Archive for the ‘Trade Statistics’ Category

Inter-Korean trade statistics update

Wednesday, August 24th, 2011

According to the Choson Ilbo:

According to the Unification Ministry, 123 firms were operating in the industrial park as of July, with combined production output amounting to US$34.87 million in May, up 25 percent from $27.79 million year-on-year.

The total volume of inter-Korean trade through the industrial park reached $825.88 million in the first half of this year, up 19.5 percent from last year and a whopping 135.8 percent from 2009.

South Korean staff dwindled from 1,461 in 2008, when inter-Korean trade was at its height, to 801 in May this year, but the number of North Korean workers rose from 36,650 to 47,172. And some 3,700 more North Korean workers were hired even since May last year when the South banned new investments there after the North sank the Navy corvette Cheonon in March.

At the moment, the regime is unlikely to shut down the industrial park, since nearly 50,000 North Koreans are working there. But experts stress that the government should take the seizure of the properties in the resort as a warning and be prepared for anything that the regime could do.

“There’s nothing we can be sure of in inter-Korean relations,” said Dong Yong-seung, a researcher at the Samsung Economic Research Institute. “Risk factors always exist because the government launched the Kaesong project without providing any safety net to protect its people and properties, as in the case of the Mt. Kumgang tour project.”

South Korean investments in the industrial park amount to W920 billion (US$1=W1,079) — W540 billion invested by the 123 firms, and W380 billion from the government and public corporations to lay the infrastructure, including electricity and communications facilities, and landscaping.

If the regime shuts down the industrial park, the South would suffer double the losses it incurred from the regime’s seizure of the properties in Mt. Kumgang, which are worth W484.1 billion.

Read the full story here:
Kaesong Firms Worry as N.Korea Seizes Mt. Kumgang Assets
Choson Ilbo
2011-8-24

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DPRK-China launch minerals – for – fertilizer program

Friday, August 19th, 2011

Pictured above (Google Earth): The Musan Mine, the DPRK’s largest.  See in Google Maps here.

According to the JoongAng Daily:

During his surprise May visit to China, North Korean leader Kim Jong-il secured free fertilizer and discounted food to help alleviate the impoverished country’s chronic food shortages.

A source in Beijing who monitors North Korea-China relations told the JoongAng Ilbo on Monday that Chinese officials agreed to provide 200,000 tons of fertilizer free of charge as well as 500,000 tons of corn at a discount in exchange for rights to North Korea’s abundant natural resources.

“When 200,000 tons of fertilizer is planted on North Korean soil, it can bring about a three-fold increase in the harvest,” the source said. “This can be the equivalent of giving 600,000 tons of food.”

The source added that China agreed to sell the 500,000 tons of corn for half of the international rate, which would be $30 per ton.

The corn, the source said, had already crossed the border into North Korea from northeastern China.

In exchange, Kim will allow China access to his country’s natural resources.

“The two parties agreed to participate in the extraction of buried rare earth minerals in Musan in Hamgyong Province,” the source said. “It’s quite a profit for China as it is thirsty for materials.”

North Korea is estimated to have around 20 million tons of rare earth minerals, which are vital in the production of high-tech goods.

The Beijing-based source said the agreement gives China the responsibility for the cost of building roads to transport the natural resources as well as lending equipment.

In exchange, North Korea will hand over 50 percent of the extracted rare earth minerals free of charge to China, with the rest to be sold to China at international market rates.

Meanwhile, other sources said that Kim also received a health checkup during his stay in China.

“When Kim Jong-il was visiting Yangzhou, he received a special examination from an oriental medicine doctor that the highest Chinese elite have gone to over the years,” a source familiar with North Korean issues said

The source added: “Kim Jong-il has never trusted China’s Western medicine. I heard from a Chinese official that Kim received an oriental medicine diagnosis by taking his pulse and that it did not involve drawing blood.”

