Bertil Lintner has uncovered a long-running trading relationship between North Korea and Mynamar.

All this seems to confirm what diplomatic observers have long suspected: that Myanmar and North Korea, two countries with limited access to bank and other international financial trade facilities, are engaged in barter trade. Myanmar’s ruling generals want more weapons but often don’t have the foreign funds handy to pay for them – or at least they don’t want such transactions to show up in their bank records. North Korea, meanwhile, is starved for food and likewise lacks the finances to pay for imports.

When money is involved in North Korea-Myanmar trade, transactions are always done in cash and thus untraceable. Like all other ships, North Korean ones have to pay port fees in Myanmar. The MV Du Man Gang, for instance, asked to pay US$30,994 in cash rather than make a bank transfer. Other ships have made similar requests which has led to speculation about the kind of currency the North Koreans, notorious for counterfeiting US dollars, may be using.

Large quantities of counterfeit US notes have recently shown up in areas around Myanmar. In July and August 2009, a customer tried to change U$10,000 in fake notes at the State Bank of India’s main office in Imphal, Manipur. The fake bills were all of the US$100 denomination and of excellent quality, according to sources. It was the first such incident in Manipur. Although it is not clear whether the bogus notes were printed in North Korea, Imphal is located just over 100 kilometers from Moreh, an Indian town opposite Myanmar’s Tamu where a virtually unregulated border trade is booming.

Trade between North Korea and Myanmar is also apparently being done through front companies. In June 2010, the North Korean freighter MV Ryu Gong arrived with 12,838 tons of what was also described as “cement”. While the shipment was handled by the Ministry of Heavy Industry 2, the stated recipient was a little-known company known as Shwe Me, or “black gold” in Myanmar. Port documents show that the company has nearly a million US dollars in assets but what it actually intended to do with all that cement is unclear. Just as puzzling is the involvement of Singapore-based shipping companies, which handle most of the cargo’s logistics and operate under innocuous sounding names including words like “maritime” and “services”. One of the companies has a distinct Korean name but is actually based in Singapore.

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Filed under: Business/Economy, Korea, Maritime, Southeast Asia Tagged: barter, burma, counterfeit, dprk, myanmar, north korea