Nuclear test no. 3?

November 23rd, 2010

The Japanese and South Korean media have asserted that the DPRK is potentially preparing for a third nuclear test. I have no idea if this is the case, but the North Koreans certainly want us to see them conducting activities at their test site in Kilju county. Below I have placed some pictures of the area from both Google Earth and Digital Globe (taken  at different dates) of the test site:

Tunneling Activity:

Image data: Location: 41°16’34.70″N, 129° 5’16.99″E.  Dates: 2005-2-15, 2009-10-9, 2010-10-16. The top two images are from Google Earth. The image on the bottom is from DigitalGlobe.

New Vehicles:

Image Data: Location: 41°16’41.21″N, 129° 5’14.97″E.  Date: 2010-10-16.  Source: DigitalGlobe.

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More DPRK loggers reportedly running away

November 22nd, 2010

According to the Daily NK:

According to a former North Korean logger in Russia, instances of forestry workers running away from a “Forestry Mission” program organized by North Korea’s Forestry Ministry in the Russian Far East are increasing due to excessive salary deductions currently being imposed by the North Korean authorities.

Song Ki Bok, a 48-year old former logger who now lives in South Korea told The Daily NK on November 18th, “The Forestry Mission takes 70% of monthly salary in the name of Party funding. Who would want to work there when all the money you earn from working yourself to death is taken from you?”

Prior to 2008, North Korea took 30% of the North Koreans’ wages for “Party loyalty funds”. However, after sanctions put in place by the international community following the first North Korean nuclear test began to bite, the amount was increased to 70%.

The North Korean forestry workers do hard physical labor. Depending on the intensity of their work, they receive just $40 to $100 per month.

Therefore, once 70% is deducted as Party funds, the take-home pay of the worker is between $12 and $30. As a result, workers cannot even dream of wiring sums back to family in the North. They just deliver what cash they can gather via colleagues returning home.

Worse yet, with this kind of swingeing monthly deduction, many workers cannot even recover the bribe they had to offer Party officials in order to be sent to Russia in the first place. For example, the total amount Song ended up paying was nearly $400.

Before escaping from the forestry program, Song saw a monthly salary of $30, meaning that even if he had saved every penny he earned for a year he still would not have recouped the $400 he paid out in bribes.

In the beginning, he was buoyed by the ‘Russia Dream’. The family of a worker in a foreign country traditionally lives in better conditions than most people. Therefore, Song went to Russia in the belief that if he worked hard for three years, he could make 10 years of a North Korean working man’s salary; however, the reality was as harsh as the bitter cold of Siberia.

The Forestry Mission in Russia; Kim Jong Il’s hard currency provider

According to Song, there are 17 forestry sites in Russia which employ North Koreans. Depending on the size of the camp there are differences; however, approximately 1,500~2,000 North Koreans work at each.

The major activities of the Party Committee in each camp are surveillance and the collection of Party funds. A manager, Party secretary and an agent from each of the National Security Agency and People’s Security Ministry are assigned to each site, and 15 administrative officers below them manage operations.

The life of workers is the same as it would be if they lived in North Korea. They must partake of weekly evaluation meetings, and food is provided by distribution. They plant potatoes and wheat in cleared areas near their digs to supplement the insufficient state provisions.

If workers leave without permission, they are punished upon their return. If the crime is grave, the worker might be summoned to North Korea for reeducation.

Song commented, “Sometime people leave the camp to go hunting to earn money. They can only escape punishment by bribing the management.”

In total, the amount gathered in the name of Party funds by the North Korean authorities from each camp can exceed $140,000 per month. Calculations suggest that the annual North Korean government take from the program exceeds $25 million.

However, this harsh Party policy is driving escapes, according to Song, “Since most of their monthly salary began to be taken away as Party funds, the number of workers escaping started to increase. Just from those I know, the average has reached 30 workers per a year.”

Song, describing the harsh working conditions at the site, said, “In 2006, a wood cutter from Dukcheon in South Pyongan Province who had frostbite in both feet at work didn’t receive treatment in time. In the end, they had to cut off both his legs. His co-workers, who could not ignore the situation, raised it with the Party Committee there; however, not only was this opinion ignored, but the wood cutter was sent home with the explanation, ‘It was an accident caused by my own carelessness’.”

