North Korean restaurants violate sanctions, but they make big bucks for Pyongyang

Workers use student visa loopholes to get around sanctions to take jobs as servers and entertainers.
By Chin Min Jai for RFA Korean
North Korean restaurants violate sanctions, but they make big bucks for Pyongyang A Dec. 2022 view of the exterior of the Blue Flower Restaurant in Phnom Penh, Cambodia.

The South Korean YouTuber’s video shows his visit last April to the Blue Flower, a North Korean restaurant in Phnom Penh, Cambodia’s capital – one of 70 North Korean restaurants operating worldwide, mostly in Asia.

Collectively, they earn the cash-strapped North Korean government about US$700 million, according to the U.N. Security Council Sanctions Committee on North Korea.

But they violate international sanctions.

All North Korean workers were supposed to have repatriated before the end of 2019, but many have kept working. 

The Blue Flower itself was closed several months later – in August 2023 – possibly for violating sanctions, reported. But many of these restaurants remain open.

In his travels around Southeast Asia, the YouTuber, identified by a pseudonym Lee to protect his identity, told RFA Korean that he discovered several other North Korean restaurants – but staff in Laos and Vietnam refused to let him film the inside of the eateries.

“I spoke with the boss at a North Korean restaurant in Cambodia and he said business was good,” said Lee. “Most North Korean restaurants in Southeast Asia that I visited had good business.”

North Korean waitresses perform in front of a large menu at a North Korean-owned restaurant in the Chinese border town of Dandong, February 11, 2013. (Mark Ralston/AFP)

The North Korean workers are dispatched overseas to serve customers and entertain them by dancing and singing, and most of the money the restaurants earn is forwarded to Pyongyang.

Due to the COVID-19 pandemic, tourism to North Korea had dwindled to nearly zero. Only recently, it has restarted for guided tours from Russia.

So the restaurants, which are also found in China and Russia, were perhaps one of the only ways to experience North Korean culture firsthand.

Prior to the pandemic, the restaurants were seemingly struggling, but Lee says the ones he has been visiting were relatively successful. 

Northern cuisine

Korean cuisine varies by region, and so it is hard to generalize about how Northern cuisine may differ from that of the South, but connoisseurs can identify differences.

A tour company describes the North Korean varieties as using fewer spices and sauces than varieties in the South, while an escapee who settled in the South and opened a restaurant in Seoul told Voice of America that northern dishes are simpler, made with more traditional cooking methods.

At the Blue Flower, Lee enjoyed eating gamja jjijim, or potato pancake, and kalguksu, or knife-cut noodle soup. Varieties of both dishes exist in South Korea as well. 

The Blue Flower served the potato pancake with honey as a dipping sauce, which would be uncommon in the South.

He was also served with a North Korean variety kimchi, most of which aren’t as spicy as South Korean varieties, and several kinds of banchan (often translated as “side dishes”). And he washed it down with a cold Taedonggang beer, brewed in North Korea.

Hostesses stand at the entrance of a North Korean restaurant in Hanoi, October 6, 2023. (Nhac Nguyen/AFP)

I ate alone on the first floor of the restaurant, but he said that there also held performances on the second floor. So, the second floor was reserved for group events,” said Lee.

He said the Blue Flower was different from the North Korean restaurant he visited in Vietnam, which seemed to mimic the South Korean dining experience.

According to Lee, the server at the Blue Flower told him she had been in Cambodia for three years, meaning she arrived in 2021. 

With sanctions in effect, her presence at the Blue Flower in 2023 should have been illegal, but North Korea has been known to get around sanctions on its dispatched workers by sending them on tourism or student visas

Exploiting loopholes

In fact, since early 2019, North Korea has been using the student visa loophole to staff its restaurants in Cambodia, a North Korean restaurant worker who escaped from her employer in Phnom Penh and resettled in South Korea in 2016, told RFA on condition of anonymity for security reasons.

When I was working, we went out on work visas, but I talked to some friends who were sent out in 2019 and they were all on student visas,” said the woman, who is identified with the pseudonym Kim. “They lied to get their visas and that’s how they are overseas.”

In March 2016, the U.N. Security Council adopted Resolution 2270 on North Korea, prohibiting U.N. member states from doing any business with the North Korean regime.

At that time, China showed an even firmer commitment to implementing sanctions against North Korea than ever before. It refused to renew the visas of North Korean restaurant workers in the country and ordered the closure of North Korean companies. 

As a result, some North Korean restaurants closed, and workers packed their bags and returned to North Korea.

The restaurants are still open, however, and Kim says that the sanctions only hurt the livelihood of the workers.

“The sanctions against North Korea did not actually affect the business of overseas North Korean restaurants that much,” said Kim. “In 2017, China said it supports sanctions against North Korea and inspected all the goods overseas North Korean workers were bringing back to North Korea. When workers got home, there were missing items, and everything was torn.” 

Additionally, said Kim, North Korea’s way of getting around sanctions was not to send the workers back to North Korea, but to a different country so that they can work more before being discovered and possibly repatriated. They often don’t know where they are going up until the moment they depart.

“The process is kept secret, so the workers don’t know much about it,” she said. “When the restaurant closes, almost everyone takes a plane and heads out to China.”

She said the managers of restaurants look for business partners anywhere they can find them, and on a moment’s notice, everyone boards a plane and they fly to the next country.

It is an existence that many of the workers dislike, but they have no choice but to comply with their orders.

Marketing curiosity

A North Korean restaurant once located in Tashkent, the capital of Uzbekistan, began business after the 2019 sanctions went into effect.

Shin Hyunqwon, who runs a travel agency in Uzbekistan, told RFA that the restaurant thrived, not only through word of mouth from local residents, but also as a hotspot for South Korean tourists.

Five employees dispatched from North Korea escaped in May, June and August 2022, one after another, causing the business to close. Since then, there have been no North Korean restaurants in the capital of Uzbekistan, Shin said.

North Korean restaurants in China and Russia, which have closer relationships with North Korea, have been thriving regardless of sanctions against North Korea. 

One reason for that is by catering to South Korean tourists’ curiosity about North Korea and providing an opportunity to interact with North Korean staff.

A North Korean restaurateur who operates a restaurant in northeastern China said he had been in the business for decades. It has been an official policy to refuse service to South Koreans, but not all the restaurants comply.

“On the outside, they are all North Korean restaurants, but some of them are jointly operated by North Korea and China,” said Park. “In North Korean restaurants where the owner is Chinese and the employees are North Koreans, they accept South Korean customers.”

The situation is similar in Russia where South Koreans are banned from entering North Korean restaurants. However, Russia has stricter rules on South Koreans entering the country than China.

 Translated by Claire S. Lee and Leejin J. Chung. Edited by Eugene Whong.


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