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A recent UN report revealed that a large portion of North Korea’s overall income is brought in through outsourced slave labor.
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Primarily focused in China and Russia, tens of thousands of North Koreans are forced to work as much as 20 hours a day, while up to 2.3 billion dollars a year in wages are collected by their government.
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But slavery isn’t the only criminal activity from which North Korea sees profit.
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So we wanted to know, how exactly does North Korea make money?
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Well, North Korea’s economy has always seen abysmal growth.
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According to UN statistics, both North and South Korea started out with a similar GDP in 1970: around $300 dollars per capita.
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By 2013, South Korea’s GDP had grown by nearly than 9,000%. Meanwhile, North Korea’s GDP only doubled over those 4 decades.
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But most financial figures surrounding their economy are unknown, as North Korea has one of the most closed economic systems in the world.
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This is the result of a cultural philosophy known as "juche", or "self-reliance".
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The enclosed system is one of the ways that North Korea is able to farm out its citizens in what is effectively slavery.
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While some workers do see payment from their government, it is in the form of nearly worthless local currency, the won, at a massively inflated exchange rate.
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In North Korea’s black markets, a single US dollar can buy more than 8,000 won, while the government offers an exchange of just 105 won.
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But besides collecting for slave labor, North Korea also trades in other internationally prohibited activities.
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One North Korean defector reported that the country has allocated major agricultural zones for growing opium.
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They have also become well known for producing mass quantities of methamphetamines, the majority of which go to China.
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A 2008 congressional report found that the increasing drug trade over North Korean borders was strongly linked to government sources.
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However, later congressional reports disputed this link, pointing to private North Korean drug traffickers as the source instead.
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North Korea is also a hotbed of counterfeiting.
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The US has accused their government of producing at least $45 million dollars in very high quality $100 dollar bills, which are known as "supernotes".
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This counterfeiting operation is thought to net up to $25 million dollars a year in profit.
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But perhaps the biggest benefactor of North Korea’s economy is actually China.
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While North Korea has almost no money, they have considerable natural resources.
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North Korea imported nearly twice as much as they exported with China.
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But this trade imbalance is actually beneficial to China, because it comes with mining contracts for North Korean coal and zinc.
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China is also one of the only countries to support North Korea with food, weapons, and energy, in the face of international sanctions.
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North Korea’s dishonest economic dealings may explain how they’ve avoided collapse while sanctioned around the world.
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As long as they continue an alliance with China and Russia to keep their limited trade afloat, North Korea will keep exporting drugs, counterfeit bills, and slave labor.
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North Korea’s outsourcing of slave labor is particularly disconcerting. Check out this Seeker Daily video up top to learn more about why they started this practice.
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Or, if you want to know how their secretive government actually works, check out our video down below.
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