Want to make millions from North Korea? Become a luxury goods exporter in China during the next succession

An interesting story has been making the rounds of South Korean media the past couple of days (in English, in Korean) about a sudden, large jump in luxury goods imported into North Korea.



Using trade stats from Chinese customs (the North’s main trading partner), a parliamentary committee in the South found North Korean imports of vehicles (Northern elites tend to prefer German iron, especially Mercedes); TVs, computers, and other electronics; liquor; and luxury watches (gifting expensive watches on important occasions is a cultural trait the North actually shares with the South) went from roughly 300,000,000 U.S. dollars in 2008 and $322,530,000 in 2009, to $446,170,000 in 2010 and then $584,820,000 in 2011.



The large jumps in 2010 and 2011 (and presumably this year as well) overlap with the sudden appointment and rushed power transition from Kim Jong-il to his son, Kim Jong-eun. In essence, the North’s 0.001% has been throwing around a few hundred million dollars worth of hard-to-obtain luxury items to keep Pyongyang’s 1% satisfied, or at least mildly mollified, during the latest dynastic succession. An effort that, to date, appears to be working, plus furnishing a nice bump to Northeast Asian sales of Hennessy, Rolex, and the rest of the dictator chic product line.


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