North Korean Economy Watch

Bertil Lintner wrties in the Asia Times:

For more than a decade, the world around North Korea has been shrinking. In the wake of its missile and nuclear tests and recent accusations that it torpedoed a South Korean naval vessel, the list of internationally imposed sanctions and trade restrictions aimed at isolating the reclusive state has grown ever longer.

But the North Koreans, who have been in a state of war for more than half a century, have often found ingenious ways around those restrictions and added pressures from the United States, Japan and other countries, most visibly seen in the string of front companies and bank accounts it maintains across Asia.

Recent indications are that Pyongyang has sought willing trade partners outside of Asia and its new closest commercial ally appears to be Brazil. Relations between the two countries have warmed considerably since leftist Luiz Inacio Lula da Silva became president in January 2003.

The official Chinese news agency Xinhua reported in October 2004 that North Korea planned to open an embassy in Brasilia, its fourth in the Latin and South American region after Havana, Cuba, Lima, Peru and Mexico City. On May 23, 2006, the official Korean Central News Agency (KCNA) and the Brazilian media reported that the two countries had signed a trade agreement.

More recently, the KCNA reported last December that a “protocol on the amendment to the trade agreement” had been signed in the capital Pyongyang. “Present at the signing ceremony from the DPRK [Democratic People’s Republic of Korea, or North Korea] side were Ri Ryong Nam, minister of foreign trade, and officials concerned and from the Brazilian side Arnaldo Carrilho, Brazilian ambassador to the DPRK, and embassy officials,” according to the news report.

China’s role in facilitating trade between Brazil and North Korea remains a matter of conjecture, but it is significant that the state mouthpiece Xinhua has eagerly reported on the warming of relations between the two countries. China remains Pyongyang’s most important base for all kinds of foreign trade – legitimate as well as more convoluted business transactions through front companies in Beijing and elsewhere.

But North Korea also needs more discreet trading partners, as China is often criticized in international forums for its close relations with the North Korean regime and is undoubtedly closely watched by Western intelligence agencies. And it is hardly surprising that Brazil, which is known to harbor its own nuclear ambitions, albeit for stated peaceful purposes, has emerged as such a friendly nation to Pyongyang.

Significantly, Brazil has established what appears to be an understanding with another aspiring nuclear power: Iran. “Also like Iran, Brazil has cloaked key aspects of its nuclear technology in secrecy while insisting the program is for peaceful purposes, claims nuclear weapons experts have debunked,” according to an April 20, 2006 Associated Press report.

While Brazil is more cooperative than Iran on international inspections, some worry its new enrichment capability – which eventually will create more fuel than is needed for its two nuclear plants [1] – suggests that South America’s biggest nation may be rethinking its commitment to nuclear non-proliferation.

”Brazil is following a path very similar to Iran, but Iran is getting all the attention,” said Marshall Eakin, a Brazil expert at Vanderbilt University in the United States. ”In effect, Brazil is benefiting from Iran’s problems.”

In September 2009, Lula declared before the United Nations General Assembly: “Iran is entitled to the same rights as any other country in its use of nuclear energy for peaceful purposes.” He added to reporters outside the UN General Assembly, “I defend for Iran the same rights with respect to nuclear energy that I do for Brazil.” He added: “If anyone is ashamed of having relations with Iran, it’s not Brazil.”

But it is Lula’s budding cooperation with North Korea that is especially worrying to some Western observers. According to one longtime observer of the North Korean scene, “Both nations have long-standing ambitions to develop a nuclear capability as well as missiles and space-launched vehicles. Both have been the subject of intense US political pressure at times, Brazil on-and-off, North Korea all the time. And Brazil has access to technology that North Korea can only dream about.”

Because Brazil is not on any international sanctions list, it is easier for it to obtain dual-use materials. It remains to be proven, however, that Brazil has served as a conduit for such goods ultimately destined for North Korea.

According to official trade statistics, available at www.stat-trade.com, North Korea’s largest trading partner in 2009 was China, with two-way commerce totaling US$2.67 billion. That was followed by South-North Korean trade worth $1.68 billion. A surprising third on the list was Brazil with US$221 million in two-way trade, well ahead of Singapore, Hong Kong and North Korea’s other traditional Asian trading partners.

