Financial Transfers from Japan to North Korea: Estimating the Unreported Flows

Abstract

With the collapse of the Soviet Union and the cutback in Chinese aid to North Korea (DPRK),1 Pyongyang for the moment seems to be left with only one potentially major source of concessional resource transfers: the General Association of Korean Residents in Japan (known by the abbreviated Chosen Soren in Japanese, Chochongnyon in Korean). This organization of pro-DPRK Koreans living in Japan-estimates of whose membership range from about 100,000 to roughly 250,000-has been described as North Korea's money pipeline.2 In the view of most specialists, this money pipeline funnels very substantial volumes of aid to North Korea every year. In a presentation before the Japanese Diet in March 1994, for example, the director-general of the Japanese Agency for Public Security and Investigation stated that Chosen Soren was believed to be remitting Y60 billion to Y80 billion a year to Pyongyang3-equivalent to $650 million-$850 million at the exchange rates then prevailing. Those estimates are consistent with figures widely cited in the