This Wednesday, the regime in North Korea is celebrating the founding of what is today its people’s army 75 years ago. To mark the anniversary, a military parade with fireworks and a large march is expected in the evening at Kim Il Sung Square in Pyongyang.
The governments in the USA and South Korea are already excited to see what the party dictatorship will be able to offer in terms of nuclear-capable missiles this time. Ned Price, spokesman for the US State Department, pointed out on Monday in Washington that the show would not be taken too seriously. The parade “certainly has more news and propaganda value than material value”.
The country is using increasingly sophisticated cyber techniques
Nevertheless, the display of the glory of arms could again raise the question of how North Korea can afford its military presence at all. The country has been poor for a long time, but since the pandemic began, the situation has gotten worse rather than better. North Korea has been almost completely sealing itself off since the beginning of 2020 for fear of the corona virus. Trade doesn’t work like it used to, United Nations (UN) sanctions are a burden.
North Korea is primarily living on aid from China. Nevertheless, the regime of ruler Kim Jong-un is arming itself. In the past year, it has fired more than 70 test rockets at various ranges – a record. Where does the funding for all the material come from?
Cybercrime appears to be part of the answer. In any case, North Korean hackers stole more money from the Internet last year than ever before. This emerges from a confidential report by independent sanctions monitors to a committee of the UN Security Council. The Reuters news agency was allowed to see the report on Monday and quoted from it.
Accordingly, North Korea used “increasingly sophisticated cyber techniques to gain access to digital networks involved in cyber financing and to steal information that could also be valuable for its own weapons programs”. The sources of this insight are UN member states and cybersecurity firms.
The theft is said to have been “record-breaking” in 2022
Exactly how much money North Korea stole from the Internet is difficult to say. The sanctions watchdog estimates the sum at 630 million US dollars, a cyber security company assumes more than one billion US dollars. “The fluctuations in the value of cryptocurrencies in recent months have likely affected these estimates,” the report states, “but both show that 2022 was a record-breaking year for DPRK virtual asset theft.” DPRK stands for “Democratic People’s Republic of Korea”, the official name of North Korea.
North Korea has always denied raising money through hackers. But it is not very likely that the regime will finance its nuclear weapons program with honest economic practices. It has probably even broken its own anti-corona rules for this in the past three years.
North Korea can produce some raw materials for rocket construction itself. Steel for example. There are enough workers. But for components and precision machines that have to come from abroad, the dense borders will probably open up after all. “North Korea has built up a trade network through bribery and embezzlement over the decades,” says Peter Ward, an expert on North Korea’s economy at the private Kookmin University in Seoul. “They have found ways to overcome the mistrust and restrictions from Europe and North America evade”.
Kim Jong-un’s regime covers the costs of this black market with savings, contributions from the party people – and with self-service from the Internet. So there is also money from virtual raids in North Korea’s nuclear missiles? Peter Ward replies, “That seems very likely.”