North Korea: what happens to a country when the oil is cut off?

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Pfeiffer, Dale Allen. 17 Nov 2003. Drawing Lessons from Experience; The Agricultural Crises in North Korea and Cuba. From the Wilderness.

November 17, 2003, 1100 PDT, (FTW) — So what happens to an industrialized country practicing modern agriculture when it loses its fossil fuel energy base? There are two countries where it has already happened: North Korea and Cuba. Both countries have little or no oil resources of their own, both relied upon the Soviet Union for their oil imports, and both experienced a swift and severe drop in their oil imports following the demise of the Soviet empire. While showing proper respect for the suffering of people in both countries, perhaps we can benefit from studying their examples.

DPRK (North Korea)—A Warning to the US

North Korea has always held less than half the population of South Korea. Prior to the Korean War, South Korea was a largely agrarian society, while the Democratic People’s Republic of Korea (DPRK, North Korea) was largely an industrial society. Following the war, the DPRK turned to fossil fuel subsidized agriculture to increase the production of their poor soils.

By 1990, DPRK estimated per capita energy use was 71 gigajoules per person, the equivalent of 12.3 barrels of crude oil. This was more than twice the per capita usage of China at that same time, or half the usage of Japan. DPRK has coal reserves estimated at from 1 billion to 10 billion tons, and developable hydroelectric potential estimated at 10-14 Gigawatts. But North Korea must depend on imports for all of their oil and natural gas. In 1990, DPRK imported 18.3 million barrels of oil from Russia, China and Iran.

An Energy Crisis

Following the collapse of the Soviet Union, Russian imports fell by 90%. By 1996, oil imports amounted to only 40 percent of the 1990 level. DPRK tried to look to China for the bulk of its oil needs. However, China sought to distance itself economically from DPRK by announcing that all commerce with DPRK would be settled in hard currency beginning in 1993. China also cut its shipments of “friendship grain” from 800,000 tons in 1993 to 300,000 tons in 1994.

On top of the loss of oil and natural gas imports, DPRK suffered a series of natural disasters in the mid-1990s that acted to further debilitate an already crippled system. The years 1995 and 1996 saw severe flooding that washed away vital topsoil, destroyed infrastructure, damaged and silted hydroelectric dams, and flooded coal mine shafts rendering them unproductive. In 1997, this flooding was followed by severe drought and a massive tsunami. Lack of energy resources prevented them from preparing for these disasters and hampered recovery.

DPRK also suffered from aging infrastructure. Much of their machinery and many of their industrial plants were ready for retirement by the 1990s. Because DPRK had defaulted on an enormous debt some years earlier, they had grave difficulty attracting the necessary foreign investment. The dissolution of the Soviet Union meant that DPRK could no longer obtain the spare parts and expertise to refurbish their infrastructure, leading to the failure of machinery, generators, turbines, transformers and transmission lines. DPRK entered into a vicious positive feedback loop, as failing infrastructure cut coal and hydroelectric production and diminished their ability to transport energy via power lines, truck and rail.

See Pfeiffer’s excellent article: Drawing Lessons from Experience; The Agricultural Crises in North Korea and Cuba for the rest of the story.

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