Today, North Korea has an air of danger and isolation about it. The idea of traveling to North Korea is laughable, and it’s been that way for quite a long time. But in the 1970s, there was hope for a more open country, and Sweden was one of the first Western countries to extend any sort of friendly gesture towards North Korea.
At that time, North Korea was an untapped market for every sort of company, and Swedish businesses were more than happy to provide. Things were looking up for North Korea after the Korean war, and there was reason to believe that opening up trade routes between the two countries would be beneficial to them both.
It only took one business deal, and one of the biggest car thefts in history, to teach Sweden the lesson that blind trust doesn’t always pay off.
North Korea’s Economic Status in the 1970s
North Korea was in flux, newly under the leadership of Kim-Il-Sung. At the time, the country was still known to be isolationist, but there was interest in international trade.
North Korea was desperate to catch up with other countries as far as industry and technology went, but they had a long way to go. It’s likely that they stretched themselves too thin in this race to compete, which is one reason they could never accomplish their goal…and why they decided to never pay their car debt to Sweden.
Trade with North Korea wasn’t exactly easy, either. They were interested in branching out, but still wary of other countries. All deals were heavily monitored by the government, and international trade had only really been established with China and the Soviet Union. North Korea was receiving a lot of aid at the time, too, and it was in no position to spurn these allies.
That didn’t mean that they weren’t open to trading with countries in the West, though. One area where North Korea was lacking was the industrial sector, and they desperately needed to modernize. That’s where Sweden, and their Volvos, come in.
The North Korea Volvo Deal
Part of modernizing North Korea was bringing in new cars, and the Volvo 144s was a brilliant choice. Sturdy and rectangular, these Volvos were reliable, no nonsense cars that would last for a long time–exactly what North Korea was looking for.
Better yet, Sweden was also in the position to send North Korea a plethora of heavy mining equipment as well. The deal would earn Sweden $70 million, and also serve as the first inroads into the North Korea market for the Scandinavian country.
The first order from Sweden to North Korea was 1,000 Volvos, mostly the 140 series with a few new 240 series in the mix. The deal was so important and monumental for the two countries that talks immediately sprang up about Sweden having an embassy in North Korea, an almost unheard-of thing at the time.
So, with that, the heavy mining machinery and boxy Volvos were on their way, with the cars quickly being distributed among the favored of Kim-Il-Sung. At the same time, the first Western embassy, the Swedish embassy, was founded in Pyongyang.
The first diplomat to North Korea was a Swedish diplomat named Erik Cornell. He described Pyongyang as “Snowy, windy, cold.” and mentioned that “You couldn’t go into a cafe or restaurant because there were none.”
Cornell served as the diplomat to North Korea for only two years, from 1975 to 1977.
North Korea and the Stolen Volvos: Where Did Things Go Wrong?
Once the Swedish embassy was opened in Pyongyang, Cornell noticed that things weren’t running as smoothly as they appeared on the outside looking in.
Then, just as quickly as it had started, North Korea’s trade with the West came to a standstill. None of the invoices were being paid, which meant that none of the traded goods had actually been purchased. They had just been given to North Korea, and the country seemed perfectly content to never pay for them.
All of that industrial equipment that Sweden had sent over was never put to use. The Volvos, though, were definitely being driven, even if they had essentially been stolen.
For years, the stolen Volvos could be seen in the backgrounds of the rare picture from Pyongyang, and visiting journalists and political figures were always given one of the infamous Volvos as their vehicle for the extent of their stay.
Despite the shady business doings, Sweden still retains one of the best relationships with the North Korea government out of any other country. Sweden’s embassy still exists in Pyongyang, and their presence there allows them to work as the go-between with other Western countries like America and the mysterious, often hostile North Korean government. The Swedish Embassy even steps in when American citizens are detained in North Korea, doing what they can to help.
The Legacy of the North Korean Volvos
To this day, Sweden is still trying to acquire payment from North Korea, even if it has become a lost cause at this point. Sweden sends North Korea twice-yearly reminders about the bill for the Volvos that still remains unpaid, but North Korea never responds. Maybe the letter is just getting lost in the mail.
Even now, some of the Volvos can still be seen cruising the empty streets of Pyongyang, but they aren’t quite the status symbols they once were. Instead, you’re more likely to see the Volvo 144s working as taxis and other sorts of casual transportation. There aren’t many left, but they aren’t extinct yet, either.
While the initial cost of the Volvos and accompanying machinery was $70 million, with interest, that debt has ballooned to an astounding $322 million. The Swedish government paid Volvo for their product, but they themselves are still left holding the bill after all these years.
It isn’t all bad news, though. Sweden still has more trust from North Korea than most other countries on the planet, so that might just make the price tag of 1,000 Volvos worth it.
References
“How a thousand unpaid-for Volvos created a diplomatic bridge between Sweden and North Korea”
“How 1,000 Volvos Ended Up In North Korea — And Made A Diplomatic Difference”