The nominal figure may not be impressive in an international context, but it is substantial for North Korea, a country with an estimated total gross domestic product of about $22 billion. North Korea’s trade with Brazil has recently increased almost at the pace it has decreased with Thailand, from where it previously sourced dual-use chemicals, raw materials and machinery. Thailand no longer figures prominently in recent trade statistics, which is noteworthy given that their two-way trade reached a record US$331 million in 2004.

Those deals were done under the government of Thaksin Shinawatra, who at one point even proposed signing a full-blown free-trade agreement with North Korea. In August 2005, the former Thai premier was formally invited by North Korean leader Kim Jong-il to visit Pyongyang. The visit never materialized, however, and when Thaksin was ousted in a September 2006 military coup, Thai-North Korean relations began to deteriorate. By 2008, bilateral trade between Thailand and North Korea fell to $76 million and in 2009 dipped further to $47.1 million.

Among North Korea’s more remarkable export items before the September 2006 coup in Thailand were 1.3 tons of gold and 10 tons of silver. Another pre-arranged shipment of 12 tons of silver arrived in Bangkok in October of that year. However, business is now reportedly sluggish at the two main trading companies that North Korea is known to maintain in Bangkok, Star Bravo and Kosun Export Import.

Successive Thai governments that have ruled the country since Thaksin’s overthrow are believed to have complied more strictly with international pressure to restrict dealings with North Korea. In Brazil, however, North Korea has a long history of involvement with various leftist groups, the distant offshoots of which are now in power in Brasilia.

North Korea expert Joseph S Bermudez wrote in his 1990 study “Terrorism: The North Korean Connection”:

From 1968 to 1971 the DPRK provided financial and military assistance to several leftist organizations in Brazil, most notably to Carlos Marighella’s National Liberating Action (Acao Libertadora Nacional – ALN) and the Revolutionary Popular Vanguard (Vanguarda Popular Revolucionaria – VPR). By November 1970, the DPRK established a training base in the Porto Alegre area, where a small number of guerrillas were given guerrilla warfare, small arms, and ideological training. A small number of ALN and VPR personnel is believed to have also received training within the DPRK.

Marighella – a Marxist, writer and founder of the ALN – was the leader of a militant movement that fought against Brazil’s US-supported, authoritarian right-wing governments in the 1960s. In September 1969, the guerrillas even managed to kidnap US ambassador Charles Burke Elbrick for 78 hours. After his release in exchange for 15 imprisoned leftists, Elbrick remarked, “Being an ambassador is not always a bed or roses.” Two months later, Marighella was killed in an encounter with Brazil’s police. But on November 4, 2009, the 40th anniversary of the death of Marighella, Lula declared him a “national hero”.

Although ideology may be less important than profits in today’s capitalist world, there are old emotional bonds between North Korea and Brazil under Lula that should not be entirely discounted. Brazil may be among the countries which have condemned North Korea’s nuclear program, as was shown when, in May 2009, the Brazilian government called on North Korea “to sign the Comprehensive Nuclear Test Ban Treaty and to strictly observe the moratorium on nuclear tests”.

But bilateral trade between the two sides is nevertheless – in relative terms – now booming. In May last year, North Korea’s Foreign Affairs Minister Pak Ui-chun arrived in Brazil to meet with his Brazilian counterpart, Celso Amorim. Pak expressed Pyongyang’s interest in receiving assistance in its deep-water oil prospecting efforts from PETROBRAS (Brazilian Petroleum Corporation), while Amorim said his country was reportedly interested in exporting what he referred to as “farm” machinery.

So far no military hardware, or material that could have military applications, is known to have changed hands between North Korea and Brazil. But Pyongyang has found at least one new trading partner which could potentially replace some of its former business allies in Asia. It’s a budding relationship that will be closely monitored by North Korea watchers in Japan and the West.

Read the full story here:
Brazil, North Korea: Brothers in trade
Asia Times
Bertil Lintner
Asia Times
6/3/2010

According to the BBC:

A United Nations panel has accused North Korea of continuing to export nuclear and missile technology in defiance of a UN ban.

The experts said North Korea has used front companies and intermediaries to sell weapons and provide illegal assistance to Iran, Syria and Burma.

The preliminary report was compiled by a seven-member group that monitors Pyongyang’s compliance with sanctions.

