May 29, 2018

North Korea continues to raise foreign currency despite sanctions

Featuring ​Neil Bhatiya

Source: Financial Times

Journalist Don Weinland

North Korea’s trade deficit with China has ballooned, raising questions on how the reclusive state has been able to continue to generate foreign currency reserves despite the sanctions imposed against it.

The deficit with China hit $1.9bn in 2017, a 141 per cent increase on the year before and the largest deficit with its neighbour in at least 17 years, according to data compiled by Aberdeen Standard Investments.

China’s imports from North Korea in 2017 fell to $1.7bn, a six-year low, while North Korean imports from China rose by about 6 per cent on the year before to $3.6bn, the data showed.

While a planned meeting between North Korean leader Kim Jong Un and US President Donald Trump in June could signal a loosening of sanctions on Pyongyang, the current restrictions are supposed to prevent it from carrying out a wide range of dollar-generating trade with other countries.

In spite of those restrictions, the regime has managed to continue raising foreign exchange to pay for imports from China, confounding economists following the country’s balance of trade.

Read the Full Article at Financial Times

  • ​Neil Bhatiya

    Research Associate, Energy, Economics, and Security Program

    Neil Bhatiya is the Research Associate for the Energy, Economics, and Security Program at the Center for a New American Security. His work focuses on the geopolitics of energy...