Trump's North Korea threat could have a '$10 trillion price tag' for US

 

Donald Trumps recent threats to unleash "fire and fury" on North Korea would take a $10 trillion hit to the United States economy, a North Korean expert estimated.

In recent days, Trump and the North Korean regime have engaged in heated rhetoric about the Asian nation's nuclear weapons program.

Trump warned on Tuesday the US would rain down “fire and fury” on Pyongyang if North Korea followed through with its threat to attack the US-held Pacific island of Guam.

Donald Trumps threats to unleash 'fire and fury' on North Korea to take a $10 trillion hit on the US economy. Picture: AFP

The president's rhetoric came as tensions mounted between the US and the rogue state.

The escalating threats followed reports North Korea had mastered crucial technology needed to strike the US with a nuclear missile.

If the US was successful in wiping out the North Korean regime, experts predict the process of reunification between the two Koreas to follow would become exhausting and economically catastrophic.

But Dr Leonid Petrov, a North Korea expert and visiting fellow at the Australian National University’s College of Asia and the Pacific, warned this would cause a significant financial burden on the US.

“I think it will probably cost at least $10 trillion, but probably more,” he told News Corp.

Dr Petrov previously said reunification would cost an estimated $3 trillion immediately, with $7-8 trillion more to follow over the next 10 years.

“The younger generation of South Koreans is not very keen at all to see reunification because they know they will have to pay for this,” he said.

If this were to happen, Dr Petrov said marked social tension between South Koreans and North Koreans would follow, including abuse, crime and other social problems.

“Both countries have been isolated from each other, they speak different dialects, understand the world differently. South Korea doesn’t need its impoverished, aggressive, poorly educated brothers to inundate South Korea,” he said.

Dr Petrov argued the South Korean economy was reaching crisis point and urgently needed access cheap resource and labour, News Corp reported.

“South Korea might use the opportunity to exploit North Koreans who have less education or experience in enterprise.

“Millions of North Korean workers could become second class citizens, there could be widespread discrimination - even the border might be kept for years to stop mass immigration.

If the US was successful in wiping out the North Korean regime, experts predict the process of reunification between the two Koreas to follow would become exhausting and economically catastrophic. Picture: AFP

“It will take at least a decade before the level of prosperity will be equalised between North and South.”

The best-case scenario is something akin to the reunification of Germany in 1990. South Korea would likely benefit economically in the long run, according to a report from Capital Economics.

Like Japan and many European countries, South Korea has a population that is fairly old with the median age 41.2.

North Korea, however, is a much younger country with the median age of 33. In a peaceful transition, this would breathe youth back into the workforce and improve the South’s demographic outlook.

Youth isn’t the North’s only natural resource — it’s home to the Korean peninsula’s greatest wealth of untouched raw materials. For South Korea, access would push down the need to import and provide it with cheaper building blocks for its strong manufacturing industry.

Reunification would raise problems for crime, migration and other social issues. Picture: Reuters

Besides the utilisation of North Korea’s potential, a unified Korea could benefit significantly from lower military expenses, which cost both countries dearly. That money would be freed up for other projects.

Amid Trump’s heated words days ago, South Koreans are buying more ready-to-eat meals that could be used in an emergency and the government is planning to expand nationwide civil defence drills planned for August 23.

Hundreds of thousands of troops and huge arsenals are arranged on both sides of the tense demilitarised zone between the two Koreas.

Trump and French President Emmanuel Macron spoke by phone on Saturday and agreed to work together on a crisis on the Korean Peninsula, the White House said in a statement.

"They discussed the need to confront the increasingly dangerous situation associated with North Korea's destabilising and escalatory behavior," the White House said in a statement.

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