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US sanctions to hit Chinese companies trading with North Korea

With the sigining of the bill, U.S. sanctions against North Korea are now in effect. It went through both houses of the U.S. government at an unprecented speed.

But why did that happen and how are these sanctions designed to hurt the regime?

Our Kwon Jang-Ho explains.

The North Korea Sanctions and Policy Enhancement Act came into force as soon as President Obama signed the bill on Thursday.

It′s the first bill that targets North Korea specifically and it marks a change of stance from Washington.

Previous North Korea sanctions bills had never made it past both the Senate and the Congress, due to lawmakers looking to encourage negotiations with the communist state.

But North Korea′s recent actions have shifted opinion, and the bill passed through the chambers in an unusually quick fashion, garnering support from both sides of the aisle.

On average a bill takes 4 to 8 months to become law. This bill was signed in 37 days.
 
us sanctions hitting chinese companies

″The speedy process of passing and signing up this resolution reflect the urgency and importance of the issue, North Korea nuclear issue, from the perspective of the United States.″

The sanctions will freeze the assets of anyone under U.S. jurisdiction doing any kind of business related to North Korea′s nuclear or weapons program, or involved in human rights abuses.

But perhaps more significantly is that the sanctions will now carry out secondary boycotts, meaning that the U.S. will also block any businesses and groups that do any trade with the regime in third party countries as well.

The bill has been designed to choke off any outside sources of cash coming into the regime, via such exports of coal, graphite and other mineral resources from the North.

These sanctions are expected to have the biggest impact in China.

Although it is difficult to get definitive numbers, about 90-percent of North Korea′s overseas trade is done with Chinese partners.

Trade between China and North Korea is said to worth about 6-point-8 billion U.S. dollars.

It′s currently hard to say which Chinese companies are currently in business with both North Korea and the U.S. for the sanctions to take effect, but there are precedents.

In 2013 the U.S. government issued notices on five Chinese companies, which had violated U.S. government sanctions on Iran, Syria and North Korea, although which countries the companies were working with were not specified.

Experts say that there is a possibility that China could react in a similar fashion.

″China could do something about the U.S. companies that are involved in weapons trade towards Taiwan. That has been some dispute between the United States and China. China indirectly use that kind of measures, vis-a-vis, the U.S. companies...″

The U.S. sanctions come as negotiations are on-going on a new UN Security Council resolution on North Korea.
China, one of the five permanent members of the council, has expressed its reservations about sanctions on North Korea.

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