[Reportage part I] The effect of sanctions at the corridor between N. Korea and China

Posted on : 2016-04-01 12:46 KST Modified on : 2019-10-19 20:29 KST
Despite harsh measures to limit economic interchange with North Korea, trade continues in Dandong
Trucks park at China Custom in Dandong
Trucks park at China Custom in Dandong

“Everything’s determined by who makes more money. Money is power. For all the talk about equality between men and women, it all comes down to who makes more money. Money talks.”

“The world doesn’t just revolve around money, you know.”

“I beg your pardon? You should speak the truth.”

“But that is the truth. . . .”

“That’s the future. What about the reality today?”

He kept pressing me for an answer.

“I guess today it does revolve around money. . . .”

 

Singing South Korean favorites
 North Korea
North Korea

After all the questioning, I found myself trailing off. I’d met him at a Japanese restaurant in Dandong, a city in China‘s Liaoning Province. He knocked back an Asahi beer from the table. As someone who had lived 33 years in a capitalist society, I had no reply for someone who claimed money made the world go around. This man telling me that “money talks” was a North Korean, someone who had lived for forty years in a communist society.

He had visited China frequently for over a decade on business, and now he was stationed in Dandong for a North Korean company. He wore a Tommy Hilfiger shirt and used a Samsung smartphone. He had Chinese employees with him and said their wages were more than 20,000 yuan (US$3,070) a month. He also said his company recently imported over US$50,000 in products, and showed me a text message from a Chinese buyer thanking him in advance for receiving the goods. Seeing me struggle to finish my sentence, he answered for me.

“You see it, don’t you? So it’s a harsh reality.” He laughed. “Every time I meet people from the South, I wonder how much money they’ve got in their pocket. When I met you, I thought, ‘What’s her standing? Is she high enough to meet someone like me? How much does she make?‘”

Sometimes he contradicted himself. He said money was power, but he also said a full stomach wasn’t a measure of living.

“Why do you think of the North as beggars? ‘You’re making nuclear weapons when you have no money - why don’t you feed yourselves?’ If you want to judge a person’s life by whether they’ve got a full stomach or not, think of the Won-young case.”

He was referring to the recent death of Shin Won-young, a seven-year-old South Korean boy, after months of abuse by his father and stepmother.

“If you judge by the standard of how full his stomach was, do you think it happened because he was poor and had nothing to eat? He was abused and didn’t get any protection. How terrible is that?”

“South Koreans call North Korea ‘beggars who can’t get enough to eat,’ and they don‘t even understand their own society or situation. Up until 2000, the whole country had nothing to eat. That’s not begging, that’s a collective phenomenon. In the North, it’s like you’re seeing us that way when you don’t even wear underwear or cover up your breasts.”

His argument was that South Korea’s capitalist society may allow us to fill our stomachs, but that it is not a healthy one. Accompanied by his wife, he went to a karaoke room after the first round of drinks at the Japanese restaurant. He chose to sing South Korean favorites “The Dew of the Morning” by Yang Hee-eun and “Labyrinth of Love” by Choi Jin-hee.

“‘The Dew of the Morning’ is still banned, isn’t it?” he asked me. As someone who claimed to search South Korean media every day - and who even knew the particulars of the Hyeongje Welfare Center incident involving human rights infringements against so-called “vagrants” in the 1980s - he was surely aware the ban on “The Dew of the Morning” had been lifted at some point. It was meant as a pointed jab against “South Korean society.”

“Why do the women slap men in South Korean TV shows?” he asked me. “Isn’t that true in real life too?”

It was the evening of Mar. 14, and I took my leave of the couple at the karaoke room. Before entering the taxi, the wife asked to shake my hand. “I don’t know when we’ll meet again,” she said.

From there to the hotel, it was a long walk along the river with the Sino-Korean Friendship Bridge in view. I opened the door to my riverside hotel room to see downtown Dandong and the Amnok (Yalu) River in the darkness outside the window.

On the other side of the river was the North Korean city of Sinuiju. I’d been in Dandong for over six days. Is anyone outside the Korean Peninsula aware that there’s a city where South and North Koreans meet every morning to exercise, where borders break down? It was nighttime in the city of Dandong, a city that defies the imagination more than any fiction or movie.

 China waiting for inspection before crossing the DPRK-China Friendship Bridge into Sinuiju
China waiting for inspection before crossing the DPRK-China Friendship Bridge into Sinuiju

 

North Korean officials overseas and Pyongyang-style market economics

The man who sang “The Dew of the Morning” is an employee at a North Korean state-run enterprise who is assigned overseas. Hundreds of North Korean employees are living and working in Dandong.

Most are members of the elite, graduates of Kim Il-sung University or North Korea’s University of International Relations, which trains diplomats and other officials involved in foreign affairs under the auspices of the Korean Workers’ Party (KWP).

In Dandong, however, this man is called the company’s “representative.” He did not tell me exactly how many such company representatives were in Dandong, but he did say that there were fewer than 1,000 in Dandong and around 3,000 in China’s three northeastern provinces.

