The US sanctioned Chinese and Russian entities for helping North Korea cash in on its billion-dollar smuggling schemes

Photo: Getty Images
  • The US sanctioned Chinese and a Russian entities on Wednesday for helping service the illegal cigarette and alcohol trade in North Korea.
  • According to the US Treasury, North Korea’s cigarette smuggling has reportedly netted the Kim regime over $US1 billion per year.
  • Profits from the cigarette trade and other smuggling schemes are said to help fund the country’s missile and nuclear weapons program.

The US sanctioned Chinese and a Russian entities on Thursday for helping service the illegal cigarette and alcohol trade in North Korea that has reportedly netted the Kim regime more than $US1 billion per year.

The US Treasury stated on Thursday that it was targeting individuals and entities involved in facilitating shipments of banned substances to North Korea.

According to the statement, China-based Dalian Sun Moon Star International LogisticsTrading and its Singaporean affiliate SINSMS Pte. Ltd. were said to have worked together to clear the path for illicit shipments of alcohol, tobacco and cigarettes to North Korea, using forged shipping documents.

Russian port service agency Profinet and its director general were also slapped with sanctions for providing services, including the supplying of fuel to North Korean vessels, on at least six occasions.

“Treasury will continue to implement existing sanctions on North Korea, and will take action to block and designate companies, ports, and vessels that facilitate illicit shipments and provide revenue streams to the DPRK,” Treasury Secretary Steven Mnuchin said in the statement.

It added that the $US1 billion per year North Korea is raking in from these activities comes from its massive tobacco racket.

Illegal cigarette sales could help fund the country’s weapons program

Sources told Radio Free Asia in November that there are about 20 joint ventures run by Chinese and North Korean tobacco firms that manufacture tobacco products for sale domestically and across the world through smuggling networks.

Recent studies have shown North Korea has established “sophisticated transnational smuggling networks,” to distribute illicit goods, which provide the regime with the revenue it needs to fund military and weapons programs.

US officials and a high-level North Korean defector who spent years working for what has been described as a regime-connected “slush fund” have said that profits from smuggling go directly into the pockets of the North Korean elite.

Washington has continued to pressure North Korea to give up its nuclear weapons program, and has said that sanctions against North Korea will remain in place until denuclearization has been achieved, much to North Korea’s frustration.

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