Russia’s direct relations with North Korea have been largely ignored in the West. The West believes that the prime influence in North Korean economic and political affairs has been that of its large northern neighbour, China, and that Russia is primarily interested in political and diplomatic influence and exchanges with North Korea in conferences like the Six-Party talks. These talks, now stalled, were designed to find a solution to the challenges to the world presented by North Korea’s nuclear program and its development of ICBMs. Putin and Kim have now agreed to try and revive them.
The Six-Party Talks were launched in 2003, and were aimed at ending North Korea’s nuclear program through negotiations involving China, the United States, North and South Korea, Japan, and Russia. Despite a number of meetings and interchanges, talks reached a stalemate when Pyongyang walked out of negotiations in 2009 and, a year later, revealed a vast new uranium enrichment facility to visiting U.S. scientists.
In early 2012, under North Korea’s new leader, Kim Jong-un, the North Koreans announced they would suspend nuclear testing and permit international inspectors to monitor the moratorium in exchange for food aid from the United States. That did not last after a North Korean long-range missile launch in late 2012 and a nuclear test in early 2013 reneged on North Korea’s promises. North Korea has been under international sanctions by the U.S. since the late 1950s and, in 1988, the United States added North Korea to its list of state-sponsors of terrorism. The country fell under further pressure with the imposition of additional sanctions by the UN in 2006.
On 21 September 2017, President Donald Trump issued Executive Order 13810 allowing the United States to cut from its financial system or freeze assets of any companies, businesses, organizations, and individuals trading in goods, services, or technology with North Korea. Any aircraft or ship upon entering North Korea is banned for 180 days from entering the United States. The same restriction applies to ships which conduct ship-to-ship transfers with North Korean ships. Treasury Secretary Steven Mnuchin stated that "Foreign financial institutions are now on notice that going forward they can choose to do business with the United States or North Korea, but not both." A statement from the White House said "Foreign financial institutions must choose between doing business with the United States or facilitating trade with North Korea or its designated supporters.”[i]
Despite two well-publicised meetings between Trump and Kim there has not been a lot of progress in resolving the U.S. demand for the total denuclearisation of North Korea nor in reducing or eliminating the severe restrictions enforced against North Korea by the U.S. and some of its allies. In the light of this Putin and Kim have been conducting an unstructured discussion in Vladivostok about how to proceed further in getting sanctions reduced or removed; a subject dear to the heart of the Russians who suffer similar sanctions.
Russia has a far more extensive economic influence on North Korea than is often cited. Before the economic advance of China after its embrace of proto-capitalism, Russia was the main foreign partner of North Korea. In the 1970s and 1980s the Soviet Union accounted for up to 50% of North Korea’s foreign trade. Today, Russia is now responsible for a mere 1.2% of the North’s external trade (which still makes it the DPRK’s second largest trading partner) albeit a very distant second, after China, which holds the unassailable top position with 92.5%.[ii]
According to Federal Customs Service of Russia, “in 2016, bilateral turnover stood at $76.8 million. North Korean exports ($8.8 million) included frozen fish (24.6%), parts and accessories for tractors (22.3%), articles of apparel and clothing accessories (16%), and wind musical instruments (12.4%). Russian exports ($68 million) consisted mainly of bituminous coal (75%), lignite (5%), petroleum oils and gas (4%), as well as wheat (5%), and frozen fish and crustaceans (3%).5 Bituminous coal is an important raw material suited for making metallurgical coke, which is used in smelting iron ore. This type of coal is not found in North Korea, so the DPRK has to procure it from abroad. According to the International Trade Centre data, China had been the main supplier of bituminous coal to the DPRK until 2014, but since 2015, North Korea has received most of its coal imports from Russia (85% in 2015 and 75% in 2016). North Korea runs a chronic deficit in bilateral trade with Russia that is compensated by other economic exchanges, particularly by the exportation to Russia of North Korean labour.[iii]
There is considerable evidence that Russia actually exports a great deal more to North Korea through shipments made through third parties, primarily China. A large volume of petroleum products are shipped from China to North Korea, but the origin of the oil and refined products is Russia. According to Russia’s Ministry for the Far East Development, up to one third of China’s exports to North Korea (roughly $900 million in 2015) was actually made up of Russian-originated goods.6 This indirect trade is mostly constituted by petroleum products. It is estimated that China exports about 500,000 metric tons of crude oil and 270,000 tons of oil products to North Korea each year while Russian-originated oil supplies to the DPRK, mostly gasoline and diesel fuel, are estimated to be within the range of 200,000-300,000 tons per year, which amounts to roughly $200-300 million in the current prices.[iv]
While Chinese oil deliveries to North Korea are made through the state-owned pipeline, the Russians supply petroleum products brought to Primorskiy Krai by the Eastern Siberia-Pacific Ocean (ESPO) oil pipeline’s main terminal near Nakhodka and shipped on small North Korean tankers from Nahodka, Slavyanka, Vostochny and Vladivostok.