…

The 47-page report outlined a broad range of techniques used by North Korea to evade sanctions imposed by the UN after the North’s nuclear tests of 2006 and 2009, the Associated Press reports.

The report said North Korea had moved quickly to replace banned individuals and entities with others to enable it to continue the nuclear trade.

Among a number of “masking techniques”, it said the North describes exports falsely, mislabels shipping container contents, falsifies information about the destinations of goods and uses “multiple layers of intermediaries, shell companies, and financial institutions”.

The report said North Korea has a range of legitimate trade offices but also sustains links with international criminal organisations to pursue the banned trades.

An unnamed diplomat told Reuters the findings were “not entirely surprising”.

“The point is that North Korea has been providing that kind of aid to Iran, Syria and Burma,” he said.

The report comes before a crucial day of talks in New York about the future of the Nuclear Non-Proliferation Treaty.

It also comes at a time of increased tension surrounding what international investigators say was a deadly North Korean torpedo attack on a South Korean warship in March.

Read the full article here:
North Korea ‘trading nuclear technology’ says UN panel
BBC
5/28/2010

According to the Daily NK:

 

The Daily NK has obtained images from the North Korean women’s national table tennis team training facility located in the Mankyungdae-district of Pyongyang. On the bulletin board in the gymnasium, the team’s main aim is posted, “To go forth with an ideological resolve to give joy to the revered General.” The General, Kim Jong Il’s name is posted in red ink.

The notices were posted to encourage players to do their best at the World Table Tennis Championships in Moscow, which finished on the 30th.

The images, which The Daily NK received from a Chinese civilian returning from North Korea, also show a list of demands for players: to train themselves to face tense of games; to develop strategies based on a deep understanding of the opponents; to take their own serving and receiving skills one level higher; and to control their body condition so as to be able to take part in 100% of training.

On another notice, “Let’s eliminate doping,” it explained the notion of doping and emphasized, “From the social, moral and medical point of view, doping is a serious action. Let’s step forward into the anti-doping struggle knowing the dangers of doping.”

Other notices analyze North Korea’s competitors and offer ways to deal with other players, especially South Korean players Kim Kyung A, Kim Mee Young and Lee Eung Hee. The notices elaborate on these players’ special skills and their weak points.

Despite these efforts, however, the North Korean women’s table tennis team lost their clash with the South Korean team 3-0 in the first round, presumably failing to give much pleasure to the General.

See more pictures at the Daily NK.

Click here to see a satellite image of the DPRK’s table tennis facility in Pyongyang’s sports district (where the pictures were taken).

Read the full story here:
Playing Table Tennis for the General
Daily NK
Park In-ho
5-31-2010

(H/T to the Marmot)  According to the AFP:

Speakers at a Pyongyang event marking World No-Tobacco Day stressed the increasing social concern over the practice, the official news agency reported.

The agency, in a separate report, noted that a non-smoking campaign has intensified, with smoking banned in theatres, cinemas, schools, hospitals, sidewalks and other public places.

Violators in the hardline state “are exposed to legal sanctions,” it said without elaborating.

The country’s best-known convert is leader Kim Jong-Il, a former heavy smoker who was reportedly advised by his doctors in 2007 to quit because of heart problems. A smoking ban was imposed at all the venues he visits.

An official photo taken in 2009 during a visit to a cigarette factory showed the leader with a cigarette in his mouth, but it was unclear whether he had lapsed or was posing for the camera.

South Korea and other states accuse the North of killing 46 young sailors with a torpedo attack on a South Korean warship in March. It denies responsibility.

See the photo of Kim Jong-il smoking at the  Marmot.

Read the full story here:
N.Korea hails no-tobacco day amid military tensions
AFP
5/31/2010

According to Bloomberg:

Japan tightened controls on sending money to North Korea and authorized the Coast Guard to search the communist regime’s ships in response to the deadly attack on a South Korean naval vessel.

The cap on undeclared cash transfers will be lowered to 3 million yen ($32,800) from 10 million yen, Chief Cabinet Secretary Hirofumi Hirano said today in Tokyo. Parliament passed a bill allowing the boarding of ships in international waters suspected of carrying North Korean nuclear or missile technology.

The toughened sanctions come a week after an international report concluded that a North Korean torpedo sank the 1,200-ton Cheonan in March, killing 46 sailors. Japan banned almost all trade with Kim Jong Il’s regime last year in response to a second nuclear weapon test and several missile launches.

