North Korea interested in joining AIIB

PYONGYANG: North Korea was interested in joining the Asian Infrastructure Investment Bank, the director of the country’s major think tank said yesterday, expressing hope that activities of the new China-led lender will greatly benefit his country and the region.

Kim Chol, who heads the Economic Institute of the Academy of Social Sciences, told Kyodo News in Pyongyang that he personally “believes the international community’s attention on the AIIB reflects the vulnerability of the US-led international financial system.”

While also voicing hope that the inception of the AIIB could lead to the removal of international economic sanctions against North Korea, he said, “I am hoping that the bank will genuinely contribute to Asia’s economic development.”

North Korea is not part of the AIIB and it has not formally shown its stance on the bank, which is seen by some officials and experts as posing a challenge to existing Western-dominated institutions.

The AIIB’s 57 prospective founding members, mostly Asian economies but also including some major developed countries such as Britain and Germany, plan to set up the lender with an initial capitalisation of $100 billion by the end of this year.

On Monday, delegates from the 57 founding members gathered in Beijing and most of them signed the AIIB’s articles of agreement that specifies details of its structure.

China, North Korea’s foremost important ally, proposed the creation of the AIIB in October 2013 to help finance Asian developing countries’ massive infrastructure needs.

Among major economic powers, the United States and Japan have opted out of joining the AIIB, citing concerns over its governance standards.

Kim also spoke of North Korea’s worst drought in a century for two years in a row and the situation of its crude oil imports.

He said a lack of rain has caused “great damage” to North Korea’s agricultural sector and it is still difficult to predict the scale of negative impact on the country’s food production.

“As recent rainfalls have yet to dramatically raise water levels of reservoirs,’’ Kim said.

“North Korea is stepping up its efforts to minimise the damage by taking measures such as introducing new farming techniques and building irrigation channels.’’

With regard to China’s official customs data showing that its exports of crude oil to North Korea have been remained nil since last year, Kim said, “I have not heard about them.”

Kim said what he “knows is that North Korea is securing crude oil from around the world,” adding that “its imports of gasoline and other petroleum products have been on the rise.’’

Meanwhile, Li Sun Chol, a scholar of the institute who also attended the meeting with Kyodo News, denied the view that North Korea’s deepening of its relations with Russia from last year is intended to make up for Pyongyang’s cooling relations with Beijing.

He noted that North Korea has consistently had active economic cooperation with Russia in this century.

But Li said North Korea “is cautious about totally committing to a specific country and seeks to diversify its external relations.’’