Russia’s trade with North is rising

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Russia’s trade with North is rising

Sanctions on North Korea are affecting trade with China - but Russia may pick up the slack.

China’s Global Times reported Thursday that China-North Korea trade dropped 6.7 percent from June to July, or from $489 million won to $456 million. The paper said China’s exports of oil to the North dropped to the lowest level since January 2016.

On Aug. 5, the UN Security Council unanimously passed a sweeping sanctions package following North Korea’s two intercontinental ballistic missile tests in July, stepping up restrictions on its international trade and affecting as much as one-third of its $3 billion annual export revenues.

Russia’s trade with North Korea as of June this year hit some $61 million, the Voice of America said Wednesday, quoting data from Russia’s Federal Taxation Service.

That volume is an increase of some 74 percent from the bilateral trade measured in June 2016, which was $35 million.

“Although the actual amount of trade between Russia and North Korea is not as large as between China and North Korea, Russia-North Korea trade is definitely on a rapid rise,” said a diplomatic insider.

North Korea may also be trying to attract more tourists from Russia. It opened a tour agency in Moscow named NKorean, the North Korean Embassy in Moscow announced Wednesday.

“North Korea is one of the safest countries to travel to,” said a counsellor of the embassy. “We guarantee the safety of all tourists who obey the laws of the country.”

The embassy said that it will also shorten the visa processing period from two weeks to three days.

“Fewer people from around the world are visiting North Korea as tourists after American Otto Warmbier was held in prison and returned home [in a vegetative state] and died soon afterwards,” said a diplomatic insider. “As I understand it, tourism brings foreign currency into the country, so North Korea is probably seeking to expand its tourism businesses in Russia.”

There were concerns in U.S. foreign policy circles that once the UN sanctions were implemented, Russia may make up for the trade lost with China.

“I’m concerned that Russia may backfill North Korea,” U.S. Ambassador to UN Nikki Haley is quoted to have told U.S. lawmakers in June. “We don’t have proof of that, but we are watching that carefully.”

South Korea’s President Moon Jae-in may also be hoping for closer relations with Russia.

Moon is to travel to Moscow next month to meet with President Vladimir Putin. Moon will give a keynote speech at the Eastern Economic Forum in Vladivostok.

To fine-tune the presidential summit in advance, the South’s Foreign Minister Kang Kyung-wha held a meeting with Russian Foreign Minister Sergey Lavrov Friday.

Moon also appointed Democratic Party Rep. Song Young-gil, who was his special envoy to Russia in May, as chairman of the Presidential Committee on Northern Economic Cooperation, established on Friday.

“President Moon hopes to pursue a two-track policy in regards to economic relations with Russia, as one of Russia-South Korea economic cooperation and another of the two Koreas and Russia,” Song told the JoongAng Ilbo.

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