Mark Leong/Matrix for TIME. THE SPICES OF LIFE: Traders make deals to make a living.

Just Like Home
In a sleepy Chinese outpost, spice traders have created a little bit of Korea
By HANNAH BEECH Weihai

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The pungent smell of kimchee and barbecued beef wafting out of the Woo Lae Oak restaurant promises all good things Korean. So do similar fragrances emanating from the Taihe Inn, which caters to South Korean businessmen and offers cut-rate Asiana Airlines tickets to Seoul. And it's hard to miss the Daewoo and Samsung factories on the outskirts of town. Yet despite the quintessential Korean flavor of Weihai, the flag that flies over this coastal trading town is, in fact, Chinese.

Weihai has long been accommodating to foreigners. The first outsiders to drop anchor in this sleepy haven in eastern Shandong province were British merchants, who wangled a treaty port out of a war-weakened China in 1898. Korean traders in search of cheap spices arrived nearly a century later, when Weihai became one of the first maritime towns to open up during China's economic reforms. Today, all traces of the Union Jack have been replaced by icons from the Land of the Morning Calm. Korean merchants swarm the markets, in search of the choicest goods to take back home. Hangul, the Korean script, announces everything from a Korean supermarket to a Korean toilet-bowl store. The head of Hyundai, one of Korea's top conglomerates, is the honorary president of a local teachers' college.

Three times a week, 600 Korean traders board the slow boat from Inchon to Weihai, amusing themselves during the 18-hour journey with strobe-lit karaoke, OB beer and Dance Dance Revolution videogame machines. On the return trip, their sacks bulge with chili, garlic and sesame oil. Yoon Sung Il, 51, has crossed the Yellow Sea twice a week for the past three years. By selling his bags of spices to Korean restaurateurs, he pockets a profit of $200 per trip, even when he brings his wife and 18-year-old son along for the ride. "There are worse ways to make a living," he says, lounging on deck in Hawaiian shorts and wraparound sunglasses. "It's better than sitting in an office with a calculator."

When the Asian financial crisis hit South Korea, small-time merchants were among the first to feel the pain. Two thousand of the most enterprising hopped the boat to China—mostly to Weihai, but also to Dalian and other Shandong ports—to buy cheap Chinese goods and sell them back home at markups as high as 350%. Now, even kids on summer break from Korea's top universities engage in a little spice arbitrage. "I don't know why more people don't do this," says Chung Ju Yop, 21. "I can make money and get a look at the rest of the world."

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Such opportunities may be narrowing. Last year, the influx of cheap Chinese food products so inflamed Korea's farmers that Seoul decreased the amount a trader could import from 120 kg to 70 kg. In October, the load will be lightened to 50 kg. The trade spat heightened in June when Seoul raised tariffs on Chinese garlic from 30% to a whopping 315%. Beijing retaliated by banning South Korean mobile phones and polyethylene, a key component in making plastics. Although government officials have resolved the tariff dispute, some traders are worried. "On the surface, the two countries say that trade is good for both sides," says Lee Jung Il, a former fish breeder who now imports Chinese food and liquor to Inchon. "But underneath, neither wants to accept the other's goods."

Still, the trade tiff hasn't stopped the Korean merchants who flood into Weihai every week. The port has also drawn hundreds of China's ethnic Koreans, most of whom hail from Manchuria. With the industrialized northeast facing the brunt of layoffs at state-owned companies, many ethnic Koreans have left home for better opportunities in the south. Cui Mianzhen's entire family moved from icy Heilongjiang province to Weihai last year. Now she works at a hotel for Korean traders, while her parents run a company that supplies Seoul jewelers with raw pearls. Jobs for Korean speakers are plentiful, she says, and Cui has convinced several high-school friends to join her in Weihai to work as translators, secretaries and sales clerks. "Here, we can be proud to be ethnically Korean," she says. "It's not something we feel the need to hide, as we did back in Heilongjiang."

Not all the 130 stores that cater to Weihai's visiting traders are run by ethnic Koreans. Shopkeeper Hou Jianling, 24, packages wine from China's southwest Yunnan province for Koreans to take home as gifts. The Koreans, she says, drive a hard bargain. Some day she hopes to use the business tips she has picked up from her overseas clients by working as an exporter-importer. "Culture used to go from China to Korea," says Hou, who studied Korean at a local college. "Now we Chinese are learning how to do business more efficiently from the Koreans." Despite Weihai's welcoming ways, trader Lee has one complaint: "The Chinese can't make kimchee correctly." Even if the spices are Chinese, he maintains, the preparation must be done by a real Korean. Some things, it seems, just can't transcend borders.

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