“The cabinet has decided to take these new measures prompted by the unforgivable torpedo attack,” Hirano said. Japan also reduced the amount of money an individual can legally take into North Korea to 100,000 yen from 300,000 yen, he said.

Prime Minister Yukio Hatoyama will hold a two-day summit with South Korean President Lee Myung Bak and Chinese Premier Wen Jiabao starting tomorrow on South Korea’s Jeju Island. Japan and the U.S. are pushing Wen to acknowledge and condemn North Korea’s role in sinking the ship.

Koreans in Japan

Japan is home to about 589,000 Korean nationals, based on 2008 data, most of them the descendents of forced laborers brought back from the peninsula during Japan’s 1910-1945 occupation. South Koreans number almost 400,000 and North Koreans about 40,000, according to the Korean Residents Union, a pro-South group in Tokyo. Chosensoren, a Japan-based group that supports North Korea, doesn’t disclose its membership numbers.

North Korean residents in Japan have sent billions of yen in money and goods back home to relatives since the 1953 end of the Korean War, much of it derived from their operation of pachinko gambling parlors. Sanctions imposed last year and in 2006 have reduce the amount.

“Japan has imposed so many sanctions in the past that the new measures won’t have much impact,” said Pyon Jin Il, author of the “The Truth of Kim Jong Il” and chief editor of the Tokyo-based monthly Korea Report. “This is more symbolic, to show the world that Japan is doing something.”

In the 11 months through February, 55 million yen was wired or brought to North Korea from Japan, down from 280 million yen in the April to March 2006 fiscal year, according to Ministry of Finance data.

Trade between Japan and North Korea fell 97 percent to 793 million yen in 2008 — all in Japanese exports — from 21.4 billion yen in 2005. Last year’s sanctions added to a previous ban on exports of luxury goods imposed in 2006 following the communist nation’s first nuclear test.

Read full story here:
Japan Tightens Control on Sending Cash to North Korea
Bloomberg
Takashi Hirokawa and Sachiko Sakamaki
5/28/2010

A few weeks ago I posted satellite images of the North Korean naval fleet in its southern West Sea waters (link here).  Last week the Choson Ilbo posted information on the DPRK’s East Sea submarine bases:

Between 70 and 80 percent of North Korea’s submarine fleet is stationed along the eastern coast, where four shark-class submarines disappeared recently from South Korean radars. Compared to the shallow waters of the West Sea, conditions in the East Sea are so favorable to submarines that it has been referred to as a “paradise” for them.

North Korea has around 70 submarines — 20 Romeo-class subs weighing 1,800 tons, 40 shark-class subs (325 tons) and 10 salmon-class subs (130 tons). A salmon-class sub is believed to be responsible for sinking the South Korean Navy corvette Cheonan.

There are four North Korean submarine bases along the east coast, including Chaho Base where the four shark-class subs that vanished are stationed, as well as Mayangdo, Toejo and Wonsan, all in South Hamgyong Province.

Chaho and Mayangdo are the main bases. Chaho is equipped with a cave to protect submarines from aerial attacks as well as a canal that can transport submarines faster to the ocean. A Google Earth image unveiled a few years ago shows eight Romeo-class and three shark-class submarines at Chaho.

The Mayangdo Base is near the site of an abortive light-water reactor project in Sinpo and is ideal for safe docking and hiding submarines. It apparently houses Romeo, shark and even whiskey-class training submarines. The base in Toejo is home to North Korea’s eastern naval command and the shark-class submarine that was stranded off the coast of Gangneung in 1996 carrying 25 North Korean spies.

Using the East Sea, which makes it difficult to detect submarines, small North Korean submarines apparently infiltrated South Korean waters regularly during the 1990s. A log found aboard a yugo-class North Korean submarine captured off the coast of Sokcho in 1998 showed records of numerous infiltrations. South Korea’s First Naval Command, which covers the East Sea, has dispatched destroyers, convoys and corvettes to search for the four submarines that have disappeared from radars.

