North Koreans Send Funds Home

Resettled in the United States, North Koreans find ways to send money back home.
2010-07-23
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Images released by Chosun Sinbo, a pro-North Korean newspaper in Japan, show the front and back of the newly issued North Korean 5,000, 2,000, and 1,000 won bills, Dec. 4, 2009.
Images released by Chosun Sinbo, a pro-North Korean newspaper in Japan, show the front and back of the newly issued North Korean 5,000, 2,000, and 1,000 won bills, Dec. 4, 2009.
Yonghap News Agency

WASHINGTON—Since the United States opened its doors to North Korean defectors in 2004, close to 100 people have been granted residency, and promptly gotten to work sending funds to poverty-stricken relatives back home.

"There are a lot of people who send money to North Korea, because people back home have little to eat, and life is hard," said Choi, a North Korean defector who was resettled in the United States after arriving in South Korea in 2006.

Choi said she sends U.S. $1,000-1,500 to family in North Korea once, sometimes twice a year.

"It may not be much elsewhere, but that is a lot of money for those families living in North Korea,"  she said.

"Because their offspring got out of North Korea and are making money here, their North Korean families are now rich," Choi added.

Agents charge a steep 20 percent in commission to send the funds to North Korea. Some wire the money to relatives via South Korean bank accounts and then Chinese bank accounts, Choi said.

She said telephone re-routing services had also sprung up enabling defectors to speak on the phone directly to their families, giving them hard-to-come-by information about the outside world, and hearing news from home.

Some brokers will receive the funds in China, and use it to buy much-needed foodstuffs—basic staples such as rice and flour—before smuggling it across the border to relatives in North Korea.

Basic staples

Kim, a North Korean who arrived in the United States in 2008, said he used this method to keep his family from hunger.

The commission is lower, it is easier to escape searches at the border, and the families are relieved of the difficulty of trying to exchange U.S. dollars or Chinese yuan for North Korean currency.

"I sent medicine, shoes, and clothes to my family," Kim said.

"They need to be delivered by courier, but customs charge only between 100 and 200 Chinese yuan (U.S. $15 and $30)."

Kim said the economic situation in North Korea seems to be getting worse, quoting his family in North Korea as saying that the price of rice is rising rapidly and that the cost of staples is increasing.

They contacted Kim to ask for urgent help, because it was becoming harder and harder to feed everyone.

A third U.S.-based defector, Jang, said he had sent about U.S. $1,000 dollars to family in North Korea through Korean-Chinese brokers in the past two months.

While the 20 percent commission was steep, there was still enough money left over to feed his parents, brothers, sisters, and their families, Jang added.

Jang said he had secured a steady job since arriving in the U.S., and said he plans to send funds home regularly.

Mountain stipends and river funds

Impoverished North Koreans have a long history of receiving money from relatives overseas.

Money wired by Korean residents of Japan has long been dubbed the "Mount Fuji stipend," while money coming from North Korean defectors living in South Korea is known as a "Mount Halla stipend."

"Tumen River funds," meanwhile, are those that cross the border from China.

According to defectors, brokered money transfers from North Korean defectors residing in China to their families in North Korea appear to be picking up speed, and may include funds coming from further afield via China-based brokers.

North Koreans who can afford to save their money are ignoring a new currency brought in by the ruling Workers' Party in the isolated Stalinist state in favor of the more trusted renminbi yuan from China.

On the country's black markets—the chief source of essential goods for many under a planned economy in which products are scarce and often monopolized by the country's elite—any buyer offering to pay in yuan can expect a large discount, residents say.

North Korea issued its revalued won last December, dropping two zeroes off the old won and imposing limits on the amount that can be exchanged per person.

The move sent shockwaves through North Korea, with reports of citizens rushing to black-market moneychangers to cash in their won for more stable U.S. dollars and Chinese yuan.

Original reporting in Korean by Soo Kyung Rhee. Korean service director: Max Kwak. Translated from the Korean by Greg Scarlatoiu. Written in English by Luisetta Mudie. Edited by Sarah Jackson-Han.

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