On July 13, Senator Cory Gardner, chairman of the Senate Foreign Relations Subcommittee on Asian and Pacific Affairs, introduced the North Korean Enablers Accountability Act, which will ban groups and companies conducting commodity or service transactions with North Korea from using the U.S. financial system. Here’s Cho Bong-hyun from the Industrial Bank of Korea Research Institute to explain the strong sanction against North Korea.



The act may serve as a basis to impose the so-called secondary boycott on companies involving North Korea’s nuclear and missile development and human rights abuses as well. Although it is Washington’s own sanction measure, the act is especially aimed at Chinese firms doing business with North Korea in a move to block their financial transactions with the North and eventually cut off North Korea’s access to hard currency.



The act specifies 10 Chinese companies that conduct a lot of trade with North Korea. It marks the first time that the U.S. Congress has identified particular Chinese firms while introducing an act related to sanctions on North Korea. They are importers of goods such as coal and iron from North Korea. It is assumed that the Chinese trade firms have circulated North Korean coal, which is banned by the U.N. Security Council, in the Chinese market. Meanwhile, Japanese newspaper Yomiuri Shimbun reported on July 15 that the Trump administration started an investigation into a Chinese trading company. The U.S. is expected to impose financial sanctions on the company if it secures evidence of illicit business between the company and North Korea. On July 14, the U.S. House of Representatives passed a bill to crack down on Chinese telecommunications firms that support North Korean cyber attacks. Late last month, the U.S. Treasury Department labeled China’s Bank of Dandong as a money laundering concern, as the bank was suspected of acting as a channel for illicit North Korean financial activity. In September last year, the Obama administration slapped financial sanctions on Dandong Hongxiang Industrial Development, a Chinese firm suspected of doing illegal trade with North Korea, and indicted the company’s chairwoman, Ma Xiaohong. In this way, the U.S. has been placing pressure on China in a bid to prevent North Korea’s provocations.



Despite the fact that the U.N. Security Council has imposed strong sanctions on North Korea, the communist nation continues with provocations, including its recent launch of an intercontinental ballistic missile. The U.S. believes that China is responsible for that, since China accounts for nearly 90 percent of North Korea’s foreign trade. The U.S. is urging Beijing to join the sanctions more actively because international sanctions will only have limitations without China’s participation. It seems the U.S. is using the secondary boycott measure for now. But it will likely come up with even stronger measures to prompt China to join the sanctions aggressively so Beijing can discourage Pyongyang from developing missiles and nuclear weapons, and elicit a change from the North. That’s the main purpose of Washington’s pressure on Beijing.



Conflict between the U.S. and China intensified when the U.N. Security Council convened an emergency meeting in the wake of Pyongyang’s Hwasong-14 intercontinental ballistic missile, or ICBM, test on July 4. While discussing additional sanctions on the North, the U.S. and China engaged in a fierce war of nerves over China’s suspension of oil supply to North Korea. With the two sides failing to find a compromise, the U.S. has decided to take measures against Chinese firms doing business with North Korea. The prospects for future U.S.-China relations are not very bright.



While China joins the U.N. sanctions on North Korea, it is opposed to Washington’s unilateral sanctions on the North because the sanction measures are mostly targeting Chinese companies. China believes that it is inappropriate for the U.S. to impose direct sanctions on Chinese entities. The U.S. is stressing China’s role when it comes to North Korea’s nuclear and missile development, while China is against too much pressure on the North. The U.S.’s secondary boycott on Chinese enterprises comes at this time, and bilateral conflict is showing signs of expanding.



The U.S. prevents its companies and individuals from trading with North Korea, but the measure proved to be ineffective because there are no trade activities or financial transactions between the two nations. Therefore, the U.S. has expanded the sanction list to include companies and individuals in third countries, with Chinese people and entities subject to the sanctions. Attention turns to how Washington’s crackdown on Chinese firms may evolve.



Ten Chinese companies are now on the sanction list, but the U.S. is expected to continue to use the secondary boycott on not only companies but financial institutions involved in business dealings with North Korea. The measure could expand to other countries, including Russia, to cut off North Korea’s cash flows. The additional measures may not produce visible results in the short term, but the international community needs to make consistent efforts to find a breakthrough in the North Korean nuclear issue. Tougher sanctions might be an option. International cooperation will be important to resolve the nuclear issue in a fundamental way and promote a change in North Korea.



South Korea, for its part, needs to devise a well-thought-out strategy aimed at gaining an independent voice in the diplomatic arena.