Last year, the North Korean government instructed its overseas employees that they were allowed to meet South Koreans in connection with work. While these employees had long interacted with South Koreans living in Dandong who did business with the North, the new instructions officially cleared the way for such interactions.

During my nine-day trip to Dandong, I met a South Korean in his sixties doing business in the North - we’ll call him Choi - who knows a number of North Korean trade representatives. (In order to protect the South and North Korean overseas employees, the names and ages of people who appear in this story will not be disclosed.)

“North Korean employees don’t meet each other very much in Dandong,” said Choi, who has been doing business in North Korea for 18 years. “They have to watch out for each other, and there’s a system of mutual surveillance. If anything, they‘re more comfortable with people from South Korea like us, because what they say to us will never get back to North Korea.”

“Even Chinese-Korean and ethnic Chinese in North Korea are connected to the North, but what North Koreans say to us won’t make its way back home.”

Signs that a North Korean-style free market economy has been starting to bloom since North Korean leader Kim Jong-un took power in late 2011 can also be seen in Dandong.

“The majority of North Korean companies are operated by the state. Organizations of every level in North Korea - whether the army or the party - have companies attached to them. That’s what companies are,” said Choi.

“The Ministry of People’s Armed Forces, and military divisions, and other government institutions have their own companies. Each of these institutions sets up companies that go into business in a certain area. The idea is for each unit to support itself.”

“No doubt they get some support from the central government, but to some extent they have to fend for themselves. Plus, they have to give something back to the government.”

“There weren’t very many companies before, but these days it has become very easy and simple to set up a company. Since Kim Jong-un took power, I mean. The government determines what area they’ll do business in.”

In Nov. 2009, North Korea shut down the jangmadang (underground markets) while pushing through currency reforms. But unexpected consequences including a spike in the price of goods led the government to end its suppression of the markets in May 2010, and as of Dec. 2015 it was still tolerating them.

According to Curtis Melvin, an analyst at the US-Korea Institute at Johns Hopkins University who has analyzed satellite imagery, as of Oct. 2015 there were 406 official markets at which North Koreans pay rent and do business under government supervision. Since there were about 200 markets in 2010, this means that the number has doubled in just five years. (“2015 Trends and Outlook for Marketization in North Korea,” by Yang Mun-su, a professor at the University of North Korean Studies)

Separated from North Korea by the Yalu River, Dandong is both a window into North Korea and a city in which exchange occurs between North Korea and China - as well as North Korea and South Korea - through the conduit of trade.

“While the North Korean economy suffered an extreme crisis in the 1990s, in the 2000s there were signs of a limited recovery. The North Korean corporate structure as of 2013 has probably become quite different from the conclusions we drew in the 1990s, but a detailed analyst has yet to be conducted,” wrote Lee Seok-gi, a senior analyst at the Korean Institute for Industrial Economics and Trade, in a report titled “The State of North Korean Corporations and Industrial Trends in the 2000s: Focusing on an Analysis of Official North Korean Media.”

But there is virtually no information about the rapidly changing North Korean-style market economy or North Korean corporations.

According to the secret border agreement reached by North Korea and China in 1962, the Yalu River is supposed to be jointly managed and used by the two sides. Since the 1980s, there has been exchange between Dandong and Sinuiju, which share the river.

Starting in 1992, when South Korea and China established diplomatic relations, South Korea businesspeople flocked to Dandong to do business with North Korea. Even after the May 24 Measures in 2010, which placed a ban on economic cooperation between North and South Korea, North Korean products continue to make their way into South Korea indirectly, by way of China, and vice versa.

Since the UN Security Council adopted Resolution No. 2270, the sixth sanctions resolution against North Korea, on Mar. 3, Dandong has received even more attention than Beijing. Dandong was in the path of the storm; the border had taken an economic hit; the mood was chilly; there was tension in the air, there were frowns on the faces of merchants; residents were worried about their livelihood; and relations between North Korea and China had suddenly frozen - or at least the news reports broadcast in South Korean living rooms would have it. The evidence was photos and videos showing North Korean restaurants in Dandong without any customers, tour boats on the Yalu River, empty customs offices, and a lack of trucks on the Sino-Korean Friendship Bridge. 

But what about the reality that lies behind the television news and newspaper articles? Have UN sanctions on North Korea severed the trade route passing through Dandong? Will North Korean sanctions have any economic effect? How much business are North Korean trade representatives in Dandong doing? What is life like for the South Koreans, Korean-Chinese, ethnic Chinese in North Korea and North Koreans, all of whom have been crossing the border for decades to trade in Dandong? Is North Korean society across the Yalu River as closed as we think it is?

My head was filled with questions as I set out for Dandong. I had decided to enter the real Dandong, instead of trying to fit reality into a predetermined frame. Accompanying me was Kang Joo-won, 43, an anthropologist who has been researching these four groups of Korean speakers who have been visiting Dandong for decades as well as their economic cooperation.

By Park Yu-ri, staff reporter

Please direct questions or comments to [english@hani.co.kr]

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