Russia Increases Economic Support For North Korea As China Backs Away

Tyler Durden's picture

Over the past two months, China, North Korea’s economic benefactor and formally the source of 90% of its foreign trade, has been withdrawing financial support, ostensibly under the auspices of US sanctions, as Communist Party leaders try to rein in the North’s nuclear program to appease the US and prevent a potentially destabilizing conflict on its border – a development that would be particularly unwelcome during the Communist Party’s upcoming national congress.

As we reported earlier this week, North Korea’s thriving black-market economy (the county earns hundreds of millions of dollars a year from illegal weapons sales, along with other illicit activities rumored to include counterfeiting of US dollars and the manufacture of methamphetamine) has helped blunt the economic impact of UN sanctions meant to reduce the country’s legitimate exports by 90%.

Last month, China ordered North Korean businesses operating in the country to close, and asked its banks to stop doing business with North Korean businesses and individuals in accordance with the latest round of UN Security Council sanctions.

But as China withdraws, Reuters reports that Russia, which shares a small border with North Korea along the country’s eastern flank, is quietly stepping in to offer economic support for its restive neighbor, even after declining to use its veto power to kill UN sanctions against the rogue state.

Russia’s reasoning is simple: If the North Korean regime falls, more US troops could deploy near Russia’s eastern border – an eventuality that Moscow would like to avoid, given the NATO buildup in Europe.

Though Moscow wants to try to improve battered U.S.-Russia relations in the increasingly slim hope of relief from Western sanctions over Ukraine, it remains strongly opposed to what it sees as Washington’s meddling in other countries’ affairs, according to Russian diplomats and analysts familiar with the Kremlin’s thinking.

 

Russia is already angry about a build-up of U.S.-led NATO forces on its western borders in Europe and does not want any replication on its Asian flank, the sources added.

 

Yet while Russia has an interest in protecting North Korea, which started life as a Soviet satellite state, it is not giving Pyongyang a free pass: it backed tougher United Nations sanctions against North Korea over its nuclear tests last month.

A Russian company began routing North Korean internet traffic this month, giving Pyongyang a second connection with the outside world besides China, according to Reuters. Trade between Russia and North Korea doubled to $31.4 million in the first quarter of 2017 thanks to what Moscow said were higher oil product exports, according to Russia’s ministry for the development of the Far East.

The US suspects that Russia is undermining UN sanctions by allowing North Korean ships to sail home with large loads of fuel, despite officially declaring another destination. Russia has also resisted pressure to repatriate tens of thousands of North Korean laborers whose remittances help support the Kim regime.

“The Kremlin really believes the North Korean leadership should get additional assurances and confidence that the United States is not in the regime change business,” Andrey Kortunov, head of the Russian International Affairs Council, a think-tank close to the Russian Foreign Ministry, told Reuters.

 

“The prospect of regime change is a serious concern. The Kremlin understands that (U.S. President Donald) Trump is unpredictable. They felt more secure with Barack Obama that he would not take any action that would explode the situation, but with Trump they don’t know.”

Presumably, Russia has chafed at President Donald Trump’s aggressive rhetoric, taking umbrage at his reckless threats to “totally destroy” North Korea, and that the regime “won’t be around much longer.”

As Reuters noted, any talk of unseating any leader of a former Soviet satellite state for whatever reason is politically toxic in Moscow.

To be sure, Beijing’s economic ties to Pyongyang still dwarf Moscow’s and China remains a more powerful player in the unfolding nuclear crisis. But while Beijing is cutting back trade as it toughens its line on its neighbor’s ballistic missile and nuclear program, Russia is increasing its support.

Last month, Russia stoked the US’s ire by hosting the "Zapad-2017" military drills, the latest iteration of military drills that began during the Soviet Union in the 1970s. While Russia placed the number of soldiers participating in the exercise, which also involved neighboring Belarus, at around 10,000, NATO estimates that the real number could’ve been closer to 100,000. Land, sea and air units took part in the games across a huge area encompassing western Russia, Belarus, the Baltic Sea and the Russian exclave of Kaliningrad. Now, the US is accusing Russia and Belarus of breaking up the war games into smaller segments to avoid being observed by international monitors.

Russian President Vladimir Putin told a forum last month in Vladivostok – an eastern port city 60 miles from Russia’ border with North Korea - that he understood the country’s security concerns about the US and South Korea.

To be sure, Russia and China continue to advocate for a peaceful dialogue between the US and the North. The two countries have proposed a peace plan that would ask the US and South Korea to end their military exercises in exchange for the North ending its nuclear tests. However, after President Donald Trump poisoned the well by saying Secretary of State Rex Tillerson was “wasting his time” trying to talk to the North, this eventuality appears increasingly remote. But as the drumbeat of war intensifies in the US, the two countries are taking steps to ensure that their mutually-agreeable buffer against US "missile defense" systems in South Korea remains intact.

