North Korea incurred $200M revenue loss due to economic sanctions

Pyongyang has asked the U.N. for a review of the embargoes.
By Elizabeth Shim Contact the Author   |  Jan. 11, 2017 at 11:34 AM
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SEOUL, Jan. 11 (UPI) -- Economic sanctions are taking their toll on North Korea, and Pyongyang may have incurred a $200 million revenue loss in 2016, according to a South Korean study.

The estimate from Seoul's Institute for National Security Strategy comes at a time when North Korea is asking the United Nations Security Council to arrange a forum that would verify the "legality" of U.N. sanctions.

According to Seoul's analysis, North Korea has lost $200 million in export and other revenue in nine months owing to heavy economic embargoes, Yonhap reported Wednesday.

The figure was included in the institute's report that evaluated the impact of U.N. sanctions Resolution 2270. It covers the period from March to November 2016.

As a result of the March sanctions that passed with support from China and Russia, North Korea's foreign currency earnings dropped precipitously. A loss of $200 million in revenue is equivalent to 7.4 percent of total North Korea exports for 2015, which was about $2.7 billion, according to the report.

But the greatest loss for North Korea came following South Korea's decision to shut down a jointly operated factory park in Kaesong. Sanctions have also made it difficult for North Korea to engage in arms sales or send forced laborers overseas.

The North Korean trade environment is deteriorating due to pressure from China and the United States, the report added. Examples cited in the study include U.S. sanctions imposed against Chinese firm Hongxiang Industrial.

Other U.N. member states in the Middle East and Southeast Asia have been cooperating with sanctions. States have authorized the termination of North Korea-related bank accounts or detained North Korea cargo ships at ports, according to the South Korean analysis.

The sanctions have been repeatedly condemned by Pyongyang, which has claimed its weapons of mass destruction are for defense purposes.

North Korea's Ambassador to the U.N. Ja Song Nam recently requested an international forum that could investigate the legality of the sanctions, Kyodo News reported Wednesday.

Ja told United Nations Under-Secretary-General for Political Affairs Jeffrey Feltman the United States is welcome to participate in the forum, a sign Pyongyang is trying to initiate talks with the incoming Trump administration, according to Kyodo.

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