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Category: Sanctions

April 20, 2016

Pyongyang’s sanctions are the ones that hurt the North Korean people the most.

Last month, I wrote about one slightly surprising consequence of sanctions against North Korea — sanctions have prevented Kim Jong-un from selling off and exporting resources needed by the North Korean people, which has flooded North Korean markets with cheap coal and seafood. Now, we’re starting to see something like the converse of this, in which restrictions on what North Korea’s donju and purchasing agents can import is forcing them to find other ways to kick up steep “loyalty payments”...

Categories Class Warfare/Famine & Food Aid/Sanctions
April 13, 2016

Dozens of North Korean ships stranded by U.N. sanctions

Since this year’s nuclear test and the rounds of U.S. and U.N. sanctions that followed, I’ve tracked the implementation and enforcement of shipping sanctions closely on this site. For ease of reference, here’s a brief chronology of what I’ve observed since March 2, 2016, when the U.N. Security Council approved Resolution 2270, which — required the inspection of all cargo to and from North Korea; banned the reflagging of North Korean ships; banned exports of coal and iron ore (except...

Categories Shipping sanctions
April 12, 2016

Angola may be defying U.N. sanctions against North Korea

A report last month by the U.N. Panel of Experts found that Namibia has been involved in joint projects with KOMID, a designated North Korean entity, to build an arms factory in the African nation. The finding drew a defiant response from the Namibian government, but as a defense to a sanctions violation, it was a blue answer to a red question. In response, I wrote this post — which attracted much attention in Windhoek — rebutting Namibia’s argument and explaining...

Categories Africa/Arms Trafficking
April 8, 2016

Why an unprecedented mass defection could be a sign of instability in North Korea

Yonhap is reporting this morning that 13 North Koreans —12 women and a male manager working at one of its overseas restaurants in an unidentified country — have defected and arrived safely in South Korea. The impetus for this unprecedented mass defection? Sanctions — which never work, so we’ve been told. “As the international community has slapped sanctions on the North, North Korean restaurants in foreign countries are known to be feeling the pinch,” Jeong Joon-hee, a ministry spokesman, told...

Categories Sanctions
April 7, 2016

Does our State Department want denuclearization or an exit strategy?

I’ve long wished that I could attend more ICAS events, but they tend to coincide with busy times in my work schedule. That was also the case when Assistant Secretary of State Danny Russel spoke to ICAS earlier this week. The State Department has since published . A reader (thank you) forwarded it, and asked for my views. Sending a consistent message to North Korea and China is very important at this moment, and it hardly serves that purpose to...

Categories Appeasement/Diplomacy/Sanctions
April 6, 2016

The Panama papers, Pyongyang, and Nigel Cowie

Here at OFK, we keep a running list of gullible foreigners who’ve tried to get rich in North Korea, justified their support for its regime as ways to reform and open it to global commerce, and instead met the same fate as Hyundai Asan, Volvo, Yang Bin, David Chang and Robert Torricelli, Chung Mong-Hun, Roh Jeong-ho, and Orascom’s Naguib Sawaris, who I predicted back in 2008 would “eventually meet the same fate.” Regulators should require securities issuers to disclose their investments in North Korea...

Categories Money Laundering/Sanctions
April 5, 2016

Radio Free Asia launches investigation of N. Korean forced labor

Radio Free Asia has launched an investigative reporting project into the use of North Korean labor on three continents, and the dangers those joint ventures pose not only to the North Korean workers, but to their customers abroad. RFA also published this infographic about where the North Korean workers are, doing everything from logging and construction to staffing medical clinics. No doubt, the conditions in which the North Korean workers labor also vary, which causes some to criticize the description...

Categories Anju Links/Human Rights/Sanctions
April 1, 2016

European Union publishes new N. Korea sanctions regulation to implement UNSCR 2270

I’ve previously written about the importance of Europe’s role in enforcing U.N. sanctions against North Korea. On March 5th, the EU designated 16 people and 12 entities under its existing North Korea sanctions program. Yesterday, it finally announced the publication of a new “restrictive measures” regulation to implement UNSCR 2270. Based on the summary, the new regulation follows last month’s Security Council resolution right down the line. The measures extend, inter alia, export and import prohibitions to any item (except food or medicine)...

Categories "United" Nations/Europe/Sanctions
March 29, 2016

N. Korea’s restaurants, rumored to be involved in money laundering, are closing down.

North Korea’s overseas restaurants are not a significant percentage of its GNP,* but they are an important source of hard currency for Kim Jong-un. As early as 2008, one writer estimated that each restaurant remitted between $100,000 and $300,000 to Pyongyang each year. As of February of this year, there were 130 of them earning $100 million annually. Since then, the South Korean government has told its citizens to stop patronizing the restaurants, and business has fallen dramatically: On some...

Categories Money Laundering/Sanctions
March 28, 2016

Daily NK: China not taking North Korean coal shipments

Last week, I posted about the conflicting reports about China’s compliance with the new sanctions on North Korea. Just after I posted that, I noticed that the Daily NK had also added a report of its own, suggesting that amid a regime mobilization to expand coal production, coal exports were being refused by Chinese ports. “Recently, we’ve seen a full ban on our [North Korean] ships at the Port of Yingkou in Liaoning Province, where coal trade had been most...

