Inside North Korea's Black Market: How Ordinary People Survive When the State Stops Feeding Them

The Woman Who Sold Everything and Lived

Her name, for the purposes of this piece, is Hyun-ja. She was born in Chongjin — North Korea's third-largest city, a rusting industrial port on the northeastern coast — in 1971. When I met her in a small apartment in Shenyang, China, in March of 2019, she had been living as an undocumented person for nearly four years. She made dumplings. She sold them out of a Styrofoam box near a construction site. She was terrified, exhausted, and one of the sharpest people I've ever interviewed. And she told me something I've been thinking about ever since.

North Korea Untold

"The government taught us that selling things was shameful," she said, her hands wrapped around a cup of instant coffee she'd insisted on paying for herself. "That only capitalists did business. That we were better than that." She paused. "Then my son started going to school without eating. So I became a capitalist."

That's the story of North Korea's black market — the jangmadang — in a single sentence. It didn't emerge because people got greedy. It emerged because the state collapsed and took the food distribution system with it. And what replaced it is one of the most extraordinary informal economies on earth. Invisible to most outsiders. Absolutely essential to nearly everyone inside.

What the Famine Built

You can't understand the markets without understanding the 1990s. The Arduous March — that's the regime's own euphemism for it — killed somewhere between 300,000 and 800,000 people, depending on whose estimate you use. The UN's numbers. The defectors' numbers. Nobody really knows. What we do know, from hundreds of testimonies collected over the past two decades, is that the Public Distribution System — the PDS, the state mechanism through which every North Korean citizen was supposed to receive food rations — essentially stopped functioning across large parts of the country.

People starved. People foraged. And then, slowly, people started trading.

A woman in Hamhung would sell her furniture to buy corn. A man in Hyesan — right on the Chinese border, and this geography matters enormously — would smuggle in cigarettes and resell them at a markup. A collective farm worker would skim grain before it could be reported to the state and sell the difference at night. These weren't organized crime syndicates. These were desperate people making rational decisions in irrational circumstances. And over twenty-plus years, what started as survival improvisation calcified into something resembling an actual market system.

By the time I first visited the Chinese side of the Tumen River in 2014, defectors were describing a North Korea that would have been unrecognizable to someone from the 1980s. Private trade wasn't just tolerated — in many places, it was the only economy that actually functioned.

The Architecture of the Markets

The jangmadang — literally "market ground" — exist in a strange legal limbo that has shifted repeatedly under Kim Jong-un. In the early 2000s, the regime officially permitted some market activity in an attempt to co-opt what it couldn't suppress. Official markets were established, stalls were licensed, fees were collected. The state, in other words, decided to tax the thing it couldn't kill.

But the official markets are only part of the picture. According to one defector who asked not to be named — he still has family in Wonsan and the fear in his voice when he talked about them was not performance — the real commerce happens in layers. There are the sanctioned day markets. There are unofficial evening markets that technically violate curfew but operate anyway, with the right bribes in place. There are apartment-based traders who operate essentially as wholesalers. And then there are the networks — the donju, the "money masters" — a new merchant class that has emerged with genuine capital and genuine influence.

I've spoken to seven defectors who mentioned the donju specifically, between 2016 and 2022. Their accounts are remarkably consistent. These are people — often women, interestingly — who accumulated enough capital through market activity to start financing other traders, essentially functioning as informal banks and venture investors simultaneously. One woman I interviewed in Seoul in January 2020, a former factory administrator from Pyongsong named Oh Kyung-soon (she gave me permission to use her name), told me she had personally borrowed from a donju to set up a small noodle stall in 2008. Within three years, she said, she was earning more in a week than her official state salary paid in a year.

"The state salary was a joke," she told me flatly. "It was a number on paper. The market was real."

What They Sell (And What That Tells Us)

The range of goods available in the jangmadang is — I want to choose this word carefully — astonishing. Early markets were mostly food. Corn. Rice. Vegetables. Then came manufactured goods: clothes, shoes, basic household items smuggled in from China. By the 2010s, according to multiple sources, you could buy USB drives loaded with South Korean dramas, Chinese smartphones, imported cosmetics, and bootleg DVDs. There are reports — I cannot independently verify these, but they come from multiple credible sources — of markets in Pyongyang where you can find foreign liquor and imported snacks that would look at home in a convenience store in Seoul.

This matters because of what it reveals about information flow. Every USB drive full of K-dramas is a small act of ideological subversion. The regime knows this. That's why the Reconnaissance General Bureau runs entire units dedicated to intercepting foreign media. That's why people get sent to labor camps for watching South Korean content. And yet it keeps happening. The market is stronger than the fear — or at least, for enough people, the calculation still comes out in favor of the risk.

One defector, a young man I'll call Junho, who left North Korea through China in 2018 and now lives in the UK, told me he had watched all of Boys Over Flowers — a South Korean drama — on a smuggled phone in his dormitory room in Kaesong. He was seventeen. "We all knew it was illegal," he said. "But everyone was doing it. If everyone does it, it feels less dangerous somehow." He laughed a little when he said that. Then he stopped laughing.

The Corruption That Runs It All

Here's the thing that took me a while to fully internalize, even after years of hearing about it: the jangmadang doesn't just coexist with state corruption. It runs on state corruption. It is, in a very real sense, inseparable from it.

