Inside North Korea: How does Kim Jong-un fund a lavish lifestyle of yachts and champagne?

And as North Korea continues to build up its nuclear arsenal speculation is growing over how crackpot North Korean dictator Kim Jong-un funds his lavish lifestyle of superyachts, party islands and luxury limos.

Kim, whose regime has again shocked the world by carrying out hydrogen bomb tests, continues to live in the lap of luxury while most of his people struggle to survive on scraps. 

And as the international community imposes increasingly harsh sanctions on the hermit state, questions about his seemingly endless funds are being raised.

North Korea has been accused of funding Kim’s extravagant lifestyle through illegal operations such as cybercrime, weapons trading, dealing drugs and trafficking endangered species.

Experts told CNN Kim’s ill-gotten gains were also used to bankroll North Korea’s recent nuclear tests and increasingly aggressive missile program.

Spies and defectors have also claimed a shadowy government department sells fake cash and Viagra to keep Kim and his inner circle happy.

David L. Asher, who has tracked North Korea’s illegal activities, said: “This money helps keep Kim Jong-un in power at a time he is engaged in nuclear brinksmanship.

“This is the gift that keeps on giving. It has become one of the North’s largest illicit revenue generators.”

A 2008 Congressional Research Service report said Pyongyang could generate as much as £770 million a year from illegal activities.

The country bought £500 million worth of luxury goods in 2012, according to a 2014 report from the UN.

Kim is well-known for his love of imported Swiss cheese as millions of his countrymen struggle to put food on the table with most of his 25 million scraping by on £3 a day.

A UN Food and Agriculture Organisation report said North Korea remained one 34 nations needing external aid to feed its people.

The agency estimates around 2.8million “vulnerable” people face an “ongoing struggle with under-nutrition and a lack of vital protein and fat in the diet”.

Meanwhile, guests of Kim are given rooms decorated with imported antique furniture, paintings and tapestries.

His seaside party pad – close to the port of Wonson – has its own marina and secluded bays patrolled 24 hours a day by heavily armed troops.

Jet skis, yachts and speed boats are moored in the marina alongside Kim’s own 200-foot super-yacht which is fitted with its own array of water chutes and slides.

A fleet of Mercedes cars ferries guests to the complex across a private bridge after they arrive at a nearby airstrip.

There is also a private railway station built to service the dictator’s retreat.

It comes as world leaders condemn North Korea’s recent hydrogen bomb test as tensions between Pyongyang and the United States continue to escalate.