South Korea urges North to repay loans

South Korea has urged North Korea to repay millions of dollars in loans provided to the impoverished nation in recent years, a government official said Tuesday. South Korea’s state-run Export-Import Bank made the request to its North Korean counterpart via fax and international mail, the official at the unification ministry said, according to state-run Yonhap news agency. The move came a day after North Korea failed to pay back US$8.6 million in what should have been the first repayment of the principal and interest on assistance worth $80 million extended to the North in 2007. Last week, South Korea informed the North of its obligation, though the North has yet to reply. In 2007, South Korea provided the North with US$80 million worth of raw materials to help it produce clothing, footwear and soap in return for minerals such as zinc. In 2008, the North provided South Korea with zinc and other materials worth $2.4 million, three percent of the principal. Separately, South Korea provided rice and corn in loans worth $724 million to North Korea between 2000 and 2007, during a period in which two liberal South Korean presidents sought reconciliation with North Korea. North Korea has since missed the deadline to repay South Korea $11.61 million in principal and interest for the $724 million in food loans. South Korea has sent messages to North Korea asking for repayment on eight separate occasions, but the North has failed to respond. South Korea says the North is required to pay back a total of $961.53 million by 2037.