Of course the Choson Ilbo did not post coordinates or images of the sub bases, so I offer them here:

Chaho Base:  40°12’36.28″N, 128°38’55.51″E. See in Wikimapia here.
Mayangdo Base:  39°59’51.79″N, 128°11’31.44″E. See in Wikimapia here.
Toejo Base:  39°52’35.98″N, 127°46’42.48″E. See in Wikimapia here.
Wonsan Base :  39°20’38.43″N, 127°25’28.19″E. There are many naval facilities in Wonsan Bay but I have not located any submarines. The coordinates are from a peninsula in the bay with a significant KPN presence.  See in Wikimapia here.

We frequently see maps of the Northern Limit Line (NLL), the defacto and disputed maritime border that separates the two Koreas in the West Sea.  Recently a friend emailed me a map of the DPRK’s desired alternative maritime border–something I had never seen.  I have mapped out both borders in the image below.

Click image for larger version.

The source map comes from this AEI article.

UPDATE: Evan Ramstad offers some more information in the Wall Street Journal:

Known in South Korea as the Northern Limit Line, or NLL, the border was drawn up by the United Nations after the end of the Korean War in 1953. The North has objected to the line since the early 1970s, arguing in part that the line forces its ships to take lengthy detours to international shipping lanes.

Those objections intensified in the 1990s and led to two deadly skirmishes in the area in 1999 and 2002. In 2007, leaders of the two Koreas agreed to turn the area into a “peace zone.” That agreement—vaguely worded, struck just ahead of a South Korean election by an outgoing government and never implemented—was interpreted in the North as erasing the border and in the South as keeping it.

“North Korea’s provocations near the NLL are aimed mainly to show that it doesn’t acknowledge the line,” says Kim Jang-soo, who was South Korea’s defense minister in 2007.

Officials and analysts in South Korea, backed by some in the U.S., are making connections between Kim Jong Il’s appointment early last year of his friend O Kuk Ryol to the National Defense Commission, the North’s most important state body, and an increase in statements about the disputed sea border by the North’s state media.

Mr. O led the North’s Operations Department, the umbrella group widely believed responsible for the regime’s illicit activities, including counterfeiting and drug production. The department was later merged with the military’s Reconnaissance Bureau, which includes its special forces, and is considered by outside analysts as most likely to have planned and carried out the Cheonan attack.

“O was a childhood friend of Kim Jong Il and is perhaps his closest friend today,” says Bruce Bechtol, a Korea specialist and professor at the U.S. Marines Corps Command and Staff College.

North Korea’s alleged attack on a South Korean patrol ship is part of dictator Kim Jong Il’s efforts to redraw the western sea border between the two countries, according to an increasingly held view.

The March 26 sinking of the Cheonan, which South Korea blames on a North torpedo attack, has long been seen as retribution for the heavy damage South Korea inflicted on a North Korean ship in a November naval firefight.

More broadly, intelligence analysts in Seoul and abroad believe the alleged attack is part of military muscle-flexing by Mr. Kim as he prepares to transfer power in his family’s regime to a son.

The authoritarian, closed North, having denied torpedoing the Cheonan, isn’t talking about motivations. But some specialists and intelligence analysts in South Korea and the U.S. are focusing on what they see as the driving factor in the North’s actions, a sustained effort to redraw the inter-Korean border in the Yellow Sea off the two countries’ west coast.

Known in South Korea as the Northern Limit Line, or NLL, the border was drawn up by the United Nations after the end of the Korean War in 1953. The North has objected to the line since the early 1970s, arguing in part that the line forces its ships to take lengthy detours to international shipping lanes.

Those objections intensified in the 1990s and led to two deadly skirmishes in the area in 1999 and 2002. In 2007, leaders of the two Koreas agreed to turn the area into a “peace zone.” That agreement—vaguely worded, struck just ahead of a South Korean election by an outgoing government and never implemented—was interpreted in the North as erasing the border and in the South as keeping it.

“North Korea’s provocations near the NLL are aimed mainly to show that it doesn’t acknowledge the line,” says Kim Jang-soo, who was South Korea’s defense minister in 2007.

Officials and analysts in South Korea, backed by some in the U.S., are making connections between Kim Jong Il’s appointment early last year of his friend O Kuk Ryol to the National Defense Commission, the North’s most important state body, and an increase in statements about the disputed sea border by the North’s state media.

