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Despite efforts by the United Nations to impose isolating sanctions on North Korea in response to the country's continued development of nuclear weapons and intercontinental ballistic missiles, trade between Russia and North Korea soared more than 85 percent in the first four months of the year, reported Deutsche Welle (Germany).
Citing Russian customs data, the Voice of America broadcaster has reported that bilateral trade climbed to $31.83 million (29 million euros) in the January-March quarter, with the vast majority being energy products going over the border into the North.
This included $22 million worth of coal, lignite with a value of around $4.7 million, and oil estimated at $1.2 million. In return, North Korean exports to Russia were estimated to be worth $420,000. The most significant exports were chemicals and - curiously - wind instruments.
China trade falls
In contrast, North Korea's trade with China, traditionally its most important economic partner, has plummeted. Pyongyang's exports of coal to China in March came to 6,342 tons, a fraction of the 1.44 million tons sent to China in January, with an estimated value of $126.39 million. Similarly, Beijing has stopped supplying critically-needed fuel oil to the North, a clear demonstration of China's displeasure at North Korea's ongoing weapons tests.
The release of the figures detailing Russia's increased trade with North Korea coincide with President Vladimir Putin's statement on Monday that Pyongyang's latest missile launch was "dangerous" - but, he added, "We must stop intimidating North Korea and find a peaceful solution to this problem."
Read more: North Korea claims successful test of new rocket able to carry nuclear warhead
James Brown, an associate professor of international relations at Tokyo campus of Temple University, believes some of the cross-border trade may be "economic opportunism" but the motivation for the vast majority of it is geopolitical.
"Russia is very worried about the isolation of North Korea and believes that makes the situation dangerous as the US is taking a confrontational approach," he told DW.
"Moscow's position is that pressure on the North has not worked and has in fact caused Pyongyang to react because it feels threatened," he said. "So instead of isolation, which is not working, Russia is proposing engagement."
New ferry route
The most recent example of this support for Pyongyang is the plan to open a ferry route between North Korea and the Russian Far East port of Vladivostok, although the proposal has been delayed by strong protests from Japan.
In 2014, Russia announced that it was canceling $10 billion of North Korea's $11 billion in Soviet-era debt and that the remaining $1 billion would be invested back into the country. Russian investors also agreed to sink $25 billion into the North's dilapidated railway system, while more would go into basic infrastructure. The two governments also announced that Russia would rebuild the North's power grid, while the two countries would develop the ice-free port of Rason for exports of Russian coal.
In total, Russia planned to increase bilateral trade almost ten-fold to $1 billion by 2020, and that does not appear to have been hampered by more recent UN sanctions.
But Putin is also motivated by security concerns in Russia's Far East, Brown said.
"Moscow has always been worried that the defensive missile systems that the US is deploying in the region - the THAAD anti-missile system in South Korea and now Japan is discussing having Aegis Ashore - are more directed at its interests than North Korea," he said.
Daniel Pinkston, a professor of international relations at the Seoul campus of Troy University, believes that Putin - who is at odds with the international community over the Ukraine conflict and has been accused of meddling in a number of elections, including those in the US and France - may be forging closer ties with Pyongyang to sow further disarray among his perceived enemies.
"Putin seems to have adopted a slash-and-burn approach to the liberal international order, so anything that serves to undermine institutions such as NATO, the European Union or democracy in general is fair game," Pinkston said. "He is intent on creating instability in a way that serves Russian interests and this sort of multi-front, hybrid war serves to undermine the US and its allies."
"North Korea fits neatly into that agenda because it causes problems for Washington, keeps the US tied down, drains its resources and causes friction with allies in the region."
Pinkston points out that playing neighboring nations off one other for their respective favors is not a new North Korean tactic. It has manipulated China and Russia for its own ends in the past.
"That sort of back-and-forth was easier to pull off in the Cold War, but they seem to be trying to capitalize on their relations with Russia now that China has become more distant," the expert underlined. "And I think it is clear that North Korea will take whatever it can get in terms of political, diplomatic or military support, as well as resources."
Nikkei reported on April 19 that a Russian company plans to launch ferry services from the North Korean port of Nason to Vladivostok. Experts questioned by RBTH were however skeptical about the report, reported Russia Beyond The Headlines (Russia).
If the very fact of the launch of the freight line is true and not “fake news,” it is hard to assess what the line will be used for, Georgy Toloraya, director of the Asian Strategy Center at the Institute of Economics, Russian Academy of Sciences, says. He is also unsure about the volume of cargo that could be transported and the frequency of the ferry.
“North Korean passengers of the Man Gyong Bong-92 will celebrate World War II victory memorial events with Chinese tourists in Vladivostok and leave for Rason on May 10,” Nikkei said.
The ferry shuttled between North Korea and the Japanese port of Niigata until 2006, when the Japanese government banned it from entering Japanese ports in response to North Korea firing medium and long-range ballistic missiles. Toloraya told RBTH that the ferry is now idle.
Nason is an ice-free port in northeastern North Korea and has the status of special economic zone.
Workers and goods
Professor Andrei Lankov from Kookmin University in Seoul sees little sense in launching the freight line, because, he says, “bilateral trade volumes are low.”
He adds that Russia and North Korea could try to redirect part of the trade that is conducted via China. But Lankov doubts that the ferry will be used to full capacity and expects that “it will be half-empty.”
Toloraya agrees that the ferry could be used to redirect trade flows, and thinks that the freight line may have some potential.
“The ferry may carry cars, food, electronics and even banned narcotics from North Korea,” Toloraya says.
“From North Korea, it may carry seafood, for example. Maybe they could re-export goods from Southeast Asia. The ferry could also be used by Russian tourists to North Korea, making it a major source of income for the country.”
Liudmila Zakharova from the Center for Korean Studies, Institute of Far Eastern Studies at the Russian Academy of Sciences believes that the ferry could be used to transport North Korean laborers.
“The passenger ferry might be in high demand due to the expanding cooperation between the countries in temporary labor migration,” she says.
“North Korean workers usually travel to Vladivostok by plane from Pyongyang, but this is quite expensive. So, traveling by sea would reduce these costs.”
The volume of bilateral trade between Russia and North Korea has been declining since 2014 because of the current international sanctions imposed against Pyongyang. According to Russian Embassy in North Korea, bilateral trade turnover stood at $69 million in 2016.
Toloraya believes that the actual bilateral trade between the countries stands at around $1 billion.
show source http://www.dw.com/en/russia-steps-up-north-korea-support-to-constrain-us/a-38867861 https://www.rbth.com/business/2017/04/19/proposed-north-korean-ferry-to-vladivostok-may-transport-goods-and-workers_746353