These deliveries by small tankers have not always been from Russian ports. Along with these port pickups there are numbers of North Korean registered tankers loading at sea from larger vessels operated by both the Chine PLA and private Russian corporations engaged in sanctions busting. In March 2019 a North Korea-flagged tanker was caught violating UN sanctions as it engaged a ship-to-ship transfer of fuel with an unidentified vessel. The North Korea-flagged tanker ‘Saebyol’, which was transmitting on ship tracking systems as a fishing boat, was spotted alongside a vessel of unknown nationality on the high seas, conducting a prohibited ship-to-ship transfer. The illicit operation was documented by a Royal Navy frigate which was operating in the East China Sea in cooperation with Japan, enforcing the UN sanctions against North Korea.[v]
There has been in place a scheme to integrate the economies of the Tyumen River, which flows through China, Russia and North Korea for twenty years but with little to show for it.
The Tumen River in Hunchun straddles the borders of China, Russia and the DPRK. In 1992, China, Russia, the DPRK, the Republic of Korea (ROK) and Mongolia launched a joint development project in the Tumen River area, a move made to strengthen regional cooperation in the area. It never progressed very far beyond the planning stages. However, the rail links have been improved.
North Korean Foreign Trade Zones
In an attempt to deal with its economic plight, North Korea established a number of trade zones to assist in the expansion of its international trade. These are spread among three regions of the country. The most advanced is the Rason Special Economic Zone, earlier called the Rajin-Sonbong Economic Special Zone. It was established in 1992 by the North Korean government near Rason to promote economic growth through foreign investment; shipping is conducted through the port of Rajin. It is near the border with China and Russia and is a warm-water port for both countries. It is being expanded with new energy supplies from China and fuel deliveries from Vladivostok in Russia.
Although rail is the easiest link for this region the rail system to nearby Russia has suffered from a major impediment. The Korean rail lines are Standard gauge rails of 1,435 mm (4 ft. 8 1/2 in), the same as for China, while the Russian gauge is 1520 mm (4 ft. 11 27⁄32 in). In order to load railcars in North Korea for onward shipment to Russia on the Trans-Siberian Railroad the carriages must be lifted at the crossing, near the Tumen River bridge, and placed on Russian bogies for their onward journey on Russian tracks. The same is true the other direction. Since 2013 the line over the Tumen River to Rajin has been rebuilt with dual gauge track, so that standard gauge and Russian broad gauge trains from the Russian Khasan can access the port of Rajin.
In August 2015 China opened a new rail link with North Korea and a new trade zone on the border
China opened a border trade zone in Dandong early in 2016; the Guomenwan trade zone. The zone was built at a cost of $156 million and covers about 240,000 square feet. Chinese residents living within 12 miles of the border will be allowed to exchange commodities at the zone with North Koreans and no taxes will be levied on purchases of about $1,250 or less a day.
A Russian railway from Khasan in Siberia across the border to Rason began operations in 2014. Shipments have been steadily increasing ever since. The Russians plan to bring more than 1 million tons of coal through here. The appeal of Rason to the Russians is simple: it’s a gateway to Chinese markets. Transhipments of coal through the North aren’t banned under the UN sanctions, and it’s far cheaper to transit Rason than to get coal to the Chinese using other routes or means. Russian and Chinese cargo ships are used because the North doesn’t have any ships built for that purpose that are big enough. Now there are four new ferries plying the Russian-Korean route as it is cheaper than trying to use rail. The ferry service will move up to 200 passengers and 1,000 tonnes of cargo six times a month between North Korea and the Russian port of Vladivostok. There has been a recent steady flow of oil tanker traffic from Vladivostok into North Korean east coast ports.
