Liam Maddrell*

Brisbane, 2 November 2014 (Alochonaa): The Democratic People’s Republic of Korea (DPRK) or North Korea is an enigma of the international system. ‘For more than a half century Washington [and the world] has been bedevilled and even humbled by Pyongyang’ (Chang 2006, p xx, parenthesis added). However it is due to its adversarial stance towards the capitalist West, most notably the United States, and also the collapse of the Soviet Union in 1991 that has led the DPRK to increasingly rely on less conventional means with which to fund their national economic needs (Greitens 2008).

Kim Jong Un has been likened with the characters from Breaking Bad after a recent US case against a North Korean drug ring. The regime he leads uses illicit drug manafacture as a method to gain hard currency in the face of international sanctions. Source: Google Images

One of the less conventional methods North Korea has turned to through various guises is drug trafficking and manufacture. These efforts appeared to have cultiminated in 2003 with the spectacular seizure by Australian authorities on the high seas of the North Korean owned ship, the Pong Su, after a botched delivery of 150 kilograms of heroin was uncovered (Sydney Morning Herald 2006). This has been further reinforced by a Hong Kong-North Korean drug ring that was arrested by the DEA in November 2013 (wn.com).  While the Pong Su and more recent incidents are likely an attempt to expand outside North Korea’s traditional ‘drug markets’ of China, Russia, South Korea, Japan and Taiwan, it also has shed light into the murky activities of the now infamous Division 39 of the Korean Worker’s Party (Hwang 2003, p3).

The DPRK today

The DPRK today is the world’s only ‘communist’ dynasty headed by Kim Jong-Un, grandson of the Eternal President and national founder, Kim Il-Sung. Kim Jong-Un succeeded his father, Kim Jong-Il in late 2011 and as of the time of writing, there seems to be little change to the sogun or military first policies that have been pursued officially since 1994 (Worden 2008, p188). A justification often cited for the military-first emphasis of the North Korean economy is the official objective of kangseng taeguk (rich nation, and strong army) (Worden 2008, p189). As a result of this push ‘the military itself is becoming more involved in the daily functioning of economic matters’ (Worden 2008. P173). Procuring hard foreign currency is therefore a national objective of the Juche economy.
Meanwhile North Korea’s domestic economy remains a basketcase, with the command driven apparatus appearing to be dysfunctional. Due t its heavy previous reliance on Communist aid, principally from the now-defunct Soviet Union, the collapse of that system hurt the DPRK greatly. This has been further compounded by the fact that the country defaulted on its debt obligations in the 1970s, losing access to international credit in the process (Greitens 2012).
The government structure in the DPRK further lends itself to these economic realities. The cult of personality cultivated by the Kim family has led to the situation where reform must come from above, and substantial reforms of the current system are anathema to the political narrative to the ruling Korean Worker’s Party (Kim & Lee ed. 2002, p 3). Indeed the inability to reform is evidenced by the botched re-issuing of a new North Korean Won in 2009 which ultimately led to a rare public apology from the government to the people.

The Great Comrade,. Kim Jong Un. Current leader of the DPRK and grandson of the founder and Eternal President, Kim Il Sung. Source: Google Images

Consequently the International trade in drugs presents opportunities for a ‘North Korea that has trouble generating export income because of its struggles in producing high quality, value-added goods’ (The Conversation 2011). Accordingly the UN Office of Drugs and Crime declared in 2003 ‘the size of the world’s illicit drug industry was equivalent to 0.9% of the world’s GDP, or higher than the GDP of 88% of the countries globally’ (Pollard 2005). As there has been a continued growth in addiction rates globally, particularly in the third world countries, this source of wealth has only increased since (Pollard 2005).

Why Drugs?

This growth in the international trade of illicit drugs has been fuelled by a few factors of which globalisation and the ‘chemical drug revolution’ are the two most prominent. Globalisation has led to an increase in legitimate international trade across the globe, allowing more opportunities for illicit activities to take advantage of. The porous and unpoliced borders that have developed in many parts of the globe have further helped illicit trade flourish due to the ease with which their goods now can cross these borders (Griffiths 2011, p53).

The rise of chemical drugs has also helped fuel the increase in the illicit drug trade. Chemical drugs, such as methamphetamine, are easily produced in factories, allowing for the industrialisation of the production process and also allowing for a departure from the established practices of previous large-scale drug-producing operations (Pollard 2005).

