North Korean textile factories are facing difficulties acquiring raw materials following the shutdown of the Sino-North Korean border, with some even ceasing operations, Daily NK has learned.
“Since the autumn of 2018, large shipments of textiles, buttons, elastics and other materials necessary to manufacture clothes came in [from China], but the shipments have stopped because of the COVID-19 pandemic,” a North Pyongan Province-based source told Daily NK on Apr. 17. “The clothes manufactured at the end of the year haven’t been shipped out, either. They’re just sitting there in the factories.”
Daily NK sources confirmed that textile factories affiliated with the Korea Unha General Trading Company have largely ceased operations.
In 2017, the United Nations Security Council adopted Resolution 2375 in response to North Korea’s sixth round of nuclear weapons tests, effectively imposing sanctions banning textile exports from North Korea. Under these sanctions, it is forbidden for Chinese companies to commission North Korean factories to manufacture clothes and export the completed products.
Many Chinese trading companies have nonetheless concluded contract manufacturing deals with North Korean factories.
Clothes manufactured in Sinuiju or even Pyongyang as part of these contract manufacturing agreements have largely been for the South Korea or Japanese markets and include hiking clothes, golf clothes, formal wear and other high-end items.
“The clothes that China commissioned from North Korean factories were mostly high-end clothes,” one source told Daily NK. “There were a lot of clothes that cost more than RMB 1000 (about USD 141), which meant that sometimes [North Korean] people would steal some of the clothes from the shipments sent to China.”
The lack of orders from Chinese clients have also led to factories in Sinuiju, Pyongyang and Pyongsong shutting down and their workers currently remain unpaid.
North Korean factories have reportedly been unable to export the winter and spring clothes they manufactured last autumn nor have they been paid by their Chinese clients.
“There’s little chance the clothes will be sold now because winter’s over, but there’s the feeling [in North Korea] that Chinese companies should still take them,” another source said. “Right now the North Korean factories are asking the Chinese trading companies for some sort of compensation.”
In fact, many factories throughout North Korea have been unable to receive compensation from their Chinese clients, Daily NK sources said.
“[Various] assembly factories and those involved in manufacturing seafood for Chinese clients are also suffering,” another source said, adding, “They survived a long time despite sanctions, but now many people think [the factories] have reached the end of the line.”
*Translated by Violet Kim
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