Additional Information:

1. Here is a post linking to all the major DPRK food stories this year.

2. The media has reported on other DPRK food barter deals with Cambodia and Myanmar.

3. The role of the Musan Mine in DPRK-PRC relations has been quite interesting.  Here are previous posts on the mine.

Read the full story here:
North got fertilizer on Kim’s trip to China
JoongAng Daily
Chang Se-jeong
2011-8-19

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Inter-Korean trade volume for the first half of 2011 reached US$830 million

Wednesday, August 17th, 2011

Institute for Far Eastern Studies (IFES)
2011-8-11

Despite the current impasse in inter-Korean relations, the trade volume in the Kaesong Industrial Complex (KIC) continues to rise, up about 20 percent against last year.

According to the ROK Ministry of Unification, the inter-Korean trade via Kaesong totaled 825.88 million USD in the first six months of 2011. In comparison to last year’s 691.09 million USD, this is a 19.5 percent increase (134.795 million USD) and a whopping 135.8 percent climb (475.64 million USD) from 2009.

The total import reached 444.98 million USD, up 36.4 percent from last year. The total export recorded 389 million USD, a slight increase of 4.3 percent.

As of June 2011, there are about 123 companies reported to be in Kaesong. A total of 560 South Korean staffs work in the KIC, 155 of which joined since June of last year. There was also a boost in the number of North Korean workers; 3,161 new workers joined the complex from the year before, making the current number of North Korean employees 47,172.

In comparison, both commercial trade including general trade (mineral and agricultural products) and noncommercial trade such as humanitarian assistance and socio-cultural exchanges dwindled 16.2 percent (161.34 million USD) from the previous year.

The figure suggests the plunge was triggered by the sanctions imposed by the South Korean government on North Korea since May 24 of last year — a response to North Korea’s deadly provocation in March 2010 — cutting off most of the humanitarian assistance and exchanges. According to the ministry of unification, before the sanctions went into effect, general trade that comprised 30 percent fell below 1 percent and humanitarian assistance became nonexistent.

According to a recent survey conducted in the complex, economic loss engendered by the May 24 sanctions are estimated to be 3.875 billion USD. Out of the 154 total economic cooperation and trade firms in Kaesong, 104 claimed to have suffered economically, totaling over 430 million USD in losses.

The survey was conducted from January 24 to March 25 with 154 firms: 79.2 percent indicated the recent sanctions have significantly impacted their businesses; 3.2 percent answered “a little” effect; none answered “no effect at all.”

Moreover, 78.6 percent responded that the sanctions led to interruption in business operations and 12.3 percent replied that the sanctions resulted in complete shutdown.

In addition, reduction of staffs was also linked to the sanctions, in which 34.4 percent reported to have downsized by 20 percent, while 26.7 percent reported 30 to 40 percent cut backs in the number of staff.

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DPRK grain imports from China in first half of 2011

Sunday, August 14th, 2011

According to Yonhap:

North Korea imported more corn and less rice from China in the first half of this year than in the same period a year ago apparently due to a lack of foreign cash, a study showed Sunday.

North Korea’s grain imports from the neighboring country in the six-month period consisted of 38.2 percent corn, 37.5 percent flour, 16.9 percent rice and 7.2 percent beans, according to an analysis of the two countries’ trade by Kwon Tae-jin, vice president of the Korea Rural Economic Institute.

Last year, the figures stood at 34.2 percent flour, 28.8 percent corn, 19.3 percent rice and 16.4 percent beans, indicating an overall increase in imports of cheaper grains such as corn and flour this year, according to the study based on data from the Korea International Trade Association. Imports of rice and beans, meanwhile, fell from the same period last year.

This year, imports of beans cost $661 per ton on average, while a ton of rice, flour and corn sold for $538, $395 and $304, respectively.

The total amount of grain imports rose 5.5 percent to 149,173 tons, up from 141,395 tons in the first half of last year, apparently reflecting food shortages in the impoverished nation, the study said. Grain imports cost US$404 per ton on average, up 8.6 percent from $372 last year, bringing the total cost to $60.3 million, or 14.4 percent more than last year.

“The amount of grain imports last year was larger than in most years, but the fact that (North Korea) imported even more this year seems to indicate a shortage of food,” Kwon said in his study. “The larger imports of corn than beans or rice appears to be the result of a lack of foreign currency.”

