Sanctions? What Sanctions?

On October 9th, 2006, nothing happened

SEOUL, Nov. 1 (Yonhap) — Trade between North and South Korea has already topped US$1 billion this year, surpassing the record amount set last year, an official at the Unification Ministry said Wednesday.

“The total amount of trade for this year came to US$1.08 billion as of the end of September,” Koh Hwa-seop, an official at the ministry’s inter-Korean economic cooperation bureau told Yonhap News Agency.

The total amount for the entire year of 2005 was US$1.05 billion, the largest amount since the end of 1950-53 Korean War.

The record-breaking amount comes despite Seoul’s continued suspension of its humanitarian aid for its communist neighbor, which traditionally accounted for a large portion of trade between the two Koreas.

Unification Minister Lee Jong-seok had earlier claimed the suspension of the humanitarian assistance led to an 80-percent reduction of his country’s economic exchanges with the communist nation. The suspension of the aid came as punishment following Pyongyang’s launch of seven ballistic missiles in early July. The North conducted a nuclear device on Oct. 9.

However, inter-Korean economic exchanges increased to a near record-breaking amount in September to over $312 million from $97 million for the same month last year, according to Koh.

The total amount of trade between the Koreas for the January-September period in 2005 was $788 million, Koh said.

There is a market there, so some trade is going to occur inevitably. But other than dirt-cheap labor costs, what economic argument can be made that investing or trading in North Korea is such an attractive option?