Japanese authorities seized a North Korean boat in 1997, and upon searching it, found $95 million in methamphetamines hidden in cans of honey. Within 2 years, an estimated 40% of the methamphetamines in Japan were of North Korean origin. The surge also affected China; in Yanji, a city near the border, the number of registered addicts grew from 44 in 1991 to 2,090 in 2010. Defectors from North Korea told stories of provinces near the Chinese border where 50 percent or more of the adults were using the drug. But behind the trafficking were not hoodlums: it was the North Korean government.
While many states have been involved in gangland activities in the past, North Korea’s are ongoing and pervasive, unique for the way they have been formalized as a part of the government structure. It is planned and directed from a department inside the Korean Workers Party, the single-party autocracy of Kim Jung-Un. It is engaged in every facet of the drug trade, counterfeiting, and laundering money. North Korea’s actions further ostracize it when it is already isolated. But the risks are offset by a calculated strategy. Hard currency funds military capabilities, a huge army and nuclear program. These give the regime an outsized influence in the region, able to hold Japan and South Korea hostage to win concessions. For over 30 years, North Korea has been able to use its status as a nation, where in its domestic affairs no country can interfere, to allow Kim Jung Un to act as a mob boss. Now that North Korea has become a nuclear power, the global approach to negotiating- on the basis of threat management- is understandable, but attempts to curtail North Korea’s nuclear arsenal have been spectacularly unsuccessful. The US and South Korea give concessions, but the North breaks their promises, again and again. Instead of accommodating this duplicity, the US should go after the stream of dirty money North Korea depends on to function.
Bureaucratic Crooks and Office #39
Nominally a communist state, North Korea was established as a Soviet sphere of influence in 1945, after the colony of Korea was split in two. The partition made North and South Korea arch-rivals; they do not diplomatically recognize each other. While South Korea is a republic and thriving, North Korea behaves more like the kings of Korea’s past; it is the only communist state that is also a dynasty. Power is handed from father to son, from Kim Il Sung, to Kim Jong il, to the current leader, Kim Jong Un. The Kim family wields absolute control. They have closed off their borders, but they want foreign currency. The North’s money is worthless outside of the country, and within, foreign currency is needed to buy international merchandise. North Korea has few ways of obtaining it legally, such as trade with China or the Kaesong Industrial complex, jointly operated with South Korea. So a lucrative alternative was devised. Its name was Office #39, a department of the Korean Workers Party meant to acquire foreign bills. By resorting to illegal methods, it earns $500 million-$1 billion a year. Placed under the control of Kim Jong Il in 1974, the father of current despot, Kim Jong Un, Office #39 remains a part of the state.
Top photo: A girl sings for Western tourists in Pyongyang. The government tries to screen who is allowed to meet foreigners, with only the most loyal chosen. These encounters are intended to showcase the regime. (Photo by Matt Paish/CC BY)