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Why is China cracking down on illegal fishing in North Korea?

Monday, December 11th, 2023

By Benjamin Katzeff Silberstein

Daily NK has reported on several occasions on Chinese fishing activities in North Korean waters. Chinese fishers purchase fishing rights from the North Korean government, a practice clearly banned under the current sanctions regime. China has been cracking down on this over the past few months and on sales of seafood from North Korea overall, according to the outlet:

The Chinese government has recently stepped up surveillance and inspections of ships passing through North Korean waters and has even started to crackdown on the sale of North Korean seafood in the country’s markets, Daily NK has learned.

Speaking on condition of anonymity for security reasons, a source in China told Daily NK on Dec. 5 that the Chinese authorities are requiring all ships approaching North Korean waters be equipped with GPS, automatic identification systems, and other navigation and communication devices in order to report their location.

The authorities are doing this to determine where ships have been and for how long, as well as to investigate what ships were doing in North Korean waters. If they confirm that a vessel was fishing in North Korean waters, they confiscate all the seafood the ship has caught.

Accordingly, Chinese vessels that used to fish in North Korean waters are taking a major hit. The source said a fishing boat that recently tried to bring into China clams caught in North Korea is faced with having to pay hundreds of thousands of yuan in fines.

Now forced to pay large fines if caught, Chinese fishery operators say an investigation in their activities might even put them out of business.

[…]

Chinese authorities are also cracking down on sales of North Korean seafood in markets near the North Korea-China border. North Korean seafood exports are banned under UN Security Council Resolution 2371.

Previously, Chinese authorities did not go out of their way to stop Chinese nationals from importing and selling North Korean seafood, but crackdowns have been intensifying recently.

In fact, Chinese businesspeople used to sell North Korean seafood openly due to its popularity, but they do not now because inspection teams are checking the origins of the products they sell.

In regards to this situation, Chinese fishery operators and North Korean seafood sellers say the United States is putting pressure on China to enforce sanctions on North Korea, or that the authorities are cracking down because “China must follow international law for it to play its role in the international community.”

The article cites China’s ambition to appear a responsible actor in the international system in order to exert influence on the current events in Gaza as the reason for its crackdowns on this practice. I’m somewhat skeptical to this explanation. Although it might play a role, I suspect that a more basic ambition to uphold the rules and laws of the region may be what’s behind the Chinese crackdown. In any event, it is a very interesting data point, especially in a time when it’s been assumed that China’s sanctions enforcement would be very lax due to US-China tensions.

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How large are Russia’s oil exports to North Korea in context?

Thursday, June 15th, 2023

By: Benjamin Katzeff Silberstein

For the first time since 2020, Russia recently reported oil exports to North Korea in their official trade statistics. These numbers obviously do not include the unknown but likely large quantities of oil that the country buys from Russia under the radar, through smuggling. According to the official numbers,

Russia had exported 67,300 barrels of refined petroleum to North Korea by April, the first deliveries reported to the U.N. since Moscow said it shipped 255 barrels of refined oil to the North in August 2020.

Under U.N. sanctions against Pyongyang’s nuclear and missile programmes, countries are required to report monthly sales of refined petroleum to the Security Council North Korea sanctions committee.

The oil sales began shortly after train travel between Russia and North Korea resumed in November for the first time since 2020, raising expectations of a resumption of trade.

(Reuters)

Although likely an underestimate of the total (including smuggling), this number is significant, not least because of the rapid increase. But as with other current trade figures on North Korea right now, as the border seems to be opening slowly to trade, the numbers are only a fraction of North Korea’s regular imports. North Korea’s annual imports of refined petroleum before the pandemic, for example, were estimated at 4.5 million barrels per year. Assuming the same pace of Russian exports continues through the year, that would put these imports for North Korea at around 3 percent of total annual imports.