Bags of methamphetemine waiting export in a factory in an undislosed location in North Korea. Source: Google Images

‘First synthesized in 1893, meth [methamphetamine] is now one of the world’s most widely abused drugs, imbuing the user with intense feelings of euphoria, concentration and grandiosity. Smoked, injected or snorted, the drug also suppresses the need for food and sleep for an extended period of time, coming down can bring fatigue, anxiety, and occasionally suicidal ideation’ (Fish 2011).

The DPRK has sought to take advantage of this trade to meet its objectives of kangseng taeguk (rich nation, strong army). Due to these efforts the nature of drug production is very different in North Korea. ‘In other countries, the drug business is operated by underground organisations; in North Korea, government-run trade companies or military authorities headquartered in Pyongyang operated the business’ (Hurst 2005, p35).

‘Evidence that the North Korean regime is responsible for directing and engaging in these activities can be found in the existence of Division 39 of the Korean Worker’s Party’ (Hwang 2003, p3). It is through this group with the ruling party that the government directs the official illicit activities under the usual North Korean veil of silence. As a result ‘poppy cultivation and heroin and methamphetamine production are conducted in North Korea by order of the regime’ (BBC News 2004).

The building, dead centre of picture, is the Pyongyang headquarters of the infamous Division 39 in the DPRK. It is from here that the central control of the government-run illicit drug trade is managed. Source: Google Images.

As previously stated, the North Korean reliance on illicit activities to help fund government needs dates back to the default and subsequent denial of international credit Pyongyang has experienced since the 1970s. It was commonly known that ‘after the default North Korea used diplomats as drug mules to keep its embassies running’ (Greitens 212). This came to light in 1976 when a North Korean diplomat was seized by Egyptian police in possession of 880 pounds of hashish (Paddock & Demick 2003).

As a result of this clandestine trade carried out by the ruling Korean Worker’s Party, ‘there have been at least fifty arrests or drug seizures involving North Koreans in more than twenty countries’ (Paddock & Demick 2003). The most spectacular arrest in recent memory was the Australian seizure of the Pong Su freighter ship, which failed in its attempt to import 150 kilograms of heroin into Victoria (Sydney Morning Herald 2006). It is also likely due to the publicity generated by the Pong Su incident that recent North Korean government efforts in drug trafficking and production have been less audacious in scope and therefore less susceptible to being uncovered by law enforcement authorities in foreign countries (Asia One News 2011).

The recent arrests in America show that North Korea is evolving from using its nationals in the drug trade it undertakes, forming relationships with organised crime syndicates from Russia, China, Hong Kong, America and elsewhere. Source: Google Images

Why its unlikely to stop

It is however unlikely that North Korea has ended its state-sponsored drug trafficking despite the U.S. State Department reporting to the contrary (Asia One News 2011). The continued rule of Kim Jong-Un relies heavily on his ability to maintain the lifestyles of those whom were integral to his father’s rule before him, in the face of continuing international sanctions. ‘Legitimacy won’t solve Kim Jong-Un’s problems. Right now his survival is guaranteed by hard currency, and the best source of it is illicit activity’ (Greitens 2012). The reliance of the military exhibited by the North Korean leadership and reinforced by its sogun policies further causes the continued need for hard currency. This wealth is then redistributed to key military officers and party officials to ensure their continued loyalty to the Kim family’s regime (Greitens 2012).

The North Korean leadership is accustomed to a level of oppulance that would be unimaginable to the average North Korean citizen. This is what the drug trade seeks to uphold. Source: Google Images

As a consequence should the flow of hard currency stop, the North Korean government will face a crisis of political legitimacy and possibly collapse (Chang 2006, p xxi). Due to this dire situation, the current leadership’s focus on illicit activities to generate the needed income is understandable. This situation belies the seemingly stable transition of leadership so far to Kim Jong-Un. The new leader is facing pressures to his rule. Ultimately ‘elite party members who supported his father will be sceptical of his untested ability to fulfil his side of their cash-for-support bargain’ (Greitens 2012).
Due to these pressures and the need to continue with the illicit activities pursued in the past ‘North Korea’s increased criminal behaviour poses a serious security challenge to Asian and US Interests’ (Hwang 2003, p1). The DPRK has fostered working relationships in recent years with global crime syndicates such as Chinese triads and Japanese yakuza (Hurst 2005, p36). With these relationships the Japanese government estimates that North Korea accounts for 43% of all drug imports into Japan (Hwang 2003, p4). Trade at such volumes is essential for the cash and credit starved leadership in Pyongyang.

