Chinese Aid to North Korea Uncovered - Gainesville Coins News
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Chinese Aid to North Korea Uncovered

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Chinese Aid to North Korea Uncovered

The U.S. Department of Justice (DOJ) is pursuing charges against a prominent CEO and Communist Party member in China for providing illegal aid to North Korea, which is under heavy international sanctions.

north koreaAs part of these sanctions, U.S. authorities have determined to levy penalties against Chinese companies that deal with the rogue North Korean regime. By holding these foreign firms accountable, the hope is that it will starve the autocratic regime in North Korea of much-needed resources. By most accounts, the citizens of the country are without many basic necessities like electricity or a clean living standard—in addition to lacking most personal liberties and access to unbiased information. The longer this poverty and seclusion continues, the more likely it becomes that Kim Jong-un's infallible leadership will lose credibility with the public.

The accused party, Ma Xiaohong, is not only one of the leading voices of China's only political party, but is also the chief executive officer of Dandong Hongxiang Industrial Development, a major corporation. The impropriety is alleged to have taken place between 2009 and 2015.

As explained by The Atlantic, "The tightening of penalties for those who do business with North Korea comes from legislation passed by Congress this year. It requires the White House to sanction Chinese firms that do business with Pyongyang. In this case, China has already opened an investigation into the company, located north of Dandong city in the country’s northeast."

Xiaohong's company has now been blacklisted by the Treasury Department, which maintains such a list of firms that have run afoul of North Korean sanctions. This measure keeps them from conducting official business with the government, although some clever companies have found ways to skirt the regulations and dupe the government into unwittingly dealing with them. It's one of the many problems the new laws are intended to confront.

In addition, the Justice Department seized 25 separate bank accounts owned by Miss Xiaohong or her firm.

There is an open question about what the response from Beijing will be. As a regional neighbor and fellow communist regime, China has a certain rapport with North Korea. Fairly or not, the People's Republic is seen as the protector and apologist for the dictatorship and its bellicose military ambitions.

china-flag-shanghaiThe U.S. and its allies have openly wondered whether or not China will cooperate with the increasing pressure on North Korea. As a permanent member of the UN Security Council, a position that comes with veto authority, China did approve sanctions against North Korea through the supranational organization. No matter their commonalities, China is understandably worried about the unpredictability of North Korea's leadership.

While these kinds of covert, illicit activities with North Korea are not endorsed by the Chinese government, it's telling that a such a high-ranking official would be implicated in the illegal money-funneling. The scariest part is that North Korea's ambitions for nuclear weapons may have sympathetic ears within the Chinese Communist Party's corridors of power.

 

The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.

About the Author

Everett Millman

Everett Millman

Analyst, Commodities and Finance
Managing Editor

Everett has been the head content writer and market analyst at Gainesville Coins since 2013. He has a background in History and is deeply interested in how gold and silver have historically fit into the financial system.

In addition to blogging, Everett's work has been featured in CoinWeek, Advisor Perspectives, Wealth Management, Activist Post, and has been referenced by the Washington Post.

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