North may restore rail commerce with Russia to boost trade

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North may restore rail commerce with Russia to boost trade

Speculation is growing that North Korea may revive overland rail commerce with Russia amid talks to restore trade between the countries, which were reported by the Russian Ministry for the Development of the Far East and the Arctic (Mdfea) on Tuesday.
Sin Hong-chol, Pyongyang’s ambassador to Moscow, and Mdfea Minister Alexey Chekunkov “spoke in favor of a phased restoration of trade and economic ties” in light of changing Covid-19 conditions, according to the Mdfea. The ministry did not disclose the date or location of the meeting.
The report hints at the possibility that the North may soon undertake tentative steps to ease the protracted blockade on border trade with Russia, following similar measures regarding its border trade with China.
North Korea resumed rail shipments from China in mid-January, with North Korean freight trains making several round trips across the Yalu River separating the North Korean city of Sinuiju and the Chinese city of Dandong beginning on Jan. 16.
The resumption of rail shipments from China comes almost two years after the North sealed its own borders in response to the initial outbreak of Covid-19 in Wuhan, China.
While North Korea’s 18-kilometer (11-mile) border along the Tumen River with Russia is much shorter than the country’s once-porous frontier with China, the area, also known as the Rason Special Economic Zone, under previous North Korean leader Kim Jong-il, received attention from Pyongyang as a designated site for foreign investment from both China and Russia.
However, following the North’s locking down its own borders, trade between North Korea and Russia’s Far Eastern federal district plummeted from $14.7 million in 2020 to just $40,000 in 2021, according to the Mdfea report.
“[The pandemic] has affected the trade and economic relations between the Russian Far East and the DPRK,” Chukenkov said at the meeting, referring to the North by the acronym of its official name, the Democratic People’s Republic of Korea. “Now we have to develop our cooperation in the face of new challenges.”
However, it remains to be seen when exactly the North will resume rail trade with Russia.
South Korean government sources who spoke to the JoongAng Ilbo on the condition of anonymity said North Korean authorities constructed sanitization and anti-virus facilities on the runway of Uiju Airfield, near the border city of Sinuiju, which are now being used to sterilize and clear shipments from China.
While the North upgraded a new rail freight station on its border with Russia in early 2021, and later added new platforms and warehouses between September and December, satellite imagery suggests that activity at the station has fallen off since then.
The North’s trade with Russia has also historically been much lower than the country’s trade with China since the dissolution of the Soviet Union in 1991, when Moscow ceased to provide Pyongyang fuel and vital commodities at lower “friendship prices.”
Bilateral trade between North Korea and Russia totaled $47.9 million in 2019, the last year before Covid-19 upended trade. By contrast, North Korea’s trade with China that same year was $3.1 billion, accounting for 90 percent of the North’s external trade.

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