North Korean Trading Firms Forge Papers to Move Banned Exports

Pyongyang dodges UN sanctions by declaring that coal and other goods come from Russia and China, sources say.

North Korea is seen across the Yalu River from the Chinese port of Dandong, Feb. 8, 2017.

North Korea is using false documents to move coal and minerals recently barred for export under U.N. sanctions, often with the help of trading firms based in China and Russia, sources say.

The sanctions, imposed in August by the world body to punish North Korea for its nuclear weapons and missile tests, prohibit the country from exporting coal, iron, seafood, and other goods, but much is still being sold abroad to earn foreign cash, sources say.

“Trading firms recently began to export coal and minerals using Chinese or Russian cargo ships,” an executive of a company based in North Korea’s North Hamgyong province, bordering China, told RFA’s Korean Service.

“Other countries won’t accept North Korean minerals now, so they are exported using forged papers showing a different country of origin,” RFA’s source said, speaking on condition of anonymity.

Loads of coal and other goods coming from North Korea are now unloaded from North Korean ships in Chinese ports such as Dandong, and from there they are exported again to Southeast Asian countries with papers showing they have come from China, the source said.

North Korean firms using the false documents include the Daesong Trading Company, the Chilsong Company run by the North Korean military, and the Myohyang Company run by North Korea’s Office No. 39, which raises money for the regime of national leader Kim Jong Un, the source said.

“There are many illegal trading firms in China and Russia helping them,” he said.

Speaking separately, a second source in North Hamgyong confirmed the practice, saying, “It is common now for foreign-currency-generating firms that export goods to Russia to fabricate certificates showing country of origin.”

“Much of the coal that used to be exported to China is now being sent to Russia, where it is turned into ‘Russian origin’ coal and is then re-exported to other countries,” the source said, also speaking on condition he not be named.

Russian and Chinese trading firms help in the effort to deceive customs officials by using their own ships and by re-certifying the origin of sanctioned goods, the source said.

“Local trading partners are deeply involved in each step of the process,” he said.

Reported by Jieun Kim for RFA’s Korean Service. Translated by Leejin Jun. Written in English by Richard Finney.