North Korea’s external trade volume reached a record high of U.S. $7.34 billion dollars in 2013, Business Korea reported on Thursday, citing a report published on Wednesday by the Korea Trade-Investment Promotion Agency (KOTRA).
The figure amounts to an increase of 7.8 percent from the previous year, and is attributed to increased exports of coal, iron ore, copper and aluminium, as well as textile and clothing goods. Imports of electricity, transportation machinery and grains make up the bulk of import increases, the report added.
North Korean exports increased 11.7 percent to 3,22 billion dollars, while imports increased 5 percent to 4.12 billion dollars, slightly decreasing the trade deficit from U.S. $1.05 billion dollars (2012) to U.S. $980 million dollars.
Long-time North Korea watcher Andrei Lankov said that the figures are credible, “since the data is, essentially, ‘mirror statistics’, based on reports of China and other trade partners of North Korea”.
While the absolute trade volume is a record high, Lankov said that the growth itself shouldn’t be taken as too sensational. “We have seen same – and much bigger – increases before,” he said, citing a 32 percent year-on-year increase between 2010 and 2011.
Commenting on the data, Andray Abrahamian of Choson Exchange said that the figures need to be taken with a grain of salt, noting that KOTRA in the past have taken “huge leaps of faith in guessing prices as well as sometimes randomly excluding statistics from some countries”. Notably, the latest figures also do not include inter-Korean trade.
All in all, however, he said the data corresponds well “with what one sees in the capital: namely more wealth is being created and the affectations that accompany it have become quite visible”.
CHINA ON TOP, RUSSIA INCREASING
Chris Green, manager of international affairs with the Daily NK, said that the driving force behind the growth rate was “the near-monopoly position of China in the market for North Korean exports, which means the exports are either under-priced or attractively priced, depending on which side of the fence you happen to be sitting.”
The bulk of North Korea’s foreign trade in 2013 was indeed with China, according to the report (89.1 percent), with imports and exports amounting to 2.91 and 3.63 billion dollars, respectively.
Despite international sanctions against North Korea, trade with China has been growing steadily since 2005, when exchanges between the two countries accounted for about half of the North’s external trade.
Exports of mineral resources such as coal and brown coal increased 14.9 percent to 1.43 billion dollars and accounted for 44.4 of total exports. Most of these goods were shipped through China, the report said.
RUSSIA OFF-SETTING CHINA?
Trade between North Korea and Russia also increased 37.3 percent, making Russia the second biggest trade partner for the North, followed by India, Thailand and Singapore.
The report said that North Korea “is likely to focus on the amelioration of bilateral relations with Russia to address its dependence on China.”
“We’ll see if this is sustained in the coming year as the DPRK has been actively courting Russian involvement it its economy,” Abrahamian said, noting recent activity in Russia-North Korea relations focusing on economic cooperation.
Economic exchanges with Russia have been increasing rapidly since the opening of the Rajin-Khasan railway link in September last year, and Russian and North Korean authorities have recently made headway on further economic cooperation with a series of high-level bilateral visits.
Asked whether growth in trade volume will be noticed on the ground by average North Koreans, Chris Green said that “since much of current investment in services is taking place in Pyongyang, one can say that it is helping some of the North Korean people”.
“But the trickle-down effects are very limited, and everyone knows that a significant proportion of the population is deliberately excluded from access to whatever affluence as might accrue from this”.
Picture: NK News, Rason SEZ.
Chad O’Carroll contributed reporting
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