Today comes word of more sanctions on Chinese state-owned companies, all with close ties to the military, for helping Iran with its nuke and missile programs.

The sanctions, announced by the State Department, are part of a diplomatically complex effort to cut off the flow of technology into Iran that could aid its weapons programs, while pressing both China and Russia to threaten action against Tehran at the United Nations Security Council.

Included in the latest sanctions, first reported Tuesday by The Washington Times, are two companies closely tied to the Chinese military: the China North Industries Corporation, known as Norinco, and the China Aero-Technology Import and Export Corporation, or Catic, which is one of the country’s largest producers of military aircraft.
. . . .

The other Chinese companies were the Hongdu Aviation Industry Group, the Limmt Metallurgy and Minerals Company, Ounion (Asia) International Economic and Technical Cooperation Ltd. and the Zibo Chemet Equipment Company.

Further reading on some of the sanctioned companies here:

• Norinco, a massive parastatal in China’s military-industrial complex, has an extensive history of proliferation to Iran, and was once a major supplier to American discount stores.
• Zibo Chemnet, several other Chinese companies, and North Korea’s Changgwang Sinyong Corporation were all sanctioned in July 2003 for WMD proliferation activities.
• Hongdu Aviation produces this trainer for the Chinese air force. The airframe shows clear signs of having F-18 genes and is a potential precursor to an indigenous fighter production or export program. There is little question that China can supply Iran with all the technology it needs to build UAVs and cruise missiles, which is could then use to deliver any WMD it can sufficiently miniaturize.
• China Aero Technology was sanctioned in January of 2005 for helping Iran with its WMD programs. The State Department’s Federal Register publication of the sanctions notice (70 Fed. Reg. 133-01) also lists new sanctions against Zibo Chemnet, Norinco, and North Korea’s Paeksan Associated Corporation, all for technology transfers to Iran.
• Limmt was sanctioned in 2004 for technology transfers to Iran, along with “The Beijing Institute of Aerodynamics of China, the Beijing Institute of Opto-Electronic Technology (BIOET) of China, . . . the China Great Wall Industry Corporation of China, [and] China North Industries Corporation (NORINCO) of China.” Another name on the list: North Korea’s Changgwong Sinyong Corporation, about which I will say much more later.

The Times writes that no evidence links these technology transfers to the highest levels of China’s government, but that statement dissolves under a flood of circumstantial evidence, and reopens concerns about a recently-exposed attempt by a Chinese triad to smuggle surface-to-air missiles into the United States. A Chinese general was implicated in the plot. Given the extensive and often repetitive nature of the violations by these Chinese parastatals and the close connections between those companies and the Chinese military, it’s not unreasonable to infer that senior officials of the Chinese government authorized those transfers. I’m not alone in drawing that inference:

The U.S. intelligence community has concluded that China and North Korea have cooperated to produce and deliver components for missile and WMD programs to a number of Middle East clients, Geostrategy-Direct.com reported in its current editions. The intelligence finding led to the U.S. decision to impose sanctions on Chinese companies cooperating with North Korea in the fields of missile and WMD. After a lengthy debate within the National Security Council and State Department, the Bush administration approved the new sanctions to demonstrate a tougher policy toward Beijing, the officials said.

Note the familiarity of some of the names mentioned in that 2003 report:

The five Chinese companies sanctioned were identified as Taian Foreign Trade General Corporation of China, the Zibo Chemical Equipment Plant of China, the Liyang Yunlong Chemical Equipment Group Company of China, China North Industries Corporation, known as Norinco, and the China Precision Machinery Import/Export Corporation.

The best that can be said in China’s defense is that nearly three years after being put on notice that its top military parastatals were working with the North Koreans to arm Iran, China’s government has failed to take effective measures to stop to very same companies from selling similar components to the same customer.

Opening the floodgates of dual-use technology to China–and for some very suspect reasons–ought to be recorded as one of America’s greatest foreign policy miscalculations, alongside President George H.W. Bush’s failure to confront China morally and politically after the massacre at Tienanmen. The current administration doesn’t escape criticism, either. Just this past March, the State Department extended a waiver of import sanctions against NORINCO, clearly a flagrant supplier of sensitive technology to the mullahs. This apparently caused sufficient concern in Congress that the Senate held hearings. Those hearings specifically focused on both NORINCO and the North Korean nuclear crisis.