Meanwhile, North Korea also boosted its imports of fertilizers by 91 percent in the first half of this year, buying a total of 190,396 tons compared with 99,588 tons in the same period last year. The country bought more than 164,000 tons of ammonium sulfate, which is sold at $188 per ton, while only importing some 25,000 tons of urea for $346 per ton.

“It seems like either fertilizer production in North Korea has dropped significantly, or they are aiming to boost their food production by a large amount,” Kwon said.

The Daily NK also published a story on these findings.

Read the full story here:
Lack of foreign cash forces N. Korea to buy more corn, less rice
Yonhap
2011-8-14

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On the demand for DPRK-made missiles

Tuesday, July 26th, 2011

UPDATE 3 (2011-9-27): The Center for Nonproliferation Studies hosted a panel discussion on Mr. Pollack’s report.  You can see all the presentations here.

UPDATE 2: The Washington Post has recently covered this study.

UPDATE 1: 38 North has published an article by Mr. Pollack which provides an interesting narrative of the market for North Korean missiles.

ORIGINAL POST: The Choson Ilbo published the following:

Forty percent of ballistic missiles developing nations have imported since 1987 came from North Korea, VOA reported Thursday.

The claim comes in a report titled “The Evolution of North Korea’s Ballistic Missile Market” by Joshua Pollack, a nuclear proliferation expert at the U.S. Science Applications International Corporation, who says, “More than 40 percent of the roughly 1,200 theater ballistic missile systems supplied to the developing world between 1987 and 2009 came from North Korea.”

During this period Iran, Egypt, Syria, Libya, Yemen, the U.A.E., and Pakistan imported missiles from the North. The North topped the list of ballistic missile suppliers, followed by Russia (400) and China (270).

But the North’s missile export began declining rapidly in 1994.

North Korea’s time as supplier of “complete missile systems” to the Middle East at large ended because the Middle East no longer had the need for rapid arms buildup and missile stockpiles after the end of the Iran-Iraq War, Pollack said.

The North proved “adaptable to shifting market and security environments” by “turning instead to the export of missile components and materials.” But missile importers had less demand for North Korean missiles as they built their own production capabilities, he added.

Pollack’s report was carried in the July issue of The Nonproliferation Review published by James Martin Center for Nonproliferation Studies at Monterey Institute of International Studies.

Mr. Pollack’s full report can be found here (PDF). It is well worth reading. Mr. Pollack is also a blogger at ArmsControlWonk.com.

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DPRK’s import of luxury goods and estimated trade data

Wednesday, July 20th, 2011

UPDATE 2 (2011-7-20): The Daily NK offers some more statistics:

It has been confirmed the North Korean authorities were concentrating on importing luxury items for privileged people, while international humanitarian organizations were worrying about North Korea’s chronic food shortage and the damage to the vulnerable classes.

According to statistics from the South Korean government and Chinese customs, from January to May this year, the cost of food import is only about 4% out of the total amount of imports, which translates to about 46 million dollars out of 1.148 billion dollars.

The total amount of trade with China was doubled as compared with the corresponding period from last year: exports were increased by 217% and imports by 58%. The export amount is 812 million dollars while the import is 1.148 billion dollars.

In comparison, around 10 million dollars were used to purchase high quality liquor, cigarettes and others for privileged classes. The amount of cigarette imports, such as Marlboro, Mild Seven and others, is 7.5 million dollars. 2.4 million dollars were used to buy Cognac or whisky like Chivas Regal, Hennessy X.O. and other kinds of alcohol.

The amount of alcohol imported was increased by 94 % compared to the same period of last year.

It was reported that other items, such as international designer brands clothes, watches, and other items and electronic goods from SONY and Samsung were also imported.

It also showed that North Korean authorities sold wheat it had received from the international community to other countries. 200,000 tons of phosphate rock, which is materials for fertilizer, provided by Middle Eastern countries for free in 2010, were sold to some countries in Europe.

In addition, since South Korean markets have been blocked due to May 24 Measures, North Korea tried to download agricultural products, which are disguised as Chinese products, onto South Korean vessels in international waters by secretly working with Chinese traders. The South Korean government reported that there were four cases last year and 11 cases so far this year.

So apparently everyone has seen the data source but me.

