Kaesong Workers Recoup Stolen Wages on the Black Market

With all the questions about how much pay  Kaesong workers actually collect, we’ve always  suspected that their earnings  must be  far  more than most of their North Korean neighbors.  For one thing, the workers are hand-picked loyalists; the regime  must want to keep them relatively content.   Yet no one really believed that the workers received the “official” wage of around $60 a month, after “voluntary” deductions and the bite of the inflated official exchange rate.

I figured it was just a matter of time before the Daily NK told us the real deal, and finally, we have a few answers.  As suspected, the regime gets almost all of the cash.  The workers receive ration stamps, or  “commodity provision tickets,” which convey the right to buy scarce  food items and consumer goods at special shops  for “official” prices.  Because those prices are  much lower than ordinary black-market rates,  Kaesong workers then score a tidy profit reselling what they don’t consume.

Currently, the official salary for laborers at the Kaesong Industrial Complex is around 60 USD, a small amount of which is distributed as cash and the rest in the form of “commodity provision tickets.

In the Kaesong Industrial Complex, there are several shops that can only be frequented by Kaesong laborers and the prices at these stores are at inexpensive compared to prices in the jangmadang.  Laborers at the Kaesong Industrial Complex use their “commodity tickets” to purchase products at a cheap price and can make a huge profit by selling the goods, giving the difference to middlemen (currency traders who mediate deals).

Recently, there have even been cases where the middlemen had specific orders for certain items from the Kaesong laborers, asking them to procure a certain amount of rice, oil, and so on. The middlemen can easily make an exorbitant amount of money by selling these goods at the jangmadang.  Kim also said, “Among the laborers at the Kaesong Industrial Complex, there are a lot of people who take an item here and there. Then they conspire with bus drivers and hide the goods in the vicinity; once the quantity is fixed, they hand over the goods to middlemen in exchange for money.   [Daily NK]

No wonder North Korean workers pay hefty bribes to score jobs there — sure, the workers are exploited, but this is a far  more privileged  form of exploitation than they’re used to.  If North Korea itself is  a vast prison, Kaesong sounds like the prison laundry. 

Kaesong also turns out to be something of a laboratory in capitalism after all, though not exactly in the way its South Korean  designers must have intended.  And while the North Korean authorities probably either designed or choose to overlook this de facto marketization, they may be less pleased  if the workers are exposed to South Korean consumer goods, or the abundance  in the chow line at lunchtime.  

At the same time, some of our worst suspicions are confirmed:  we have no idea how Kim Jong Il is spending all that cash, and if the workers are essentially  paid in food and have no say in the terms of their employment, how are they not slaves?

2 Responses

  1. The Kaesong Complex is one of the eeriest places I’ve ever seen. By “eeriest” I mean it doesn’t fight in with its surroundings at all. Try to imagine a chunk of Seoul transplanted to North Korean territory: the same sidewalks, traffic lights, street signs, architecture, billboards, etc. They even have a Family Mart! I can’t even begin to imagine what those North Korean workers must think, nor can I imagine the stories about what the South must like that circulate throughout the country because of that complex. Then again, the entire Kaesong region is basically hard-core regime loyalists…