TOKYO -- Impoverished North Koreans can barely afford food, let alone cars. And their government seemingly prefers to channel what little hard currency it has into rocket fuel for missile tests over gasoline for the nation’s transportation system.
But if conditions can get even worse for the communist dictatorship’s pitiful automotive industry, they just might.
New sanctions passed by U.S. Congress could sever one of the key lifelines keeping open North Korea’s auto factories.
The measures were passed after Pyongyang rattled the world in January by conducting a nuclear test, then launching a purported satellite that critics called a veiled missile test.
They expand existing sanctions through a so-called secondary boycott, which penalizes businesses and individuals in third countries that have financial dealings with North Korea.
They should tighten the screws on Chinese companies that ship essential parts and components to North Korean auto factories and Chinese companies involved with joint ventures in the North, a recent report in South Korea’s Korean Joongang Daily said.
Last year, for example, China invested $8.7 million in a truck and minibus factory near Pyongyang, the newspaper said.
And about 90 percent of all auto parts used by North Korean assemblers come from across the border in China, it added.
Those Chinese partners are now beginning to think twice about doing business in North Korea because of looming sanctions.
If they have transactions with U.S. banks or ambitions to enter the U.S. market, they could be put on the black list.
The crackdown comes at an especially inopportune time for North Korea, the newspaper said, because, amazingly, vehicle output in the country is soaring. By North Korean standards, that is.
Demand for dump trucks, cargo trucks and buses is increasing by about 10,000 units a year, the newspaper reported, citing a source at a Chinese company involved with a joint venture.
That brings the total vehicle population to a whopping 1 million across all of North Korea’s roads, it estimated.
Now, even that paltry growth is under threat.