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North Korea

Sanctions against North Korea take their toll on smugglers operating along Chinese border

The 1,400km border is the linchpin of North Korea’s economy, with China accounting for about 90 per cent of its trade

PUBLISHED : Sunday, 24 December, 2017, 2:22pm
UPDATED : Sunday, 24 December, 2017, 2:22pm

The small-time smugglers who long helped secretly knit North Korea to the outside world have seen their work plunge since ruler Kim Jong-un came to power, as a handful of large, well-connected Chinese businesses have taken over the trade along the Chinese border.

As Kim has ramped up his country’s nuclear and missile programmes, the increasingly tight international sanctions have favoured more sophisticated players, throwing the world of small-time smugglers into turmoil. One former smuggler, a rail-thin man in his 50s who chain-smokes cheap North Korean cigarettes, worked the border’s secret trails and quiet river crossings until last year, when he left North Korea to move in with relatives in China.

“I could bring in 10 televisions at once, the same thing for refrigerators,” he says. But no more.

The underground community’s troubles reflect the immense role that the border plays in North Korea’s economy, and offer a window into a world that outsiders almost never see. In rare detailed interviews, nearly a dozen people tied to smuggling networks, most either former smugglers or black market traders, discussed how life has changed since Kim came to power in late 2011.

In North Korea, a nation shaped by repression and isolation, smuggling is far more than a crime. Smugglers brought in food during a famine, and eventually carried everything from car parts to South Korean TV shows. They ferried in TVs and ferried out escaping families. Smuggling became a respected profession, offering a road to the emerging middle class.

I could bring in 10 televisions at once, the same thing for refrigerators
Former smuggler

The 1,400km border is the linchpin of North Korea’s economy, with China accounting for about 90 per cent of its trade. While North Korea has faced international trade sanctions for over a decade, Beijing only began significantly ratcheting up enforcement over the past year, amid Pyongyang’s surging weapons tests. Trade has declined, but analysts say a range of products still flow across the frontier, their path smoothed by bribes and politicians in both countries.

As sanctions have tightened, the trade machine has simply grown more complex.

“It’s the smaller traders who are feeling the heat,” said John Park, director of the Korea Working Group at Harvard’s Kennedy School of Government, who has studied how a few Chinese companies came to dominate the border amid the tougher sanctions, acting as intermediaries for North Korean firms. “But this becomes an opportunity for larger companies with North Korean clients.”

When North Korean coal exports were forbidden, some shiploads were channelled through Russia to hide their origin. When North Korea’s overseas businesses faced closure, they opened front companies or hired Chinese middlemen. When buyers objected to clothing made in North Korea, factories reportedly began adding “made in China” labels.

As this peculiar form of globalisation reverberated along the border, many long-time smugglers simply couldn’t keep up.

“I used to make a lot of money,” says another former smuggler, a gravel-voiced Chinese man in his mid-40s now working as an occasional labourer in South Korea. “But it’s not like that today.”

It is lunchtime in Ulsan, the industrial city where he now lives, but he’s sitting in a restaurant nursing both a hangover and a beer. For years, he says, North Korean border units allowed him to bring goods across in exchange for bribes.

“These guys would just let the smuggling happen,” he says.

The man, like all those interviewed with ties to smuggling, spoke on condition of anonymity, since he was admitting to breaking numerous laws.

He made his career running scrap copper into China, working with North Korean partners. His partners would dispatch cars carrying tons of metal to isolated stretches of the Yalu River, which marks North Korea’s northeastern border. Much of that region is deeply rural, with small mountains flanking the river and very few roads. Surveillance is often light. Even in security-obsessed North Korea, borer guard posts can be more than a half-kilometre apart.

I used to make a lot of money. But it’s not like that today
Former smuggler

He hired North Korean soldiers to haul the metal in 50kg sacks across the river, sometimes floating them on rafts made from inflated inner tubes. Cars waiting in China would then whisk the goods away.

For each shipment he brought the soldiers meals, beer and snacks – especially pig’s feet.

“I’m a kind-hearted person,” he growls.

On his best days, he says, he earned more than US$3,600. He could do that a few times a year.

When demand dropped for copper he switched to North Korean rabbit fur, which he could sell to Chinese clothing manufacturers. Then, about two years ago, with sanctions starting to tighten, North Korean border guards grew wary. Rumours spread of harsh punishments: “Anyone caught [helping smugglers] would be killed.” Eventually his partners quit. “They told us they were too scared to do it any longer, no matter how much we were willing to pay.” He finally gave up.

Smuggling grew exponentially in the mid-1990s, when famine savaged the country. As government control loosened, desperate Northerners began crossing the border into China, searching for food or work. While the famine and the turmoil eventually eased, a quietly budding market economy – and the smugglers – held on.

Some trace the pressure on small-time smugglers to the final years of long-time dictator Kim Jong-il, who died in December 2011. Others say it began under his son and successor, Kim Jong-un.

The chain-smoking ex-smuggler says his troubles first began in 2012, when North Korean border units began restricting his shipments. Eventually he was limited to what he could carry. His business finally collapsed last year and he left for China.

Life was supposed to be easier in China. But he barely speaks Chinese and can’t find work.

“All my friends are there in North Korea,” he says, nodding toward the nearby border. His one solace is soju, a vodka-like alcohol loved in both Koreas. “I drink here at my home. One shot with each meal, every day.”