UNITED NATIONS (REUTERS) - North Korea continued to develop its nuclear and ballistic missile programmes during the past year, and cyber attacks on cryptocurrency exchanges were an important revenue source for Pyongyang, according to an excerpt of a confidential United Nations report seen on Saturday (Feb 5) by Reuters.

The annual report by independent sanctions monitors was submitted on Friday evening to the UN Security Council North Korea sanctions committee.

"Although no nuclear tests or launches of ICBMs (intercontinental ballistic missiles) were reported, DPRK continued to develop its capability for production of nuclear fissile materials," the experts wrote.

North Korea is formally known as the Democratic People's Republic of Korea (DPRK). It has long been banned from conducting nuclear tests and ballistic missile launches by the UN Security Council.

"Maintenance and development of DPRK's nuclear and ballistic missile infrastructure continued, and DPRK continued to seek material, technology and know-how for these programmes overseas, including through cyber means and joint scientific research," the report said.

Since 2006, North Korea has been subject to UN sanctions, which the Security Council has strengthened over the years in an effort to target funding for Pyongyang's nuclear and ballistic missile programmes.

The sanctions monitors noted that there had been a "marked acceleration" of missile testing by Pyongyang.

The United States and others said on Friday that North Korea had carried out nine ballistic missile launches in January, adding it was the largest number in a single month in the history of the country's weapons of mass destruction and missile programmes.

"DPRK demonstrated increased capabilities for rapid deployment, wide mobility (including at sea), and improved resilience of its missile forces," the sanctions monitors said.

North Korea's mission to the UN in New York did not immediately respond to a request for comment.

Cyber attacks, illicit trade

The monitors said "cyber attacks, particularly on cryptocurrency assets, remain an important revenue source" for North Korea and that they had received information that North Korean hackers continued to target financial institutions, cryptocurrency firms and exchanges.

"According to a member state, DPRK cyber actors stole more than US$50 million (S$67 million) between 2020 and mid-2021 from at least three cryptocurrency exchanges in North America, Europe and Asia," the report said.

The monitors also cited a report last month by cyber security firm Chainalysis that said North Korea launched at least seven attacks on cryptocurrency platforms that extracted nearly US$400 million worth of digital assets last year.

In 2019, the UN sanctions monitors reported that North Korea had generated an estimated US$2 billion for its weapons of mass destruction programmes using widespread and increasingly sophisticated cyberattacks.

The latest report said North Korea's strict blockade in response to the Covid-19 pandemic meant "illicit trade, including in luxury goods, has largely ceased".

Over the years, the UN Security Council has banned North Korean exports, including coal, iron, lead, textiles and seafood, and capped imports of crude oil and refined petroleum products.

"Although maritime exports from DPRK of coal increased in the second half of 2021, they were still at relatively low levels," the monitors said.

"The quantity of illicit imports of refined petroleum increased sharply in the same period, but at a much lower level than in previous years," the report said. "Direct delivery by non-DPRK tankers to DPRK has ceased, probably in response to Covid-19 measures: instead, only DPRK tankers delivered oil."

North Korea's humanitarian situation "continues to worsen", the report said. The monitors said that was probably due to the Covid-19 blockade, but that a lack of information from North Korea meant it was difficult to determine how much UN sanctions were unintentionally harming civilians.