This is not to say that the news isn’t significant, particularly if it marks the beginning of a longer trend. But for now, North Korea’s oil and fuel imports remain, as far as we can tell, far lower than their regular levels.

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Why the North Korea–China trade increase could be an illusion

Wednesday, May 24th, 2023

By: Benjamin Katzeff Silberstein

North Korea–China trade is steadily growing, perhaps slowly moving back to its normal  before Covid-19 -“Maximum pressure” sanctions in 2016–2017. According to the latest numbers, trade continues to grow:

Chinese outbound shipments to the isolated country surged 69% year-on-year to $166 million in April, data released by China’s General Administration of Customs showed.

The top export items in terms of value were processed hair and wool used in wigs, worth about $11.6 million, and diammonium hydrogen phosphate, a widely used fertiliser, worth $8.84 million.

But it is far from back to the “old normal” before 2017. Look, for example, at what is being exported. The biggest export products were wigs and fake eyelashes, accounting for over 66 percent of exports to China. This is part of an offshoring industry where North Korea first imports hair from China, and then locally manufactures it into wigs to export back. Sales of wigs, eyelashes and related products accounted for close to $22.7 million in April. To get a sense of proportion, consider that coal exports, formerly one of North Korea’s most central export goods, totalled $1.19 billion in 2016, a little over $99 million per month on average. So when we look at North Korea’s most central exports at the moment, they are still very small compared to the increasingly distant normal. Wigs just aren’t economically meaningful in the same way as coal.

None of this is to say the increase in trade isn’t meaningful. North Korean imports from China may be just as meaningful or perhaps even more so for the economy at this point, with inputs both for export-destined wigs and fertilizer being the central import goods. The increase in trade is certainly positive for the North Korean economy, but it does not seem to (yet) change the overall dynamics where North Korea still cannot export its formerly most important export goods openly, without circumvention and smuggling that involves significant costs. It could be that covert exports will eventually reach the old level of openly reported exports, but we don’t have any hard data to suggest that is yet the case.

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Yet another North Korea–China border opening report (including tourism)

Thursday, May 11th, 2023

By Benjamin Katzeff Silberstein

At this point, non-materializing reports about the China–North Korea opening for full traffic are too many to count. A recent story by SCMP (link here) claims both truck trade and tourism from China to North Korea will start in one month. But “sources briefed by officials on both sides” is an acknowledgment that the report is not based on direct sources. And as has seemed the case for North Korea since Covid-19, plans for policy changes can often change and often do. Judging by the policy pattern, there doesn’t seem to be an overall strategy or timeplan.

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As Chinese ambassador arrives, is North Korea opening up?

Thursday, March 30th, 2023

By: Benjamin Katzeff Silberstein

After a very long hiatus over the pandemic, China’s new ambassador to North Korea has taken up his post in Pyongyang, AP reports:

Wang Yajun will help in the development of the traditional friendship between the “close neighbors sharing mountains and rivers,” Foreign Ministry spokesperson Mao Ning said at a daily briefing.

China is North Korea’s main source of economic aid and political support, but interactions have been disrupted by travel restrictions imposed in an attempt to prevent the spread of COVID-19.

The ambassador’s posting comes as North Korean state media reported that leader Kim Jong Un urged his nuclear scientists to increase production of weapons-grade material to make bombs to put on the country’s widening range of weapons.

The report Tuesday followed a series of missile launches — seven this month alone — and rising threats to use the weapons against North Korea’s enemies.

(Full article here.)

Does this signal a broader relaxation in North Korea’s border restrictions, brightening prospects for trade to open up more broadly as well? Maybe. After all, there’s been signs for many months (well over a year), from infrastructure construction to (fairly tangible) rumors reported from the border area. And imports have increased, particularly of food, resulting in prices stabilizing somewhat.

