News / Asia

Russia Forgives North Korean Debt

FILE - Russian President Vladimir Putin at event in St. Petersburg, June 5, 2014.FILE - Russian President Vladimir Putin at event in St. Petersburg, June 5, 2014.
x
FILE - Russian President Vladimir Putin at event in St. Petersburg, June 5, 2014.
FILE - Russian President Vladimir Putin at event in St. Petersburg, June 5, 2014.
VOA News
Analysts say Moscow's decision to forgive most of North Korea's debt is aimed at clearing a path through the secretive state for a natural gas pipeline from Russia to South Korea.

Russian President Vladimir Putin last month forgave 90 percent of North Korea's $11 billion debt. He also allowed Pyongyang to use payments on its remaining debt balance for health, education and energy programs of its own.

Several experts say they believe this is an attempt by Russia to win favor with North Korea to get a pipeline agreement.

Scott Snyder, director of the Program on U.S. Korea Policy at the Council on Foreign Relations, said this is something Russia has long wanted. He said it was discussed "back in 2011 between then [Russian] President [Dmitry] Medvedev and [North Korean leader] Kim Jong Il.”

Synder added that it was again discussed by Russian President Vladimir Putin and South Korean President Park Geun-hye at a summit late last year. “So I think that there is interest on both the Russian and the South Korean sides in doing something,” he said.

International Investment Strategist Tom Elliot at the deVere Group's London office said the Russians are “very serious” about making this happen.

“You saw the keenness with which Putin followed up on a very long standing idea with China," Elliot said, adding that Beijing and Moscow reached an “agreement last month on running a gas pipeline into China.”

Elliott also explained how Russian efforts to find new energy markets accelerated after the West's negative reaction to the Kremlin's annexation of Crimea and current tensions in eastern Ukraine.

Snyder says North Korea also had motivations of its own to work with Russia on the debt issue, which has lingered since the fall of the Soviet Union. 

This is "a way of clearing out the underbrush in order to draw in more Russian investment to North Korea,” he said.

North Korea only agreed to a repayment plan after Russia offered debt forgiveness and said payments on the balance could be spent by Pyongyang on domestic infrastructure programs.

According to various reports, North Korea's Soviet-era debt would be worth $238 million if valued at the current market price. But according to Elliott, North Korea agreed to the higher valuation in hopes of attracting future foreign investment.

Elliott explained, “If you're a country that actually wants to encourage international investment to grow ... you don’t want to be seen as buying up your debt on what’s called the secondary market at two cents on the dollar.” He said doing that "is considered very poor etiquette, indeed.”

You May Like

Analyst: Joint-Arab Military Force Poses Perilous Challenge

Although international forces are desperately needed to counter the threat of the Islamic State group, analysts say conflicting alliances could escalate fighting More

Asia’s Middle Class Changes Demand for Wheat Grain Exporters

Changes in tastes and diets are boon for wheat exporters such as Australia and the United States More

S. African Comedian Taking Over Popular TV Show

Mixed-race comedian Trevor Noah, who is loved for his edgy jibes about race and language, is taking the helm from Jon Stewart at The Daily Show in US More

This forum has been closed.
Comment Sorting
Comments
     
by: Kimchi Law Blog from: South Korea
June 19, 2014 2:42 AM
Of course having 90% of your loan written-off isn't exactly stellar for investor confidence, but a win is a win....

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Film Tells Story of Musicians in Mali Threatened by Jihadistsi
X
Greg Flakus
March 30, 2015 6:48 PM
At this year's annual South by Southwest film and music festival in Austin, Texas, some musicians from Mali were on hand to promote a film about how their lives were upturned by jihadists who destroyed ancient treasures in the city of Timbuktu and prohibited anyone from playing music under threat of death. As VOA’s Greg Flakus reports from Austin, some are afraid to return to their hometowns even though the jihadists are no longer in control there.
Video

Video Film Tells Story of Musicians in Mali Threatened by Jihadists

At this year's annual South by Southwest film and music festival in Austin, Texas, some musicians from Mali were on hand to promote a film about how their lives were upturned by jihadists who destroyed ancient treasures in the city of Timbuktu and prohibited anyone from playing music under threat of death. As VOA’s Greg Flakus reports from Austin, some are afraid to return to their hometowns even though the jihadists are no longer in control there.
Video

Video With Coalition Airstrikes, Iraq Entering 'Last Page' of IS Battle

American warplanes joined Iraq's battle against the so-called 'Islamic State' in northern Iraq late Wednesday, as Iraqi ground troops launched a massive assault on Tikrit. Analysts say the offensive could take the coalition a step further towards Mosul, the largest city held by Islamic State forces. Others say it could also deepen already-dangerous sectarian tensions in the region. VOA's Heather Murdock has more from Cairo.
Video

Video Philippines Wants Tourists Spending Money at New Casinos

Tourism is a multi-billion dollar industry in the Philippines. Close to five million foreign visitors traveled there last year, perhaps lured by the country’s tropical beaches. But Jason Strother reports from Manila that the country hopes to entice more travelers to stay indoors and spend money inside new casinos.
Video

Video Civilian Casualties Push Men to Join Rebels in Ukraine

The continued fighting in eastern Ukraine and the shelling of civilian neighborhoods seem to be pushing more men to join the separatist fighters. Many of the new recruits are residents of Ukraine made bitter by new grievances, as well as old. VOA's Patrick Wells reports.
Video

Video Islamic State Prisoners Talk of Curiosity, God, Regret

Islamic State fighter, a prisoner of Kurdish YPG forces, asked his family asking for forgiveness: "I destroyed myself and I destroyed them along with me." The Syrian youth was one of two detainees who spoke to VOA’s Kurdish Service about the path they chose; their names have been changed and identifying details obscured. VOA's Zana Omer reports.
Video

Video Germanwings Findings Raise Issue of Psychological Testing for Pilots

More is being discovered about the co-pilot in the crash of Germanwings Flight 9525 in the French Alps. Investigators say he was hiding a medical condition, raising questions about the mental qualifications of pilots. VOA's Carolyn Presutti reports.
Video

Video Hi-tech Motorbike Helmet's Goal: Improve Road Safety

In cities with heavily congested traffic, people can get around much faster on a motorcycle than in a car. But a rider who is not sure of his route may have to stop to look at the map or consult a GPS. A Russian start-up company is working to make navigation easier for motorcyclists. Designers at Moscow-based LiveMap are developing a smart helmet with a built-in navigation system, head-mounted display and voice recognition. Zlatica Hoke has more.
Video

Video DOJ: Illinois National Guard Soldier Tried to Join ISIS

U.S. federal law enforcement agents arrested two suburban Chicago men accused of trying to join ISIS overseas, while also plotting attacks in the United States. As VOA’s Kane Farabaugh reports from the Midwest state of Illinois, one of those arrested is a soldier of the Illinois National Guard.
Video

Video New Wheelchair Is Easier to Use, Increases Mobility

Traditional push-rim wheelchairs create a lot of stress for arm, shoulder and neck muscles and joints. A redesigned chair, based on readily available bicycle technology, radically increases mobility while reducing the physical effort. VOA’s George Putic reports.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.

VOA Blogs

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More