North Korea is overhauling its foreign trade system to route transactions only through official state trade organizations this year. Authorities have banned individual traders from using Chinese mobile phones, cutting off many of the trade connections those traders spent years building.
A source in North Pyongan province told Daily NK on Friday that traders in Sinuiju and other areas along the Chinese border once used Chinese phones to communicate directly with Chinese counterparts on contract-manufacturing deals. Their position in that trade is rapidly weakening, the source said.
In the past, authorities let traders who needed to negotiate delivery schedules and quality directly with Chinese partners register a Chinese phone with the security agency. Now authorities are confiscating even phones that were properly registered.
“After Chinese President Xi Jinping’s visit to North Korea, an order came down banning the use of Chinese mobile phones,” the source said. “For a while, authorities just watched to see how things would unfold, but starting last month, they began confiscating phones outright. There were also hints that traders should get rid of any unregistered phones on their own.”
Some traders had kept using unregistered Chinese phones by relying on personal ties to security agents. That option is disappearing too, as agents grow less willing to look the other way, the source said.
“In the past, you could register a Chinese phone by citing business necessity,” the source said. The agency in question is the National Intelligence Agency, formerly known as the Ministry of State Security. “That’s no longer possible, because the whole trade structure is changing so individuals no longer need to contact Chinese partners directly,” the source added.
North Korea shifts foreign trade from individuals to the state
Inside North Korea, many see the measure as more than a crackdown on phone use. Many view it as part of a broader shift moving foreign trade’s center from individual traders to the state.
Traders once negotiated prices and delivery schedules directly with their Chinese counterparts. The strength of a trader’s network in China long served as a measure of that person’s competitiveness and influence.
Now North Korea is computerizing orders, payments, shipments and cancellations. Trade must go through designated trade organizations approved by the Ministry of External Economic Affairs. That system has all but eliminated traders’ direct contact with Chinese partners, the source said.
“Who you knew in China used to be power, but that era is over,” the source said. “Designated trade organizations place and ship orders based on central approval, and individual traders have less and less room to operate on their own.”
The source added that traders will likely handle only production and processing work going forward. Opportunities to find buyers or negotiate prices directly will grow more limited.
North Korea is folding foreign trade once run by individual traders into a centralized state system. The trade networks with China that traders spent years building will likely weaken rapidly as a result. Absorbing these informal, direct-contact networks into state control could reshape North Korea’s broader distribution and production system, observers say.
Reporting from inside North Korea
Daily NK operates networks of sources inside North Korea who document events in real-time and transmit information through secure channels. Unlike reporting based on state media, satellite imagery, or defector accounts from years past, our journalism comes directly from people currently living under the regime. We verify reports through multiple independent sources and cross-reference details before publication.
Our sources remain anonymous because contact with foreign media is treated as a capital offense in North Korea — discovery means imprisonment or execution. This network-based approach allows Daily NK to report on developments other outlets cannot access: market trends, policy implementation, public sentiment, and daily realities that never appear in official narratives.
Maintaining these secure communication channels and protecting source identities requires specialized protocols and constant vigilance. Daily NK serves as a bridge between North Koreans and the outside world, documenting what’s happening inside one of the world’s most closed societies.
August 24, 2026 at 08:21PM
by DailyNK(North Korean Media)