Strange but true: North Korea owes Sweden millions for Volvos from the 1970s
Sweden is no stranger to odd stories, but the tale of how North Korea owes the Scandinavian nation millions in unpaid bills for items including a thousand Volvos from the 1970s is definitely one of the weirdest of all.
The story goes that back in the mid-1970s the Swedish government saw the potential to trade with North Korea, and companies like Sandvik, SKF and car giant Volvo were encouraged to court it as a new export market, off the back of the Asian country's economic strength in the 1960s.
Volvo received an order for 1,000 of its 144 model and promptly started shipping the cars out to North Korea in 1974. But it very quickly became apparent that Pyongyang was not paying for the goods that had been shipped.
In fact, they never did, and the debts have stood ever since. Adjusted for inflation, they now amount to the equivalent of millions of dollars.
The Local thought the story had to be an urban myth, but Sweden's National Export Credits Guarantee Board (EKN) has confirmed that it's 100 percent true.
The authority, which promotes Swedish exports by insuring export credits, are now the ones owed the money.
"It's true, it's still the case. The debt now amounts to just over 2.719 billion Swedish kronor ($302 million)," Carina Kampe from EKN told The Local in 2017.
"At the time EKN insured the companies' export credit, and when North Korea didn't pay, EKN had to pay out to the export companies under the credit insurance. So after that, EKN took over the claim, and with the passing of the years the debt as grown," she said.
Even though it looks unlikely that Kim Jong-un will cough up the cash any time soon, as a formality EKN still has to ask for the bill to be paid every year, as it does with all debts on its books.
"How it works is we have this claim, and like all claims we have, it's on EKN's books, so we continue to ask for it to be paid," Kampe said.
"People have even claimed to have seen the cars driving in North Korea nowadays, even though the last ones were sent in the 1970s. That's why they're still getting publicity."
So the positive side of the story, if there is one, is that Volvo clearly built pretty solid cars in the 1970s.
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The story goes that back in the mid-1970s the Swedish government saw the potential to trade with North Korea, and companies like Sandvik, SKF and car giant Volvo were encouraged to court it as a new export market, off the back of the Asian country's economic strength in the 1960s.
Volvo received an order for 1,000 of its 144 model and promptly started shipping the cars out to North Korea in 1974. But it very quickly became apparent that Pyongyang was not paying for the goods that had been shipped.
In fact, they never did, and the debts have stood ever since. Adjusted for inflation, they now amount to the equivalent of millions of dollars.
The Local thought the story had to be an urban myth, but Sweden's National Export Credits Guarantee Board (EKN) has confirmed that it's 100 percent true.
The authority, which promotes Swedish exports by insuring export credits, are now the ones owed the money.
"It's true, it's still the case. The debt now amounts to just over 2.719 billion Swedish kronor ($302 million)," Carina Kampe from EKN told The Local in 2017.
"At the time EKN insured the companies' export credit, and when North Korea didn't pay, EKN had to pay out to the export companies under the credit insurance. So after that, EKN took over the claim, and with the passing of the years the debt as grown," she said.
Even though it looks unlikely that Kim Jong-un will cough up the cash any time soon, as a formality EKN still has to ask for the bill to be paid every year, as it does with all debts on its books.
"How it works is we have this claim, and like all claims we have, it's on EKN's books, so we continue to ask for it to be paid," Kampe said.
"People have even claimed to have seen the cars driving in North Korea nowadays, even though the last ones were sent in the 1970s. That's why they're still getting publicity."
So the positive side of the story, if there is one, is that Volvo clearly built pretty solid cars in the 1970s.
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