"COVID-19 and Pressure on North Korea's Economy... Increased Pressure to Return to Nuclear Negotiations"
[Asia Economy Reporter Jeong Hyunjin] Bloomberg reported on the 11th (local time) that North Korea is facing setbacks in economic recovery after closing its border with China to prevent the spread of COVID-19.
Bloomberg cited the US North Korea specialist media NK News, reporting that following North Korea's first confirmed COVID-19 case, fuel prices have risen, port activities have decreased, and train and airline routes have been suspended. In recent days, with the introduction of new quarantine procedures in North Korea, diesel prices have surged by 36%, and ship activity at Nampo Port has also declined.
With the border closure, foreign tourism, which was a channel for foreign currency inflow into North Korea, has stopped, and trade with the outside world is expected to be restricted, Bloomberg analyzed. In particular, it forecasted that if the economic crisis continues due to the border closure, pressure from the US urging North Korean State Affairs Commission Chairman Kim Jong-un to return to the nuclear negotiation table will intensify again.
Before the spread of COVID-19, North Korea's economic situation had shown signs of improvement. The United Nations Conference on Trade and Development (UNCTAD) estimated that North Korea's economy, which experienced its worst recession in 2018, grew by 1.8% last year. As exports to China increased, North Korea's trade volume and economic activities also grew. According to a report from the UN Security Council's North Korea Sanctions Committee released the previous day, North Korea exported at least $370 million (approximately 439 billion KRW) worth of coal last year.
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However, Bloomberg predicted that if North Korea fails to secure sufficient funds to promote economic development due to the border closure, it will become difficult for the country to refuse the US demand to return to denuclearization negotiations.
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