“The life of a forestry worker fighting against cold which can reach -40˚C in winter is unspeakably tough,” Song said. “Meanwhile, they don’t even receive a proper month’s salary, which reduces their will to work.”

“If a worker escapes, in the end he has no choice but to head to South Korea. When I think about those of my colleagues who couldn’t come to South Korea with me, it is still hard to sleep at night.”

Read more about logging camps in Russia (including satellite imagery) here and here.

Read the full story here:
Runaway Loggers on the Rise Due to Wage Cuts
Daily NK
Kang Mi Jin
11/22/2010

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DPRK lifespans lag RoK’s

November 22nd, 2010

According to Yonhap:

North Koreans are expected to live 11 years less than the average South Korean due mainly to malnutrition that adversely affects births and causes more people to die earlier than normal, a government report showed Monday.

The Statistics Korea report, based on data released by the United Nations and Pyongyang, showed the life expectancy for an average North Korean at 69 years, lower than numbers reached in the communist country in the early 1990s before it was hit by devastating famine.

The life expectancy for men reached 64.9 while that for women was 71.7 years. This is 11.3 years and 11.2 years less than this year’s life expectancy of South Korean men and women, respectively.

“Generally, the population has not fully recovered from the famine and hardship, although conditions have improved in the past few years,” a statistics official said.

He said estimates revealed that there may have been a “population loss” of around 610,000 for a decade after the mid-1990s, caused by a higher number of deaths and people shying away from having babies.

The official said up to 480,000 more people may have died compared to what was normal during the 1994-2005 “slow-motion famine” period when the country could not properly feed its people.

Newborn baby numbers fell by an estimated 130,000 vis-a-vis natural increase rates in the 1995-2004 time frame, as fewer people married and couples put off giving birth during hard times, he said.

The latest statistical report, however, said that despite chronic food shortages, North Korea’s population managed to post steady growth in the last two decades.

As of this year, the population is estimated to be 24.19 million, up 0.5 percent from a year earlier. Before 1997, the population grew more than 1 percent on-year, but gains have become stagnant since 1998, staying under the 1 percent mark.

This year’s numbers make North Korea the 49th most populous country in the world, compared with 26th-ranked South Korea, whose population reached 48.88 million.

The statistical report, meanwhile, showed the number of economically active people in the North between the ages of 15 and 64 reaching 16.58 million this year, with the number of men being smaller than women.

The median age of the population stood at 30.1 years for men and 33.7 for women, five or six years younger than numbers for South Korea. The country effectively became an “aging society” in 2003 with the number of people over 65 hitting 7.2 percent of the total population and should be an “aged society” in 2033 with 14.5 percent of the population over 65 years old.

The report predicted that North Korea’s population will peak at 26.54 million in 2037, compared to South Korea’s peak population that is expected to be reached in 2018, when there may be some 49.34 million people living in the country.

If both South and North Korean populations are combined, the number would hit its peak in 2027 with 75.06 million people living on the peninsula, the report said.

Read the full story here:
N. Koreans expected to live 11 years less than S. Koreans: report
Yonhap
11/22/2010

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DPRK builds hundreds of cell towers, expands distance education opportunities

November 22nd, 2010

Institute for Far Eastern Studies (IFES)
NK Brief No. 10-11-22-1
11/22/2010

The Chosun Sinbo reported on November 15 that North Korea has erected hundreds of cellular signal towers throughout the country, providing phone service to every province, city, and town in North Korea. According to the report, the expansion of the North’s 3G network has really taken off in 2010, and the number of subscribers within the country has grown 2.5 times in the latter half of the year, as has the available coverage area.

This initiative has focused on setting up hundreds of cell towers near major highways, cities, and industries important to economic advancement. It was also reported that industry insiders had revealed that not only towns, cities, and provinces were targeted for the expansion of cellular service, but that there was a plan to erect towers in the back country, as well, and that authorities aimed to extend service to every village in the country by next year.

