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N. Korea-China trade declines again

N. Korea-China trade declines again

SEOUL: Trade figures between North Korea and China have declined, but an expert maintained that their economic relationship will not be further influenced by the recent nuclear test. According to the Korea International Trade Association (KITA), the amount of exports and imports between North Korea and China has declined for the second year in a row.

From January to November last year, North Korea’s exports to China decreased 12.3 percent to $22.79 billion and imports declined 16.8 percent to $26.29 billion compared to the previous year during the same time period.

The year-on-year rate also marked the lowest amount of exports and imports between the two since 2009. Imports of rice from China dropped 74 percent to $886.6 million. Also, exports of anthracite went down 6.3 percent to $9.63 billion.

“There are primary reasons why the total amount of trade has been decreased. Firstly, the world price of mineral resources has declined,” said Lim Eul-chul, a researcher from the Institute for Far Eastern Studies told NK News.

Lim also said if the volume of trade is the same as in the previous year, the total amount of trade would be diminished due to the decrease in the global price of mineral resources which are the main items North Korea has usually exported.

“Even though the official trade statistics between the two have followed a negative trend, there are lots of illicit trade activities which cannot be counted, so the smuggling trade can cover the decrease in official statistics,” Lim said.

“Another reason is a Chinese slowdown in economic growth, so China’s demand for North Korea’s raw materials needed for construction has diminished,” Lim Kang-Taeg, researcher at the Korea Institute for National Unification (KINU), told NK News. However, Lim said it is hard to say that their trade has dramatically dropped as of yet because recent trade activities are still greater than early 2010.

As for the North’s fourth nuclear test, Lim forecast that China will to express their discomfort but said its actions would likely by symbolic rather than practical and detailed. Lim said that over the last few years North Korea’s third nuclear test influenced their relations, but had little effect on their volume of trade.

“China will not participate in the international community’s sanctions towards North Korea. They will autonomously impose sanctions, but will adjust the degree of sanctions to avoid leaving North Korea’s economy in severe condition,” Lim said. According to Korean Statistical Information Service (KOSIS), North Korea’s degree of dependence upon trade with China was 89.1 percent in 2013 and 90.2 percent in 2014.