North Korean foreign-currency earning enterprises are actively seeking private Chinese investors with whom to jointly operate enterprises in China.
The joint ventures involve Chinese investments of capital and North Korea supplies of labor. The North Korean Ministry of Commerce has a history of running things like restaurants and massage parlors in China; conversely, it is unheard of for individual North Korean companies to be given permission for joint ventures of this nature.
A Party cadre linked to one foreign-currency earning enterprise in Hoiryeong reported to Daily NK on the 14th, “Foreign-currency earning companies have been dispatching small groups of workers to China to contact Chinese industrialists.”
The source went on, “The Chosun enterprises supply the labor while the Chinese investors take responsibility for the buildings, interiors and equipment. The operations are run jointly by the Chinese investors and managers from the North Korean companies.”
“(The North Korean authorities) have been telling entities at all levels to seek various ways of earning foreign exchange,” he claimed. “In the past, the Ministry of Commerce’s External Labor Bureau went into the Chinese market directly and ran the businesses, but that was not successful very often. So, in the end, they have started giving permission to individual entities and letting them get involved in foreign-currency earning activities.”
One Chinese-Korean trader from Jilin Province who works with North Korean partners corroborated the story, telling Daily NK, “Trade with North Korea has been recovering recently, and their companies are trying hard to find joint venture partners.” He added the example of a Chongjin-based company director with existing ties to China who is now seeking a partner for a restaurant business in the Yanbian region.
However, he went on, “In the past Chinese investors invested in the opening of things like factories but they took damage or got swindled. The only opportunity here is for [the North Korean side] to provide cheap labor like this. The North Korean authorities must provide confidence that they can supply the necessary human resources.”
