Virus shuts North Korea’s best route around Trump sanctions
By: Sam Kim and Jon Herskovitz | Feb 12 2020 at 12:30 AM | International Trade
North Korea’s decision to shut the border with China to avoid the coronavirus will set back its nascent economic recovery, renewing pressure on Kim Jong Un to return to nuclear negotiations with Donald Trump.
A jump in fuel prices, a dip in port activity and the suspension of train and air links show the early impact as reports emerge of the first virus case in North Korea. In recent days, Seoul-based NK News reported a 36% jump in diesel prices and diminished activity at the port of Nampho, along with new quarantine procedures.
The closed borders will cut off foreign tourism that provides the cash-starved state with hard currency and further limit the trickle of trade it has with the outside world. The economic blow—if sustained—might make it tougher for Kim to keep pushing back against Trump’s demands.
Before the virus complicated matters, things had been looking up: Reforms, a bumper harvest and sanctions-dodging were helping North Korea claw back some of the lost growth triggered by tougher United Nations trade restrictions and a drought.
The UN Conference on Trade and Development estimated that the economy expanded by 1.8% last year, following its biggest slump in decades in 2018. That view tallied with a surge in China’s imports that suggested an increase in economic activity and trade.
Global sanctions piled on North Korea in 2017 for its nuclear and missiles tests have slammed its trade and access to vital resources such as oil. That hasn’t stopped Kim from building his nuclear arsenal and finding ways to evade the economic restrictions, such as the illegal trading of commodities via high-seas transfers between ships, the U.S. and others have said……
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