North Korea Market Entry

North Korea Market Entry

Korea (North – DPRK): The country’s relations with the EU

The EU continues its “critical engagement” policy in relation to the DPRK by supporting:

  • peace and security on the Korean Peninsula
  • dialogue with the US
  • non-proliferation of nuclear weapons
  • human rights

The EU supports international efforts to ensure peace and stability on the Korean Peninsula through stakeholder dialogue. The EU provides humanitarian aid to the country through its European Union Program Support Units (EUPS), of which there are a total of 6 operating in the DPRK. The EU also appeals for respect for human rights in the country and is currently applying restrictive measures against the DPRK aimed at ending the further development of nuclear weapons. The humanitarian area provides scope for the engagement of Czech companies. Check smber for agriculture and fishing facts of North Korea.

The Czech Republic, together with the EU countries, supports the continuation of the dialogue between the USA and the DPRK in order to create long-term peace on the Korean Peninsula and progress on the issue of denuclearization. This development would lead to the gradual relaxation of the UNSC sanctions regime, which would create more space for Czech business activities in the DPRK.

  • Representation of the EU in the country
  • The country’s trade relations with the EU
  • Provision of development funds and EU instruments

Representation of the EU in the country

The EU has no representation in the country. Among the EU member states, Bulgaria, the Czech Republic, Germany, Poland, Romania and Sweden have their embassies in Pyongyang, which take turns in leading the local EU presidency at six-monthly intervals. The embassies of the Czechoslovak Republic of the EU cooperate closely with the representation of the UK. The FR interest office also operates in the country.

The country’s trade relations with the EU

Germany is the largest long-term trade partner of the DPRK within the EU countries. In 2015, it exported goods worth EUR 7.299 million and imported goods worth EUR 4.745 million to the DPRK. It must be said that, compared to 2012, this is a significant reduction in the volume of trade – Germany’s exports at that time amounted to EUR 19.65 million and imports to EUR 12.05 million (data from the DE statistical office).

The EU imported from the DPRK mainly machinery and transport equipment (€5 million in 2015) and chemicals and related products (€4 million), with some items very likely to have originated in the Kaesong Industrial Zone. The EU exported chemicals and related products (€6 million), machinery and transport equipment (€5 million), food and live animals (€2 million), consumer goods (€2 million) and beverages and tobacco (€2 million. EUR).

After the introduction of sanctions at the end of 2017, the DPRK’s trade exchange with the EU was reduced to a marginal minimum, in the order of hundreds of thousands of EUR. In shops for foreigners in the capital, it is possible to buy some food products from EU countries, especially Germany. These goods are probably re-exports from China rather than direct trade.

Provision of development funds and EU instruments

The EU has been providing humanitarian and food aid to the DPRK since 1995. Most of the projects it is currently funding (under the banner of the European Commission) are focused on food security, health, water and sanitation, with the primary targeting of the most vulnerable part of the DPRK population. The projects are carried out by EU partners, some of whom have representatives in the DPRK. In addition to the EU, some EU member states also have their own development and humanitarian projects in the country. The budget of the EUPS units for each year is in the order of tens of millions of EUR.

Korea (North – DPRK): Business and economic cooperation with the Czech Republic

Mutual trade turnover has decreased significantly in recent years. The main cause is the insolvency of North Korean partners, the poor purchasing power of the population, bad experiences with fulfilling obligations, competition from cheap products from neighboring China and, since 2017, international sanctions against the DPRK. In the case of the Czech Republic, the uninsurable nature of exports to the DPRK is also an important negative factor.

Balance of mutual trade exchange for the last 5 years

Trade exchange between the Czech Republic and the DPRK (in thousands of USD)
v tis.
Export Importation Turnover Balance
USD USD USD USD
2015 7 230 237 -223
2016 5 125 130 -120
2017 36 771 1037 -735
2018 1 15 16 -14
2019 0 65 65 -65

10 most important Czech export/import items

Main import items: integrated circuits, computer components, looms, small textiles and fabrics, metal products (of rolled steel), automobiles, telephones, chemical products and chemicals (lysine, esters, salts, copolymers, polyacetals, polyethylenes, semiconductors, molten magnesium).

Main export items: mechanical products, boilers, tools (drills, cutters), TV, shoes, buses, trams, tractors, flower products, hygiene products, alcohol

The statistics also include goods and materials sent to the Embassy of the Czech Republic in the DPRK.

Mutual exchange in the field of services

According to information from the ZÚ, there is no mutual exchange of services.

Czech investments in the territory: Companies and joint-ventures in mutual trade and in other areas of economic cooperation

The Czech Republic has no investments or joint ventures in the DPRK.

North Korea Market Entry