N.Korea Ekes Out Dollars by Re-exporting Cigarettes

North Korea is earning much-needed hard currency amid international sanctions by re-exporting imported cigarettes to China and Southeast Asia, the Financial Times said Tuesday.

The North in February last year repackaged about 15,000 cases of State Express 555 cigarettes worth about US$6.3 million which it imported from British American Tobacco in Singapore and re-exported them to Vietnam, the Philippines and other countries at slightly higher prices.

According to shipping documents, the cigarettes rebounded out of the North Korean port of Nampo to Hai Phong in Vietnam and Manila in the Philippines via Dalian in China and Singapore. But the daily said their ultimate destination was probably China.

"While the UN banned luxury goods exports to North Korea, member nations have been allowed to compile their own sanctions lists, which critics say created loopholes," the daily added. The cigarette deal was possible because Singapore, like the EU, banned exports of cigars but not cigarettes, while Australia, Canada, Japan and the U.S. banned exports of cigarettes to the North.