N.K. economy to shrink on trade sanction

The North Korean economy is to record further negative growth this year on trade suspension by the South following the North’s sinking of a warship, a report said Tuesday. 

A report by the state-run Korea Development Institute said although the suspension of inter-Korean trade is expected to cost North Korea about $280 million annually, its economy won’t shrink to the crisis level had in the 1990s. 

“Our outlook is based on a forecast that its external trade will likely post a setback,” it said without estimating a figure. 

North Korea’s economy contracted 0.9 percent last year on poor harvests and strengthened international sanctions targeting its nuclear program.