China’s trade with North Korea increases

Shunned by the most of the world as a pariah state, Nth Korea is cementing ties with its old patron, China, with trade volume between them hitting new highs, according to South Korean statistics.

The trade volume in 2011 soared a record 60% to $5.63 billion and although final data is not yet available, analysts expect 2012 to be another banner year.

The dramatic increase reflects a conscious decision by Beijing in 2011 to prop up its failing ally. Shortly before his death a year ago, North Korean leader Kin Jong II made three trips to China to secure support for rebuilding his ruling Workers’ Party, the equivalent of the party in China. The Chinese also have been keen to prop up Kim’s 29-year-old son and successor, Kim Jung Un.

Beijing last year also gave permission for tens of thousands of North Koreans to work in factories in northeastern China, usually sending a large share of their earnings back to their government.

With Chinese help, the North Korean economy grew for the first time in three years, albeit a modest 0.83%. In the last year, Pyongyang has undergone its first significant facelift in decades, adding modern apartment blocks, a new airport terminal, stores and restaurants and a dolphinarium to the North Korean capital.

Nevertheless, South Korean per capita income remained about 19 times higher than North Korea’s $1,239.

North Koreans buy most of their consumer goods and fuel from China. China accounted for 70% of North Korea’s foreign trade last year, the highest since the South Korean statistic office began calculating the figures.

The South Korean figures provide a glimpse of the economic health of one of the world’s most secretive countries. North Korea does not report its trade statistics.


US report forecasts China as top economy

An intelligence report forecasts that China will overtake the United States as the world’s largest economy in the 2020s.

The National Intelligence Council, in its first assessment in four years aimed at shaping US strategic thinking, predicts that the US will still be the world’s most influential country in 2030.

“The US most likely will remain ‘first among equals’ among the other great powers in 2030 because of its pre-eminence across a range of power dimensions and legacies of its leadership role,” it said.

“Nevertheless, with the rapid rise of other countries, the ‘unipolar moment’ is over and Pax Americana – the era of American ascendancy in international politics that began in 1945 – is fast winding down,” it said.

The study predicted that Asia’s economy, military spending and technological investment would surpass those of North America and Europe combined by 2030, but warned of major uncertainty over an emerging China.

“If Beijing fails to transition to a more sustainable, innovation-based economic model, it will remain a top-tier player in Asia, but the influence surrounding what has been a remarkable ascendance will dissipate,” it said.

China’s global power is likely to keep rising but at a slower rate – a phenomenon of easing growth that, according to historical precedent, makes countries “likely to become fearful and more assertive,” the study said.

Europe, Japan and Russia are expected to maintain slow economic declines through 2030, while a number of middle-tier countries could rise, such as Colombia, Egypt, Indonesia, Iran, Mexico, South Africa and Turkey, it said.

he study expected major benefits from technology by 2030, but warned that climate change threatened to pose serious challenges.

With a growing population and rising incomes, the planet’s demand for water, food and energy will grow by 35, 40 and 50 percent respectively by 2030, it said.

A wealthier China and India would likely need to rely more on food imports, driving up international prices. Families in low-income nations would feel the pinch hardest on food, likely fuelling social discontent.