The DPRK and its Trading Partners
For many nations of the world the problems posed by the DPRK’s international pariah status are viewed as an opportunity rather than an impediment. For some nations, a close working relationship with the DPRK has been nurtured for a long period. In Egypt, for example, there has been a Cairo--Pyongyang axis growing since the days of Nasser when Kim Il Sung sent financial support for the closing of the Suez Canal by Egypt. The DPRK set up an embassy in Egypt in 1961 and offered military and financial support to Egypt in the Six-Day War in 1967 and military supplies to help Egypt and its proxies drive the British out of Aden. In the 1973 war against Israel, Egypt’s senior air force commander, Hosni Mubarak, used North Korean pilots to fly missions in Egyptian aircraft. Mubarak made four visits to Pyongyang from 1983-1990 where he laid the foundation for Egyptian investments in the North Korean economy. “The most striking demonstration of Cairo’s willingness to invest in North Korea was Egyptian telecommunications giant Orascom’s establishment of Koryolink, the DPRK’s only 3G mobile phone network, in 2008. This business deal, which was authorized by Egyptian billionaire Naguib Sawiris, gave Orascom 300,000 new North Korean customers. This deal highlighted the potential for mutually beneficial economic links between the two countries, and Sawiris’s subsequent visits to Pyongyang facilitated further Egyptian investments in the North Korean economy.”[vi] North Korea has been a critical supplier of military technology to Egypt since the 1970s. In 1975, President Anwar el-Sadat authorized the purchase of Soviet-made Scud-B missiles from the DPRK. The North Korean military responded to Cairo’s missile purchase by technologically assisting Egypt’s Scud-B missile production efforts. These Scud-B missile procurements established long-term technical exchanges between to two nations during the late 1990s and early 2000s. Now, with the Iranian progress in producing missiles, Egypt is very anxious to continue to acquire more missile technology from the DPRK which will help it against its main enemy.
Moreover, the indelicate Trump tweet offensive against the Iranian 2015 nuclear deal, the Joint Comprehensive Plan of Action (JCPOA), which may force Iran to drop its participation has made the acquisition of nuclear technology reappear on the technical military horizons of many Middle Eastern States; Egypt among them. Despite U.S. and Russian objections Egypt has not given up hopes to be a nuclear power. Egypt has continued to refuse to accept comprehensive international inspections of its nuclear energy program. This question has been raised by the IAEA’s discovery of highly enriched uranium at Ishas in 2007 and 2008, which occurred despite Mubarak’s rhetorical commitment to a nuclear-free Middle East. Sisi has refused to abandon his close ties with the DPRK and, if the Iranian deal is abandoned, is ready to recommence his own nuclear program.
Egypt is not the only nation in the Middle East with such a fall-back position of engaging with the DPRK if nuclear proliferation becomes an acceptable norm. In 2015 Abu Dhabi purchased USD $100 million worth of weapons from North Korea to use in the war in Yemen (according to a leaked memo from the US State Department.). The deal included a shipment of rockets, machine guns and rifles that were sent to Yemen to support groups loyal to the UAE in the conflict. According to the memo, the US State Department warned Abu Dhabi that North Korea would use the money from its arms deal to finance its nuclear programme.[[vii] The UAE’s covert arms purchases from Pyongyang results from Abu Dhabi’s belief that North Korea is a potentially valuable missile system supplier in the world market and should be deterred from selling sophisticated military technology to Iran and Yemen’s Houthi rebels. As a result of Trump’s inclination to dissolve the JCPOA pact with Iran (which is widely believed to be about to happen) the UAE and other states in the region are preparing for the acquisition of missiles and nuclear technology to counter the expected rush towards competency by Iran, freed of the ICPOA.
North Korea trades with a number of countries which are anxious to retain their link. From 2007 to 2015, the value of annual trade activities between African states and the DPRK amounted to $216.5 million, higher than the average $90 million recorded from 1998 to 2006, Pyongyang has built arms factories in the Democratic Republic of the Congo, Ethiopia, Madagascar and Uganda. It has been contracted to construct military sites in Namibia. This relationship with Namibia led to Namibia being cited as a violator of UN sanctions, Theoretically Namibia halted relations with the DPRK in 2016 but Namibian newspapers bemoan the fact that the DPRK technicians are still there. Officially, the Namibian Government announced that it had terminated the services of Korea Mining Development Trading Corporation and Mansudae Overseas Projects, but was cunning on the wording for relations between the two countries. Korea Mining Development Trading Corporation (KOMID), North Korea's primary arms dealer, is blacklisted under UN sanctions for earning foreign cash through illicit arms trades. Construction company Mansudae is known for having built several state houses, statues and monuments in Africa. In Namibia, they have already built the national history museum and State House, and are busy with the defence headquarters and the shadowy munitions factory. This led to Namibia being accused of violating United Nations sanctions against North Korea. Namibia has already given over N$1,3 billion to North Korea through various construction projects since 2002, and Windhoek seems to remain steadfast in keeping relations with them.[viii]
Police training and leadership-protection courses provided by North Korea have also been popular across the continent, including Benin, Mozambique, Nigeria, and Zimbabwe (best noted for its training of the notorious Fifth Brigade). Pyongyang has also sold ballistic-missile manufacturing lines to Libya, while South Africa intercepted a shipment of weapons from North Korea bound for the Congo in 2009. The ISS reported in Feb. 2016 that Pyongyang was still exporting ballistic missile-related items to the Middle East and Africa. The DPRK has had a long and profitable relationship with Malaysian traders using the company Glocom, which exports DPRK small arms and communications equipment throughout Central Asia and the Middle East. The DPRK has extensive relations with African countries; especially Equatorial Guinea, Angola, DR Congo, and Burundi. The DPRK’s relationship with DR Congo also recently sparked an international controversy when a UN report was leaked on May 16, 2016 revealing that Congo had purchased pistols from the DPRK in 2014 and recruited 30 North Korean instructors to work alongside the Congolese police and presidential guard.
The DPRK has not been restrained from delivering substantial quantities of chemical and biological weapons to countries around the globe. Of particular interest has been the deliveries of chemical and biological agents to Assad’s Syria (in addition to Scuds and surface to air missiles). In a confidential August 2017 report of UN experts to the Security Council the experts reported the delivery of prohibited chemical, ballistic missile and conventional arms by the DPRK to Syria. The report added that this was because of a log-term contract between Syria and the firm, KOMID.
KOMID is the Korea Mining Development Trading Corporation. It was blacklisted by the Security Council in 2009 and described as Pyongyang's key arms dealer and exporter of equipment related to ballistic missiles and conventional weapons. In March 2016, the council also blacklisted two KOMID representatives in Syria. "The consignees were Syrian entities designated by the European Union and the United States as front companies for Syria's Scientific Studies and Research Centre (SSRC), a Syrian entity identified by the Panel as cooperating with KOMID in previous prohibited item transfers," the UN experts wrote. SSRC has overseen the country's chemical weapons program since the 1970s. Although the bulk of DRPRK trade is with China, there are a number of other countries with which it trades less clandestinely.
Why Kim Needs the Russians
In the period when Kim was having his “love fest” with Trump the Chinese were as accommodating to the North Koreans as possible. As a price for their assistance, China demanded a series of reforms in North Korea; reforms which didn’t take place or were suspended. In March 2019 North Korea resumed work on nuclear and missile facilities. Worse, greater scrutiny of satellite photos revealed additional nuclear and missile development sites that North Korea never admitted it had. America, and their allies (South Korea and Japan) now have more reason not to trust North Korea.[ix] This distrust made it more difficult for North Korea to appeal to South Korea to rescue them from both the US and the Chinese (who were negotiating a new trade deal with the US and the removal of tariffs.). North Korea found that it had few options. They decided that their only possible saviour would be Russia, particularly when it came to smuggling.
Putin was happy to agree a meeting with Kim,, but has very little more it can do to assist. Russia operates under relatively severe international sanctions right now and is attempting to carve a greater role for itself as an arbiter in the Middle East; along with efforts in Venezuela and Africa. It doesn’t want to antagonise the West further with any overt actions which could directly help North Korea. It will expand its North Korean trade through the new southern transport corridor from Primorsky Krai; it will call for the resumption of activities in the Tumen River Basin, the resumption of the Six Nation discussions, etc. These are small enough not to raise the level of defiance by Russia with China by arranging for North Korea what China has refused to do itself. Russia will assist but not enough to save the North Koreans from serious food and other shortages.
What Is the U.S. Reaction?
At the moment, the U.S. has little to fear from Russia and North Korea working together more closely than before. There is little they can achieve of value but the possibilities of propaganda campaigns are extensive. As in many other aspects of Russian foreign policy what is actually achieved and celebrated is far less than the reality. Russia has survived on bluff and bluster for centuries. There are few Russians who actually believe what their government says (a lot like the U.S. and its leaders).
