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China denounces US sanctions on North Korea trade

North Korean leader Kim Jong-un visiting the Chemical Material Institute. Photo: Getty Images

China on Wednesday denounced new US sanctions linked to North Korea trade, accusing the Trump administration of "long-arm jurisdiction" that unfairly targets Chinese companies and threatens Beijing's cooperation in reining in the rogue state.

The US Treasury Department on Tuesday announced new penalties against 10 entities and six individuals, mostly Chinese and Russian, for providing support to North Korea in ways that aided the rogue state's missile and nuclear programs. The Treasury characterized the targets of its new sanctions as "third-country companies and individuals."

The decision came just a few weeks after Beijing and Moscow agreed to fresh United Nations sanctions on North Korea. It also came less than two months after the Treasury imposed sanctions on a bank, a shipping company and two individuals from China.

"We urge the US side to stop this wrongdoing and correct this immediately," Chinese Foreign Ministry spokeswoman Hua Chunying said at a press conference on Wednesday.

"The Chinese side opposes the unilateral sanctions outside the framework of the UN Security Council, especially the 'long-arm jurisdiction' imposed by any other country on the Chinese entities and individuals based on its own domestic laws," Hua said.

"Long-arm jurisdiction" is a term for when authorities exercise jurisdiction over foreign entities. There has been considerable debate over the US use of that practice.

China, Hua said, "always" implements North Korea-related resolutions of the United Nations Security Council "in their entirety" and fulfills its international obligation.

"Our efforts are there for all to see. We will investigate and deal with the Chinese enterprises and individuals in accordance with our own domestic laws and regulations provided that they are suspected of violating the relevant resolutions of the UN Security Council," she said.

The Chinese government insisted it implements the Security Council resolutions and would punish companies that violate sanctions. Earlier this month, China suspended imports of coal, iron and lead ores, and seafood products.

State media joined the fray with China Daily on Thursday saying the sanctions are "not a silver bullet."

"The US has long believed that sanctions are a silver bullet. But the majority of sanctions have not only failed but also caused humanitarian disasters in other countries," the newspaper said, adding that such "secondary sanctions" will have "little effect" in persuading North Korea.

Nationalistic Global Times was more aggressive, saying the US will "pay for unjust ban on Chinese firms," which it claimed "severely violates international law."

"So far the US sanctions have exerted little impact on China, but it breaks the rules and offends China," it added.

"The US has acted beyond its authority and its unilateral sanctions are unreasonable. For one thing, how could Washington be confident about the illegal trade between China and North Korea? For another, who grants Washington the right to make judgments on which companies violate UN Security Council resolutions?" asked the paper.

The US, it said, aims to "tarnish the international image of China" and is not acknowledging its own responsibility in the issue.

"China has made the most efforts in sanctioning North Korea, while the US has never shown appreciation to Chinese companies which suffered losses from the sanctions," it added.

Washington, Global Times warned, "had better restrain itself" as China "can choose whether and how to retaliate against the US given how Chinese companies are hurt. The Chinese government has the obligation to speak for the country's legitimate companies."

The US views China as North Korea's economic lifeline. China is responsible for about 90 percent of its neighbor's international trade.

However, China's strong response came as data pointed to a sharp slowing of trade between the two allies.

China imported and exported goods worth $456 million in July, down from $489 million in June.

The data, released by China's General Administration of Customs and analyzed by Reuters, showed that just 120 tons of gasoline were shipped from China to North Korea in July, 97 percent lower than a year ago. By comparison, the June figure was 8,262 tons.

"From the Chinese perspective, these sanctions are ridiculous because those enterprises engaged with North Korea before the Security Council resolution," said Shi Yinhong, a professor of international relations at Renmin University in Beijing. "China will not accept this kind of punishment."

Lu Chao, a Korean Peninsula expert at the Liaoning Academy of Social Sciences, said Washington's decision to impose unilateral sanctions on China was inappropriate, unacceptable and "very domineering."

"China is strictly implementing the UN resolution. Though we can't 100 percent exclude the possibility of individuals having underground deals violating the Ministry of Commerce's regulations, the United States being so far away doesn't have a proper reason to take sanction measures unilaterally," he said. "They should inform the Chinese government and let the latter deal with it."

Yang Xiyu, a North Korea expert at the China Institute of International Studies in Beijing, called the US move counterproductive and said Washington should have worked more closely with Beijing.

"I think this shows the frustration from the US toward Beijing, that China won't play as the US wanted," he said, arguing that it would do nothing to dissuade North Korea from pursuing nuclear weapons. "It's a superfluous measure that may only worsen the Sino-US relationship and destroy the foundation of trust for cooperation between the two countries."

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