US hits Chinese firm with sanctions over North Korea trade

In a move designed to choke-off North Korea's external economic lifeline, the US government targeted 44-year-old Ma Xiaohong and her vast conglomerate based in China's frontier city of Dandong.

The firm, Dandong Hongxiang, and a host of officials are accused of making up a "key illicit network supporting North Korea's weapons proliferation," according to Treasury sanctions tsar Adam Szubin.

Dandong Hongxiang did more than $530 million worth of trade with North Korea between 2011 and 2015, according to a report by the Asian Institute for Policy Studies in Seoul and C4ADS in Washington.

That could have been enough to fund North Korea's uranium enrichment facilities, and to design, make, and test its nuclear weapons, the report said.

Some of the items traded included aluminum ingots, aluminum oxide, ammonium paratungstate and tungsten trioxide, materials used in nuclear enrichment centrifuges and missile design.

US officials said Dandong Hongxiang had acted on behalf of Korea Kwangson Banking Corporation, which has already been blacklisted by the United States and United Nations for its support for North Korea's nuclear and other weapons efforts.

The Justice Department placed three other individuals, Zhou Jianshu, Hong Jinhua and Luo Chuanxu on the sanctions blacklist, banning American individuals or companies from doing business with them.

The department also moved to seize 25 bank accounts controlled by Dandong Hongxiang, on grounds that they "represent property involved in money laundering."

Turning the screw, slowly

The sanctions came after Pyongyang carried out a series of tests on weapons aimed at developing a missile-borne nuclear weapon.

On September 9 North Korea conducted its fifth nuclear test triggering international outrage and threats of still further sanctions against the deeply isolated nuclear-armed country.

US President Barack Obama recently met his Chinese counterpart Xi Jinping in Hangzhou, China and urged stricter implementation of UN sanctions against North Korea.

He later met premier Li Keqiang in New York "and resolved to strengthen coordination" regarding the Korean peninsula, including "invigorating cooperation... in law enforcement channels on North Korea."

Obama's call appears to have been heeded, at least in part.

Shortly after Obama's meeting with Xi, the Chinese authorities also announced they were investigating the company.

Dandong's provincial public security department said it had placed Dandong Hongxiang and its bosses under investigation for "serious economic crimes involved in trade activities."

Ma Xiaohong -- a communist party member -- had been open about her trade with North Korea.

China has been increasingly concerned about Kim Jong-Un's provocations, but has been loath to destabilize the regime.

It fears this could prompt a flood of cross-border refugees and ultimately the prospect of US troops stationed on its border in a reunified Korea.

In 2015 China accounted for more than 90 percent of North Korea's $6.25 billion in total trade, according to figures from South Korea's state-run Korea Trade-Investment Promotion Agency.