2jBVKVf

asia policy
the attention of U.S. and ROK information-gathering activities. 4 Before
September 2016, when the U.S. Department of the Treasury announced its
sanctions on the Hongxiang Company—based in Dandong, the Chinese
city in Liaoning Province that borders North Korea—Chinese authorities
were already investigating allegations that the company was involved in
illicit activities. Hongxiang was one of the larger companies doing business
with North Korea. At its peak, Hongxiang’s trade volume with the North
reached $100 million, with its core import being coal. According to an
informed source in Dandong, Hongxiang had no intention of helping North
Korea but rather attempted to profit. Its CEO, Ma Xiaohong, was detained.
This was simply a small part in the overall picture of the nuclear problem
and Sino-U.S. interplay, which means more difficulties for North Korea’s
foreign trade.
Overall, the reduction of imports and exports has considerably affected
the DPRK’s foreign exchange income, which likely is the biggest impact
that the UNSCR 2270 sanctions have had on North Korea. No doubt,
this will add further difficulties to the DPRK’s weapon programs. Most
importantly, exports of dual-use goods to North Korea have been banned.
Chinese customs has tightened its check on the goods to be exported to
North Korea and expanded the scope to cover more items potentially usable
for military-related purposes. Financial sanctions have become even more
severe. When the bank accounts for North Korean companies are closed,
trade between Chinese and North Korean companies usually must rely on
cash or even resort to barter, and this significantly limits the conduct of
trade. Thus, because of the new sanctions, the investment environment in
North Korea has further deteriorated. Foreign investment in some industries
drastically has decreased, and foreign companies have been forced to shift
to a wait-and-see attitude. The sanctions are further reinforced with the
passage of UNSCR 2321 on November 30, 2016, which unprecedentedly
imposes a $400 million ceiling with respect to the exportation of North
Korean coal per year. Additional constraints are imposed on exports of
copper, nickel, and zinc—approximately $100 million a year—as well as
monuments from the country. 5 As time goes by, the impact of the new
sanction measures, if enforced effectively, will become even more visible.
4 The incantation of the golden hoop is used by the monk to keep the monkey under control in the
novel Pilgrimage to the West.
5 Marcus Noland, “Analysis of UNSCR 2321 Sanctions on North Korea,” Peterson Institute for
International Economics, November 30, 2016 u https://piie.com/blogs/north-korea-witnesstransformation/analysis-unscr-2321-sanctions-north-korea.
[ 88 ]