Via Financial Times

At this time of year in the Chinese border city of Dandong, travellers board boats to catch a glimpse of the pariah state on the other side of the Yalu river. The more adventurous even visit the hermit kingdom for a few days.

But, nearly five months after the coronavirus pandemic forced Pyongyang to close its border with its largest trading partner, the city at the heart of Beijing’s plans for closer relations with North Korea is all but deserted.

Guides hawking photo shoots wearing traditional Korean hanbok robes sit idle near the entrance to the “Broken Bridge”. The former railway line from China to North Korea, which was bombed by American jets during the 1950s Korean war, is now Dandong’s main attraction.

“Dandong has seen its quiet days, but nothing like this,” said Rowan Beard, a tour manager for Young Pioneer Tours. “With zero tours happening it’s put my business into slumber mode.” Another tour operator added: “Without the border open, there’s no reason for people to come.”

The freeze in cross-border trade between Pyongyang and Dandong has worsened the impact of UN sanctions, which limit the purchase of almost all goods from North Korea, analysts said.

It has also damped hopes of North Korea’s economy opening up and frustrated Beijing’s efforts to coax Pyongyang towards market reforms in return for scaling back its nuclear programme.

With the diplomatic process losing steam, China no longer prioritises the issue, said Zhao Tong, an analyst at the Carnegie-Tsinghua Center in Beijing. “The lack of better infrastructure is not the bottleneck; it’s still sanctions,” he added.

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In Dandong, the impact of these tensions has been exacerbated by North Korea’s closure of its 880-mile border with China in January, cutting itself off from the world to minimise the risks of a coronavirus outbreak.

While it is two months since Dandong last reported a confirmed case of Covid-19, cross-border activity has only tentatively restarted and tourists are still not able to visit.

Pyongyang claims to have no cases of the virus, a statement international experts have questioned, especially as the country has such a low testing capacity. North Korea’s economy is showing signs of a serious downturn, with its leader demanding more cash from North Korea’s moneyed class to weather the shock.

“There is no doubt that the epidemic has further halted China and North Korea’s normal economic dealings,” Zhang Huizhi, a scholar at Jilin University, said. “North Korea has sacrificed economic growth to counter risks from the spread of Covid-19.”

Despite Mr Kim’s push for “self-reliance”, China remains North Korea’s economic lifeline and imports coal, textiles and rare earths through Dandong. Sanctions had already crippled trade flows, but Covid-19 made matters far worse. The number of vehicles crossing the Yalu river were far below normal levels when the Financial Times visited this month, with no more than four trucks crossing at one time.

A 2018 summit between Mr Kim and President Donald Trump sparked hope in Dandong of strong trade ties across the Yalu and a possible economic windfall. Property prices in Dandong soared about 50 per cent.

Grand infrastructure projects — such as a $350m bridge linking Dandong’s New District to North Korea’s Sinuiju and multiple free trade zones — were meant to strengthen Dandong’s economic relationship with its neighbour across the border. But many of the free trade zones are almost entirely empty of North Korean traders.

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The ‘Broken Bridge’, seen to the right of the Friendship Bridge, was bombed by US jets during the Korean war © Fred Dufour/AFP/Getty

“There was never much hope to start with, [because] these are Chinese initiatives designed in a very China-centric way,” said Théo Clément, a researcher at the Ecole des hautes études en sciences sociales in Paris.

“The economic co-operation pattern they imply, where North Korea supplies low value added goods and China sophisticated goods, is precisely what Pyongyang has been trying to avoid . . . Pyongyang does not want to de facto become a Chinese neo-colony,” he added.

The coronavirus lockdown stopped what little momentum there had been. Dandong’s GDP fell 11.8 per cent year on year in the first quarter of 2020.

“The instability of policy from the other side [of the Yalu River] means local investors show little interest [in buying houses] compared to investors from elsewhere in China, who are more easily excited when they hear news about North Korea opening up,” said Li Leiyuan, a freelance real estate agent.

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One source of hope has been activity on the North Korean side of the unfinished New Yalu River bridge, where bulldozers have been laying tarmac since April after years of inactivity, according to photographs taken by locals and satellite imagery.

But residents doubt the bridge will resolve longstanding problems with cross-border trade. “Whether it opens or not, it won’t make a big difference to business,” said the owner of a shop selling taps and tiling grout, who declined to give her name.

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“They are too poor. Even if they were allowed to come, the whole economy is far smaller than even a single Chinese province.”