North Korea’s trade officials are running a pay-to-work racket
To get a coveted work posting in China, North Korean trade workers are being forced to hand over as much as $20,000 in cash to party and security officials, a source in South Pyongan province told Daily NK recently. The payments, demanded by officials who control access to overseas assignments at se
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To get a coveted work posting in China, North Korean trade workers are being forced to hand over as much as $20,000 in cash to party and security officials, a source in South Pyongan province told Daily NK recently. The payments, demanded by officials who control access to overseas assignments at several state-run trading companies, are fueling growing resentment inside North Korea’s foreign trade sector and offer a window into the country’s entrenched corruption problem.
North Korea operates a network of state trading companies, enterprises that are nominally controlled by various institutions within the ruling Workers’ Party of Korea (WPK) and the military. These companies manage the import and export of goods on behalf of the state, and a posting to China, where trade has been gradually resuming after years of pandemic-era border closures, is considered a financially valuable assignment. Officials who oversee those postings have long used their gatekeeping authority to extract unofficial payments from workers and managers eager for access to the Chinese market.
According to the South Pyongan province source, officials connected to at least three trading companies, Daedonggang Trading Company, Samhwa Trading Company, and 21st Century Trading Company, have recently been demanding approximately $20,000 per person from workers slated for short-term deployment to China.
A corruption problem built into the system
North Korea’s leadership has publicly condemned official corruption for decades. Going back to the era of founder Kim Il Sung and his son and successor Kim Jong Il, Pyongyang has periodically launched anti-corruption campaigns targeting officials who abuse their positions for personal gain. Under current leader Kim Jong Un, the rhetoric has continued. The reality on the ground, however, has consistently told a different story.
In North Korea’s foreign trade sector, the costs of these informal payment demands do not stop with the businesses and workers who pay them. Economists and analysts who study the North Korean economy say such costs tend to ripple outward, eventually affecting ordinary North Korean people as businesses recoup their losses. The dynamic erodes trust between the state and those it governs, a particularly sensitive issue in a system that depends heavily on political loyalty.
The persistence of this kind of corruption points to structural weaknesses that disciplinary campaigns alone cannot fix. When regulatory authority over valuable assignments, such as overseas trade postings, is concentrated in the hands of a small number of officials and informal payment norms become routine, the system creates conditions in which private gain consistently takes precedence over public interest. Analysts who study North Korea’s political economy note that weak internal monitoring, concentrated regulatory power, and normalized back-channel financial arrangements are all contributing factors.
Corruption in North Korea is not simply a matter of individual officials making bad choices. It is, by most accounts, woven into the fabric of how the system operates. Lasting improvement would require not just punishment of individual wrongdoers but a fundamental rethinking of how oversight is structured. As North Korea looks to expand its trade relationships, particularly with China, the credibility of that economic engagement depends in part on whether the government can demonstrate that the benefits reach beyond a privileged few.
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