Three S.Korean firms imported N.Korean coal in breach of sanctions

This file photo taken on November 21, 2017 shows a general view of North Korean coal piled up on a dockside at the port in Rason. (AFP)
Updated 10 August 2018
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Three S.Korean firms imported N.Korean coal in breach of sanctions

  • Three South Korean firms imported coal from North Korea disguised as Russian products in violation of UN resolutions
  • The customs service did not identify the companies involved, but said about 35,000 tons of coal was brought into South Korea

SEOUL: Three South Korean firms imported coal from North Korea disguised as Russian products in violation of UN resolutions in a fresh sign of loosening sanctions, South Korea’s customs agency said on Friday.
Seoul has been examining nine cases of potential imports of North Korean coal, which would breach a resolution passed last August by the UN Security Council to choke off funding for Pyongyang’s nuclear and ballistic missile programs.
The customs service did not identify the companies involved, but said about 35,000 tons of coal was brought into South Korea between April and October in 2017, worth 6.6 billion won ($5.8 million).
“The firms appear to have illicitly brought it in expecting big trading margins after prices of North Korean coal had dropped due to the import ban,” Roh Suk-hwan, deputy commissioner of the Korea Customs Service, told a news conference.
The agency said it would press charges against the firms and individuals involved for violating the customs law and forgery of private documents.
The government also plans to explore an entry ban or seizure of the 14 ships found to have transported the coal, the agency said.
But there was no financial transaction made, which would constitute another violation of the UN sanctions, as the companies took coal in return for mediating trade between North Korea and Russia, Roh said.
The UN Security Council banned North Korea’s sale of coal, iron, iron ore, lead, lead ore and seafood in a bid to slash by a third the country’s $3 billion annual export incomes, while capping imports of crude oil and refined petroleum products.
The United States has led the sanctions campaign to press North Korea to give up its nuclear and missile programs.
But across the region, there have been signs that US President Donald Trump’s campaign for “maximum pressure” lost steam after Pyongyang sought to improve relations with Washington, Seoul and Beijing.
North Korean officials have toured China to discuss economic development and speculators are snapping up property along their common border. And South Korea is studying ways to boost engagement with the North.
Last month, Washington warned against loosening sanctions on Pyongyang after Russia and China suggested discussing such a move.


World’s biggest sovereign fund worried about trade wars

Updated 54 min 39 sec ago
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World’s biggest sovereign fund worried about trade wars

  • The fund posted a positive return of 1.8 percent, or 167 billion kroner ($19.8 billion), in the second quarter
  • Markets are worried about a trade dispute between the United States and China

OSLO: The managers of Norway’s sovereign wealth fund, the world’s biggest, expressed concern Tuesday about global trade tensions, which could heavily impact its value.
The fund posted a positive return of 1.8 percent, or 167 billion kroner ($19.8 billion), in the second quarter, helping erase a loss of 171 billion kroner in January-March that was attributed to a volatile stock market.
The Government Pension Fund Global, which saw its total value swell to 8.33 trillion kroner by the end of June, manages the country’s oil revenues in order to finance Norway’s generous welfare state when its oil and gas wells run dry.
But Norway’s central bank, which runs the fund, said geopolitical and trade tensions presented a risk.
“It’s fair to say that increased trade barriers or even trade wars will not be beneficial for the fund as a long-term global investor,” Trond Grande, the deputy chief of Norges Bank Investment Management, told reporters.
Markets are worried about a trade dispute between the United States and China. Accusing Beijing of unfair competition, the US administration is considering slapping a new round of levies worth $200 billion on Chinese goods.
Talks between the two slated for Wednesday and Thursday aimed at resolving the dispute have however eased concerns somewhat.
Following US-Turkey tensions that sent the Turkish lira and the Istanbul stock market tumbling, the Norwegian fund said its assets there were worth less than the 23 billion kroner they were at the beginning of the year.
“We’ve seen the market rise for a long time, that there are different political and geopolitical events in the world that can affect the market, and we have to be prepared for the fact that (the value of) the fund can go down a lot,” Grande concluded.
The fund’s strong second quarter was attributed primarily to its share portfolio, which accounts for 66.8 percent of its investments and which rose by 2.7 percent.
Real estate holdings, which account for 2.6 percent of its holdings, rose by 1.9 percent, while bond investments, which represent 30.6 percent, remained flat.
Faced with falling oil revenues in recent years, the Norwegian government has been tapping the fund to finance public spending since 2015. But with oil prices recovering, the fund registered its first inflow in three years in June.