Congress seeks to deny NK partners to US financial system

The US Congress is pushing for a bill intended to block companies with North Korea ties from using the American financial system amid growing calls for secondary sanctions against entities in China and elsewhere that may assist with Pyongyang’s nuclear and missile programs.

The bipartisan bill was introduced Thursday by Republican Senator Cory Gardner, who chairs the Senate Foreign Relations Subcommittee on East Asia. He has been urging the UN Security Council to impose a “complete economic embargo” requiring all member nations to cut off all finance and trade with the North, with a few limited humanitarian exceptions. 

The text calls for kicking out from the US banking system the businesses and financial institutions involved in a significant amount of trade in goods and services with the communist state, barring all North Korean-made products from entering the US market, and sanctioning all firms engaged in labor exports. It also seeks to blacklist the top 10 Chinese importers of North Korean items.

“I’m introducing a legislation that will create a global embargo against North Korea to shut off access to the US financial systems and the systems and sources of trade that wish to continue to do business with North Korea,” Gardner said in a statement.

The bill is meant “to stop North Korea and prevent nuclear war,“ he said, pointing to recent news reports on an increase in China’s trade with its wayward, isolated neighbor despite the UNSC sanctions.

“My bipartisan legislation gives those that currently conduct trade with North Korea a clear choice -- either do business with this heinous outlaw regime or do business with the world’s leading economic and military power,” he added.

The US is also planning to impose new sanctions on Chinese firms and banks continuing to carry out deals with Pyongyang, Reuters reported on Thursday, citing top senior US officials.

The new measures would target Chinese small-and-medium sized financial institutions and shell companies suspected of “funneling cash” into Pyongyang’s nuclear and missile programs. The officials declined to name the target but said larger Chinese banks will remain untouched for now.

US President Donald Trump has been openly expressing disappointment over China’s lukewarm stance in curbing its economic trade with North Korea, which reportedly grew almost 40 percent in the first quarter from a year ago, raising the possibility for broader secondary sanctions.

The Trump administration has already slapped sanctions on two Chinese citizens and shipping firms accused of partnering up with Pyongyang while designating the Bank of Dandong as a money laundering concern.

By Jung Min-kyung (mkjung@heraldcorp.com)