Demand for designer goods procured by North Korean trade officials in Pyongyang has increased dramatically, suggesting a growing preference among the upper class for luxury clothing and accessories.
On Feb. 27, Daily NK spoke to a source who said trade officials in Pyongyang have recently been ordering luxury goods – including bags, clothes, and shoes – from their counterparts in China.
Pyongyang trade officials usually find pictures and prices of the goods they want on the Internet from inside North Korea and then request them from Chinese traders. Sometimes they give their counterparts only a price range and a brand and confirm the price after the Chinese trader finds a picture of an item that meets their request.
Trade officials appear to buy products that best embody both the tastes and financial power of the upper class.
“North Koreans, like South Koreans, prefer simple and high-quality styles and colors. In this way, they are different from the Chinese,” the source said. “I think this is due to the influence of South Korean dramas and movies.”
In particular, Pyongyang trade officials often request luxury clothing, including shoes, T-shirts, and sweaters from brands such as Gucci, Ferragamo, and Fendi. Items like these are expensive, often totaling RMB 5,000 to 6,000 (about USD 700 to 850).
In the case of bags, prices can be much higher, and requests often include a variety of styles from different brands, including tote bags, crossbody bags, and backpacks.
When Pyongyang trade officials place orders for luxury items or other miscellaneous goods, they request at least three or four items and as many as 100. The source explained that this is because it is relatively difficult to secure dozens of expensive bags at one time, so the trade officials request a small number and supplement the order with other products worth about RMB 5,000 each. In this way, they ensure that each transaction is worth millions of Chinese yuan.
Chinese merchants find it difficult to source enough luxury brand goods in one place to fulfill Pyongyang’s large orders, so they source the items from several cities in China, including Beijing, Qingdao, and Shenyang.
In the past, North Korea obtained luxury goods through trade officials or diplomats sent abroad, but more recently traders have been able to search for items within the country, specify what they want, and import the goods through Chinese traders, resulting in new trade routes and systems as well as higher trade volumes.
Trade officials in Pyongyang have also emphasized to Chinese traders that they will not accept counterfeit goods, going so far as to require certificates of authenticity with the products. In the past, North Korean trade officials preferred counterfeits, but now they insist that the goods they receive are genuine.
“These luxury clothing and other goods are then sold in large department stores or foreign currency shops in Pyongyang,” the source said. “This means that the demand for luxury goods has increased among members of the upper class, such as high-ranking officials or moneylenders in Pyongyang.
“You can buy luxury clothing or bags at Daesong or Rakwon department stores,” added another Pyongyang-based source. “If you ask a department store for a certain item, they’ll even find it for you.” In this way, department stores act as procurement companies.
The regime is eager to keep the elite happy
Despite North Korea’s worsening economic crisis due to the closure of its borders following the outbreak of COVID-19, the upper class’s demand for luxury items has only increased.
“When Kim Jong Un made an official visit to the high-end Daesong Department Store in Pyongyang, he instructed the staff to ‘ensure the comfort and convenience of the people.’” This statement can be seen as an acceptance of the material demands of Pyongyang’s ruling class, which is the target group of Daesong Department Store,” Oh Gyeong-seob, senior researcher at the Korea Institute for National Unification (KINU), told Daily NK in a phone call.
Oh’s statement refers to Kim Jong Un’s visit to Daesong Department Store in 2019, where he told employees, “We must ensure people’s comfort and convenience in their daily lives by selling enough high-quality daily necessities and consumer goods to meet their ever-growing tastes and desires.”
Oh believes that the North Korean authorities understand the material desires of high-ranking officials and the upper class, and are actively taking steps to cultivate a system that provides them with what they want.
“The North Korean elite were probably more eager to own these luxury products after seeing that Kim Jong Un, the country’s most important celebrity, and those close to him also owned them,” Oh said. “In addition, it appears that the wealthy are now engaging in a kind of ‘revenge buying’ as trade has remained very limited due to the impact of COVID-19.”
Translated by Audrey Gregg. Edited by Robert Lauler.
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