At the same time, there are good reasons to doubt it. Welcoming back a Chinese envoy is, after all, a decision more in the realm of foreign policy and diplomacy than economics and pandemic prevention. Thus far there have been no reports in outlets such as Daily NK or Rimjingang suggesting a major reversal in trade policy is imminent. To the contrary, the bigger pattern seems to be the state centralizing control over trade while keeping it at a very small minimum. Whatever trade regime emerges from this, it may not look like the old one.

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What upgrades of North Korea’s surveillance equipment say about policies and priorities

Monday, November 7th, 2022

By: Benjamin Katzeff Silberstein 

According to a recent report, North Korean authorities upgraded their system for monitoring and detecting use of foreign-made cell phones (which is illegal) along the border. This is all part of the general crackdown on “anti-socialist” phenomena over the last four-five years, and under Covid-19 in particular:

North Korea has replaced radio wave detectors installed in regions along the China-North Korea border with the latest models.

The authorities use the radio wave detectors to crack down on illegal mobile phones.

According to a Daily NK source in Yanggang Province, North Korean authorities recently replaced the radio wave detectors in border regions such as Hyesan and Samjiyon as part of its efforts to ferret out locals who use illegal foreign-made mobile phones.

The Ministry of State Security’s Bureau 10, the division in charge of radio wave surveillance, replaced the equipment under top secrecy from Oct. 1 to Oct. 15.

The source said that given how the ministry upgraded its detectors along the border to the latest models, it seems the ministry will once again wage a fierce war to root out users of illegal foreign-made mobile phones.

In fact, since the COVID-19 pandemic, the Ministry of State Security has been conducting a sweeping “mop-up war” and “war of annihilation” in border regions against people who use illegal foreign-made mobile phones.

The Ministry of State Security has arrested many border residents on espionage charges, subjecting them to forced labor of varying severity. In serious cases, the ministry has even dragged off locals to political prison camps.

With border residents continuing to use illegal mobile phones to contact China, South Korea or other countries despite these efforts, the Ministry of State Security appears to have replaced its existing radio wave detectors with high-end ones capable of tracking the location of mobile phone users more quickly and accurately.

A defector who came to South Korea in 2019 told Daily NK that given how the Ministry of State Security installed the old radio wave detectors several years ago, it may have been time to replace them.

“In fact, if the ministry replaced them with new, highly capable radio wave detectors, it means they want to root out more Chinese-made mobile phone users, and even if not, the rumor that it installed new devices would have been effective in generating fear that the authorities will catch people who use Chinese-made mobile phones,” he said.

(Source: Kim Chae-hwan, “N. Korea replaces radio wave detectors on border with the latest models,” Daily NK, November 3, 2022.)

None of this information is possible to confirm, and the report relies on a small number of sources. Nonetheless, if accurate, the news is interesting for several reasons. For one, it highlights the regime’s increasing reliance on, and investments in, technology for surveillance. Moreover, it further highlights the government’s emphasis on border control and information censorship, which has increased significantly over the past few years.

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North Korean imports from China turning toward food

Thursday, November 3rd, 2022

By Benjamin Katzeff Silberstein

The first items North Korea imported from China when railway freight trade started back up were mainly industrial goods, but lately, imports appear to have shifted more toward foodstuffs. Daily NK: 

According to a Daily NK source in China last Friday, freight trains have been departing every morning from the Chinese city of Dandong for the North Korean city of Sinuiju since Sept. 26.

From late September to early October, the freight cars have been mostly laden with aluminum window frames, tiles, living room lights and other construction supplies, but from mid-October, the trains are carrying a wider range of cargo.

Trains entering North Korea still carry construction or interior supplies such as aluminum window frames, wood for furniture and sawdust, as well as medical supplies like masks and antibiotics. However, since mid-October, foodstuffs have accounted for a far higher share of imports, so much so that over half of freight cars have been laden with various food items.

In fact, the items now accounting for a greater share of North Korean imports by freight trains from China include soybean paste, soy sauce, red pepper powder, sugar, seasonings, vinegar, garlic soybeans and other items. In particular, imports of foodstuffs needed to make kimchi have reportedly increased with the start of kimjang, or the kimchi-making season.

