N.Korean trade in rare decline

North Korea's international trade dropped last year for the first time in more than a decade after the state was hit by UN sanctions to punish it for a nuclear test in May, a South Korean think tank said.

The report by the state-run Korea Development Institute (KDI) made available Wednesday said the largest impact came from a sharp decline in trade with China, the North's biggest benefactor that its leader is expected to visit in coming weeks.

"North Korea's trade data have yet to be officially compiled but its trade with China and South Korea, its two major business partners, shrank last year (based on China's statistics)," the report said, giving its trade volumes with China and South Korea suffering drops of 4 percent and 8.4 percent respectively.

The combined decline in trade with the two and with the European Union accounting for nearly 90 percent of the North's trade points to an overall decline of at least 5 percent in the past year, KDI said.

"The decline in the North's imports indicates a foreign exchange shortage in the North," it said, adding the trade decline was the first since 1998.

The North's main exports are weapons and minerals and its main imports are oil, machinery and grain, according to the US Central Intelligence Agency's World Factbook.

The economic woes of the North, made worse by a botched currency reform late last year, have been putting pressure on the North to return to stalled nuclear disarmament talks where it can win aids, analysts said.
Moreover, the North Wednesday formally launched a development bank aimed at at-tracting foreign funds to revive its economy, its state media reported.

Source: Global Times