To this end, the Chosun Sinbo reported, the Pyongyang-based DPRK-PRC JV Checom Joint Venture Company has set up a “flow manufacturing process and is producing hundreds of high-performance cellular phones each day” and, “Related sectors are testing new devices and actively working on a project aimed at modifying the operating software to suit the needs of North Koreans.”

The paper also reported that North Korea’s academics and scientists collaborated to develop such a system in a short time, and that the system was also integrated into the nation’s Intranet. This system is different from the previous configuration in that videos, recordings, and text messages can be sent both ways, so that the system better supports an exchange of information rather than merely a transfer.

The paper emphasized that by providing distance education service to every local academic office, city and town library, and science and educational facility, the North has enacted a state-of-the-art, nationwide education system. In addition, by providing the infrastructure for real-time interactive lectures, workers and children in every region of the country can easily pursue their education by actively participating in a wide range of lectures.

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Crack in Orwellian paradise

November 21st, 2010

Lankov writes in the Korea Times:

One of the most important peculiarities of North Korean life is the degree of isolation of North Koreans from entire world. The government does not want them to be aware of some facts which contradict the officially approved picture of the world and their own country. To make sure that propaganda has no competition, the North Korean authorities eliminate all possible sources of alternative information.

Few if any Communist countries were as efficient as North Korea in cutting their population off from the unwanted and unauthorized knowledge about the world beyond the nation’s boundaries.

Few North Koreans are ever allowed to leave their country. The only statistically large but non-privileged group of people with overseas experience was the Siberian loggers who were sent to the wilderness of Southern Siberia from the late 1960s onwards. However, that part of the world is not famous for a high density population, so their contact with the locals was kept at a bare minimum (and North Korean authorities saw to this).

All other groups of North Koreans who were allowed to travel overseas formed the upper crust of society and by definition were carefully chosen for their supposed political reliability. These privileged few were diplomats, crews of the North Korean ships and planes as well as a handful of the people who were allowed to participate in international exchanges, largely of academic nature. These people had a lot to lose, and they also knew that their families would pay a high price for any wrongdoing they committed, thus they seldom caused trouble. They are least likely to talk much about overseas life.

There were students, of course, but their numbers were very small ― perhaps, less than 10,000 North Koreans ever graduated from foreign universities (just for comparison: some 240,000 South Koreans are studying overseas right now).

The North Koreans cannot buy or read books published overseas ― no exception is made even for books from other Communist countries. All non-technical foreign publications are kept in special departments of libraries and one needs a security clearance to access them. In these departments the subversive material could be read only by the trustworthy people who obtained special permission from security police.

Of course, radio was the major source of worries for the Pyongyang leaders. So, North Korea is the only country which outlaws the use of the radio sets with free tuning. All radio sets are permanently fixed on the wavelength of the official Pyongyang broadcast, and police conduct random house checks to ensure that technically savvy owners have not re-modeled their sets.

In a clearly Orwellian twist, the government does its best to keep the populace cut off from the past as well. All periodicals and most books more than ten years old are to be sent to the same special departments with access being limited to the people with proper security clearance. Even speeches of the Great Leader are edited (rewritten) from time to time to meet the demands of the ever changing political situation.

Why did they do it? The answer seems to be obvious: the governments know that they have to hide the huge difference in economic performance between North Korean and its neighbors, and above all ― between North and South Korea. Currently, the ratio of per capita income between two Korean states is estimated to be at 1:15 at best and 1:50 at worst. This is the largest gap which exists worldwide between two countries which share a land border, and this gap is powerful proof of North Korea’s economic inefficiency. The government understands that once the populace learns about the gap, the situation might get out of control. To prevent it, they work hard to keep people ignorant about the outside world.

Until 2000 or so, they have been generally successful, even though some snippets of dangerous information found their way to North Korea. Things began to change in the late 1990s when North Koreans began to move across the porous border with China. Most of the refugees did not stay in China, but eventually returned to North Korea. They brought back stories of Chinese prosperity, DVDs with South Korean TV shows and small, easy-to-hide transistor radios with free tuning.

Since then, things began to change, and the information self-isolation system began to fall apart. However, it might be premature to believe that it has been damaged beyond repair. Yes, people in the borderland area are aware that they live in a poor and underdeveloped society. Many people in Pyongyang also came to realize this. But it seems that in more remote parts of the country the isolation still works reasonably well.

