After the Korean War came to an end in July 1953, North Korea signed a massive trade deal with Sweden in an effort to rebuild their economy and to become a more independent functioning state. Sweden saw the potential to trade and thought they could benefit from North Korea’s newly emerging economy. In the 1970s, they exported $70 million worth of Swedish-made industrial machinery, heavy mining equipment, and 1,000 Volvo 144s cars.
Sweden became the first western country to open an embassy in North Korea in 1975. In fact, until 2001 Sweden was the only western country with diplomatic representation there. Shortly after opening an embassy in Pyongyang, it became clear to Sweden that North Korea could not afford to pay for those imported goods. They certainly did not pay for those 1,000 Volvos.
It probably begins to explain the unique yet long-standing relationship between Sweden and North Korea. As we all know Sweden’s policy of neutrality in armed conflicts- the Nordic country has a history of avoiding picking sides in conflicts. However, that is not the case with North Korea.
Over the years, Sweden has managed to gain a small sense of trust with North Korean leadership- sometimes enough to ease tensions and influence in the area. Sweden has played a crucial diplomatic role with the secretive government in North Korea, most often seen when it acts on behalf of the west when Westerners get into trouble.
The United States has no formal diplomatic relations with North Korea, so there is no Embassy in North Korea. Thus, the US has entrusted Sweden to represent their diplomatic interests in North Korea. Sweden plays a similar role for Australia and Canada. For instance, when the American journalists Laura Ling and Euna Lee were detained in North Korea in 2009, it was the Swedish Embassy in Pyongyang that stepped in and represented the US interests. They were initially sentenced to 12 years of hard labor. But they were freed after the Swedish Embassy arranged a meeting between former President Bill Clinton and Kim Jong II.
Sweden shipped Volvos to North Korea as part of an ill-fated trade deal. Swedish Export Credit Agency sends a yearly reminder to North Korea to this day, and the debt has amounted to over $322 million. More than four decades later, North Korea has yet to pay for 1,000 Volvos. But Sweden remains an important Western diplomatic presence in Pyongyang, North Korea.
All these years later, 1,000 Volvos are still there in North Korea just like the Swedish Embassy. Perhaps a fleet of 1,000 unpaid Volvos is just a cost of diplomacy.