North Korea’s Shocking Source of Nuclear Development Funds

UN Documents on North Korea Sanctions
$34 Billion Stolen Through Hacking in the Last 7 Years
40% Allocated for Weapon Development

North Korea’s recent actions have been unsettling. The country has been frequently launching ballistic missiles into the Sea of Japan, causing international tensions. This year alone, North Korea launched two rounds of ballistic missiles, adding to a tally of over 100 since 2022. The question arises: how does North Korea finance these costly weapons programs?

According to the annual report of the Panel of Experts under the UN Security Council Sanctions Committee on North Korea released on the 20th, North Korea stole $750 million through hacking and cyber-attacks last year. This amount accounted for 50% of North Korea’s total foreign currency earnings last year.

Since 2017, the amount North Korea stole through hacking has grown to approximately $3 billion. The investigation found that 40% of the total was allocated for the development of nuclear weapons and other weapons of mass destruction.

In fact, according to the Korea Institute for Defense Analyses’ findings in 2022, North Korea spent between $1.1 billion and $1.6 billion that year on various nuclear developments, which notably included six nuclear tests.

Breaking down the nuclear expenditure further, the institute estimates that between $600 million and $700 million was spent on the Pyongsan Uranium Concentrate Plant, the Nyongbyon Nuclear Scientific Research Center, reprocessing facilities, reactors, and light water reactors. They also estimate that between $200 million and $400 million was allocated to constructing centrifuge production and enrichment facilities. Notably, each nuclear test cost estimated up to $160 million.

Regarding missile development, the cost breakdown is that launching a short-range ballistic missile (SRBM) requires between $3 million and $5 million. Meanwhile, intermediate-range ballistic missiles (IRBM) command a minimum cost of $10 million, reaching up to $150 million. Intercontinental ballistic missiles (ICBM) entail expenses ranging from $20 million to $30 million per missile.

With this money, the DPRK could buy between 1.41 million and 2.05 million tons of rice and between 2.82 million and 4.1 million tons of corn, a staggering surplus surpassing North Korea’s annual production of these grains.

Based on the 860,000-ton annual food shortage estimated by the CIA, this would be enough rice for 1-2 years and enough corn for 3-4 years.

Until now, the origin of such a substantial amount of money has long remained a mystery. In 2017, the UN-sanctioned North Korea for its seventh nuclear test, including an export ban. At that time, North Korea’s textile exports, which amounted to $760 million annually, stopped, and the issuance of new labor permits for North Korean overseas workers was halted, leading to an economic blockade.

Despite this report revealing some funding sources, the origins of the remaining expenditures remain shrouded in mystery.

Meanwhile, North Korea’s famous hacking groups include Kimsuky and Lazarus.

Kimsuky is a special forces unit established by North Korea’s Reconnaissance General Bureau in 2012 for cyber attacks against South Korea and the United States. It became known in South Korea in 2014 when it hacked the nuclear research institute of Korea Hydro Nuclear Power(KHNP). Since then, it has sent malicious files to defense, security, unification, and diplomacy experts, often posing as journalists, spreading malicious code, and stealing secrets.

Lazarus, formed in 2007, is known for employing computer viruses and ransomware. Recently, it was uncovered that the group laundered approximately over $100 million worth of Ethereum using the Tornado Cash (TORN) cryptocurrency transaction mixing protocol.