Every market trader I've ever spoken to — without a single exception — has described a system of regular payments to local officials. Police officers. Party cadres. Market supervisors. The payments are not optional. They are the cost of doing business. A trader in Sinuiju, according to a source who left that city in late 2021, was paying three different officials monthly: the head of the local inminban (neighborhood watch unit), a police officer who patrolled the market area, and someone she described only as "a man from the party office" whose actual role she didn't know and didn't ask about.

This creates a system that is simultaneously repressive and self-sustaining. Officials have a direct financial interest in the markets continuing to function. Which means they have a direct financial interest in not enforcing the laws that would shut those markets down. Which means the markets continue to function. It's not a paradox — it's a protection racket. And protection rackets, historically, are remarkably stable.

But the stability isn't guaranteed. Kim Jong-un has periodically cracked down — really cracked down — when he felt the markets were getting too autonomous, too much of a parallel power structure. In late 2020 and into 2021, in the context of COVID border closures, multiple sources reported severe restrictions on market activity. One woman who managed to get a message out through a broker network in Dandong, China, described markets in her city being forcibly closed for weeks at a time. "People were going hungry again," the message said. The border closure, meant to keep out COVID, also kept out the Chinese goods that the informal economy depended on.

The Women Who Run the Economy

I need to stop here and make a point that doesn't get made enough in Western coverage of North Korea: this is largely a female economy. The markets are dominated by women. There are structural reasons for this — men are still required to show up at state enterprises, even when those enterprises have no work and pay no wages, whereas women were historically classified differently and had somewhat more freedom of movement. So women took the space that the system left open.

But it's become something more than an accident of policy. Multiple defectors have described a genuine shift in household power dynamics. Women who earn real income through trading have leverage that North Korean society — deeply patriarchal in its official structure — never anticipated giving them. Oh Kyung-soon told me, with a kind of quiet pride, that by 2011 she was giving her husband an allowance. "He didn't like it," she said. "But he took the money."

There are women who have used market income to bribe their way out of problems — their children's school issues, legal difficulties, housing problems. Women who have effectively purchased their families' stability through commercial acumen. I've heard this from defectors in Seoul, in Toronto, in Berlin. The pattern is consistent enough that I've stopped being surprised by it and started thinking of it as structural. The market didn't just feed people. It reorganized, quietly and without anyone planning it, some of the basic power relations inside North Korean households.

Getting Money Out (And In)

One of the more sophisticated elements of the informal economy — and one that connects North Korea to a global network of brokers and fixers — is the hawala-style money transfer system that defectors and their families use to move money across the border. It goes by several names, but most people just call it the broker system.

Here's how it works, roughly: a defector in South Korea — let's say someone who has a mother still in Hyesan — contacts a broker, usually a Korean-Chinese person operating out of Dandong or Yanji. The defector pays the broker a sum in South Korean won or Chinese yuan. The broker contacts an associate inside North Korea. That associate physically delivers the equivalent amount — minus a substantial commission, typically 30 to 40 percent — to the mother in Hyesan. No money actually crosses the border. It's a ledger system, settled through trust and reputation and, when those fail, through threats.

I've interviewed four brokers. Three refused to be recorded. One, a man I met in a Korean restaurant in Yanji in September 2017, talked for two hours. He'd been doing this for nine years. He was matter-of-fact about the risks — North Korean security services, Chinese police, the occasional violent dispute with clients — in a way that suggested either deep calm or complete compartmentalization. Probably both. He estimated that he personally moved the equivalent of several hundred thousand US dollars a year. "Small amounts, many times," he said. "It adds up."

This system is, as far as I can determine, the primary way that the North Korean defector community in South Korea maintains any connection with family members left behind. It is also, for those family members, often a lifeline — a supplement to market income that makes the difference between getting by and not getting by.

What It Means

I've been writing about North Korea for a long time. Long enough to be skeptical of grand conclusions. Long enough to have learned that the country confounds predictions with remarkable regularity, and that anyone who tells you they know exactly what's happening inside is either lying or hasn't been paying attention.

But here's what I think the jangmadang story actually tells us. It tells us that the North Korean state, for all its brutality and for all its totalitarian architecture, has lost something it can't get back: the economic dependency of its population. For most of the country's history, the regime controlled people partly through the distribution of food and goods. You needed the state to eat. That's an extraordinary lever of control, and the famine broke it.

People now know — they know in their bones, because they lived it — that the market feeds them. Not the party. Not the general secretary. The market. And that knowledge, once acquired, is not easily un-acquired. The woman selling corn rice in Chongjin, the broker moving money through Dandong, the young man watching South Korean dramas on a smuggled phone in Kaesong — they are all, in their different ways, people who have made a private and irreversible settlement with reality.

Hyun-ja — the woman who makes dumplings in Shenyang — told me, near the end of our conversation, that she sometimes misses North Korea. Not the regime. Not the fear. She misses specific things: a particular view of the sea near Chongjin. Her mother's kitchen. A friend she lost track of after the crossing. And then she said something that I wrote down and have read back to myself many times since.

"The market taught us that we could solve our own problems," she said. "The government spent forty years trying to teach us the opposite. In the end, hunger was a better teacher."

I paid for the next round of coffee. It seemed like the least I could do.