North Korean Ore Trader’s Death Highlights Pressures to Raise Cash for Pyongyang

The rare-earth metals trader was under pressure to send home a million dollars despite Sino-Korean border shutdown.
2021-03-30
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North Korean Ore Trader’s Death Highlights Pressures to Raise Cash for Pyongyang Visitors walk on the Broken Bridge over the Yalu river which separates North Korea's Sinuiju from China, in Dandong, Liaoning province, China March 19, 2021.
Reuters

A North Korean trade representative in China tasked with bringing in a million U.S. dollars a year for the Pyongyang regime took his life when the coronavirus made raising the funds impossible, fellow traders in China told RFA.

The trader, stationed in the Chinese city of Dandong on the border with North Korea’s Sinuiju, was in charge of selling rare-earth elements mined in North Korea, for use in Chinese manufacturing. At the beginning of the pandemic in Jan. 2020, Pyongyang and Beijing shut down their 880-mile border and suspended all trade and traffic, leaving the man with no way to deliver the ore to China.

Sources told RFA the trader was still on the hook for the $1 million even though he now had no way to make the money.

“In February, a North Korean trade worker took his life in Dandong. The coronavirus made it so there was no hope of resuming North Korea-China trade. He had no way to meet the foreign currency goals he had been assigned,” a Chinese citizen of Korean descent told RFA’s Korean Service March 27.

“He was a skilled businessman who earned a lot of foreign currency by smuggling ore concentrates into China… with an annual assignment of $1 million,” the source said.

Ore concentrate from North Korea cannot be legally exported due to international sanctions aimed at depriving Pyongyang of cash and resources that could be funneled into its nuclear and missile programs.

“He opened offices in Dandong and Dalian, selling molybdenum and cerium concentrates. He was a member of the Chilsung trading company, which is under Office 39, and he earned more through smuggling than official trade,” said the source.

Formally the Central Committee Bureau 39 of the Workers' Party of Korea, the organization charged with procuring funds for Kim Jong Un was set up in the late 1970s under the rule of regime founder Kim Il Sung, Kim Jong Un’s grandfather.

The office has foreign currency-earning agents in many countries, and they are expected to earn money regardless of the economic circumstances.

RFA reports from the past year documented how trade officials in charge of North Korean laborers in China were begging to find work for them after opportunities dried up due to the pandemic.

The pressure to meet the earnings goal is so high for trade workers sent abroad, and the ore trader had been a valued asset to the regime.

“We know that this trade worker was seen as a very loyal trade worker by the authorities. He regularly met his assigned earning goals by smuggling the rare metals, and he also sent a large amount to Pyongyang in loyalty funds each time,” the source said, referring to cash payments demanded by the regime.

“But we found out that after coronavirus hit trade, he had been covering the funding assignment by taking out loans from his Chinese counterparts because smuggling ore concentrate was impossible,” said the source.

Another source, a Chinese citizen of Korean descent from Dalian, about 171 miles west of Dandong, confirmed the death to RFA.

“The other North Korean trade officials are greatly discouraged by his suicide because he had once been a very successful trader,” the second source said.

“He was a man in his 50s who specialized in smuggling ore concentrates,” the second source said, confirming that he regularly met his state-assigned foreign currency targets in excess of $1 million each year.

“Because such a competent trade worker took his own life due to all the pressure, the North Korean authorities exempted trade workers in China from paying their assignments until the coronavirus situation subsides,” said the second source.

RFA reported earlier this month that trade workers in China were temporarily exempt from their currency earning obligations, but at that time it was not known that the ore concentrate smuggler’s death may have been the catalyst.

“For nearly a month after the suicide, the authorities in Pyongyang refused to receive the body, saying it was due to the coronavirus. The body could not be buried in the mountains in North Korea, so they cremated it without any documents,” the second source said.

“Because the trade worker is a citizen of North Korea, they cannot put his remains in a Chinese columbarium, so they just keep it in a storage room. During his lifetime, he was busy earning foreign currency and gave a lot in loyalty funds, but now they won’t even take his remains and he’s stuck in a storage room in China.”

According to another RFA report, North Korean state companies this month began hoarding molybdenum ore. Sources said the hoarding caused a spike in molybdenum prices inside North Korea, and that it could be seen as an indication that trade with China could resume soon.

North Korean trade workers dispatched abroad often run afoul of international law when trying to meet their foreign currency targets.

Earlier this month, Mun Chol Myong, a trader assigned to earn foreign currency in Malaysia, became the first North Korean national to be extradited to the U.S.

He is accused of laundering money through the U.S. financial system as a means to evade sanctions and provide luxury items to North Korean elites.

The extradition caused Pyongyang to break off relations with Malaysia, and RFA reported that trade officials in China feared that the diplomats in the North Korean embassy in Kuala Lumpur could face punishment upon their return to North Korea.

Reported by Jieun Kim for RFA’s Korean Service. Translated by Leejin Jun. Written in English by Eugene Whong.

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