UPDATE 1 (2011-7-22): The Los Angeles Times picked up on the report and offered a few more details:

North Korea’s importing of luxury goods from China nearly doubled in the first five months of this year, compared with the same time period for 2010, according to a report by Beijing customs officials obtained by the South Korean Unification Ministry.

The communist regime spent $46 million on imported corn, rice and other food staples, but it also spent $10 million on luxury items from January through May of this year. Imported through China, the items reportedly include Marlboro cigarettes, Hennessy cognac, whiskey and Japanese beer, South Korean officials said this week, quoting the Chinese customs report.

The imports included about $500,000 worth of high-grade beef, apparently for luxury meals, which North Korean leader Kim Jong Il uses to maintain the support of the power elite, Seoul officials said.

This year, the regime again requested food aid, citing reduced crop yields. Though the European Union plans to send $14.5 million in food aid, the United States and South Korea have been reticent to supply such aid.

Some scholars believe that North Korea has exaggerated its need for food, alleging that the aid is turned over to the military or stored for future use, such as a planned celebration next year to mark the anniversary of the regime.

“I do not believe these claims about mass starvation,” said Andrei N. Lankov, a professor at Kookmin University in Seoul and the author of several books on North Korean history and politics.

He called the move by Pyongyang “a deliberate campaign to get free food, which will then be distributed to the privileged groups as government gifts. This will allow them to increase their legitimacy and win some popular support at the expense of the Western and South Korean taxpayers.”

I still have not seen the original Chinese source.  If anyone has it, please send it my way.

ORIGINAL POST (2011-7-20): Yonhap cites an unnamed South Korean government official (anyone want to take credit for these statistics?) who claims that the DPRK is skirting UN sanctions and obtaining luxury goods.  According to the article:

Despite years of food shortages, North Korean leader Kim Jong-il has engaged in the gift politics of showering his top aides and other elites with luxury goods to win their loyalty.

Some ruling elites also enjoyed McDonald’s hamburgers delivered from China via Air Koryo, North Korea’s flagship airline, the official said, without elaborating.

The North also spent about US$7.5 million in buying cigarettes such as Marlboro and Mild Seven in the first five months, a rise of 117 percent compared to the same period last year, according to figures by South Korea and China. It also showed that the North imported $2.4 million worth of Hennessy Cognac, whiskey and Japanese beer, up 94 percent compared to the same period last year.

The trade volume between North Korea and China stood at US$1.96 billion in the first five months, twice as much as in the same period last year, according to Lee.

Since the article does not name a source or provide any way to track down the numbers, take them with a grain of salt.

Read the full story here:
N. Korea imports luxury goods for ruling elites despite food shortages
Yonhap
2011-7-20

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Kaesong wages set to increase (2011)

Friday, July 15th, 2011

UPDATE 1 (2011-8-10): Wages of North Korean workers in Kaesong Industrial Complex set to rise 5% for the fifth consecutive year. According to the Institute for Far Easter Studies (IFES):

The minimum wage for North Korean workers at the Kaesong Industrial Complex (KIC) has risen annually at a rate of 5 percent since 2007. The year 2011 stands to mark the fifth consecutive year that such an increase has occurred.

Recently, the steering committee for the KIC and South Korean and North Korean authorities reached an agreement to accept a 5 percent wage hike for North Korean workers at the complex. Accordingly, as of August 1, 2011, North Korean workers at the KIC should earn USD 63.814 rather than USD 60.775 in monthly wages. South Korean authorities, as an exchange for accepting the North Korean demand for a wage increase, requested that productivity be elevated via the adoption of a more efficient method of worker placement.

At the meeting, the Kaesong Industrial District Management Committee, representatives of companies in the complex, and the head of corporations were in attendance and reached an agreement to form a task force specifically for the improvement of productivity of workers. While the overall output of the KIC has increased, the output per worker has not improved, leading to the decision to establish the task force, with the goal of enhancing the competitiveness of the complex.

The minimum monthly income of USD 60.775, which kicked in last August, remained in effect until July 31 of this year. The Labor Law of the KIC caps the wage increase at 5 percent; a 5 percent increase to the minimum wage this year would elevate the minimum monthly wage for workers to USD 63.814.

