Joong Ang Daily
Hwang Young-jin
5/15/2007
North Korean trade with the EU and Japan went into a free fall last year, but China helped pick up the slack.
Missile and nuclear tests interfered with North Korean trade in 2006, leading to the country’s first decrease in five years, a report from the Korea Trade-Investment Promotion Agency said. Decreases in trade with the West caused by political problems were the biggest culprit, the agency said.
North Korean exports to Japan fell 41 percent while imports from Japan dropped 30 percent. Trade with the European Union went down 23 percent in exports and 18 percent in imports. The European Union and Japan are the world’s first- and third-largest economies. Trade with the world’s second-largest economy, the United States, was practically zero.
But trade with China, the nation closest to the North politically and geographically, served as a buffer to reduce the impact of the large drops in European and American trade, so the North’s overall trade figures didn’t change much, the agency said.
Almost 60 percent of North Korea’s trade is conducted with China. The North’s next-biggest trade partner was Thailand, which accounted for 12.5 percent.
The communist country’s trade volume in 2006 fell 0.2 percent, with exports dropping 5.2 percent to $947 million and imports increasing 2.3 percent to $2 billion. Trade has been growing since the start of the new millennium. In 2005, the total trade topped a record $3 billion.
With an international economic blockade in place, trade relations with Japan and the European Union got worse.
The Kotra report said the Feb. 13 agreement reached during the six-nation talks in Beijing regarding the nuclear issue is a positive signal for the recovery of North Korean trade, but it is up to North Korea whether to act on its commitments and allow trade to recover.
Inter-Korean trade was not considered in yesterday’s report. Trade between the two Koreas reached $1.3 billion in 2006, a 28 percent rise year-on-year. The South sold $830.1 million and bought $519.5 million.
