Pyongyang sanctions hit trade at China's border city

DANDONG (China) • Rows of sewing machines in one Chinese garment factory on the border with North Korea are now silent, unmanned after UN sanctions sent home their seamstresses from the secretive country.

Factory owners, merchants and shop owners in the border city of Dandong - China's main trading hub with neighbouring North Korea - are feeling the pinch from the United Nations resolutions.

Dandong bet its economy on trade with the North, seeing the benefits of economic growth and rapacious consumption of Chinese products across the border.

Envisioning a bright future, the city expanded, building the Dandong New District as a cooperation zone on the banks of the Yalu River, which marks the border.

A massive four-lane, US$350 million (S$462 million) bridge with a new Customs area was built to link the zone to the North. Construction of the bridge finished three years ago yet it has not opened. On the North Korean side, concrete runs into fields of snow as Pyongyang has not built roads to meet the bridge.

Now UN sanctions - which Beijing has backed as it grows tired of its ally's nuclear and missile tests - are buffeting Dandong's economy, which slowed in 2016.

The potential of the new bridge and cheap North Korean labour brought Mr Lin and his garment factory to a Dandong factory zone, where signs admonishing workers not to smoke or litter are in both Chinese and Korean.

"The North Koreans are disciplined and hardworking," Mr Lin said of the 100 North Korean women he recruited last year.

But the UN Resolution 2371 turned Mr Lin's plans upside down - his workers arrived two days after China announced its implementation: No new contracts with North Korea.

Today, Mr Lin's three-floor garment factory is mostly empty. There are no able and cheap Chinese workers in the city, he said.

Garment imports from the North have also been sanctioned. There were 30,000 North Koreans working in Dandong before the August sanctions but nearly 6,000 have gone home, he said.

North Korean-run businesses in the city have begun to close, with several restaurants forced to shut their doors.

Truck and train traffic on the older, narrow one-lane Sino-Korean Friendship Bridge that carries most of the trade is said to be down.

Roughly 90 per cent of the North's past exports have been sanctioned and new measures now target goods travelling in the other direction.

Mr Wang Xueliang, who runs the Dandong Balance Trade Company, said he is no longer allowed to send tractors, trucks and cars to the North. China cut off all vehicle sales to the North earlier this month, he said. "For the moment we will keep operating," Mr Wang said. "But it's having an effect."


A version of this article appeared in the print edition of The Straits Times on January 22, 2018, with the headline 'Pyongyang sanctions hit trade at China's border city'. Print Edition | Subscribe