North Korea’s Changgwang Sinyong, whose name repeatedly emerges in these reports, has a long history of selling missile and UAV technology to A.Q. Khan’s network in Pakistan and Yemen (you may recall the So San incident), as well as to Iran. This 2003 report states that CSC also has a significant presence in Syria, Libya, and Egypt. CSC is essentially North Korea’s state missile technology proliferation firm. It has been sanctioned at least eight times.

On June 28, 2005, President Bush signed Executive Order 13,382, which imposed the ultimate penalty on CSC and several other North Korean entities: it flat-out froze their assets. Shortly thereafter, the Treasury Department’s Office of Foreign Asset Control published some interesting details. First, we learned that CSC uses a number of aliases / dummy companies / fronts, including “Korea Mining Development Trading Corporation,” “External Technology General Corporation,” and “North Korean Mining Development Trading Corporation,” or KOMID. Other North Korean companies sanctioned:

• Korea Ryonbong General Corporation, alias Korea Yonbong General Corporation, and formerly known as the Lyongaksan General Trading Corporation.
• The Tanchon Commercial Bank, which has previously called itself the Changgwang Credit Bank, the Korea Changgwang Credit Bank.

I’ll give you one final detail on Changgwang Sinyong. India’s Chandigarh Tribune, presumably passing along a leak from Indian intelligence, states that in 1998, one Kang Thae-Yun was CSC’s Pakistani representative, and was heavily involved in selling missile technology to Pakistan and Iran. Mr. Kang’s wife found a novel way to bring more income into the Kang household: feeding information about CSC’s activities to “western intelligence agencies.” In June of that year, North Korean counterintel evidently caught up with her and terminated her career with extreme prejudice.

The story appears to be well sourced; a number of the details it reported back in 2002 were subsequently confirmed with the exposure of A.Q. Khan’s links to the North Koreans. It is followed up by this 2004 report, of somewhat questionable origin, which claims that the murdered woman, Kim Sa Nae, was actually a nuclear scientist herself, and was shot under murky circumstances while staying on A.Q. Khan’s own compound with other North Korean scientists.

A Pakistani official said his country’s intelligence agents suspected that the United States was using Kim as a mole inside the North Korean delegation, but that her actions were uncovered by Pakistani and North Korean agents.

An Indian official who is familiar with his government’s assessment of the killing said bluntly: “She was in fact killed by the North Koreans on the grounds that she was in touch with certain Western diplomats.”

The report notes that three days after her death, Ms. Kim’s body was tossed onto a C-130 carrying centrifuges and bomb blueprints to Pyongyang. A month later, Mr. Kang also returned to North Korea, undoubtedly under very uncomfortable circumstances.

The other news today about China’s dealings with evil regimes comes in the form of this Chosun Ilbo report, speculating that another Chinese bank may soon face U.S. money laundering sanctions in connection with North Korea:

The U.S is secretly investigating a new Chinese bank on charges of laundering illegal capital flowing out of North Korea, the Japanese Yomiuri Shimbun reported Wednesday, quoting diplomatic sources. However, the name and location of the bank has not been revealed, the daily added. The U.S has seized forged US$100 bills–the so-called supernotes-worth US$45 million over the last 16 years since it uncovered the counterfeit notes made in the North for the first time in late 1989. In Taiwan alone, the US confiscated supernotes worth US$13 million last year. The U.S Treasury Department recently informed countries involved in the situation and urged them to take countermeasures, the Japanese daily reported.

I’ve previously reported on the effect of a similar investigation of Banco Delta Asia of Macau, Macau’s second-largest bank. Delta ultimately cut off North Koreans’ transactions, resulting in an exodus of North Korean spies and money launderers from Macau. The Asian WSJ has reported that the Bank of China, China’s largest bank, is also under investigation by Treasury, although it’s not clear if the BOC is the subject of the latest Yomiuri report. Seng Heng Bank, also of Macau, has also been named.

If the explanation were as simple as money, the Chinese parastatals wouldn’t risk the loss of their potential revenue with the United States or such deep trouble with the U.S. Congres. Only strategic considerations conceivably trump those other interests.

