North sanctions to cut exports in halfNorth Korea’s exports are expected to fall by half due to sanctions from the United Nations Security Council, according to a report released by the Korea International Trade Association (KITA) on Tuesday.
Under the international sanctions, Pyongyang’s seven key exports have been banned from being shipped out of the country following the regime’s fourth nuclear test and launch of a long-range rocket.
The North also cannot import aircraft fuel that might be used for military purposes.
The seven restricted products - coal, iron ore, steel, gold, titanium ore, vanadium ore and rare earth materials - accounted for a whopping 44.9 percent of the country’s total export sales in 2014, at $1.5 billion.
Among the seven, restrictions on coal will bring about the greatest losses because it accounted for 34.2 percent of the North’s total exports as of 2014, followed by iron ore (6.6 percent), steel (3.9 percent) and gold, titanium ore and vanadium ore (less than 1 percent).
If the sanctions are in place for long enough, the slashed supply of foreign currency will deal a serious blow to the North’s economy and industrial operations, the report said.
Following such sanctions, analysts forecasted that the North might try to ramp up exports of unrestricted products such as clothing, or promote tourism packages around the capital city of Pyongyang.
“However, unstable supplies of electricity, technological difficulties and financial burdens in the country will stand as barriers for accomplishing such measures,” a KITA spokesman said.
Another important factor that might influence the power of the sanctions is how China responds.
China has been the North’s greatest ally and also its largest export destination for years. In fact, 86.1 percent of the North’s exports were made to China in 2014, and the North’s dependency on the Chinese economy has been increasing over the last five years. As a result, China has typically been reluctant to impose measures that could devastate the North’s economy.
BY KIM JEE-HEE [email@example.com]
More in Economy
Public sector job growth outpaces private sector growth
Exports up 10.6 percent in first 20 days of 2021
Down with the Cptpp!
Biden presidency good news, bad news for businesses
Trillions of support promised ahead of Lunar New Year