If the past is any guide, when the U.S. and China were in good relations, the Korean Peninsula was also stable. But the worsening relations between the two powers would increase the geopolitical risks on the divided peninsula. In this sense, it is important to restore their relations for now. South Korea finds it necessary to join the strong international sanctions on North Korea in response to Pyongyang’s nuclear and missile provocations. At the same time, it also needs to seek inter-Korean dialogue and cooperation in order to manage North Korea stably and improve bilateral ties. Seoul should deal with relations with China cleverly to induce Beijing to deter Pyongyang’s provocations. Based on the solid South Korea-U.S. alliance, Seoul should also cooperate with the international community to facilitate a change in North Korea. In brief, South Korea should mobilize the various possible means available.



Since North Korea’s ICBM test early this month, the U.S. and China have been in a war of nerves over additional sanctions on the North. It remains to be seen whether and how the two sides may find some common ground.



[Interview] Self-support Center for N. K. Defectors



On July 11, a self-support center opened in Sanggye-dong, Nowon-gu District in northern Seoul, with the purpose of helping North Korean defectors, especially those who belong to vulnerable groups, lead independent lives. Let’s meet with Sohn Kwang-joo, president of the Korea Hana Foundation, who attended the opening ceremony of the new center.



For North Korean defectors who have to resettle in South Korea, the most important thing is to find a job. The Korea Hana Foundation puts top priority on their employment. We wondered how to help out the elderly and the disabled, who generally find it challenging to get jobs, and we came up with the idea of opening this center.



The new self-support center is the second of its kind, following the one that opened earlier this month in Geumcheon-gu District in southwestern Seoul. Female and disabled North Korean newcomers aged over 65 who do not engage in economic activities are eligible for the programs offered by the center.



I’m almost 80 years old now. I hope to work and have a good time here for the rest of my life. This is a great resting place.



Like other defectors, I came to South Korea in search of freedom after going through many difficulties. We’re happy to be able to work here. It is impossible to get jobs in North Korea.

The center is also for single-parent families, like my family. Working together with senior citizens here, I can release my stress. I’m firmly determined to work hard, earn money, and raise my children well.



Currently, some 17 people are participating in the work program at the center, working six hours a day, five days a week. Let’s hear from Park Myung-hee, deputy head of the Self-support Department at the Korea Hana Foundation.



These people make boxes or do packing to make some money. Other than that, we also encourage them to take part in a yoga program as part of efforts to help them resettle in South Korea in a healthy and stable way.



An official of the center is explaining to senior citizens how to work. Here’s Park Chan-sik, head of a local firm that offers jobs to people at the center.



I heard many newcomers from North Korea just sit idle because they are unemployed. People here don’t have to be pressed for time while doing this work, and their pay is about average. My company covers the transportation costs. I hope the newcomers, who have lived difficult lives in North Korea, resettle properly and live better lives here. If this work proves to be helpful for them, though only in a small way, I couldn’t be happier.



It’s good for elderly people to participate in the work program and start earning some money. But they are also happy to make friends, to whom they can open their hearts. Here is Seo Yu-jeong, chief of the self-support center, who takes part in the program with her mother.



My mother is old and physically challenged. She feels bored and depressed from time to time, but she is reluctant to go out because of her disability. But she likes to talk about her hometown with people here. While working, they laugh a lot and even dance together. They have a really good time here. For them, it’s nice to earn money, of course, but it’s also wonderful to have fun while working and share their pain and sorrow with each other. In the process, they feel their pain is being healed. This is one of the good things about the program.



The self-support center is designed to assist the newcomers in their financial independence and stable resettlement. Having this purpose in mind, the Korea Hana Foundation plans to carry out its leisure programs and psychological counseling service in cooperation with local communities. Here again is Ms. Park.



We’ll encourage the newcomers to receive regular medical check-ups at local health centers. They are not familiar with South Korean society, so we’ll motivate them to join cultural activities and learn important social skills as well. We’ll also provide the yoga program on a quarterly or weekly basis to help them train the body and mind. The purpose of the center is to give support to the newcomers with these programs



Based on the experience of running the self-support center, the foundation is considering opening many more similar centers across the nation. Let’s hear again from Ms. Park.



We are aiming to open six more self-support centers by next year in regions where many North Korean expats live. The purpose, of course, is to provide useful programs tailored to the newcomers so they can adjust to South Korean society appropriately.



While mingling with their fellow defectors and sharing their stories with one another, the elderly people from North Korea find themselves missing their families in the North even more. And their wish for a unified Korea grows stronger.



I’ll save money little by little and give it to my grandchildren after Korea is unified, although it might only be a small amount of money. I would feel great and proud of myself if I show them that older people like me can make money and live well in South Korea.

When I get paid, I’ll donate the money to neighbors in need. Travel? I’ve already made a trip, as I came all the way to South Korea. If I make money, I hope I can help out those in need.

I wish I could give my entire salary to my first son in North Korea. Whenever I eat well and wear nice clothes here, I think of my precious child. I think I’ll miss my son until I die.



Here’s hoping that the self-support center will fulfill its goal successfully so North Korean defectors will all be able to smoothly settle in South Korea.