China, North Korea Trade Imbalance Deepens


“China is selling more goods to North Korea, but buying less from there – creating a worsening trade imbalance that may deepen Pyongyang’s need for credit from China or cash elsewhere, The New York Times reported.

By Roman Harak via Wikimedia Commons

According to the Times, the steady flow of Chinese goods might be why economic sanctions have had little effect on North Korea — the sanctions cut North Korea’s export income, but it can still get goods from Beijing to keep an urban populace happy.

“My best guess is that North Korea is receiving trade credits from those providing it with goods and services — that is to say, China,” Steve Hanke, a Johns Hopkins University economist, told the Times.

The Times noted that for years, Chinese purchases of coal and other goods gave North Korea a steady source of money.

But that source isn’t so steady anymore, with North Korea buying $2 worth of goods from China in July for each $1 of sales to China and Beijing essentially halting purchases of North Korean coal since mid-February.

North Korea may need to buy even more from China in months ahead because of a drought, the Times reported.”

More details at Newsmax.