Shining a Light on North Korea’s Illicit Shipping and Sanctions Evasion Practices

Lee Kok Leong, our special correspondent, interviews Mathew Ha, research analyst at the Foundation for Defense of Democracies, on Pyongyang’s illegal maritime tactics to evade sanctions. The Foundation is a Washington DC-based nonprofit, nonpartisan research institute focusing on foreign policy and national security. Mathew’s research includes North Korea’s illicit financing, human rights, the U.S.-Korea alliance, and inter-Korean relations.

As 90 percent of global trade involves maritime transportation, North Korea is constantly seeking new ways to exploit this global supply chain for its benefit, with proceeds going towards advancing the country’s nuclear and missiles production, funding the lifestyles of elites, propping up the economy, and for personal gains. As Pyongyang sees these streams of revenue as vital to its survival, the regime has developed a number of novel but illegal tactics and a complex web of entities to enable it to evade the sanctions imposed by the UN and US.

Maritime Fairtrade (MFT): What are the various North Korean maritime tactics designed to evade US/UN import and export sanctions?

Foundation for Defense of Democracies (FDD): The various maritime tactics employed by North Korea includes frequent changes to the identity of vessels by flying foreign flags of convenience, frequent changes to the names of vessels as well as frequent changes to vessel ownership and management.

However, more recently, other tactics that have become more frequent include manipulation of the automatic identification system (AIS) used to show where vessels are travelling. AIS manipulations allows vessels to avoid detection in order to travel to ports or meet other ships to conduct transactions.

Additionally, ship to ship transfers, which are now banned by UN Security Council resolution 2375, continues to be a common tactic. There have been several accounts provided by the governments of Japan, the US, Australia, and several others of North Korean ships transferring sanctioned goods, such as oil and coal, to other ships that would travel then to ports to offload this cargo. The UN Panel of Experts also included this evidence in its most recent report.

In addition, this same report by the UN Panel revealed a new tactic for North Korean maritime tools. Specifically, North Korea have now been using new larger barge and bulk-carrier vessels to reduce the number of trips, conduct direct delivery services, and potentially to even reduce the need for ship-to-ship transfers. However, this new development does not mean the North Koreans will stop conducting ship-to-ship transfers of sanctioned goods, according to the Panel’s evidence in its latest report.

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