King's College London

• The presence of extensive procurement networks in the Chinese border regions are significant to both North Korea’s economy and support to its military-related programmes, including WMD.
• It is assessed that North Korea employs a covert system in its attempts to prevent the activities between North Korea-based entities and suppliers being identified.
• The majority of those entities identified in the China border regions were located in Dandong, although significant numbers were also identified in Dalian and Shenyang. The research to date also found potential presence of North Korean-associated companies in other locations within the Chinese border provinces.
• Within the cities of Dandong, Dalian and Shenyang many of the entities were found to be collocated suggesting centres for North Korean-related trade, and close proximity to logistic centres.
• The nationality of the majority of people identified and associated with the entities in this report are assessed to fall into three basic categories;
  • Chinese (citizens) business people who trade with North Korean.
  • Ethnic Koreans of which there are over 2 million who are Chinese citizens living in the border provinces of Jilin, Liaoning and Heilongjiang.
  • North Korean persons living and/or working in the border regions within China.
• From open source information this study has identified a large number of networks/groups that North Korea could potentially use in support of proliferation-related procurement. However, this is considered to be only part of the potential number of entities that exist.
• Most of the entities/companies included in international sanctions lists are based in North Korea. So far, of the entities and people identified in this study only two appear in any sanctions list, these being;
  • Korea Ryonha Machinery Joint Venture Corporation (UNSCR 1718)
  • Dandong Hongxiang Industrial Development Company Ltd. (US)

• A number of companies and individuals identified have been included in UNSCR 1718 PoE reports with the assertion that they have aided North Korean proliferation activity, but have not been included in any sanctions list.

Although this initial study has not identified any new policy recommendations, it has shown that the extent of the problem is potentially far greater than many have previously considered. To have effective sanctions against North Korean proliferation activity cooperation with, and support to, Chinese authorities should be considered.