Sometimes I wonder how shocked North Koreans will be when exposed to the outside world for the very first time. We can be sure that their surprise will be huge ― and perhaps, their disappointment about their country’s past will be huge, too.

Read the full story here:
Crack in Orwellian paradise
Korea Times
Andrei Lankov
11/21/2010

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DPRK workers in Angola

November 20th, 2010

According to the Choson Ilbo:

The Agostinho Neto Center of Culture is a massive national park that the Angolan government is building on 12,000 sq. m of land in the capital city Luanda in memory of its first president. On Oct. 24, the entrance was firmly shut with a black iron gate. Through barred windows, three or four Asian workers could be seen: they are staff of North Korea’s Mansudae Overseas Project Group of Companies, which earns much-needed foreign currency for the regime from massive construction projects and monumental sculpture in the developing world.

Initially, the Agostinho Neto Center was commissioned to a Brazilian construction company, but work came to a halt until the North Koreans took over at the end of 2007.

The North Korean workers are living together in temporary wooden accommodation in a corner of the construction site. There are reportedly 100 to 120 of them in Angola. North Korea supported independence movements and civil wars of some African countries, and has been involved in some large construction projects there based on the diplomatic ties built this way. The North provided military aid to the side currently in power during the Angolan civil war and is reportedly building other parks and peace monuments in Cabinda and Huambo, one or two hours away by plane from Luanda.

The Daily NK reported North Korea has earned at least US$160 million in construction projects in Africa since 2000. A South Korean resident in Angola said, “Although North Korean workers only get minimum living cost from their government, they make additional money by working on smaller-scale projects locally when they have some spare time waiting for equipment or materials to arrive.”

One North Korean worker said, “When we go to the site for work, we sometimes get Angolan traditional congee called Fungi. It’s delicious. We eat better here than in North Korea because we can get rice from Chinese construction firms.”

In a predominantly black residential area in Luanda, there is a pharmacy run by a North Korean doctor in a shabby one-story building. “I work at a national hospital in the morning, and run this pharmacy privately in the afternoon. This is the only way I can make the ends meet,” he said.

According to a local source, there are about 180 North Korean doctors across Angola, including about a dozen in Luanda. There are also North Korean doctors in Mozambique and Congo, and some practice oriental medicine. At the pharmacy, acupuncture costs $80 for the first treatment and $40 thereafter.

Read the full story here:
N.Koreans Struggle for Hard Currency in Africa
Choson Ilbo
11/20/2010

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DPRK scientists increase publications

November 19th, 2010

According to the Choson Ilbo:

North Korean scientists wrote a record number of papers for international scientific journals this year. Their enthusiasm was apparently undimmed by a botched currency reform late last year, tight international sanctions and a worsening food situation.

According to information provider Thomson Reuters who regularly reviews the state of scientific research, North Korean scientists submitted 26 papers, all of them co-authored, to Science Citation Index journals until November.

Since 1976, North Korean scientists have written a total of 143 papers for international journals, or a mere four per year on average. Between 1977 and 1981 there were none and only a few until the 1990s. But the number has risen conspicuously since 2004, with 11, the first two-digit figure, in 2005, 17 in 2007 and 2008, and 19 in 2009.

The 26 papers written this year cover a range of topics from optics, nanotechnology, hydromechanics, material science, and bioengineering to medicine, cosmology and mathematics. Three papers on optics are all directly or indirectly related to laser research.

Five or six papers are about nanotechnology, the hottest research topic in the world of science today. As if to reflect the food shortage in the North, one paper focuses on a method to increase the corn harvest using insects.

None of this year’s papers were published in top-class journals such as Science or Nature, nor were any of them were written by North Korean scientists alone. Chinese scientists co-authored 14 papers, and scientists from Australia, Germany, Japan, Malaysia, Switzerland and other countries 12.

