After North Korea's largest-ever test of a nuclear device in early September, the United States is taking an unprecedented hardline stance to curb the reclusive regime's accelerated pursuit of nuclear development.
The U.S. Treasury announced last week that it had sanctioned China's Dandong Hongxiang Industrial Development and four of its executives. The Treasury accused the firm of laundering millions of dollars via U.S. banks for North Korea's Kwangson Banking Corporation, which has already been blacklisted by the U.S. and United Nations for its involvement in the North's nuclear and missile development.
Daniel Fried, coordinator for sanctions policy at the U.S. State Department, indicated at a recent Congressional hearing that more Chinese companies could be under U.S. investigation for suspected breach of North Korean sanctions.
Crackdown on Chinese firm
"We have crossed a line here," said Bradley Babson, former World Bank adviser and chair of the DPRK Economic Forum at the U.S.-Korea Institute at the Johns Hopkins School of Advanced International Studies.
"We are now doing things that we have never done before in trying to chase down the way North Korea tries to evade sanctions," Babson said.
Gordon Chang, an author and columnist who writes extensively on China, said there has been growing frustration within the U.S. government over illicit trade between China and its ally.
"We've been much too tolerant, but nonetheless we are going to see a change in attitude on the part of the administration, which is already starting to manifest itself," Chang said.
Babson said the sanctions are likely to limit Chinese companies — both sanctioned and unsanctioned — from engaging in business activities with North Korean entities.
"Sanctioning means they won't be able to work through the American banking system for their business interests, and I think it would make the business community in China very wary about doing business with North Korea," he said.
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