Lockdowns in China, and North Korea, Deal Double Blow to Bridge City

SHENYANG, China — There are plenty of reasons that business has been lousy recently at Steven Wen’s clothing store in Shenyang, the largest city in northeastern China.

Local officials locked down the city for one month this spring after detecting just a few dozen coronavirus cases among its nine million people. Residents have guarded their spending closely since the lockdown was lifted. And in a region often referred to as China’s Rust Belt, the local economy had already been shaky for years.

Possibly the main problem, though, is that Ms. Wen’s primary customer base has virtually evaporated.

“With North Korea closed because of the virus, they can’t come or go at all,” she said from behind the counter of her store in Shenyang’s Koreatown, where signs advertising steep discounts on imported South Korean styles had done little to draw in shoppers. “Before, we’d have maybe dozens of North Korean customers every day. Now you don’t even get 10.”

China’s continuing strict coronavirus controls have battered local economies across the country. But Shenyang has endured a double blow. Just 150 miles from the North Korean border, it is suffering not only from the restrictions in China, but also from those imposed by the even more isolated country next door.

Before the pandemic, Shenyang was a rare bridge between North Korea and the outside world.

It was a top destination for the select number of North Koreans allowed to work abroad, who would then remit home the money they earned in factories or restaurants to bolster the country’s foreign currency reserves.

It was also a launching pad for foreign tourists, mainly Chinese, seeking to visit North Korea. Multiple flights each week connected Shenyang to Pyongyang, or travelers could take a one-hour high speed train to the Chinese border city of Dandong, then enter North Korea by bridge.

The city’s Koreatown is home to the Pyongyang Restaurant, a multistory venue featuring a giant image of the skyline of the city for which it’s named. Alongside smoky Korean barbecue joints and street stalls pungent with fresh kimchi, shops advertise red ginseng, a North Korean specialty, and traditional medicines labeled “Made in DPR Korea.” Not far away is the Chilbosan Hotel, founded as a joint venture between Chinese and North Korean companies.

There aren’t exact figures for the number of North Koreans in Shenyang, but North Koreans made 165,200 visits to China in 2018, the last year for which China published statistics. Many of those visits, and many North Koreans residing longer term in China, were concentrated in the city’s northeast, including Shenyang and Dandong, in a region also home to a sizable population of ethnically Korean Chinese.

Those close ties brought risks even before the pandemic.

When the United Nations imposed sweeping sanctions on North Korea in 2017, China, by far the country’s largest trading partner, said it would shut down North Korean joint ventures and companies, and would send North Korean workers home. Still, many North Koreans remained in China on short-term visas that allowed them to skirt the restrictions, according to analysts and foreign governments. Chinese tourism to North Korea actually grew after the sanctions.

But then the pandemic arrived and accomplished what the sanctions could not. In 2020, both China and North Korea halted virtually all international arrivals, restrictions that neither country has meaningfully lifted. Shenyang in particular had perhaps China’s most extreme quarantine rules: Until the end of June, it required all international arrivals to undergo 28 days of centralized quarantine, followed by 28 days at home.

The change was immediately noticeable to Ms. Wen, the clothing store worker, who said she could easily identify her North Korean customers. Their dialect is different from the South Koreans who live in Shenyang, said Ms. Wen, who is ethnically Korean. They paid in cash. And they were willing to buy the pricier offerings that Chinese shoppers sometimes balked at, said Ms. Wen, noting that many appeared to be businessmen.

“Now there are way fewer customers,” she said. “Clothing on sale will occasionally get sold, but those at a regular price won’t move at all,” she added, gesturing at the racks of spring dresses still on display, despite the season’s having long since turned to summer.

For other Shenyang business owners, the problem isn’t one of demand: They don’t have the supplies to meet the needs of the North Koreans who do remain, unable to go home.

At a small Korean convenience store, there would normally be North Korean beer or dried vegetables, said the owner, who gave only her surname, Zhou. But the supply had dried up since the borders closed.

For a time, North Koreans in Shenyang came by to ask when more would be available. “Now, they don’t even come to ask,” Ms. Zhou said. “They know there isn’t any.”

As for the rest of the goods — a colorful array of South Korean instant noodles and bottled drinks — there was little demand, said Huang Panyue, an employee at the store who was sitting outside, idly watching the thin trickle of passers-by in what was normally the summer high season for tourism.

“All our stock is about to expire,” Ms. Huang said, adding that China required imported goods to be quarantined, further eating into their shelf life.

Though the disappearance of most North Korean customers has been a challenge, for many here that’s merely an addition to the primary problem: how China’s own Covid restrictions have hurt business.

Before the pandemic, many Chinese visitors to Shenyang had flocked to the Pyongyang Restaurant, eager to see the North Korean waitresses and their twice-daily song and dance performances.

But on a recent Friday at lunchtime, the gold-upholstered banquet tables were empty, except for one trio of diners. There had been no daytime performances since the pandemic began, a waitress said.The only chatter came from an old North Korean movie playing on a wall-mounted television, showing a man embracing a tearful woman, which another waitress said was a classic from her childhood.

Back outside and a few stalls down from the convenience store, Zhu Hongmei paused from hawking the contents of her display cooler — several varieties of pickles, a veritable barrel of kimchi — to lament the 50 percent drop in business since the pandemic began. The lockdown had been bad enough, but even after it lifted, the authorities sealed off one end of Specialty Street, the main road in the city’s Koreatown, choking foot traffic. Ms. Zhu said. It had only recently reopened.

She had tried to make up for the drop in visitors by turning to online sales, promising to mail her wares — in vacuum-sealed bags to guarantee freshness, she added — anywhere in the country. But many cities had their own lockdowns, making sending packages there impossible.

“This pandemic has really messed us up,” she said.

Che Mingji, the owner of an indoor golf course on the top floor of a mall on Specialty Street, said his revenue had fallen by 30 to 40 percent in recent years, largely because his South Korean clients, who once made up about half his customers, had left China.

Still, at least the few North Korean customers he had continue to show up.

“They still come,” he said. “I guess because they can’t go back.”

Liu Yi contributed research from Shenyang, and Li You from Shanghai.