Mr. O led the North’s Operations Department, the umbrella group widely believed responsible for the regime’s illicit activities, including counterfeiting and drug production. The department was later merged with the military’s Reconnaissance Bureau, which includes its special forces, and is considered by outside analysts as most likely to have planned and carried out the Cheonan attack.

“O was a childhood friend of Kim Jong Il and is perhaps his closest friend today,” says Bruce Bechtol, a Korea specialist and professor at the U.S. Marines Corps Command and Staff College.

Mr. Roh said it called for creating a joint fishing zone in the disputed border area. He called it the most significant accomplishment of the summit and hinted a few days later that he might bend on the NLL, saying it was “misleading” to describe it as a border.

Kim Jang-soo, then-defense minister, said in an interview that he left the summit understanding that the sea border would remain intact. He and many military and political leaders in South Korea worried that changing the line would make it easier for the North’s naval ships to reach the Southern port city of Incheon and its capital, Seoul.

In the November meeting between defense officials, “we talked a lot about common fishing areas with our North Korean counterparts,” Mr. Kim said. “But our position was that we could never agree with this area unless North Korea acknowledged the [NLL] line.”

Some critics in South Korea saw the summit and Mr. Roh’s apparent flexibility on the line as an effort to bolster support for his progressive party, which was trailing in polls two months ahead of national elections. It was a miscalculation.

The victor in the December election, current President Lee Myung-bak, in his campaign described the NLL as a “critical border that contributes to keeping peace on our land.”

After taking office in February 2008, Mr. Lee said South Korea would move forward on the 2007 summit deal and other economic aid only after North Korea took steps to end its pursuit of nuclear weapons.

After Mr. Lee’s election, there have been no further meetings on the proposed peace zone.

Read the full article here:
Korea Crisis Has Roots in Border Row
Wall Street Journal
Eavn Ramstad and Jaeyeon Woo
6/2/2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-05-27-1
5/27/2010

On May 24, the South Korean government announced, in response to the Cheonan incident, the cessation of inter-Korean exchanges and other sanctions against Pyongyang. These measures will directly impact the North, costing it 250~300 million USD. According to the Ministry of Unification, North Korea earned 245.19 million USD from inter-Korean cooperative schemes not related to the Kaesong Industrial Complex. This does not include additions monies for customs fees, transportation costs, mediation fees and other incidentals.

About 254 million USD worth of goods were produced on commission in the North after raw materials or partially manufactured products were sent from the South. 10~15 percent of this (25-38 million USD) covers labor and other costs. Therefore, by halting all exchanges and cooperative schemes other than the Kaesong Industrial Complex, North Korea stands to lose at least 200 million USD.

In particular, as the South has banned the import of North Korean sand and marine products, both known to be money-earners for the North’s military, it appears these sanctions have the potential to really pressure Pyongyang. In addition, preventing North Korean ships from using South Korean waters could cost an additional nine million USD. An additional 6 billion won-worth of government-related projects for the North has also been suspended. Ultimately, the cessation of inter-Korean exchange will cost North Korea 250~300 million USD.

The Korea Defense Institute estimates that through inter-Korean projects, tourism, and the Kaesong Industrial Complex, North Korea earned 180 million USD in 2004, but that jumped to 233 million USD in 2005, 341 million in 2006, and 534 million USD in 2007, before falling to 490 million in 2008, and 347 million USD last year.

It appears that the reduction in foreign currency earned by the North has somewhat impacted its economy. Now, the cessation of inter-Korean contacts means further reduction in the North’s access to foreign currency, possibly causing severe shortages of daily necessities because of a lack of trade and insufficient production capacity. If inter-Korean trade ceases, the North can no longer earn foreign capital from Seoul, and this could cause DPRK-PRC trade to drop off, if the North is unable to cover its bills.

It will also cause a loss of jobs for all those North Koreans involved in consignment production, fishing, farming, and other areas of the economy hit by the freeze in trade with the South. As the processing-on-consignment business has reached 30~35 million USD per year, labor involved in the industry nears that of the Kaesong Industrial Complex, and could mean the loss of as many as 40,000 jobs.

While the government has decided to maintain the Kaesong Industrial Complex, it plans to downsize the ROK manpower by 40-50 percent. The reason given is to be able to ensure the safety of the workers, but if the number of workers is cut by 50 percent, this cannot help but have a huge impact on production, raising concerns with North and South Korean employees alike.