Experts attribute the rapid increase to a new policy focus on science. Dr. Byun Sang-jung of the Institute for National Security Strategy said in a New Year’s message in 2000, the regime gave priority to three pillars — ideology, the military, and science and technology. Already in 1998 the North formulated a five-year plan for science and technology development, laying the stress on investment and scientific exchanges with foreign countries. Even scientists of the U.S. are conducting joint research with North Korean scientists in electronics.

But the North’s production of scientific papers could decline, some experts predict. Dr. Kim Jong-sun at the Korea Advanced Institute of Science and Technology said, “Most of the North’s scientific papers published this year must got started in 2007, the last full year of the Roh Mu-hyun administration” when aid and exchanges were still in full swing.

“The North will likely produce a smaller number of scientific papers from next year, because the regime’s science policy has reached limits now that inter-Korean exchanges are suspended,” he added.

Read the full story here:
Boom Time for N.Korean Scientists
Choson Ilbo
11/19/2010

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Kim Jong-un pushes CNC deployment

November 19th, 2010

If you are not sure what CNC is, read my previous post here.

According to the Joongang Daily:

North Korean leader Kim Jong-il’s youngest son is making unofficial rounds to munitions factories in the communist state, encouraging the modernization of technology in the manufacture of weapons and following his father’s footsteps in songun, or “military-first,” politics, according to U.S.-based Radio Free Asia (RFA) on Wednesday.

Kim Jong-un wants all factories to implement computer numerical control (CNC), which enables the automation of machines with computer-assisted technology. CNC has been connected to the young leader-to-be since last year when he was tapped for succession. South Korean government officials have said that the technical term is being used in connection with Kim Jong-un because the technology is new in North Korea – suggesting the rise of a young new leader intent on modernizing military production.

“With news that Kim Jong-un will visit a munitions factory in Chongjin, North Hamgyong, the factory has been busy with movement. He is coming to inspect the CNC of the factory’s production line,” said a well-informed source cited by RFA. The factory, which is in an area of northeastern North Korea located about 50 miles from the Chinese border, is known to produce shells for multiple-launch artillery pieces. It was also mentioned in a recent broadcast by the state’s official television network for its implementation of CNC technology along with other machinery factories, “standing at the cutting-edge of machinery development,” KCTV said.

According to the source, Kim Jong-un is visiting production lines in North Hamgyong and Jagang, and munitions factories were the first to receive orders to implement CNC to “set an example” for the entire country.

The new technology is utilized to develop more weapons, which could easily attack Seoul and the metropolitan area and could put more pressure on the South Korean government.

North Korea has been urging talks with Seoul to resume cross-border tourism while simultaneously trying to hint that it wants to return to the six-party talks on denuclearization.

Kim Jong-un was also reported to have shown a friendly side to those who have cooperated with his CNC implementation plan. Factories that he visited are reportedly being given incentives, such as cooking oil for workers’ families. Kim Jong-un’s visits mirror those of his father’s past field guidance trips to various places in the communist state and indicate he is well on his way to becoming the next North Korean leader. The field guidance trips are usually touted by the North’s official media without exact dates of when the visits actually happened.

Read the full story here:
Kim Jong-un pushing ‘military-first’
JoongAng Daily
Christine Kim
11/19/2010

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DPRK defectors in China

November 18th, 2010

Andrei Lankov writes in the Korea Times:

Nowadays, there are between 20,000 and 30,000 North Koreans hiding in China, and roughly three quarters of them are women.

But what are they doing there? Of course, the major motivation behind their decision to flee was the disastrous economic situation in North Korea.

In the late 1990s, the refugees fled a very real threat of starving to death, while nowadays it is most likely that destitution and malnutrition drive them across the border. For men it is not so easy to move, since for them the stakes are higher. If caught, men are likely to face greater problems than women.

But there is another reason: large-scale trafficking of women (well, as will be explained later, the present author is somewhat wary about using the word “trafficking” to describe this phenomena).

Once a North Korean woman finds herself in China, she soon realizes that without ability to speak at least some Chinese, and with police constantly on alert against refugees, one of the best survival strategies available for her is to become a “live-in” partner of some local Chinese man.

The patterns differ greatly. In some cases, women are kidnapped or lured by false promises and then sold to Chinese husbands who might be very abusive and cruel. In some other cases, women make their own choice, often after spending years in China and acquiring a good command of the language as well as a good understanding of the situation.