Categories China & Korea/Sanctions
March 24, 2016

China’s reaction to North Korea shipping sanctions shows strain, confusion

Two weeks ago, I surveyed the evidence of China’s compliance with new U.N. sanctions and found  “mixed, yet hopeful signs.” One area in which the signs has seemed especially hopeful was the enforcement of shipping sanctions. The Philippines had already seized one designated ship, the Sierra Leone-flagged M/V Jin Teng, and detained another, the non-designated, North Korean-crewed, Tuvalu-flagged tanker M/V Theresa Begonia. There was also some evidence that Chinese ports were complying, but we’ll get to that later.  Under the...

Categories China/Diplomacy/Sanctions
March 23, 2016

North Korean diplomats behaving badly

If you’re a North Korean diplomat, a good general rule is that all publicity is bad publicity. Over the last two weeks, North Koreans, most of them diplomats or former diplomats, have attracted much publicity of the kind they couldn’t have wanted. The Chinese government reports that “a North Korean consular official” killed two Chinese citizens while driving home drunk in Dandong last month. The North Korean diplomat was on his way home from an “event celebrating North Korea’s launch...

Categories Diplomacy/Money Laundering/NK Crime/Sanctions
March 21, 2016

China & Russia alarmed about secondary sanctions, because sanctions never work.

After years of extensive, flagrant, and well-documented violations of U.N. sanctions against North Korea, China is finally reaping the consequences. Americans don’t agree on much anymore, but Beijing’s cheating has achieved a political impossibility — it has united 418 representatives, 96 senators, The New York Times, The Washington Post, and the mainstream of North Korea watchers in support of secondary sanctions on the (mostly Chinese) banks and businesses that are propping up Kim Jong-un financially. That policy is now expressed in law, and the...

Categories China/Diplomacy/Russia/Sanctions
March 18, 2016

Designation of N. Korea’s propaganda agency could mean trouble for AP Pyongyang

Yesterday, a reader — he can identify himself if he chooses to do so — asked me an excellent question that had not occurred to me: what are the implications for the Associated Press’s Pyongyang Bureau of the Treasury Department’s designation of North Korea’s Propaganda and Agitation Department for censorship? From Treasury’s Wednesday press release: OFAC has designated the Workers’ Party of Korea, Propaganda and Agitation Department (the “Propaganda and Agitation Department”) as an agency, instrumentality, or controlled entity of the...

Categories AP Watch/Censorship/Sanctions
March 16, 2016

U.S. will announce new North Korea sanctions as early as this week.

At this event at the Heritage Foundation yesterday, I emphasized that U.S. and U.N. sanctions are mutually complementary, and that for the U.N. sanctions to work, the U.S. must show its determination to back them with the new authorities in H.R. 757, and by harnessing the power of the dollar. The signs I’m seeing this week all suggest that the Obama Administration finally gets this. On Monday, President Obama said “that effective enforcement of sanctions on North Korea is one of the key tasks...

Categories "United" Nations/Diplomacy/Money Laundering/Sanctions/U.S. Law
March 15, 2016

So far, sanctions are cutting off Pyongyang’s cash while sparing North Korea’s poor.

A month after the President signed the North Korea Sanctions and Policy Enhancement Act and two weeks after the U.N. Security Council approved Resolution 2270, enough information has emerged from North Korea to allow for a preliminary assessment of how the sanctions are affecting those they are meant to target, and those they are meant to spare.  Sanctions have begun to hit their intended targets. The Daily NK reports that the donju, the well-connected traders who help finance Pyongyang’s priorities through trade with...

Categories Border Control/Capitalism/Class Warfare/Famine & Food Aid/Sanctions
March 15, 2016

HSBC freezes “at least” $87M in assets of North Korea-linked Chinese tycoon

You all remember Sam Pa, right? He’s the Chinese ex-spy with a history of dubious business dealings in Africa, for which he was eventually sanctioned by the Treasury Department. Pa’s 88 Queensway group also had dealings with Korea Daesong General Trading Corporation, a financial arm of North Korea’s Bureau 39, for which he was not designated. Today, this happened: HSBC has frozen more than $87m in accounts linked to a Chinese tycoon behind several multibillion-dollar deals in Africa, while it investigates allegations of...

Categories China & Korea/Money Laundering
March 14, 2016

Namibia’s prohibited arms deal with N. Korea triggers mandatory sanctions under U.S. law.

Namibia is a beautiful desert country with a turbulent history. Some years ago, when I worked in South Africa, I flew from Johannesburg to Cape Town, took a bus across the border to Keetnamshoop, and hitch-hiked to the isolated town of Lüderitz, which sits where the barren dunes of the Namib Desert spill into the cold waters of the Atlantic Ocean. Lüderitz was established by German colonists in the 19th Century; today, many of their descendants still live in the...

Categories "United" Nations/Africa/Sanctions