NYT About What North Korea Received From Putin In Exchange For Ammunition
- 6.02.2024, 15:38
Pyongyang shipped 2.5 million artillery shells to Russia.
Cooperation between Russia, which needs ammunition for warfare, and North Korea, which is isolated, is expanding. Supplies of shells and ballistic missiles have already violated UN sanctions, but Moscow does not stop there. It has unblocked part of the frozen assets of the DPRK and is trying to give it access to the international financial system, writes The New York Times (NYT), citing intelligence sources in a Western country – an ally of the United States.
According to them, Pyongyang has gained access to $9 million of the $30 million frozen in the Russian financial institution and intends to spend this money on the purchase of oil. In addition, a North Korean shell company recently opened an account with another Russian bank in South Ossetia. This will allow the DPRK to circumvent UN sanctions that prohibit banks from doing business with it. Thus, the DPRK may have the opportunity to conduct banking operations not only with Russia, but also through it – with "friendly" countries, such as Turkey and South Africa, the NYT writes.
Russia recognized the independence of South Ossetia in August 2008 – at the same time when it helped it to fight with Georgia. The latter considers the republic to be occupied by Russia. According to the National Bank of the Republic of South Ossetia, only three banks are registered in the country. Among them is the International Settlement Bank (ISB), which was founded in 2015 in Tskhinvali. At the same time, it began working with the separatist Luhansk People's Republic (LPR): shortly after South Ossetia recognized the independence of the so-called LPR, a group of South Ossetian entrepreneurs proposed to create a commercial bank to conduct settlements with Russia through it as an offshore, inaccessible to international sanctions. In 2018, the ISB came to the so-called DPR, and after the partial occupation of the Kherson and Zaporizhzhia regions by Russia, it began to operate also there.
The Bank of Russia, however, in February 2023 banned its branches in the "new territories" from raising additional funds, noting that the money in its accounts does not fall into the Russian deposit insurance system. In June 2023, the EU added the ISB to the sanctions list for its work in the occupied regions of Ukraine.
The U.S. officials could not provide the NYT with the details of the scheme with the bank in South Ossetia. However, according to one senior official, it is in line with U.S. expectations of what North Korea could ask Russia for in exchange for arms supplies.
Financial cooperation may be more acceptable to Russia than the transfer of military technology to Pyongyang. According to experts, North Korea is most interested in modern weapons, such as satellite technology and nuclear submarines. But despite the rapprochement between Moscow and Pyongyang, they don't trust each other enough to hand over “their valuable secrets, says Seo Kim, a former CIA analyst on North Korea. Since Russia is still a permanent member of the UN Security Council, it is more likely to deny the violation of sanctions, says James Brown, professor of political science at the Tokyo branch of the American Temple University, specializing in relations between Russia and the countries of East Asia:
They can always say: "Oh, no, this is a private bank, our investigators will deal with it", – but it will not go beyond these words.
The rapprochement between Russia and North Korea, especially in the military sphere, may not appeal to China, which may see this as a threat to its own security and already considers what is happening to be Moscow's invasion of its sphere of influence.
U.S. National Security Council Coordinator John Kirby said a month ago that the wreckage of a North Korean ballistic missile was found after shelling Ukraine. The DPRK, according to U.S. intelligence, has sent ballistic missiles with a range of almost 900 km to Russia in violation of UN sanctions, Kirby added.
According to the analysis of the British Royal United Services Institute for Defence and Security Studies, the DPRK has also shipped 2.5 million artillery shells to Russia.