The first is human trafficking, pure and simple. The second can hardly be described as anything but a normal marriage. But it seems that most cases lie somewhere between these two extremes.

When the border controls nearly collapsed in 1998-99, cross-border match-making services began to develop. The brides are in great demand in the poorer rural parts of northeast China. Similar problems are well-known in the South Korean countryside, too.

Single men cannot find wives since most girls go to cities and few of them would consider a farmer as a suitable husband anyway.

In the case of South Korea such a phenomenon recently produced an explosive growth in the number of the interracial marriages, with Korean farmers marrying Vietnamese and Chinese girls. In the case of China, the illegal migrants from the North are a substitute.

In some cases, a desperate bachelor pays mobsters or their intermediaries to get a wife whom he might eventually keep under house arrest, for fear that the kidnapped woman might escape.

However, more frequently families use the intricate network of inter-border connections to arrange a bride. Often the prospective wife is located on the other side of the border, but it is not a major obstacle as long as people have some cash to pay North Korean border guards.

Thus, many young Korean women enter the game willingly, even if their expectations about their future might be overly optimistic as they are often misled.

Frankly, I have serious problems with describing this particular type of arrangement as “human trafficking.” Our modern sensitivities might indeed be offended by an idea of a woman marrying somebody whom she has never seen, purely on assumption this is the surest way to guarantee her livelihood.

However, this is how nearly all marriages were concluded a century ago. The idea of romantic love union based on the mutual attraction is a novelty, invented in the 19th century Europe and still unusual in poorer parts of the world.

After all, many women get what they want: a stable life, free from hunger. They would never have such a life “under the fatherly care of the Dear Leader.”

However, these women are illegal immigrants and they have no way to protect themselves if the relationship turns abusive. If they escape, they are very likely to be caught by mobsters and sold again, or caught by police and extradited back to their home country (god knows what is worse).

However, it is also important and telling that a large number of such women, if they are indeed deported to the North to spend some time in jail there, use the first opportunity to come back to China in order to reunite with their husbands again.

Still, the North Korean authorities make sure that all women who are caught pregnant have abortions: perhaps, on the grounds of habitual racism, so common in the Kim Jong-il’s kingdom.

Many Chinese husbands try hard to do something about their Korean wives’ official standing. If the husbands are willing to contribute enough resources, sooner or later, the women acquire Chinese Resident Identity Card where they are registered as China-born ethnic Koreans.

Such an ID costs a lot in bribes to officials, but once it is secured the former hapless refugee becomes a proud citizen of the People’s Republic of China.

It is also important that children born out of such unions usually get the Chinese Resident Identity Card as well. This means that they will go to the Chinese schools and receive a standard education in Korean and/or Chinese.

However, apart from this cross-border movement of brides there is trafficking pure and simple. The Chinese sex industry is controlled and restricted, but exists, and North Korean girls form a large part of the sex workers in the cities of northeast China.

They are even more hapless than Chinese prostitutes, since they are probably more afraid of deportation than of their captors. But their sorry fate should probably become a topic of another story …

Read the full story here:
North Korean defectors
Korea Times
Andrei Lankov
11/18/2010

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US sanctions two more DPRK organizations

November 18th, 2010

UPDATE 2: Here is the actual Treasury Department Press Release (11/18/2010):

Treasury Designates Key Nodes of the Illicit Financing Network of North Korea’s Office 39

11/18/2010
WASHINGTON – The U.S. Department of the Treasury today designated Korea Daesong Bank and Korea Daesong General Trading Corporation pursuant to Executive Order (E.O.) 13551 for being owned or controlled by Office 39 of the Korean Workers’ Party.  Office 39 is a secretive branch of the government of the Democratic People’s Republic of Korea (North Korea) that provides critical support to North Korean leadership in part through engaging in illicit economic activities and managing slush funds and generating revenues for the leadership. Office 39 was named in the Annex to E.O. 13551, issued by President Obama on August 30, 2010, in response to the U.S. government’s longstanding concerns regarding North Korea’s involvement in a range of illicit activities, many of which are conducted through government agencies and associated front companies. Korea Daesong Bank is involved in facilitating North Korea’s illicit financing projects, and Korea Daesong General Trading Corporation is used to facilitate foreign transactions on behalf of Office 39.