At the meeting, North Korea mentioned international wage levels and made demands for a wage hike of more than the upper limit. However, most of the companies that operate in the KIC adamantly oppose such demands.

Despite the May 24 sanctions implemented by the South Korean government after the March 2010 sinking of the ROK navy corvette Cheonan, the growth of the KIC has continued. The trade volume has increased by 24.23 percent while the production output has increased by 26.1 percent compared to the same period last year.

Although the eight-year old Kaesong Industrial Complex boasts its competitiveness against other industrial complexes in China and Vietnam, it still has many challenges that must be resolved, including employment flexibility and incentive system.

From the institutional perspective, there are many tax benefits that Kaesong offers that industrial complexes in China and Vietnam do not. For example, the enterprise profit tax in Kaesong is at 14 percent. In contrast, China and Vietnam abolished the preferential treatment for foreign companies in 2008 and 2009, respectively; they currently apply a 25 percent of enterprise profit tax to both domestic and foreign companies. Even in terms of labor and wages, the KIC would appear to offer better quality of labor. In addition, the labor productivity of the KIC is comparable to 71 percent of South Korea, which is much higher than that of China’s Qingdao Industrial Complex (60 percent) and Vietnam’s Tanttueon Industrial Complex (40 percent).

Another advantage is the KIC’s favorable geographical proximity to South Korea, which helps reduce distribution costs and time. This advantage helps to reinforce the sales competiveness of the companies in the complex. In addition, the KIC has sufficient potential for expansion into markets in China, and domestic markets in South and North Korea.

On the other hand, Kaesong has relatively low flexibility of employment due to the principle of indirect recruitment. Difficulties in applying an incentive system are also a disadvantage of the KIC.

ORIGINAL POST (2011-7-15): Kaesong wages set to increase. According to Yonhap:

The minimum wage for workers at the inter-Korean industrial park in the North Korean border town of Kaesong is likely to rise 5 percent this year, the same annual rate of increase since 2007, industry sources said Friday.

More than 46,000 North Koreans work at about 120 South Korean firms operating in the complex, despite the South’s suspension of all other economic ties with the North over the deadly sinking of a South Korean warship last year. The local workers currently earn a minimum monthly income of US$60.775 following a 5 percent increase that took effect last August.

This year’s new minimum rate goes into effect next month after negotiations between the factory park’s management officials from the two sides. Under the park’s labor regulations, the minimum wage can increase only up to 5 percent from the previous year.

“The North Koreans are demanding an increase of more than the upper limit (of 5 percent), citing wage levels in other parts of the world,” said an official from one of the South Korean firms in Kaesong. The person spoke on the condition of anonymity.

“In effect, this is equivalent to demanding a wage rise of 5 percent,” the official said, adding that the businesses operating in the joint industrial park had tentatively agreed to accept the demand. After the increase, the North Korean workers will earn $63.814 monthly.

Meanwhile, production at the industrial zone has continued to grow, according to recent data. The park’s output of clothes, utensils, watches and other goods rose 26.1 percent last year from 2009. Since its opening in 2004 under former liberal South Korean President Roh Moo-hyun, the complex has served as a source of tens of millions of dollars for the cash-strapped North annually.

Read the full story here:
Minimum wage for N. Koreans in Kaesong likely to rise 5 pct
Yonhap
2011-7-15

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China cracking down on DPRK-made methamphetamine

Thursday, July 7th, 2011

Picture above from the Daily NK.

According to the Donga Ilbo:

China has begun cracking down on North Korea`s narcotics trade in China along with South Korean intelligence, having seized 60 million U.S. dollars worth of drugs from the North last year, according to a South Korean government source Monday.

“It’s only a fraction. The volume of drug trafficking in China will be much greater than that,” the source said.

This is the first time for China to unveil the volume of narcotics made in North Korea.

Beijing had been reluctant to raise the matter in public though it found Pyongyang`s increased drug trafficking as a threat. China diplomatically protects the North in nuclear issues but started a crackdown with South Korea apparently because it can no longer tolerate the North`s narcotics, which threatened China`s three northeastern provinces bordering the North.

The drugs seized by Beijing are said to have the best quality, going beyond the level individuals can produce. So Pyongyang is considered to be manufacturing narcotics on the national level at factories.

