Trucks loaded with mineral extracts blocked from entering China

Seol Song Ah  |  2016-03-07 10:43
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Chinese authorities began prohibiting mineral exports from North Korea on March 1st in a move not strictly related to the passing of UN Security Council Resolution 2270, which outlines sanctions against North Korea. North Korean authorities and foreign-earning currency enterprises tied to the military did not see this move coming and expressed embarrassment and shock. 

In a telephone conversation with the Daily NK on March 4, a source from North Pyongan Province said, Beginning on March 1, mineral exports such as coal and ore have not been allowed to pass through Chinese customs into China. Trucks loaded with mineral deposits have been idly waiting in front of Chinese customs near Dandong. The foreign trading companies are simply waiting for instructions from the higher authorities. 

Two separate sources, also based in North Pyongan Province, verified these claims.

Foreign-currency earning companies began hearing rumors that mineral exports would be blocked from entering China back in February, but they simply didnt believe it. The authorities did not make an official announcement or put forward a policy. Instead, senior officials have simply remarked that it will be necessary to stop exports of minerals for the time being," the source continued.

Some crafty business cadres raised the possibility of using sea-routes to smuggle the product in with Chinese foreign traders, but their Chinese counterparts rejected such proposals. Some North Korean merchants have posited, Maybe they're playing hardball to get us to lower prices to rock bottom?    

China participated in United Nations sanctions after North Koreas first, second, and third nuclear tests, she explained, but there was no special impact on trade. North Korean cadres expected that this time around would be no different and that the efficacy of the sanctions would eventually fizzle and fade to nothing. 

North Korean traders therefore expected no significant difference as they sent mineral exports through the North Korean border town of Sinuiju into the Chinese city of Dandong. They were in for a surprise when the door was slammed shut. The regime has yet to come up with an effective countermeasure or policy response, which cadres take as a sign that the road will open up again in the near future, according to the source.

Across the board, there are expectations of "short-term export restrictions," but some have voiced concerns that the restrictions might become long term. If developments continue down this road, the military foreign-currency earning enterprises and North Korean authorities who have been making a handsome profit on mineral exports are going to be given a significant blow. 

Coal and mineral exports have been an important source of funding for the Korean Workers Party. Kim Jong Un needs foreign currency to prepare for the upcoming 7th Party Congress and companies need foreign currency in order to issue the bribes that guarantee their survival. This turn of events comes as bad news to all of them. This might force authorities to turn to other sources of funding in order to ready for the 7th Party Congress, including perhaps illicit methods such as the smuggling and selling of illegal drugs, she said. 

If the long-term export restrictions bankrupt the mineral companies, many innocent workers will lose a source of income. Merchants and residents connected to the export companies in various ways will struggle to find new jobs. Kim Jong Un cannot discount the resentment that this will cause. 

On March 2, the United Nations Security Council unanimously adopted a resolution which enacts strong sanctions requiring that all cargo exported from and imported to North Korea be inspected. The resolution also bans the export of jet fuel, blocks the trade of minerals, freezes financial assets, and restricts the trade of luxury items, etc. 

*Translated by Jonathan Corrado

 
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