Published: Sat, September 23, 2017
World | By Paul Elliott

China's August trade with North Korea surges after United Nations sanctions

China's August trade with North Korea surges after United Nations sanctions

He added: "Of course, it's going to take months for the impact of these sanctions to be felt, but certainly banning imports of North Korea textiles will hurt the regime because textiles provides what the regime really needs most right now, which is hard currency".

China accounts for some 90 per cent of the North's trade, making its cooperation critical to any efforts to derail Pyongyang's development of nuclear weapons and long-range missiles. The BBC estimates the textile ban will cost the North more than $700 million per year. Beijing has already cut off purchases of iron ore, coal, seafood and other goods.

Refined oil exports to North Korea from all United Nations members is capped at 500,000 barrels from October 1 to the end of the year and 2 million barrels annually from January 1, 2018. The sale of natural gas will be prohibited and refined petroleum sales will be capped at 2 million barrels annually.

The sources said lenders were asked to fully implement United Nations sanctions against North Korea and were warned of the economic losses and reputational risks if they did not do so. The country also has tested more than a dozen missiles this year, some of which have flown over Japan - a strong US ally.

Tensions have been mounting on the Korean Peninsula as Pyongyang continues its missile and nuclear tests and the USA and its regional allies - South Korea and Japan - are holding drills in the area.

The measures follow an escalating war of words between North Korean leader Kim Jong Un and U.S. President Donald Trump. Kim had called Trump a "mentally deranged USA dotard" a day earlier after Trump said Washington would "totally destroy" North Korea if it threatened the United States or its allies.

The North Korean leader earlier labelled Mr Trump "mentally deranged" and a "dotard" while Mr Trump labelled Mr Kim a "madman" in response.

The U.S. put its own sanctions on North Korea on Thursday, against banks or companies doing business with the country.

And it's possible that North Korea is able to undermine them. US Treasury secretary Steven Mnuchin also said banks doing business in North Korea would not be allowed to operate in the United States.

The Chinese Commerce Ministry said it would ban exports of condensate and liquefied natural gas to North Korea and limit textile imports from the North, starting 12 a.m. Saturday.

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