However, the freight trains have yet to begin carrying grains such as rice or wheat flour.

(Source: Seulkee Jang, “N. Korea is now focusing on importing food from China,” Daily NK, November 1st, 2022.)

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North Korean trade with China in September highest since Covid-19 began

Tuesday, October 25th, 2022

By: Benjamin Katzeff Silberstein 

The latest figures are out for China-North Korea trade. Overall, trade in September was at its highest since Covid-19 began, which is particularly significant considering that rail traffic, one of the most central routes for goods, only started back up late that month. Total trade stood at $142.7 million. In January 2020, the same figure was slightly under $200 million. This was already a fairly low figure, but one that would have likely climbed steadily were it not for Covid-19.

$14.2 million consisted of exports, with the vast majority being imports. North Korea’s main export goods were iron ore and other mineral- and mining-related products.

North Korea mainly imported medicines and industrial goods, with truck tires being its main import. It is a crucial good for most sectors that depend on domestic transportation and the shortage of tires (whose domestically produced quality is low) has likely caused considerable difficulties.

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North Korea-China trade officially reopened

Monday, September 26th, 2022

By Benjamin Katzeff Silberstein

On September 26, a spokesperson for the Chinese Foreign Ministry officially stated that railroad traffic between China and North Korea would restart yet again, after the brief opening and sudden cancellation five months ago. The same say, a freight train crossing the border was caught on video. Bloomberg:

Foreign Ministry spokesman Wang Wenbin said Monday at a regular press briefing in Beijing the cargo rail link between the China and North Korea is reopening, after service was halted in April as part of measures to control Covid.

“The two sides will continue to strengthen coordination to ensure the steady and secure transport of goods, and contribute to friendly relations between China and the DPRK,” Wang said, referring to North Korea by its formal name.

The rail connection between the city of Dandong in China and Sinuiju in North Korea is Kim’s main link to China, his country’s biggest trading partner by far. Reopening the trade route could take pressure off Kim to return to stalled nuclear disarmament talks with the U.S., where the Biden administration is dangling the prospects financial rewards in exchange for steps to wind down its atomic arsenal.

The link was closed in 2020 near the start of the pandemic when Kim shut the borders to prevent the coronavirus from entering, and was briefly reopened in January of this year. Video on social media on Monday showed a freight train that appeared to be crossing from the Chinese side into North Korea.

(Source: “China, North Korea Restore Rail Link on Kim’s Key Trade Route,” Bloomberg News, September 26th, 2022.)

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Chinese region near North Korean border suffers from lockdowns

Thursday, September 1st, 2022

By Benjamin Katzeff Silberstein 

New York Times recently ran an interesting dispatch from Shenyang in northeastern China, about an hour’s high-speed train ride from North Korea. This report highlights something important: while trade with North Korea is negligible for China as compared to the country’s total trade volume, North Korea as a trading partner does matter for the Chinese border regions specifically:

….And in a region often referred to as China’s Rust Belt, the local economy had already been shaky for years.

Possibly the main problem, though, is that Ms. Wen’s primary customer base has virtually evaporated.

“With North Korea closed because of the virus, they can’t come or go at all,” she said from behind the counter of her store in Shenyang’s Koreatown, where signs advertising steep discounts on imported South Korean styles had done little to draw in shoppers. “Before, we’d have maybe dozens of North Korean customers every day. Now you don’t even get 10.”

China’s continuing strict coronavirus controls have battered local economies across the country. But Shenyang has endured a double blow. Just 150 miles from the North Korean border, it is suffering not only from the restrictions in China, but also from those imposed by the even more isolated country next door.

(Source and full article: Vivian Wang, “Lockdowns in China, and North Korea, Bring Double Blow to Bridge City,” New York Times, August 30th, 2022.)

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