Chinese textile firms using North Korean factories for production. Once ready, the factories then send the clothes that are labeled as Chinese all over the world. Making clothes in North Korea helps Chinese manufacturers make huge cost savings. Textiles were North Korea’s second biggest export in 2016.

Chinese suppliers send fabrics and other raw materials for manufacturing RMG to North Korean factories across the border where the garments are assembled and exported. Dozens of clothing agents operate in North Korea, acting as go-betweens for Chinese clothing suppliers and buyers from the United States, Europe, Japan, South Korea, Canada and Russia. North Korea has about 15 large garment exporting enterprises, each operating several factories spread around the country, and dozens of medium sized companies. All factories in North Korea are state-owned. And the textile factories appear to be doing great business. They take orders from not only China but all over the world.

It is believed North Korean workers can produce 30 per cent more clothes each day than a Chinese worker. Total exports from North Korea in 2016 rose 4.6 per cent. In addition Chinese companies are relocating their factories to Bangladesh, Vietnam and Cambodia to take advantage of cheaper labor.