By Kang Seung-woo
Some Chinese banks operating near the border with North Korea have frozen bank accounts held by North Koreans, by suspending deposit and transfer services, according to a media report Monday.
Among the banks is the Industrial and Commercial Bank of China (ICBC), the country’s largest bank.
If the report from the Donga Ilbo is correct, the banks’ moves contrast with the Chinese government’s negative reactions to the international community’s actions to impose additional sanctions on Pyongyang for its recent provocations that violated United Nations’ (U.N.) resolutions.
However, the South Korean foreign ministry said it was unable to confirm the report, adding that it was closely monitoring relevant Chinese moves.
“ICBC has suspended all deposits and transfers of all currencies, including the Chinese yuan and the U.S. dollar, of its North Korean bank accounts,” the newspaper reported, citing an employee from the ICBC Dandong branch.
Dandong in Liaoning Province, linked to the North Korean city of Sinuiju through a single-track rail bridge, serves as the major conduit for nearly three quarters of all trade between the two countries.
Citing a Chinese businessman who imports North Korean minerals, the report also said another Chinese bank stopped taking deposits and conducting transfer services for the accounts held by North Korean nationals.
The U.N. Security Council is debating a fresh resolution to impose harsher sanctions on North Korea in response to its Feb. 7 rocket launch and Jan. 6 nuclear test, and the punitive actions are expected to focus on blocking trade and further squeezing the North’s finances.
As a result, the Chinese banks are believed to have taken such measures to manage potential risks in advance.
In addition, last week, U.S. President Barack Obama signed into law a package of tough sanctions on North Korea calling for imposing mandatory sanctions on those assisting the repressive state over its nuclear and missile programs, cyber-attacks, human rights abuses and import of luxury goods.
It is also aimed at choking off sources of cash for the regime by sanctioning trade in coal, minerals and precious metals, and blacklisting those helping with Pyongyang’s money laundering, counterfeiting, cash smuggling and narcotics trafficking.
“Chinese companies engaging in mineral trade and other embargoed goods with North Korea are expected to be hit hard when the U.S. sanctions take full effect,” another Chinese trader told the newspaper.
“Many businessmen here are concerned about whether their trade partners in the United State, Europe and South Korea will block their imports because their products are made by North Korean workers,” the trader said.
An official of the Ministry of Foreign Affairs said, “The South Korean government will continue to call on China to play a constructive role in helping North Korea make the right decision.”