North Korea owes $395 million for 1,000 Volvos

North Korea owes Sweden hundreds of millions of dollars for 1,000 Volvo automobiles that the isolated state bought in 1974, Newsweek reports.

The magazine said Pyongyang owes the European country some $395 million (400 billion won), a figure adjusted for interest and inflation, citing government data.

The debt is a reminder of the North’s plummeting status from a growing economy to impoverished country in the span of a few decades, which critics blame on the Kim regime’s mismanagement.

“Many had been blinded by North Korea’s impressive economic growth ­ people had raced to get there first,” journalist Lamm Nordenskiöld told Newsweek. “Sweden was supposed to be the first country to unlock this new market,” she added.

Newsweek said the Swedish Export Credits Guarantee Board was advised to insure Volvo’s and other companies’ exports to the North, but the Kim regime has failed to pay back the debt.

In the 1970s, the North enjoyed an amazing 25 percent economic growth backed by military posturing and ambitious industrial projects.

Surprisingly, the 40-year-old Volvos are still used in Pyongyang as a taxi fleet. They

were well-maintained and their appearance is pristine, Newsweek reported.

The North’s economy has changed since Kim Il-sung’s reign. The regime has reluctantly accepted a market system born of necessity during a 1990s famine that killed hundreds of thousands.