.
Over the first nine months of last year, China brought in 3.04 million tons of minerals from the North for $245 million.
Most of the minerals were anthracite coals, the data showed. This year, of 8.42 million tons, 8.19 tons were anthracites.
China is the sole major ally and the biggest economic benefactor for North Korea, a reclusive regime under international economic sanctions following its nuclear and long-range missile tests.
Cho Bong-hyun, an analyst at the IBK institute, said North Korea may be trying to earn much-needed hard currency as it aims to become a powerful and prosperous country by 2012.
“Last year, North Korea ordered its institutions to meet their goals in foreign currency income by this year,” Cho said. “Since exporting minerals is a military business, we can see that the military is trying to meet its target. In addition, the steep mineral export growth was attributable to the lifting of the cap on the amount of mineral exports, as ordered by North Korean leader Kim Jong-il.”
China appears to be trying to stockpile mineral resources at affordable prices, Cho added. North Korean anthracites were traded at an average of $101 per ton, whereas the international standard for quality anthracites is $200 per ton.
“Given that North Korean coals are of very good quality, trade with China must have been made at a fairly low price,” Cho said.
Meanwhile, sources said North Korean authorities last month entirely halted its coal exports, as the impoverished country fears a shortage of energy resources during the upcoming winter.
From January to September this year, China exported 732,000 tons of minerals to North Korea, most of them crude oil.
Here is the IBK web page. If anyone can find a copy of this report and send it to me to post, I would appreciate it.
1. The economics lessons: A. The more isolated the DPRK’s economy from the global trade and financial system, the greater monopsony power Chinese firms can exert on their North Korean trading partners. B. The rents earned in the current DPRK-China trade regime are visible and have organized constituencies. Unfortunately the much greater gains that could be reaped if the North Korean economy was more open, integrated, and dynamic remain unseen and their potential beneficiaries remain unknown and unorganized.
2. The Nautilus Institute published a very interesting paper by Nathaniel Aden on China DPRK trade back in June. See it here.
Read the Yonhap story here:
N. Korea’s mineral exports to China tripled from last year: study