A brief encounter: North Korea in the Eurocurrency market, 1973–80

Abstract

This article examines the engagement of North Korea in the Eurocurrency market in the 1970s. In the Cold War regime competition for economic prosperity, the communist regime turned to the City of London to raise capital for economic development. Despite the diplomatic efforts of South Korea against its rival, the judges were international banks. The failure to manage its indebtedness resulted in the retreat of the North in the Western financial market. Lost creditworthiness was hard to restore. The divergence in the access to foreign capital resulted in the different paths of economic growth of the two Koreas.