“China is pretty much pissed off,” a diplomatic source said, adding, “China believes that North Korea’s drug trafficking has grown more serious since last year.”

Though Beijing did not specifically mention the North when it stressed a crackdown on drugs, it implied North Korean-made narcotics.

In a previous post, we linked to a Newsweek story on the Chinese crackdown:

Twenty years ago, Yanji had only 44 registered drug addicts. Last year, the city registered almost 2,100 drug addicts, according to a 2010 Brookings Institution report, with more than 90 percent of them addicted to meth or similar synthetic drugs. Local officials acknowledge that this is very likely a gross undercount and that the actual number may be five or six times higher. “Jilin Province is not only the most important transshipment point for drugs from North Korea into China, but has itself become one of the largest markets in China for amphetamine-type stimulants,” the Brookings report said.

Chinese authorities recently conducted a provincewide crackdown, code-named Strong Wind. But for law enforcement, the drug presents a particular problem. Unlike other drugs, it’s nearly impossible to trace the origin of meth. Still, officials, residents, and experts believe that much of the methamphetamine consumed in this Chinese region is manufactured across the border in North Korea, a longtime exporter of drugs. “Clearly,” the Brookings report said, amphetamine-type stimulants “from North Korea have become a threat to China in recent years.”

In an article published last year, Cui Junyong, a professor at Yanbian University’s School of Law, posited that a large amount of the illegal drugs ingested in Yanji came from North Korea. Supporting his point, the border patrol last year arrested six North Koreans in a high-profile bust, including a dealer named “Sister Kim.” Although sources estimate that a gram of meth in North Korea costs roughly 10 times the price of a kilo of rice—about $15—it’s still much cheaper than in China.

“Selling ice is the easiest way to make money,” says Shin Dong Hyuk, who was born in a North Korean concentration camp in 1982 and escaped to South Korea in 2005. Every defector, he added, “knows about ice.”

Perhaps because of its alliance with its benighted neighbor, the Chinese government has been extremely careful about pointing its finger at North Korea; reports on drug busts in Jilin province euphemistically refer to the drugs as coming from a “border country.”

“We don’t publicize” the drugs coming from North Korea because it would touch on “the good relationship between China and North Korea,” an official, requesting anonymity, from Jilin’s anti-drug unit says. But he adds, “Of all the drugs we’ve seized this year, it’s mostly been ice, because that’s our main drug here.”

According to Yun and others, North Korea’s methamphetamine production is centered in Hamheung, the site of a chemical-industrial complex built by the Japanese during World War II, which has a high concentration of chemists and was reportedly one of the worst-hit cities during the famine.

Earlier this year, a US Department of State report to the Congress alleged that the DPRK’s state-sponsored drug production was on the wane–though “private” production and trade along the Chinese border remained a problem.  According to one report:

In an annual report submitted to Congress, the US State Department said “no confirmed instances of large-scale drug trafficking” involving the North Korean state or its nationals were reported in 2010.

It said there was not enough information to confirm that the communist state was no longer involved in drug manufacture and trafficking “but if such activity persists, it is certainly on a smaller scale”.

This is the eighth consecutive year that there were no known instances of large-scale methamphetamine or heroin trafficking to either Japan or Taiwan with direct North Korean state involvement, it said in the 2011 International Narcotics Control Strategy Report.

“The continued lack of public reports of drug trafficking with a direct DPRK (North Korea) connection suggests that such high-profile drug trafficking has either ceased or been sharply reduced,” the report said.

The report said, however, that trafficking of methamphetamines along the North Korea-China border continues and press reports about such activities have increased in comparison to last year.

“These reports… point to transactions between DPRK traffickers and large-scale, organised Chinese criminal groups” in locations along the border.

“Press reports of continuing seizures of methamphetamine trafficked to organised Chinese criminals from DPRK territory suggest continuing manufacture and sale of DPRK methamphetamine,” the report said.

This and continued trafficking in counterfeit cigarettes and currency suggests that “enforcement against organized criminality in the DPRK is lax”, it added.

Additional Information:
1.  Back in March, Andrei Lankov wrote about this situtaion.