China’s near term goals are the establishment of its supremacy in East Asia, reunification with Taiwan on its own anti-democratic terms, and the securing of its access to raw materials that are key to its economy. The only real potential threat to China’s goals is the United States, along with an emerging alliance of Asian and Pacific nations, jointly pursuing a quiet strategy of containing Chinese naval power inside the Island Curtain that stretches from the Kuriles to the Strait of Molucca. As with China’s support for North Korea, which is conditional in theory but unconditional in practice, China seeks to slip the bonds of containment by leveraging security distractions for the United States without creating an unreasonable risk of war.

Unquestionably, 9/11 and Iraq have been extraordinarily helpful to China’s plans, having arguably put an end to the Pentagon’s two-major-theater-war doctrine. There can be little doubt that Chinese generals quietly relish the idea of Iran and North Korea growing as nuclear and proliferation threats to the United States, and probably the thought of more mass-casualty terror attacks in the United States.

Notwithstanding the temporary convergence of economic interests, China is no friend of the American people. But then again, it’s not exactly a friend of the Chinese people, either.

So just how stupid is Bashar Asad? Now that Syria has again been linked to a politically motivated assassination in Lebanon, and given how that all worked out for Syria the first time, you have to suspect that Bashar’s father married for something other than intelligence.

I wonder just how much of a Doctor-Evil-and-Scott vibe there must have been in Damascus while wily old Hafiz was alive.

The Strain is Showing. A must-see live report from a journalist “embedded” with terrorists near Tikrit.

Andy Jackson, as seen on (Swedish) TV, continues his excellent blogging of events surrounding the Freedom House Conference over at his own blog. Although LiNK seems to have stolen the initiative from the Red Guards–as Adrian Hong’s confrontation with one of their sullen leaders illustrates–Andy’s objective analysis has some criticisms of how they’re organizing their organizers. Andy also has some excellent advice on how to treat the riot police when they show up. I emphatically echo his recommendation to invite them in, rather than the confoundingly stupid use of gratuitous street violence. Great pics on both posts, too!

The Red Guards have had decades to infiltrate the campuses and spread their roots widely in their soil. The simple fact of their success at promoting the planet’s most ruthless, tyrannical, and fatally inefficient system of government is testimony to that. It will take some exceptional elan to challenge the radical left’s domination of South Korean student politics.

South Korea’s president Roh Moo-Hyun may have entered office with the hope of a multifaceted agenda, but that agenda has only one surviving facet. His moves to create a more redistributive economy has sufficiently damaged the economy that Roh’s allies would dream of running on that record in the 2006 elections. The attempt to move the capital out of Seoul was a political disaster; it was blocked in the courts, and mostly succeeded in creating a dangerous new political enemy in Lee Myung-Bak. Promises of a cleaner government had an exceptionally short shelf life, even by the standards of Korean politics. The predictable promises to make Korea the hub of this-or-that came and went. Even the feel-good politics of publicly diminishing relations with Japan and the United States have failed to produce lasting support at the polls. There are some signs that with the United States moving to downgrade the alliance on its own accord, voters think things may have gone too far.

Paradoxically, the one Uri policy that still appears to have substantial public support is appeasment of the North, although that policy is arguably the least successful of all. I intentionally use the politically-loaded term “appeasement” to mean accomodation of North Korea’s every crime–whether against its citizens, other nations, humanity as a whole, or even Seoul itself–without any expectation of significant countervailing concessions by North Korea. The Uri government often treats North Korea’s very arrival at a meeting to accept more generous gifts from South Korean taxpayers as a concession in itself. This isn’t surprising, given that the government couldn’t find much else to boast about. It has yet to bring home even such fundamental concessions as the North’s minimal compliance with the 1953 armistice, which required the return of all prisoners of war.

Thus, the appeasement of North Korean behavior–no matter how unquestionably beyond the pale–is the one surviving piece of the Roh agenda for which significant popular support exists, and Roh now finds it under dire threat now that the FBI, Homeland Security, and Treasury have unrolled a global network of North Korean counterfeiting operations. Denial is a predictable enough response for the Roh Administration, but the facts persistently intrude to disturb the conception of the new policy:

A South Korean intelligence official told the JoongAng Daily yesterday that the North’s counterfeiting activities have been monitored since the early 1990s and that evidence gathered during that period is enough to give credibility to Washington’s claim that Pyongyang has manufactured forged U.S. dollar bills.

