North Korea’s closed society keeps trade routes open

From the Washington Post

Flow of money, goods frustrates US drive to tighten isolation

Doug Struck

February 3, 2003


Once a month, Hiroshi Yano bundles together a few million yen, wraps the money in plastic with a Japanese customs seal, and put it on a ship to be handed over at sea to a boat captain from North Korea and delivered to the Stalinist government there.


It’s all legal: The money is payment for North Korean snow crabs that Yano imports for Japanese tables.  And Yano said he wants to continue the business, nukes or no nukes.


“We are just a private company doing trade.  We are independent of politics,” said Yano, manager of an import business that runs three ships to North Korean waters from this port town 350 miles west of Tokyo.


The payments are just one example of the many flows of money and goods that prop up the North Korean system and circumvent the isolation that the US and other countries have sought to impose.


The Bush administration’s strategy to tighten that isolation and compel North Korea to dismantle its nuclear weapons program may be undermined by the complexity and number of trade routes that snake in and out of North Korea.


The trade ranges from the global export of missiles to lone Korean smugglers who wade the river border into China to barter for their food.  It includes products as legal and innocuous as Yano’s snow crabs and as dangerous as smuggled drugs delivered to Japan’s coast line by unmarked ships.


[But each year] North Korea makes missile sales estimated to bring in anywhere from several hundred million to $1billion.  Its customers, intelligence agencies say include Libya, Iraq, Iran, Yemen and in the past, Pakistan. 


Japanese importers pay the North Koreans with bundles of cash or with bartered goods such as food, sports shoes or a bike for the sailors, or generators.  30,000 large crabs are worth about $4,000.


Seafood is the biggest component of Japan’s $370 million annual trade with North Korea, which brought the DPRK’s ships to Japan 1,200 times last year.


South Korea has $350 million in trade with the DPRK.  Most of it from sending textiles to the north and buying finished clothes. 


China reported its trade at $730 million, and that is just the legal trade.  It used to be food and oil, now it is everything: pots, pans, shampoo.


Many intelligence analysis believe that smuggling is orchestrated directly by powerful North Korean officials.  Japanese claim they manufacture methamphetamines.


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