2. Earlier this year, the DPRK arrested some Japanese men in Rason for “trafficking and counterfeit”.

3. In June, China intercepted a meth shipment from the DPRK.

4. Marcus Noland also has posted on this topic.

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DPRK trade update: China (up), South Korea (down)

Thursday, July 7th, 2011

UPDATE 1 (2011-7-13): Marcus Noland wrote some comments on the DPRK’s trade with China:

In an earlier post we argued that North Korea’s trade dependency on China, while large and rising, is frequently exaggerated in public discussions. According to press reports, the Korean Development Institute has apparently gone some way in rectifying this situation, determining that China accounts for 57 percent of North Korea’s trade—a far cry from the 80 percent derived from the KOTRA figures that ignore North-South trade, yet still well above the 30-40 percent we obtain on the basis of IMF figures. Like KOTRA, the KDI figures appear to be missing trade—their overall estimate for total North Korean trade, approximately $6 billion, is well below the $8-11 billion reported in recent years by the Fund. Those figures are not unimpeachable—just take a look on our recent posting regarding their FDI data, but it is striking that the numbers diverge by such large margins.

ORIGINAL POST(2011-7-7):

Trade with China: According to the APF (2011-7-6):

North Korea’s reliance on China for trade deepened last year after South Korea severed most ties with Pyongyang, accusing it of torpedoing of one of its warships, a think-tank said Wednesday.

The state Korea Development Institute said in a report the North’s trade with China was worth $3.47 billion last year, up 29.3 percent from a year earlier.

Such trade accounted for 56.9 percent of its total trade of $6.09 billion last year, up from 52.6 percent in 2009.

The trend intensified this year, with the value of North Korea-China trade nearly doubling to $1.43 billion during the first four months from the same period a year earlier.

This was mainly due to a sharp rise in the North’s coal exports, the institute said.

In contrast, the North’s exports to South Korea plunged from an average $40 million per month in January-May last year to a mere $1 million per month in the first four months of this year.

“The North drastically expanded exports of such strategic materials as coal to China” after its trade with the South was almost cut off, the report said.

This sudden surge in exports contributed to energy shortages in the North during the past winter.

Here is the report home page (Korean). Here is the report (Korean-PDF)

Trade with South Korea: According to Yonhap:

Trade between South and North Korea shrank more than 14 percent in a year following economic sanctions imposed on the North in retaliation for its sinking of a South Korean warship, the Unification Ministry said Sunday.

Total inter-Korean trade dropped to US$1.73 billion in the year spanning from June last year to May this year, declining 14.41 percent from $2.02 billion in the same June-May period a year earlier, according to the ministry.

The decline came after the sitting Lee Myung-bak administration declared on May 24 last year its resolution to bring the North’s March 26 sinking of the South Korean warship Cheonan to the United Nations Security Council.

The South also imposed economic sanctions on the North in reaction to the ship attack that killed 46 crew members. The North has denied responsibility for the attack.

General trade and processing trade, in which North Korea imports resources and manufactures them to re-export to the South or another country, plunged 76.45 percent to $165.9 million during the cited period, the ministry said. Both of the trade types have been banned since the May resolution.

Inter-Korean trade has shown an even steeper downtrend since the beginning of this year as pre-paid manufacturing orders, which were exempt from the trade ban, nearly came to an end, according to the ministry.

During the January-May period, cross-border trade stood at $685.2 million, down 21.5 percent from the same five-month period last year, it said.

However, the volume of trade via the Kaesong industrial complex, an inter-Korean joint economic project, rose 24.2 percent to $1.55 billion over the past year, the ministry added.

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Some publications and reports

Tuesday, July 5th, 2011

Below are some very interesting reports and publications. All well worth reading:

Foreign Assistance to North Korea
Congressional Research Service (CRS)
Mark E. Manyin, Mary Beth Nikiti
Download here (PDF).  See other CRS reports on the DPRK here.

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U.S.-DPRK Educational Exchanges: Assessment and Future Strategy
The Freeman Spogli Institute
Edited by: Gi-Wook Shin, Karin J. Lee
Read the whole book  here (PDF)

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Beyond Good Intentions: The Challenges of Recruiting Deserving Young North Koreans
38 North
Goffrey See, Choson Exchange

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