Making good on promises made with the late Kim Jong-il at a conference in Ulan-Ude, Siberia, Russia has announced today that it will forgive 90% of North Korea’s $11 billion dollar debt. While $10 billion will be written off immediately, another $1 billion will be spent toward mutual economic development projects.
“The North Korean-Russian debt adjustment pact will pave the way for the two countries to further expand economic cooperation between them,” according to Korean Central News Agency.
Earlier negotiations had focused on getting North Korea to recognize Russia as the Soviet Union’s successor state with regards to who held the DPRK’s debt. With this resolved, Russia and North Korea can begin work on a number of joint projects including a trans-Korean railroad, a gas pipeline, and electricity lines.