According tot he Joonang Ilbo:

The U.S. government has nominated Robert Einhorn, an expert in nonproliferation issues, as its new coordinator for implementing UN Security Council sanctions against North Korea, diplomatic sources in Seoul said on Thursday.

Einhorn is currently the special adviser to U.S. Secretary of State Hillary Clinton for nonproliferation and arms control, and a source here said Einhorn is one of Washington’s leading experts in Korean Peninsula and North Korean nuclear issues.

The sources said the United States is looking to streamline the process by which it implements sanctions, as it prepares to seek a UN resolution that addresses the sinking of the South Korean warship Cheonan. Last week, a multinational team of investigators concluded that North Korea attacked the 1,200-ton corvette with a torpedo on March 26.

“The U.S. administration was seeking more efficient management of implementation of sanctions, which had been divided between the State and the Treasury departments,” the source said. “Philip Goldberg, the assistant state secretary at the Bureau of Intelligence and Research, had been doubling as the implementation coordinator, but Einhorn is poised to take over.

“The U.S. government also tried to strengthen its sanctions system after the second North Korean nuclear test last year, when Goldberg was named the coordinator,” the source said. Goldberg was appointed to his Bureau of Intelligence and Research post in February.

Another source said Einhorn’s nomination is also part of the U.S. government’s efforts to follow up on President Barack Obama’s order to review “existing authorities and policies” on North Korea. Soon after South Korean President Lee Myung-bak unveiled Seoul’s countermeasures against Pyongyang Monday, the White House expressed its support and said in a statement, “This review is aimed at ensuring that we have adequate measures in place and to identify areas where adjustments would be appropriate.”

According to the State Department, Einhorn spent 29 years at the department and served as a senior adviser at the Center for Strategic and International Studies from 2001 to 2009. He held arms control and nonproliferation positions at the U.S. Arms Control and Disarmament Agency, and from 1999 to 2001 he was the assistant state secretary for nonproliferation.

In October 2000, Einhorn accompanied then-Secretary of State Madeleine Albright to Pyongyang, where he met Kim Jong-il twice. Einhorn was also involved in missile talks with North Korea.

“Aside from his knowledge of North Korean nuclear issues, Einhorn is tight with Gary Samore, the weapons of mass destruction coordinator at the White House, and other nonproliferation officials in the Obama administration,” another source in Seoul said. “Einhorn should be able to provide leadership in his new role.

“And since he’s also been dealing with financial sanctions on Iran as the special adviser at the State Department, Einhorn is a great fit to manage financial embargoes against North Korea.”

Another diplomatic source said the Obama administration needed to tighten its sanctions regime. The source said when North Korean overseas accounts were closed off by U.S. sanctions, they simply changed the name of the individual or the company which had opened the account and resumed transactions. The sanctions were aimed at banning transactions by companies or individuals suspected of involvement in the North’s weapons of mass destruction programs.

“U.S. officials have taken note of such [name-changing] practices and they’re preparing measures to eliminate them,” the source said.

U.S. officials are also continuing to press China to join them in punishing North Korea. In an interview with National Public Radio yesterday, Korean time, Kurt Campbell, the assistant secretary of state for East Asian and Pacific Affairs, said that because China is cooperating with the United States about nuclear issues in Iran, he hopes it will do the same in dealing with the Cheonan case.

In another related move, Obama and Japanese Prime Minister Yukio Hatoyama condemned the Cheonan attack in a phone conversation and pledged cooperation with South Korea. Japanese Chief Cabinet Secretary Hirofumi Hirano said Japan will lower the limit on the amount of undeclared cash that can be carried into North Korea to 100,000 yen ($1,097) from the current 300,000 yen, as part of Japan’s toughened sanctions.

Read the full story here:
U.S. nominates sanctions ace
Joongang Daily
Kang Chan-ho, Yoo Jee-ho
5/29/2010

A few months ago I wrote about two attempts to hack into my computer.  The post is here if you are interested.  Well, since then I have fended off no less than six attempts to break into my computer–including two attempts just today (three this week).One email containing a virus was ostensibly from a North Korea expert and the second email was intended to look like it came from the Korea Economic Institute (it even referenced an actual upcoming event of theirs).  I know of several others who have been targeted and some who have even been infected so please be careful out there.Someone is still not playing nice.