“With current government policies in place that want to keep the North’s regime afloat, the government wants to delay acting on the issue as long as possible,” the official said. “North Korean counterfeiting activities are nothing new, and they are a known lifeline for the North.”

Most officials here have been dodging questions and repeating that the administration wants more decisive evidence. “For us, there is the big picture to be considered. We have never said that we will just sit down and do nothing if there are illegal activities,” said one senior government official.

U.S. Ambassador Alexander Vershbow has also been making the case:

Washington is sending a team of State Department officials and agents to Seoul in January to provide new and detailed information on North Korean counterfeiting, including its purchase of special ink and printing equipment , a source in Washington said yesterday.

The source said in a phone interview that the large number at a briefing in Washington last Friday on North Korean counterfeit activities, in which diplomats from 40 countries participated, made it hard to provide strong evidence at the time.

Which is odd, because there are few nations that are less reliable recipients of U.S. intelligence today than South Korea.

Meanwhile, referring to an incident earlier this year in which South Korean intelligence officials said, without disclosing the origin, high quality $100 bills were in circulation in the country, U.S. Ambassador to Seoul Alexander Vershbow said yesterday, “We are quite convinced that the origin of these supernotes can be traced to North Korea.”

The ambassador reiterated that the issue was separate from ongoing nuclear talks with the North. Nonetheless, he also reaffirmed Washington’s unmoving position on the matter. “We will take the necessary measures to protect ourselves and to enforce our laws,” said the U.S. ambassador.
. . . .

Just hours after the remarks, Seoul took an immediate stance on the ambassador’s remarks. A senior South Korean official suggested that Mr. Vershbow’s remarks could be described as “careless,” and that they were inappropriate for an ambassador to make.

This might just as well have been another “The Death of an Alliance” post. I should also point out that Vershbow has also warned the North Koreans that this should not be seen as an excuse for more stalls and standoffs in the six-nation goat rodeo that increasingly appears headed for the the goat corral, and the goat knacker.

Even your correspondent has gotten in on the discussion. Over the weekend, I was called by a reporter from one of South Korea’s major dailies (I won’t say which one) asking me to provide what evidence I’ve gathered in blogging this story–and I can justifiably claim to have recognized its significance since it first broke. I was flattered to assist with numerous links, and the person was clearly interested in a thorough exploration of the facts. A better partnership between blogs and traditional media means more democratization of our information, and it may also mean that some underreported aspects of this story may get more attention than they’ve received thus far.

The editorial page of the Chosun Ilbo also shows some thinking with which I couldn’t exactly argue, either, starting with a few more details on South Korea’s own assessment of North Korea’s counterfeiting activities:

The National Intelligence Service, in a 1998 report titled “A New Threat in the 21st Century: Realities of and Responses to International Crimes”, said North Korea forges and circulates US$100 bank notes worth $15 million a year, and that the counterfeiting is carried out by a firm called February Silver Trading in the suburbs of Pyongyang.

The NIS said in reports to the National Assembly the same year and the next that the North operates three banknote forging agencies, and that more than $4.6 million in bogus dollar bills were uncovered in circulation on 13 occasions since 1994. “That North Korea is a dollar counterfeiting country was common knowledge among intelligence officials,” said a former senior NIS official.

Yet suddenly, when the U.S. brings up the question of North Korea’s counterfeiting activities, our government says there is insufficient evidence. That has prompted American officials to accuse our government of lying. The reason for the volte-face is that Seoul is afraid of antagonizing Pyongyang while six-party talks aimed at denuclearizing North Korea hang in the balance.

It then goes on to restate a point in which I’ve taken great pleasure in repeating:

But what if the shoe was on the other foot? If a country hostile to South Korea forged a huge number of our banknotes and circulated them around the world, what should our government do? And if an ostensible ally of ours defended that counterfeiting country, what would we think of that ally?

That’s my cue:

I’m not sure the voters of South Korea are ready to choose that platform, a fact that even Chung Dong-Young may be prepared to accept.

