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Inter-Korean trade jumps in H1 despite soured relations

All Headlines 11:00 September 29, 2010

SEOUL, Sept. 29 (Yonhap) -- Trade between South and North Korea surged in the first half of the year despite high tensions over the communist nation's alleged sinking of a South Korean warship in March, a trade organization said Wednesday.

South Korea's exports to the North soared 63 percent on-year to US$430 million in the January-June period with North Korea's exports to the South jumping 43 percent to $550 million, according to the Korea International Trade Association (KITA).

The unexpected surge came as the relations between the divided Koreas dipped to their lowest ebb in years after Pyongyang allegedly sank the South Korean warship Cheonan in March in what has been determined by an international investigation team as a torpedo attack. The sinking left 46 South Korean sailors dead.

Seoul imposed a trade ban on the North in May though exchanges between the divided Koreas had already been waning.

KITA attributed the increase of inter-Korean trade to the growth of a joint industrial complex between the two Koreas in the North's border town of Kaesong.

"The increase is believed to have come from the amount of exchanges through the Kaesong complex, which increased 96 percent on-year, as the industrial complex is usually not affected by political relations between the South and North unlike general trading," KITA said in a press release.

Still, trade between the two Koreas again fell short of North Korea's exchanges with its largest ally and benefactor, China.

North Korea and China exchanged $1.28 billion worth of goods and services in the first six months of the year, while the amount between the two Koreas came to $980 million, or 69.8 percent of that between North Korea and China.

Trade between the two Koreas peaked in 2007 when they exchanged nearly $1.8 billion worth of goods, or 91 percent of $1.97 billion between North Korea and China, KITA said.


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