“Korea Daesong Bank and Korea Daesong General Trading Corporation are key components of Office 39’s financial network supporting North Korea’s illicit and dangerous activities,” said Under Secretary for Terrorism and Financial Intelligence Stuart Levey.  “Treasury will continue to use its authorities to target and disrupt the financial networks of entities involved in North Korean proliferation and other illicit activities.”

E.O. 13551 targets for sanctions individuals and entities facilitating North Korean trafficking in arms and related materiel; procurement of luxury goods; and engagement in certain illicit economic activities, such as money laundering, the counterfeiting of goods and currency, bulk cash smuggling and narcotics trafficking. As a result of today’s action, any assets of the designated entities that are within U.S. jurisdiction are frozen and U.S. persons are prohibited from conducting financial or commercial transactions with these entities.

UPDATE 1: Here is the US Treasury Department’s web page on North Korea.

ORIGINAL POST: According to Reuters:

The United States sanctioned on Thursday two North Korean companies linked to a group it accuses of drug smuggling and other “illicit” activities to support the nation’s secretive leadership.

U.S. sanctions against North Korea aim in part to persuade Pyongyang to abandon its nuclear programs, which the United States views as a threat to its allies South Korea and Japan. The North tested nuclear devices in 2006 and 2009.

The Treasury Department’s moves against Korea Daesong Bank and Korea Daesong General Trading Corporation will freeze any assets belonging to them that fall within U.S. jurisdiction as well as bar U.S. companies from dealing with them.

Their main aim is not to block North Korean assets in U.S. banks — analysts say there are unlikely to be any — but to discourage other banks from dealing with North Korea, thereby cutting off its access to foreign currency and luxury imports.

Perks and luxuries such as jewelry, fancy cars and yachts derived from North Korea’s shadowy network of overseas interests are believed to be one of the main tools Pyongyang uses to ensure loyalty among top military and party leaders to North Korean leader Kim Jong-il.

The Treasury described the two entities as “key nodes of the illicit financing network” of Office 39 of the Korean Workers’ Party, which it accuses of producing and smuggling narcotics to earn foreign exchange for the government.

“Korea Daesong Bank and Korea Daesong General Trading Corporation are key components of Office 39’s financial network supporting North Korea’s illicit and dangerous activities,” Treasury Under Secretary Stuart Levey said in a statement.

Heroin Production?
The Treasury designated the two under a recent executive order that targets entities that support North Korea’s arms trafficking, facilitate its luxury goods purchases and engage in illicit economic activities such as money laundering, drug and bulk cash smuggling and counterfeiting goods and currency.

President Barack Obama signed the executive order on August 30 allowing the Treasury to block the U.S. assets of North Korean entities that trade in arms or luxury goods, counterfeit currency or engage in money laundering, drug smuggling or other “illicit” activity to support the government or its leaders.

When that executive order was announced, the Treasury accused Office 39 of producing opium and heroin and of smuggling narcotics such as methamphetamine.

U.S.-North Korean relations have deteriorated since Obama took office, with his aides deeply unhappy about Pyongyang’s decision to conduct nuclear and missile tests last year as well as the March 26 sinking of the South Korean corvette Cheonan.

Forty-six South Korean sailors were killed in the incident, which the United States, South Korea and other nations blame squarely on North Korea. Pyongyang denies responsibility.

In the August 30 executive order, Obama cited the Cheonan’s sinking as well as 2009 nuclear and missile tests by North Korea as evidence it poses “an unusual and extraordinary threat” to U.S. national security, foreign policy and economy.

The Obama administration has been skeptical about returning to so-called six-party negotiations with the two Koreas, China, Japan and Russia under which Pyongyang committed in 2005 to abandon its nuclear programs.

U.S. officials say they do not want to talk for the sake of talking and North Korea must show some commitment to abandoning its nuclear programs.
Read the full story here:
U.S. sanctions two North Korean entities
Reuters
Arshad Mohammed
11/18/2010

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