Thanks to the reader who sent me the link to this piece in the IHT:

Now there are disturbing signs of a return to the command economy, with the revival of food rationing and a ban on trade in grain. There is evidence that the revived public distribution system is again being used as a tool of control, with favored state employees provided with enhanced access to food in preference to the vulnerable populations targeted by the WFP.

The government is reneging on supply-side reforms as well. Reports of grain seizures harken back to previous episodes of severe food distress in North Korea. Far from solving the food problem, these seizures have exacerbated shortages as farmers seek to protect themselves from a predatory state through pre-harvesting, hoarding, tending secret plots and diverting output to illicit markets.

With an improved harvest and aid from the WFP, China and, especially, South Korea, the public distribution system may function in the short-run. But the longer-run effects of the command-and-control approach to food are clear: insecure supply during the next harvest cycle as farmers protect themselves, highly uneven distribution through politically controlled channels, spiraling market prices and hunger.

Although I obviously take issue with the conclusion that harvests have improved, Noland’s own writings repeatedly disclaim the reliability of all statistics coming out of North Korea. All we really know about North Korea’s food situation is that it has rejected one of its major sources of food, and that starving refugees are still fleeing the country.

(by guest blogger Andy Jackson)

This the last of a series of posts on the Seoul Summit: Promoting Human Rights in North Korea and related events.

Signing up
When Joshua and I had talked about my guest-blogging at One Free Korea last summer, I ultimately decided against it for a couple of reasons. First, I was already writing for my blog, the Marmot’s Hole and (rarely) TCS Daily. Between those commitments and my day job, I just didn’t think I had the time to make much of a contribution. Second, most of my posts are of the “˜link and spin’ variety and Joshua, having access to same MSM sites that I do, really didn’t need my help to put out a good product.

That changed this fall and winter when I got the chance to cover the Seoul Summit for Human Right in North Korea first hand. That brought up the question of where to post. Considering Joshua’s excellent coverage of Freedom House’s Washington event, I asked him if I could come on board.

Summary
About ten days prior to the summit, several speakers, including Kang Chol-hwan and Tim Peters, gave lectures on North Korean human rights. Aside from being informative, the lectures gave me a chance to work out technical blogging issues. I was also lucky enough to catch a presentation by David Hawk at a small gathering of human rights activists.

As for my posts of the Seoul Summit itself, I believe that most of the post titles are pretty self-explanatory:

- Overview and opening dinner
- Vershbow, Leftkowitz and post-conference fireworks
- The Status of North Korean human rights NGOs in the ROK
- “˜We are not a bunch of pacifists and appeasers.’
- Kim Moon-soo, the anti-Chung Dong-young
- Michael Horowitz’s statement
- “˜Resolving the nuclear question and NK human rights are not mutually exclusive.’
- On food aid and “˜military first’
- Breaking through Kim Jong-il’s walls of isolation
- All North Korean refugees are political refugees
- NGOs and NK human rights

Seoul Summit’s impact
In the short term, I think the impact of the Seoul Summit was negligible. The crowds for the conference and post-conference rallies, while not insignificant, were not especially impressive by Korean standards. The timing (in the middle of a freezing spell and just before final exams) didn’t help. Any buzz generated by them was quickly pushed off the public radar by the saga of Hwang Woo-suk’s fall from grace (which has become the Korean equivalent of the OJ trial for the way it captured the public’s attention).

But I think the summit did three things that could have a long-term impact on the North Korean human rights debate in South Korea.

First, it reinforced the Grand National Party’s position of making human rights a first-tier issue in Seoul’s relationship with Pyongyang. Both of the GNP’s leading candidate’s for President in 2007, Park Geun-hye and Lee Myung-bak, participated in the summit. The conference also raised the profile of Kim Moon-soo, a GNP member who is the conscience of the National Assembly on human rights for North Koreans.

Second, it put the administration on the defensive regarding its North Korean policies. For too long they have gotten away with portraying Roh Moo-hyun’s Sunshine II policy as enlightened engagement and opponents as simple knee-jerk anti-communists. The summit exposed the lie of that argument and put the administration and its supporters on the defensive. While I don’t expect any major changes in policy from the Roh administration, they might begin to feel enough pressure to at least limit the damage. A good start would be for the government to reverse its policy against helping North Korean defectors.

