Sanctions against North Korea benefit Russian Far East economy - Like This Article

August 24 , 2017 - Fort Russ News - 

KtovKurse - translated by Inessa Sinchougova

UN trade sanctions against North Korea can benefit the economy of the Russian Far East: they will open up opportunities for the export of raw materials from the region, as well as for the supply of seafood to China.

On August 5, in response to the launch of intercontinental ballistic missiles by Pyongyang, the UN Security Council unanimously adopted a resolution toughening sanctions against North Korea.

The sanctions impose a ban on the growth of North Korean workers abroad, the establishment of new joint ventures with Pyongyang, and the import of coal, iron, lead and seafood from North Korea.

All this can create a supply deficit in the market of the Asia-Pacific region, which Russia is ready to compensate.

"Coal, iron, lead and seafood - none of this Russia buys from North Korea, because it has enough of its own raw materials, most of which is exported," said Artem Lukin, associate professor of the Department of International Relations at the Far Eastern Federal University .

"In this sense, sanctions can be beneficial to Russia. This is especially true for seafood, "he said.

Until recently, North Korea was the main supplier of fish and seafood to China, which in the northeast has a large number of seafood processing enterprises.

"Now these plants are likely to switch to Russian suppliers. Russian fishermen in the Far East can expect a higher profit, "Lukin added.

According to Lukin, China stopped buying coal from North Korea in February this year, which led to an immediate rise in prices for Russian anthracite - a type of coal.

UN sanctions also freeze the accounts of the North Korea's Foreign Trade Bank, and North Korean courts violating UN resolutions will be banned from entering foreign ports.

These sanctions are unlikely to affect the tiny trade balance that exists between Russia and North Korea, said Svetlana Mishchuk, the academic secretary of the Far Eastern campus of the Institute for Comprehensive Analysis of Regional Problems.

"If we consider the share of North Korea in the trade balance of Russia, then it takes 106th place in this indicator as of the first quarter of 2017," she said.

"North Korea was 79th in terms of exports from Russia, and 134th in terms of imports. Therefore, we can say that the introduction of sanctions will not affect the regional economy. There may be some unpleasant moments, but their significance is small, "Mishchuk said in an interview.

Further sanctions are directed against persons associated with Pyongyang's missile and nuclear programs.

North Korea stated that it considers the UN resolution as a violation of its sovereignty and reserves the right to "lawful response" without specifying what measures it intends to take.

According to Lukin from the Far Eastern Federal University, the ban on new joint ventures with North Korea, as well as investment in expanding existing ones, is unlikely to harm Russia.

"At present, we have only one large Russian-North Korean joint venture RasonConTrans," Lukin said.

This company was created to control the construction, as well as infrastructure projects in the North Korean port city of Rason, in addition, it was responsible for bringing the Rason-Hasan railway line to it.

"However, Russia has already allocated the bulk of the investment for this project, spending about $ 300 million on it from 2008 to 2013," he said.

"There is enough money in the reserve, so the project is unlikely to require new investments," Lukin said, adding that he is not aware of Russia's plans to create any other joint ventures with North Korea.

The ban on UN member states to increase the number of North Korean workers means that at the time of the adoption of the resolution, countries can retain the number of such workers.

Thus, Russia is allowed to leave untouched the current number of workers from North Korea, that is, about 32,000 people, Lukin said.

In his opinion, in the context of the current economic situation in Russia, the country does not need to invite additional North Korean workers.

"Demand for North Koreans could increase if and when the Russian economy begins to show faster and stronger growth, which is unlikely to be expected in the near future. In this respect, US sanctions against North Korea will not seriously harm the Russian economy, "Lukin said.

     Follow us on Facebook!                                                  

                                                 

       Follow us on Twitter!

                             

             Donate!

from Fort Russ http://ift.tt/2xfDIjy
Sanctions against North Korea benefit Russian Far East economy - Like This Article

Tweet

Subscribe to receive free email updates: