China has closed a North Korean bank’s accounts in a fresh sign that Beijing is becoming increasingly frustrated with the North’s weapons program.
The Bank of China, China’s largest state-owned bank, has shut down all accounts of the North Korean Foreign Trade Bank. The Pyongyang-based institution has been accused of helping to fund the North’s growing weapons program.
All transactions in the accounts have been suspended, but China did not reveal how much money was in the accounts at the time of its closure.
As Pyongyang seeks to further its development of missiles and nuclear weapons, many have accused the Foreign Trade Bank of playing a key role in funding research and testing. Earlier this year, the US Treasury described the Foreign Trade Bank as a “key financial node” to the North Korean regime.
As The Bank of China closes North Korea bank accounts, some argue other banks in the region will feel pressured to suspend accounts held by the Pyongyang regime. Yet Bank of China was always likely to be the first financial institution to do this, says John Park, an expert on Chinese-North Korean relations at Harvard University:
“Bank of China, of all the Chinese banks, has to adhere to international sanctions because they have a reputation to uphold.”
However, Park adds that the move is not as significant as some might think, pointing out that the bank already lessened its dealings with North Korea years earlier. “What would be more substantive,” argues Park, “is if China revokes the work authorization documents for the North Korea state trading companies in China.”
Bank of China’s closure of North Korea bank accounts follows months of bellicose warnings from Pyongyang, including threats of nuclear war against South Korea and the US.
The North’s nuclear launch test in February, the third of its kind in seven years, angered ally China, with Beijing saying it “resolutely” opposed the test. Many politicians have urged Beijing to take more decisive action in its crackdown on the North.