North Korean Denials

The North Korean government has continuously denied its involvement in drug trafficking in any form (BBC News 2004). However the scale and nature of some shipments, including the infamous Pong Su incident indicate that there are few other conclusions that can be made. Indeed ‘North Korea has exhibited a consistent pattern of state involvement in criminal activities over a long period’ (The Conversation 2011). In fact ‘A group of communist and military leaders, including Kim Jong-Il’s sons [and current leader Kim Jong-Un] have been linked by Western intelligence authorities to Pyongyang’s illicit activities around the world’ (Gertz 2010, parenthesis added).

The infamous North Korean heorin freighter, the Pong Su, berthed in the Australian Customs wharves in Melbourne after its capture in 2003. Source: Google Images

What is apparent is that due to the continuing economic difficulties, government authorities are losing their monopolisation on the drug trafficking and production coming from North Korea. This is a result of the situation, according to Yun Minwoo, a criminologist from South Korea’s Hansei University, where North Korea is comparable to Bulgaria or Romania, countries where even the highly educated are unable to earn a sufficient income (Fish 2011).
One of the side effects of this loss of government monopoly over drug production and trafficking is that presently ‘reports indicate that methamphetamines are widely used in North Korea’ (Greitens 2012). This is as a result of the fact that such drugs can also help dull hunger pains, but the state is cracking down (Greitens 2012). While North Korea remains an economic basketcase beholden to an inefficient command system, it will continue to be hollowed out by grassroots entrepreneurialism (The Conversation 2011). Indeed under North Korea’s oppressive social regime, selling ice is the easiest way to make money (Fish 2011).

Continued Production

The continued production of North Korean heroin and methamphetamines is apparent in the Korean border regions of the People’s Republic of China. ‘Twenty years ago, Yanji [a Chinese city on the North Korean border] has only 44 registered drug addicts, last year the city registered almost 2,100 drug addicts’ (Fish 2011). Furthermore in 2010 alone Chinese officials seized a reported $60 million worth of North Korean drugs, and this trend continued (Hull 2012). While ‘official’ drug trafficking from North Korea has diminished the ‘great need for currency to meet military objectives and on inadequate export system of legitimate goods make it difficult for North Korea to turn away from drug trafficking’ (Hurst 2005, p37). Due to this reality ‘the North Korean government in spite of its supposed Juche ideology and rigid Stalinist political system, seems to of taken a rather laissez-faire attitude to all the drug smuggling that’s going on at its border with China and the epidemic drug use at its borders’ (Hull 2012).

Not only is North Korea selling drugs to gain hard currency, but often the social effects of prevalent drug use cause other issues such as addiction, crime and health issues for the countries involved. Source: Google Images

Furthermore due to their political systems, if the authorities of North Korea and China were serious above preventing the flow of illicit substances across their border, they wanted to be able to do in short order. Rather enough officials have been paid off giving rise to the situation where ‘Chinese and North Korean officials have put money over people, while growing increasingly complacent about turning their own citizens into junkies’ (Hull 2012).

While the North Korean government appeared to have halted its own large scale trafficking problems as the US State Department claims (Asia One News 2011), the undeniable fact that production continues in the Juche economy provides evidence that the leadership of Pyongyang remains involved. Recent arrests further show the erroenous nature of the State Departments proclomations a few years ago (wm.com 2013). Indeed ‘activities of this kind could not have been possible without direct oversight from the highest echelons of the regime leadership’ (The Conversation 2011). Furthermore, especially with the recent ascension to the leadership of Kim Jong-Un, the DPRK’s regimes requirements for foreign cash have not been diminished (Greitens 2012).

Despite this continued need for foreign cash, after the Pong Su incident and the more recet November 2013 bust, there has been a ‘continued lack of public reports of drug trafficking with a direct DPRK connection, suggesting that such high-profile drug trafficking has either ceased or been sharply reduced’ (Asia One News 2011). With this reduction of high profile trafficking has occurred, there has not been a corresponding reduction in the amount of trafficking or production. This provides a hint that in fact this North Korean drug trafficking is more ‘under the radar’ when it comes to law enforcement efforts. It is entirely possible that drug production is still largely run at the behest of the Korean Worker’s Party while trafficking is being increasingly ‘outsourced’ to the existing global crime networks and individual North Koreans (Hurst 2005)

*Liam Maddrell is an Editor, Alochonaa.com, a PhD candidate, School of Government and IR, Griffith University and an intern with the Australian Institute of International Affairs – Qld Branch.

** Alochonaa.com is not responsible for any factual mistakes (if any) of this analysis. This analysis further is not necessarily representative of Alochonaa.com’s view. We’re happy to facilitate further evidence-based submissions on this topic. Please send us your submission at alochonaa@gmail.com
Reference List

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