Talks with North Korea could boost global trade

Historic summit on June 12th might open doors with Asian partners

Recently, via President Trump’s Twitter account, we found out more details for the upcoming historic summit between the United States and North Korea. The meeting, taking place on June 12th in Singapore, will be the first time ever that a U.S. President will sit across from a North Korean leader.

What will come from this meeting? No one knows at this point. But, one market analyst suggests that no matter what develops from the summit, the fact that it is happening could mean a great deal for agricultural commodities. Not necessarily in North Korea, but certainly in the region.

“This is something I have been working on for well over a year and I think this summit opens more trade doors with Asian partners and helps the U.S. and China work better together,” said Mike Zuzolo from Global Commodity Analytics. ”If this North Korean meeting goes off without a hitch and we help to bring that country into the international community, I think that the United States will ‘pay back’ China with embracing that country’s Silk Road Initiative.”

The aim of the Silk Road plan, as explained by the World Economic Forum, is to kindle a “new era of globalization”, a golden age of commerce that will benefit all. Beijing says it will ultimately lend as much as $8 trillion for infrastructure in 68 countries. That adds up to as much as 65% of the global population and a third of global GDP.

But reviews from the rest of the world have been mixed, with several countries expressing suspicion about China’s true geopolitical intentions, even while others praise the scale and scope of the project.

“If the U.S. begins to show favor to this project, we can almost see another whole leg up in commodity demand worldwide between now and the middle of the century,” Zuzolo said. “That is how big of a project this is.”

The Silk Road project already has $1 trillion of projects underway, including major infrastructure works in Africa and Central Asia.

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