China slams 'wrong' US sanctions on N. Korea-tied traders

by Julien Girault with Dave Clark in Washington
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New US sanctions on North Korea ships, Chinese traders

New US sanctions on North Korea ships, Chinese traders

Beijing (AFP) - China on Wednesday rejected new United States sanctions targeting Chinese traders doing business with North Korea as "wrong", stressing that it has enforced UN sanctions over Pyongyang's nuclear provocations.

The Chinese companies were hit by punitive measures along with North Korean shipping interests after US President Donald Trump put Pyongyang back on a list of state sponsors of terrorism.

Trump warned this week that the sanctions announcement would be the first in a series of moves over the next two weeks that would reinforce his "maximum pressure campaign" against Kim Jong-Un's regime.

As had been expected, the US Treasury Department's measures unveiled on Tuesday make use of existing US directives against North Korean trade, but expand their scope to take in more companies and individuals.

Most importantly, they expand the list of Chinese firms accused of doing business with the North despite promises from Beijing that it will honour UN-backed punitive measures.

"We consistently oppose any country adopting unilateral sanctions based on its own domestic laws and regulations and the wrong method of exercising long-arm jurisdiction," foreign ministry spokesman Lu Kang told a regular news briefing.

Trump met China's President Xi Jinping earlier this month and is bullish about the US-China relationship, but concerns remain that Beijing is not ready to take tough measures against Kim.

"China has been comprehensively respecting and strictly implementing (UN) Security Council resolutions and our efforts on this regard are witnessed by all," Lu said.

The spokesman called on Washington to provide "any solid evidence" that Chinese companies have violated the UN sanctions.

He said that if any companies or individuals have violated domestic laws, "we will severely deal with that in accordance with our laws and regulations".

- 'More should be done' -

While China has backed the UN measures, it has been reluctant to take the more drastic step of cutting off oil supplies through a pipeline to North Korea's lone refinery, fearing that regime collapse could lead to chaos on their common border.

And, according to US officials, some Chinese-based banks and trading firms continue to do business with the North in defiance of UN sanctions and US threats of unilateral measures.

China has pressed for dialogue, saying this week that "more should be done" to hold talks to resolve the crisis.

A Chinese special envoy also wrapped up a four-day trip to the North on Monday, during which the two sides discussed regional concerns but made no direct statements about the nuclear standoff.

Beijing has pushed for a "dual track approach" which would see the United States freeze its military drills in South Korea while North Korea would halt its weapons programs.

Washington has rejected that approach.

US Treasury Secretary Steven Mnuchin said the sanctions would not only increase Pyongyang's isolation but also expose "its evasive tactics."

"These designations include companies that have engaged in trade with North Korea cumulatively worth hundreds of millions of dollars," Mnuchin said.

"We are also sanctioning the shipping and transportation companies, and their vessels, that facilitate North Korea's trade and its deceptive manoeuvres."

In all, the new measures add one individual, 13 trading entities and 20 ships to US sanctions lists.

Any property or assets of the firms involved found to be in areas under US jurisdiction are to be frozen, and Americans are banned from trading with them.

Three Chinese firms -- Dandong Kehua Economy and Trade, Dandong Xianghe Trading Company and Dandong Hongda Trade -- are said to have sold computers, minerals and ore to North Korea.

Chinese businessman Sun Sidong and his company Dandong Dongyuan Industrial are accused of exporting vehicles, machinery, radio navigation and "items associated with nuclear reactors."

- 'We suspended trading' -

A woman who answered the phone at the company said it was not doing business with North Korea and suggested that the firm had halted its operations.

"We are not operating," she said.

Another woman at Dandong Kehua Economy and Trade denied knowing about the sanctions.

"We have temporarily suspended (trading)," she said.

In addition to slapping sanctions on the firms and North Korean ships, the Treasury added the Korea South-South Cooperation Corporation to its sanctions list.

The firm is alleged to have sent North Korean guest workers to China, Russia, Cambodia and Poland. Foreign workers are a major source of income to the regime.

The White House has said it will not tolerate the North's testing or deployment of an intercontinental ballistic missile capable of carrying a nuclear warhead to US cities.

Experts believe Pyongyang is within months of such a threshold, having carried out six nuclear tests since 2006 and test-fired several types of missiles, including multi-stage rockets.

Despite Trump and Kim's belligerent rhetoric, US officials say their main goal is for Pyongyang to back down and agree to discuss disarmament.