North Koreans are complaining that their government’s shutdown of trade over the Sino-North Korean border due to fears over the Wuhan coronovirus is causing even more economic distress than international sanctions, Daily NK sources reported yesterday.
“People have long complained about the difficulties caused by international sanctions, but not to the extent I’m hearing now,” a source in North Pyongan Province told Daily NK on Feb. 5. “The shutdown of the border has halted all official and non-official trade over the border and has caused commodity prices to skyrocket.”
Daily NK recently reported that the prices of some commodities and exchange rates have spiked in Sinuiju following the border shutdown.
“There’s nothing but a depressing atmosphere in local markets,” the source continued, adding, “People have lived under the difficulties of sanctions for years, but now they’re worried that they are going to die of starvation.”
RELIANCE ON CHINESE IMPORTS
North Korean leader Kim Jong Un is still calling for “self-reliance” and increasing the local manufacturing of goods and technologies, but Daily NK sources said that North Korea has long imported most of its food and raw materials from China.
According to a report published by the Korea Development Institute (KDI) on Feb. 4, two of the 10 ten imports from China in 2019 were products with an HS code of 10, including grains, along with items with an HS code of 11, including “milling industry goods, malt and starch. The report suggested that North Korean authorities had imported those items to stabilize food prices.
According to a report published last year by the Korea International Trade Association (KITA), North Korea’s main imports from China in 2019 included foodstuffs such as soybean oil, flour, fruit, and glutamic acid, along with raw materials and parts used in manufacturing processes such as watch accessories and fabrics.
“North Korea continues to consume imports from China that focus on goods untouched by international sanctions (such as foodstuffs and chemical products),” the report said.
“People are just waiting for the restart of trade because the state isn’t necessarily going to give them rations [rice and other foodstuffs] after suspending trade [with China],” the North Pyongan Province-based source said. “People are worried that something terrible will happen if the customs offices continue to be closed.”
Another source in North Hwanghae Province told Daily NK that people are on the edge of “death” because of the border closure. He added that North Koreans are using their mobile phones to spread rumors around the country saying that the closing of the border has had a worse effect on the economy than international sanctions.
“North Korean authorities consider [such rumors] to be groundless and treats those who spread them as enemies of the state,” the source said. “Orders have come down to severely punish those who spread such rumors.”
Many businesses in North Korea have halted operations because of international sanctions, but now with the cutoff of raw materials from China, those businesses that were still operating are under more pressure to shutdown, Daily NK sources said.
“All of the various raw materials and other goods that came through Dandong no longer make it into the country [due to the border shutdown],” the North Pyongan Province-based source told Daily NK. “Companies are facing the prospect of having to completely shutter their operations.”
The source added that many factories in North Pyongan Province have only a couple days’ worth of raw materials to work with and speculated that factories throughout the country are facing similar situations.
“People feel like the closure of the border is creating great hardship for North Korea,” he added.
TIGHTENING THE NOOSE AROUND SMUGGLING
North Korean authorities are also reportedly trying to eliminate smuggling across the border as part of efforts to prevent an outbreak of the Wuhan coronavirus.
“Before the border shutdown, Chinese ships would unload their goods at either Sinuiju or other ports near the mouth of the Yalu River,” the source said. “Now, however, the coast guard has been ordered to shoot anybody anywhere if they try to stop their ships on the coast.”
“Coast guard units are not returning to their lookout points but are continuing to carefully watch movements on the river,” the source said, adding, “They will be treated as heroes if they catch Chinese smugglers so they’re keeping a close eye on things.”
Daily NK reported last week that ships at Sinuiju Port are no longer able to enter or leave the harbor as of Jan. 25.
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