NEW YORK • The UN Security Council's five veto powers are close to approving new sanctions on North Korea to cut the isolated state's earnings from exports by more than a quarter, principally by targeting its coal exports to China, diplomats said.

The US-drafted resolution, in response to North Korea's fifth nuclear test in September, would set a UN cap on North Korean coal exports with the aim of cutting hard currency revenues by at least US$700 million (S$1 billion).

The resolution would also restrict North Korea's maritime and financial sectors. If successful, it could cut the country's US$3 billion in annual export earnings by at least US$800 million, UN Security Council diplomats said.

The diplomats did not want to be identified as discussions were still under way. They said the new resolution would also target other North Koreans individuals and entities.

Exports of coal from the North would be capped at US$400.9 million or 7.5 million tonnes per year, whichever is lower, starting on Jan 1, according to the draft resolution obtained by Reuters.

As soon as the resolution is adopted, the North's coal exports to the end of this year will be capped at US$53.5 million or 1 million tonnes, whichever is lower, the draft said.

Over the first 10 months of the year, China has imported 18.6 million tonnes of coal from North Korea, up almost 13 per cent from a year ago.

The restrictions on coal would bar exports connected to individuals and entities involved in North Korea's weapons programmes, the draft resolution said.

The resolution added 11 individuals, including people who have served as ambassadors to Egypt and Myanmar, and 10 entities as targets for a travel ban and asset freeze for their role in the North's nuclear and ballistic missile programmes. The resolution would also ban the North's export of helicopters, vessels and statues, banning contracts similar to the ones worth millions of dollars that the North had signed to build large statues in some African countries.

It called on UN states to reduce the number of staff at North Korea's foreign missions and limit the number of bank accounts to one per North Korean diplomatic mission and one per diplomat at banks in their territory, highlighting concerns that the North had used its diplomats and foreign missions to engage in illicit activities.

Diplomats said last Wednesday that the US and China had agreed on new UN sanctions to impose on North Korea, but Russia was delaying action on a draft resolution.

A senior UN Security Council diplomat who spoke last Wednesday believed China could persuade Russia to agree to the new sanctions and that the 15-member Security Council could vote on the draft resolution as early as this week.

REUTERS