NKorean defectors struggle to send money home

For the first time in years, Choi Bok-hwa didn't get her annual birthday call in January from her mother in North Korea. The pattern was always the same: Choi's 75-year-old mother climbed a mountain in the North with a broker who had a smuggled Chinese cellphone, and after wishing her daughter in South Korea a happy birthday, arranged a badly needed wire transfer.

The last time they talked was May last year when Choi sent her mother the equivalent of US$620. Choi believes the silence is linked to the coronavirus pandemic, which led North Korea to shut its borders tighter than ever and impose one of the world's toughest restrictions on movement.

Other defectors in the South have also lost contact with their loved ones in North Korea amid the societal and economic turmoil of COVID-19 - and the trouble is not just on the North Korean side. The disconnection between defectors and their families in the North during the pandemic is shutting down an important emotional and financial link between the rival Koreas, whose citizens are banned from contacting each other across the world's most highly armed border.

Defectors in the South have long shared part of their income with parents, children and siblings in North Korea. But these defectors, who already faced chronic discrimination and poverty in the South, now say they've stopped or sharply reduced money transfers to North Korea because of plunging incomes.

Choi, a singer in a North Korean-themed art troupe, last year earned only about 10-20% of what she usually gets because her troupe canceled many performances. Many defectors have turned to brokers to stay in touch with their families in the North, a process that is complex, expensive and risky.

Brokers in North Korea often use illegal mobile phones smuggled from China to call the South from mountains near the border with China, where they can get better mobile signals and avoid detection by authorities. Most phone calls are then followed by money transfers, which require defectors in South Korea to send money to the bank accounts of other brokers on the Chinese side of the border.

Brokers in North Korea and China have long taken 30% of the money being transferred as commission. But during the pandemic some brokers have taken a 40-50% slice, according to defectors and activists. There are no official, extensive studies on how the pandemic has affected money transfers. But separate surveys of several hundred defectors by civic groups showed 18-26% of the respondents sent money to North Korea last year, down from about 50% in a similar-sized poll in 2014.

It's not clear how much worse this will make the North's already moribund economy. South Korea's spy agency last year reported a four-fold price increase of imported foods like sugar and seasoning in the North, while Chinese data show its official trade volume with North Korea plunged by 80% last year.

Defector Cho Chung Hui said his siblings used to travel for hours to the border to meet brokers and call him for money. But he hasn't heard from his siblings since November 2019. Cho said some "robber-like brokers" now ask for too large a percentage of the transferred money and that many of his defector friends are waiting for commissions to stabilize before resuming money transfers.

South Korean law bans its citizens from unauthorized contact with North Koreans, but authorities don't strictly apply the regulations on defectors because of humanitarian reasons. North Korean officials often overlook money transfers because they get bribes from those receiving money from South Korea. Cho, a former North Korean agriculture official who now heads the Seoul-based NGO Good Farmers, said it's "very burdensome" to send money to his siblings, but he'd do it again if his family got in touch to ask.