Third, there is a small but growing movement on Korean campuses supporting human rights for North Koreans. On December 10, I saw about 300 students gather to organize in support of the issue. That is about three times the number that attended a similar event last year. The student movement is significant because it further undercuts the belief by those in the government that putting human rights for North Koreans on the backburner is somehow “˜progressive.’

While it will be a long struggle, I believe that those three currents could have a significant impact on the 2007 presidential and 2008 legislative elections. The Seoul Summit was a small but important step in the right direction.

Signing off
With my work on the Seoul Summit done, I am signing off at OFK for the time being. If another opportunity arises, and Joshua keeps a light on for me, I may be back again.

Joongang Ilbo: Seoul not buying U.S. case against North’s $100 bills

Chosun Ilbo: Seoul Swings Behind U.S. in N.Korea Forgery Charge

I report, you decide.

Meanwhile, our Ambassador, envigorated by his new congressional attaboy and one-up, is making the case. Predictably, some Chinese and South Korean officials are raising the standard to “beyond a reasonable doubt,” (or even “absolute proof,” a standard that does not exist under the law) which only works when investigators have the option of getting a warrant, going to the crime scene, and boxing up the evidence.

The North Koreans’ insistence that they’re not counterfeiting now threatens the six-party goat rodeo. So sad, because as I’ve suggested before, South Korea could give peace a chance if it would just be a little more flexible:

Is any sacrifice too great for peace, I ask you?

Influence Over Principle. This story mainly seems like a thinly sourced exercise in wishful thinking, but this sort of language just grates on me for the idea that all of the problems in the U.S.-South Korean relationship can be solved if the latter did more to “influence” us.

To resolve the discord, Mr. Kim recommended that Seoul assure Washington of its position as a firm ally. “It is most important that South Korea earns U.S. trust on matters that Washington thinks the most important, such as nuclear non-proliferation,” he said. “Secondly, Seoul must find a compromise on North Korea. They should find a mid-point.”

Mr. Kim proposed creating public support for South Korea in the United States. “By using congress and companies doing business with South Korea, it is possible to influence the U.S. government to support Seoul’s position,” he said. “The North Korean nuclear issue can be a subject of such lobbying.”

If lobbying could really smooth over differences as deep and substantial as whether to trust the word of a secretive megalomaniacal psychopath and subsidize the operation of his gargantuan charnel house, I’d find it pretty disillusioning. Fortunately, Mr. Kim won’t find very many asses in this town that will part for a whiff of his sunshine.

Want to improve your image with the American people? Here’s a strong hint.

If an even temper and openness to opposing views are qualifications for a job at the U.N., you have to wonder if a hypothetical (shudder) Global Senate would confirm Kofi Annan after this freak-out:

[Annan] scolded James Bone of the Times of London for saying, “Your own version of events don’t really make sense.”

Annan responded: “I think you’re being very cheeky. Listen James Bone, you’ve been behaving like an overgrown schoolboy in this room for many, many months and years. You are an embarrassment to your colleagues and to your profession. Please stop misbehaving and please let’s move on to a serious subject.”

. . . .

“We all have to be careful, whatever responsibilities we have, not to be fed by people with agendas.”

Asked again if he bought a Mercedes tax-free for his son, Kojo, with his diplomatic discount, Annan said, “I know you are all obsessed about the car. If you want to know more about it, please address yourself to my son or his lawyer.”

“I am neither his spokesman or his lawyer,” he said. “The report of Paul Volcker is clear. I am not going to rehash it.”

Here’s what Kojo Annan’s lawyer said. It gets much worse:

Asked about his regrets, Annan said he was sorry he was not able to avert the war in Iraq in 2003.

“If I go back in recent years, one thing I would have liked to see … is for us to have done everything that we could have done to avoid a war in Iraq that has brought such division within this organization and the international community,” Annan said.

“And that is one thing that I must say still haunts me and bothers me that, as an organization, as an international community, we were not able to do.”

And while it’s tempting to admire the man for staying bought, there’s the nagging feeling that a better man would have more regrets about the tyrannies were left to do their evil work than those who were plucked from the killing floor. And in Kofi’s very next breath, this:

Annan also said he hoped the U.N.’s biennial budget, now in contention, would be adopted by the end of the year, or the world body would face a financial crisis.

You don’t say. And that would be a bad thing, how?