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North Korean workers dispatched to Russia must now pay their government an additional U.S. $100 in so-called “loyalty funds” to help cover the costs of a 10,000-home construction project in the North Korean capital, Pyongyang, sources in Russia told RFA.
The workers, sent abroad by their government to earn foreign cash, were already paying the lion’s share of their salaries in loyalty funds. They were left with just enough to cover their own living expenses and a small remittance to their families back home, but the extra payments are now stretching them even thinner.
“Last week, I ran into a North Korean who works in Vladivostok who told me that he was very upset because the North Korean authorities ordered him to pay additional loyalty funds,” a Russian citizen of Korean descent living in the Russian Far Eastern city told RFA’s Korean Service on June 1.
“The order came at the end of April, and it says each person must pay an additional U.S. $100 per month,” said the source, who requested anonymity to speak freely. “We know that the extra loyalty funds will go to housing construction in Pyongyang.”
The ambitious building project is the brainchild of North Korea’s leader Kim Jong Un, who promised at the ruling Korean Workers’ Party congress in January to alleviate the capital’s housing shortage with 50,000 new homes by the end of 2025, including 10,000 in 2021.
Funding for such a major project would be a challenge in most years, but authorities have had to be even more creative as the North Korean economy is in shambles due to the double squeeze of international nuclear sanctions and the suspension of all trade with China since the beginning of the coronavirus pandemic in January 2020.
“The guy told me that none of the North Korean workers could be excluded from this additional allocation of loyalty funds, and that the authorities even threatened those in charge of managing the work force,” said the source in Vladivostok.
The source said that most of the North Korean workers in Russia are not legally employed through no fault of their own. They have yet to receive official work permits from the Russian government due to the pandemic, but their North Korean handlers are still making them work.
“He complained that the workers’ hours have increased to more than 10 per day on average, much more than when they were on work permits. Their income is also much lower than before. After loyalty funds, the workers are left with only $200,” the source said.
“The worker and his colleagues are unhappy with the government’s order to pay more,” said the source.
“He said that none of his coworkers had ever expressed dissatisfaction with the loyalty fund scheme, but now they are angry and ask where they can possibly earn enough money to pay more when all the places they can find regular work are shut down because of the coronavirus.”
Another Russian citizen of Korean descent from St. Petersburg, on the opposite side of the country, confirmed to RFA that North Korean workers there must also pay an extra $100 per month in loyalty funds to help with Pyongyang housing construction.
“When the orders came in it wasn’t only the workers who were complaining. Even the president of the North Korean human resources company, who had been responsible for urging the employees to pay the funds started to complain,” said the second source, also requesting anonymity for security reasons.
“So did the low-level party secretaries dispatched to the company and the security officers sent to keep watch over everyone. Everyone is complaining about it.”
“Thousands of these workers have been making regularly scheduled loyalty payments from the money they earned from all their hard work, which they have to hide from the Russian government,” the source said.
“The money they earn has come from dangerous work during the pandemic which takes a physical and psychological toll on them, and most of it had already been going to loyalty funds. Now the authorities are making them pony up for construction in Pyongyang.”
“No one can accept this,” he added.
Many of the workers are lucky to even make enough to cover their loyalty obligation, according to the second source.
“Some workers have not been able to make enough for their own living expenses, to say nothing of being able to remit the rest to their families… They are outraged that the authorities are telling them to pay more, saying they’ve reached their limit.”
According to CNN, in January 2018 an estimated 50,000 North Koreans were working in Russia – many in construction – in what the U.S. Department of State called “slave-like” labor.
Following the adoption of UN Security Council Resolution 2397 in Dec. 2017, all North Korean workers in Russia were supposed to have been repatriated by the end of 2019, and host countries were forbidden from issuing new working visas.
North Korea had been able to get around this by sending workers to Russia on student visas and having them apply for work permits. Pyongyang had hoped to continue doing this beyond 2019, but the pandemic in early 2020 put a snag in those plans.
A source familiar with the North Korean labor situation in Russia told RFA in February that there were 2,000 to 3,000 North Koreans in Russia working to earn foreign cash for Pyongyang in violation of sanctions.
Reported by Jeong Yon Park for RFA’s Korean Service. Translated by Leejin Jun. Written in English by Eugene Whong.
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