What is most amusing is that the Russians and the North Koreans are holding their talks in the city of Vladivostok. Vladivostok is where the headquarters of the U.S. Expeditionary Force of 8,000 men were sent to help remove the Czech Legions trapped behind in the Russian Civil War. The buildings they are in seem to be the same buildings occupied by the U.S. Army. This is a history not usually taught in U.S. schools.
After the Bolshevik Revolution and the displacement of the Menshevik Government in early 1918, and despite the peace treaty with Germany that ended the war in the West, the Russian Civil War continued across the rest of Russia. The Red Army fought the White Army throughout former imperial Russia. A large military force, the Czech legion which had been brought in to fight the Red Army from the East was trapped by the Red Army successes and couldn’t return home. The Japanese were exceptionally active and had stationed 72,000 troops in Siberia and were funding a wild bunch of Cossacks guerrilla under warlords like Semenov and Kalmikov. These were pathological murderers who tortured, raped, and decapitated innocent Siberians, according to US Army reports. They travelled up and down the Trans-Siberian Railroad is special “Death Trains”, underwritten by the Japanese.
Even more importantly the Japanese were interfering with U.S. business. There were about 600,000 tons of U.S. supplies sitting in Vladivostok and the Japanese were threatening to take it or stop it being sold. As a gesture of neutrality, Woodrow Wilson ordered that an American Special Expeditionary Force be sent at once to Vladivostok under the leadership of Major General William S. Graves. He, and 8,000 troops, landed in Vladivostok on the first of September 1918. They were there, not to take sides in the civil war, but to try and rescue the Czech legions and the thousands of German and Austrian prisoners of war. They took up their duties patrolling the Trans-Siberian Railway and the Chinese Eastern Railway.
They were attacked by all sides. The Red Army attacked them in battles along the Trans-Siberian Railroad; the Red Partisans attacked their encampments; and the Cossacks (pushed by the Japanese) fought the U.S. troops all over the Far East. The Japanese didn’t fight but used their proxies to try and drive the U.S. out of their headquarters in Vladivostok and their regional headquarters in Khabarovsk.
Despite the kidnappings and executions of American soldiers by the Cossacks and the raids by the Partisans the Expeditionary Force tried to maintain its neutrality .In the winter of 1919-1920 the White Russian Army was defeated by the Red Army on the Volga Front and the Red Army succeeded in capturing Spassk in the Far East. The war was over and there was an outcry in the U.S. to bring the troops home. The last troops left on April Fool’s Day 1920.[x]
Maj. Gen. William S. Graves (Commanding General Allied Expeditionary Force - Siberia; seated, centre) and staff, Vladivostok, November 23, 1919
General Graves returned to the United States in 1920 and received the Distinguished Service Medal for his service in Siberia. Afterwards, he held command positions in the Philippine Islands, New York, Chicago, and the Panama Canal Zone. After serving on the jury in the court-martial of Gen. Billy Mitchell in 1925, he retired from the army in 1928 and died in 1940— the central figure in a most unusual chapter of the history of the United States Army.
[i] Borger, Julian, "Trump issues new sanctions on North Korea and claims China is following", Guardian 21/9 17
[ii] Artyom Lukin and Lyudmila Zakharova, "Russia-North Korea Economic Ties: Is There More Than Meets The Eye? "FPRI, 7/10/17
[v] “North Korea-Flagged Tanker Busted Violating UN Sanctions, World Maritime News, 8/4/19
[vi] Samuel Ramani, "The Egypt-North Korea Connection", Diplomat, August 28, 2017
[vii] Middle East Monitor, "UAE bought weapons from North Korea for war in Yemen" 20/7/17
[viii] The Namibian, "Namibia: Sacrificing Ourselves for North Korea's Gain", 1/9/17
[ix] "Korea: Kim Catches A Clue" Strategy Page, March 12, 2019
[x]There are several good accounts of the American Occupation of Siberia. Among them are:
R.M. Connaughton, The Republic of the Ushakovka: Admiral Kolchak and the Allied Intervention in Siberia, 1918-1920, Routledge; William S. Graves, America's Siberian Adventure, Peter Smith, 1941); and . Betty Miller Unterberger, America's Siberian Expedition, 1918-1920,: Duke University Press