“Made in China” is a common phrase on a number of consumer items all over the world. Chances are, most of us have at least one piece of clothing with it printed on the tag. But, some of those “Made in China” declarations may be misleading. Reuters reported that an increasing number of Chinese textile companies are using North Korean factories and labor.
Traders and businesses in Dandong, located just across the Yalu River from North Korea, told Reuters that Chinese companies are taking advantage of cheap labor across the border. The Chinese suppliers send fabrics and materials to North Korean factories, where employees assemble and export the finished products to Chinese ports, from which they go all over the world.
Much of North Korea’s exports go through Dandong. Currently, North Korea is operating under heavy United Nations sanctions due to its missile and nuclear programs, but there are no bans on textile exports. Textile exports were worth $752 million in 2016, falling only behind coal and other minerals.
The Korean-Chinese businessman told Reuters (on the condition of anonymity) that his company takes orders from all over the world, but not all of the end-buyers are aware of the product’s origins.
“We will ask the Chinese suppliers who work with us if they plan on being open with their client,” he told Reuters. “Sometimes the final buyer won’t realize their clothes are being made in North Korea. It’s extremely sensitive.”
One big-name company, Rip Curl, had to apologize last year when it realized that some of its ski gear was made in North Korea, despite its “Made in China” label. The outdoor apparel company blamed the supplier for going to “an unauthorized subcontractor.”
The traders told Reuters that this wasn’t an isolated incident, however, calling it a “widespread practice.”
A Pyongyang-based Chinese trader told Reuters that Chinese manufacturers can save up to 75 percent by outsourcing operations across the border—making the already cheap Chinese manufacturing even cheaper.
In a chilling anecdote, he told Reuters that North Korea’s cult-of-personality surrounding its leadership and hermit kingdom status makes the workers at the state-owned factories ideal employees. Sources added that employees are often housed in facilities that allow for indoctrination of “North Korean ideals” while they aren’t working.
“North Korean workers can produce 30 percent more clothes each day than a Chinese worker,” he said. “They aren’t like Chinese factory workers who just work for money. North Koreans have a different attitude—they believe they are working for their country, for their leader.”
North Korean workers received wages as low as $75 per month, with an average of $160 per month. Work days are about 15 hours. For perspective, the average factory worker in China makes around $450 to $750 each month. The North Korean workers keep about a third of that, too, with the rest going to their North Korean “government handlers.”
“Wages are too high in China now,” a businesswoman in Dandong told Reuters. “It’s no wonder so many orders are being sent to North Korea.”
