With the changing international situation, trade between China and North Korea is quietly changing.

Only one with North Korea across the river north-eastern border town of Dandong, the Chinese businessmen on the land across the river is full of mixed feelings. On the one hand, the development of border trade has yet to be tremendous business opportunities; the other hand, irregular and asymmetric trade market but also to China’s border trade business at risk.

Sino-Korean trade volume increased rapidly

According to Customs statistics, trade volume between China and the DPRK in 2008 $ 2,793,000,000, an increase of 41.3%. Among them, China exported 2.03 billion, an increase of 46% and imports 760 million U.S. dollars, increasing 30.2%. Economic cooperation with North Korea is currently the countries mainly China and South Korea.

October 13 this year, Sino-Korean border trade trade in Tumen City officially opened. By intercity trade, border residents can enjoy the goods into the Chinese territory of 8,000 yuan per person per day below the frontier of goods exempted from customs duties and import tax policy.

Commerce Department data show that the two countries in the third quarter amounted to 1.073 billion U.S. dollars of trade. Meanwhile, North Korean exports to China reached 627 million U.S. dollars, increased from last year (2.52 billion U.S. dollars) of 2.5 times.

Since 2002, the Korean economic policy adjustment, many Chinese enterprises have already seen the North Korean economic policies and prospects of good business opportunities opening up, and the border of North Korea as a medium of investment began. The year 2004 alone, North Korea’s total foreign investment of 59 million U.S. dollars, China reached 50 million U.S. dollars, accounting for 85%. According to South Korea, “Central Daily” reported that in 2004 into North Korea about 300 foreign companies, of which 40% are Chinese companies.

Dandong, Liaoning Province with its unique geographical conditions the development of port economy, where the border trade with nearly 600 companies, nearly million people rely on to eat “border food” to survive. The strange thing is, this so-called 600 enterprises in more than half of investors from the inland.

Dilemma: capital return and the planned economy

Early cross-border trade between China and the DPRK relies mainly on fish, the more common dry goods and Shell is to spend too dried out. Then do not like so cargo through the port terminals, but by entrainment over the Korean border residents, the official regulations do not exceed the weight of all this is allowed at the time. Entry after border residents will directly sell seafood, the price of domestic market prices generally almost the same, but much better in quality than the domestic.

Until now, the seafood market is still active in China and the DPRK trade projects. Every day, North Korean trading companies organizations, fishermen will be a variety of fresh scallops, squid, crab fishing from the sea shore, logistics trucks all the way from the north east coast of North Korea, after dozens of hours to reach China. Inland where there are many vendors and is awaiting the arrival of fresh goods. After a loading unloading, transport, Shandong, Beijing and Shanghai markets.

Although the market flow, business is booming, but China and the DPRK can never trade as prosperous as other border areas.

It is understood that North Korea’s cooperation with Chinese enterprises not directly business to business, to be docked with the local government, made mostly of food barter trade, small cash transactions. Until now, North Korea still need supplies and food to the daily exchange of goods with China.

“North Korean trading company size is not small, but they are purely planned economy, (North Korea) Central approved the contract after the price of a commodity, even if the prices of production costs, but also very difficult to have room for bargaining . so that domestic enterprises that are in contention export the first shipment to North Korea. Or have a loss. “An industry source said.

In addition, the phenomenon of the Korean-owned businesses less severe, and difficult to return, so that border trade companies have too awkward, let North Korea trade stumble.

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