After North Koreans were spotted repairing trade facilities and installing disinfection devices at customs offices in Sinuiju and Nampo last month, there has been speculation that trade between China and North Korea is set to resume soon.
Daily NK understands, however, that North Korean officials have not yet allocated waku (trade certificates) needed for trade agencies and individuals to participate in state-sanctioned trade activities.
A source in North Korea with insight into North Korean trade activities told Daily NK last Thursday that trade companies have completed the administrative processes to receive waku approval, but the Workers’ Party has not yet given official instructions about the allocation of waku.
To receive a waku, an individual must submit a detailed proposal containing the name of the trading company they belong to, the nature of the goods they import and export, which Chinese importers they will trade with, and what plans they have to conduct trade in the future.
Each trading company has already collected proposals containing this information from the head of kiji (a small private business organization of about seven people that is nominally attached to a trading company) and business people who wish to engage in trade activities.
It typically takes about one month for the Central Committee, the Cabinet, and the Ministry of State Security to review the proposals submitted by trading companies and agencies and approve the issuance of waku.
Since the Workers’ Party has not yet handed down orders about waku, trade is unlikely to resume during the month of April. There is speculation, however, that trade activities could resume at any time given the fact that North Korean authorities could quickly move forward with issuing waku if they believe there is an urgent necessity to do so.
Trading companies and business people who acquired waku in the past have been ordered to resubmit proposals so their certificates can be reviewed and reissued. However, even these applicants are still waiting for the document screening process to begin, indicating that the waku issuance process may take more time than it did in the past.
North Korean authorities are allowing trading companies affiliated with powerful government agencies that have continued import and export activities even after the closure of the border last January to skip the waku reissuing process.
These companies are reportedly required to submit reports detailing the total amount of party funds they have spent on trade and what activities they conducted to make sales.
During the waku issuance review process, North Korean authorities reportedly plan to closely check for signs that trading companies engage in import-export activities with South Korean businesspeople or have records of importing South Korean or Japanese goods. The authorities will also investigate whether their Chinese partner companies have links to South Korea, Japan, or the United States.
“If [the authorities] find that [the companies] are linked to an enemy country, they will likely not be able to receive a waku or participate in official trade in the future,” the source said.
Based on the source’s account, the authorities are reportedly apprehensive about trade activities linked to South Korea, Japan, and the United States, as well as the import of products from these countries into North Korea.
The delay in the resumption of official Sino-North Korean trade activities may be partially related with COVID-19 worries in the country.
Daily NK recently reported that border guards in the Chagang Province border area were wearing gas masks while on patrol.
North Korean authorities reportedly claimed that the soldiers were wearing gas masks to prevent the spread of COVID-19 mutations. The wearing of gas masks may suggest, however, that the COVID-19 situation in North Korea is already out of control.
“COVID-19 is the most important factor in the resumption of trade,” the source said, adding, “It can’t be said that the [COVID-19] situation in the country is good.”
*Translated by S & J