North Korea has consolidated its foreign trade under officially licensed trading companies, sidelining independent traders from the import process. But once goods clear customs, it is still individual traders, not the companies whose names appear on the paperwork, who control how those goods reach North Korea’s markets, according to a source inside the country.
A source in Ryanggang province told Daily NK on Wednesday that large volumes of Chinese-made clothing and shoes have recently been passing through customs in Hyesan. Trading companies formally handle the import process, the source said, but individual traders remain the ones actually distributing the goods once they clear customs inspection.
Individual traders reinvent themselves as company employees
In the past, independent traders without ties to a registered trading company could deal directly with Chinese counterparts and bring in goods on their own. But as North Korean authorities expanded official trade through customs channels, that path closed off, effectively shutting individual traders out of legal importing.
In response, many traders have registered themselves as employees of trading companies, using the company’s import license to keep operating. A trading company with import rights lends its name, and in exchange, the trader hands over a fee or a cut of the profits, folding what is still an individual operation into an officially sanctioned structure.
“The difference is that people who used to operate as individuals now operate as company employees,” the source said. “The form has changed on the surface, but it’s still individuals who are putting up the money, bringing in the goods and distributing them.”
The shift has also changed how goods move once they reach the ground. The source said that under the old system, safety officers or patrol squads would routinely shake down traders hauling goods on “servi-cha,” an informal transport network of privately operated trucks and carts that has long filled gaps in North Korea’s state distribution system, demanding cigarettes or cash at will. Now that traders can claim affiliation with a trading company, the source said, officials have fewer grounds to harass or detain them, effectively turning company affiliation into a form of protection.
Goods that clear customs this way are passed along to wholesalers and retailers in jangmadang markets in Pyongyang and other inland areas for distribution and sale. Even as authorities have tightened control to funnel all imports through trading companies, the final leg of the supply chain, getting goods from customs into the hands of consumers, still runs through the same private network of individual traders and market merchants that has operated for years.
“State-run stores and other official commercial networks can’t absorb the full volume of imported goods,” the source said. “A significant share still ends up with jangmadang traders, which is why sales at the markets keep going.”
Transport costs climb, squeezing market vendors
Transport costs between regions have also risen sharply. Prices vary by item and distance, but the cost of shipping a single box of goods has generally climbed by 70 to 150 yuan (roughly $10 to $22) compared with two to three years ago, the source said. Lower-value items now cost around 150 yuan (about $22) per box to ship, while transporting higher-value goods can run as high as 300 to 450 yuan (roughly $45 to $67).
Those higher shipping costs are passed directly on to consumers. With import costs on top of rising domestic freight charges, jangmadang merchants say they have little choice but to raise their prices.
The distribution structure is also deepening divisions among traders. Individual traders who import goods through customs can secure stable profits at the distribution stage, while merchants who depend on jangmadang retail sales face shrinking margins as they compete with official stores on price.
“In the end, it’s become even more true that those with money make more money,” the source said. “The ones controlling imports and distribution are doing well, but ordinary market traders are finding it harder to make a living than before as competition gets fiercer.”
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.
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September 11, 2026 at 05:41PM
by DailyNK(North Korean Media)