North Korea has restarted state-led smuggling along its border with China. But vehicle smugglers say a sudden fee hike has brought their business to a standstill. The trade permit fees jumped without warning, a source in Ryanggang province told Daily NK.
“State smuggling opened in Hyesan city, but not a single vehicle has come in,” the source told Daily NK on Monday. The recent increase in wakku fees, the payments smugglers make for state trade permits, has turned profits into losses. Vehicle smugglers are now stuck, unable to move forward or back, the source said.
Vehicle smuggling through the Hyesan border resumed in mid-June, according to the source. But heavy rain in China’s Jilin province raised water levels on the Yalu River. That disrupted vehicle transport across the border. Smugglers had complained that even the weather was working against them. Then authorities suddenly and sharply raised the wakku fee, dealing them another unexpected setback.
“Even if they were going to raise the wakku fee, it should only apply to newly imported vehicles,” the source said. “But they are demanding extra payment even for vehicles that already settled their fees. Depending on the vehicle, that adds up to about 10,000 Chinese yuan, or roughly $1,470, on average, and a lot of smugglers feel real despair over it.”
Smugglers see the fee hike as an attempt by the state to collect more money, the source said. The state issues these trade permits to smugglers who use their own money to import vehicles. Some smugglers complain authorities are using that control to claim an outsized share of the profits.
Smugglers reportedly bring a range of vehicles, including cars, buses and trucks, from China. They pay between 70,000 and 200,000 yuan, or roughly $10,300 to $29,400, per vehicle. After reselling the vehicles in North Korea, their net profit has typically run between 10,000 and 15,000 yuan, or about $1,470 to $2,200, per vehicle. The new fee has pushed many of those deals into the red.
“It was already frustrating for smugglers to spend hundreds of thousands of yuan on vehicles and then not be able to bring them in,” the source said. “That was because of the weather. Now they’re looking at losses on top of that. It’s hard to overstate how absurd that feels to them.”
Raising prices in North Korea is not a simple fix
Raising the sale price once vehicles reach North Korea is not a simple solution either, according to the source. “Logically, if the wakku fee goes up, the sale price should go up too,” he said. “But smugglers who already agreed on a fixed price with a buyer can’t easily go back and ask for more. Doing that makes it hard to promise future deals and could damage the relationship, so it’s a real dilemma.”
As a result, smugglers are delaying vehicle imports while they weigh their options, the source said. Accepting a vehicle now means an unavoidable loss. Refusing to accept it indefinitely is not realistic either, leaving many smugglers stuck.
Chinese traders doing business with North Korea are reportedly facing similar frustration. A separate source in China described a similar backlog. Hundreds of vehicles have piled up on the Chinese side, unable to cross the border.
“Chinese business owners need to move their vehicles quickly so they can start new deals,” the source said. “But this year, things keep getting tangled up. Deals aren’t going smoothly, and it’s causing them a lot of stress.”
“After Chinese President Xi Jinping‘s visit to Pyongyang, we expected smuggling to resume normally,” the source added. “But another obstacle came up, and now there’s concern that this whole year could pass like this. Chinese business owners want North Korean smugglers to trade steadily too, since that’s how everyone keeps making money. They hope vehicle imports return to normal soon.”
Reporting from inside North Korea
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July 8, 2026 at 12:31AM
by DailyNK(North Korean Media)