China's solar panel vendors shine a spotlight on trade ties to North Korea

Despite the latest bout of UN sanctions, businesses on the border with the Stalinist dictatorship report that commerce continues to flourish

PUBLISHED : Sunday, 20 August, 2017, 2:13pm
UPDATED : Sunday, 20 August, 2017, 9:21pm

Traders from North Korea visit Yuan Huan’s shop in the Chinese border city of Dandong several times a month to place orders, bringing their own translators and wads of cash.

Yuan, manager of Sangle Solar Power, said sales to North Koreans have soared in the past two years. Hers is one of the border businesses still thriving despite growing US pressure for China to limit commerce with the Stalinist regime.

Since North Korea mostly relies on outdated generators, blackouts are common and solar panels are prized for their role as a source backup power.

Researchers at the Nautilus Institute – a think tank based in Berkeley, California – estimated that by the end of 2014, about 2 per cent of North Korea’s population had acquired solar panels.

And despite new United Nations sanctions further narrowing the categories of goods that can be traded with the state this month, solar panels have remained off the growing blacklist.

Yuan’s shop offers a window into how Chinese traders do business with North Korea, a country with few allies and an economy that relies heavily on China’s patronage.

Every day, trucks filled with cargo cross the Sino-Korean Friendship Bridge that connects Dandong to the North Korean city of Sinuiju.

After receiving orders from North Korean customers, Yuan drops off packages at a riverside depot, and a Chinese logistics company takes care of transport across the waterway.

Some of her North Korean customers place orders by phone, but most prefer to make arrangements in person, she said.

“It is actually quite easy for traders to go back and forth. Some buy over 20 units at a time,” Yuan told AFP.

Several North Korean solar energy research and assembly plants have begun operation in recent years, according to domestic media reports, but Chinese panels appear to remain in high demand.

Last year, China exported 466,248 solar panels across the border, according to official figures from Beijing.

China extends ban on imports from North Korea in line with United Nations resolution

On Tuesday China started banning imports of iron, iron ore and seafood from North Korea as it implemented new UN sanctions that could cost Pyongyang US$1 billion per year and were imposed after its two intercontinental ballistic missile tests.

But in Dandong, where some 70 per cent of trade between China and North Korea flows, solar panel merchants remain unfazed.

“It seems that overall, there are fewer North Korean traders coming over recently, but we’re not affected by what’s happening politically,” said Shi Zhiyong, manager of the Huang Ming Solar Power shop.

“In 2009, I started seeing more North Korean traders coming to the store and their numbers have only gone up since,” Shi told AFP.

Both Yuan and Shi said their bestselling items are rooftop units that provide hot water supply. These cost between 2,700 and 14,000 yuan (US$400 and US$2,060).

The purchases by households, offices and factories show that many urban residents have adequate disposable income, Johns Hopkins University researcher Curtis Melvin told AFP.

“Aside from a few high-profile cases, such as the increase in fuel prices in North Korea or temporary suspension of coal exports to China, we haven’t seen much evidence that [previous[ sanctions have had a tremendously negative effect on North Korea’s economy,” Melvin added.

Military action on North Korea is not an option, China tells visiting US general

Sino-US relations have soured as President Donald Trump has pressed Beijing to step up pressure on North Korea, complaining about their continuing trade.

In the first half, trade between China and North Korea increased 10.5 per cent to US$2.5 billion, compared with the same period last year.

The Chinese government has defended its trade with North Korea, noting that the UN sanctions do not apply to all commerce – though AFP journalists recently visited Dandong shops that sold jewellery made with banned North Korean gold.

Shops along Dandong’s waterfront offer North Korean ginseng, dried mushrooms and even dried ants, which are meant to be good for joint pain, according to traditional Chinese medicine.

Marc Lanteigne, senior lecturer at Massey University’s Centre for Defence and Security Studies, said China has frequently “drawn connections between peace-building and combating poverty, and stressed that complete economic isolation of North Korea is both counterproductive and dangerous.”