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Fireman's picture

Russia is the only game in town.

general ambivalent's picture

China still supports the art business. No doubt an easy way to transfer money, and one owner says his work with the North Koreans is in no way political. Meaning that 'cultural' avenues are a sure way to keep ties going:

https://www.reuters.com/article/us-northkorea-china-art-insight/white-ti...

svayambhu108's picture

Let me summ this up for you the great shit strategy of US:

US want to softly bring down the Russians put them on their side then fight China. (lol they think they can do it with sanctions, low oil price down, NGOs, etc)

China talks to Russia: please help NK because I cannot do it now and you are already in the crosshairs of US.

back to basics's picture

I'm still trying to decide whether Putin is such a brilliant chess player or he looks brilliant simply because his opponents are such morons. I'm leaning towards the latter for now. 

Manthong's picture

 

Maybe the US is really not in the regime change business, but regime change is a byproduct of the US being heavily involved in the nation destroying business.

 

Ghost of PartysOver's picture

 I think you guys are forgetting a little recent history.  Remember who overthrew the  a duly elected Ukrainian govt?  Is it any surprise that Putin would not let that happen again on his southeastern border?  Stupid Murican decision followed by stupid Rusky decision followed by stupid Murican decision followed by stupid Rusky decision.........

And the wheel goes round and round, round and round...

The Alarmist's picture

No real news here. China might have joined NK in the last hot war there, but NK always had more durable ties to the USSR right up until its collapse, and they didn't really start to starve in NK until the USSR collapsed and cut off NK's most effective ties to the rest of the world.

two hoots's picture

Next will be some undesirable foe assisting Puerto Rico so they can get a foothold in the region.   Don't thing we can play the territorial state thing both ways?  PR may vote to move away and team up with who ever shows them the money?

Cynicles II's picture

US is a vassal state of israel which is controlled by the Rothschild guild of usury.

HardAssets's picture

If your ultimate objective is to bring down a used up America in order to bring about the New World Order, 'making stupid mistakes' is a perfect cover story.

Yeah, there are plenty of greedy & stupid politicians. But they're not really running things.

garcam123's picture

The only real adult on the world stage is the only one acting like an adult. I hate to say this....but I am embarrassed of being an American.  Our once great country has turned into a whore's paradise, operated for and by whores.

svayambhu108's picture

Russia has seen the Emperor has no clothes

EmmittFitzhume's picture

It's all a big shell game and the US is in on it.  It's a big show and distraction while they take your money and freedom

Mustafa Kemal's picture

"For North Korea."

No, for diplomacy and cooperation. Moreover, as the US futzes over bathroom bills and does nothing to improve its society, russia is moving into the blockchain. While we are alienating the planet, russia is establishing cooperative agreements. 

Not only that, but, unlike we muricans,  when they talk they actually make sense.  

Crazy Or Not's picture

I like the smarts of the Russian Chinese tag team approach .... good cop bad cop.
Russia says " dont like it US?.... then negociate!

TheLastTrump's picture

RUSSIA stirring up shit on the world stage again.

Theta_Burn's picture

No their not. they just add seasoning to it, and rightly so...

 

TheLastTrump's picture

Uh huh, Russia always RIGHT, USA always WRONG.

 

amirite? What did I fucking win?

NoDecaf's picture

You win a large black double dong dildo.

rejected's picture

Last 70 years.. Pretty much. 

And you and your family win the honor being the first target when Russia responds to a US first strike attempt. 

Mustafa Kemal's picture

"Uh huh, Russia always RIGHT, USA always WRONG.

 

amirite? "

No, you are not. Dont try to pull that crap. The US is wrong here and, unlike the US gov, russia is trying to take care of its people. They dont need the US making more problems on their eastern border. We are doing enough in eastern europe and have done enough in chechnya

NoWayJose's picture

With all the false accusations and sanctions we throw at Russia - we were expecting something different?

TheLastTrump's picture

Russia & China have been beligerent since about 2005. Some would say that it was warranted due to Bush's Axis of Evil speech & their satellites of Iran & Syria being in the crosshairs.

 

More wouldn't, because the sins of Iran & Syria are plain to see for all who do not hide their heads in the sand or get paid to pretend.

madashellron's picture

Change your name to the Last Dumb Trump Supporter with you.

besnook's picture

in jest or delusion, thank you for representing the zionazi view. it is needed to balance the overwhelming truth of the matter.

garcam123's picture

and.....praytell, those sins are??????????????

Mustafa Kemal's picture

"Russia & China have been beligerent since about 2005."

Funny, "belligerent" is the perfect adjective for the US. Perfect. But it has been that way since way before 2005. I suggest that maybe you would benifit by reading some history.

Praetorian Guard's picture

It would appear Kim is shittin' in tall cotton!!!!

 

Come join us for FREE at www.gunsgrubandgold.com

 

ALL ARE WELCOME!!!

DEMIZEN's picture

russia is already under sanctions why not make a buck in NK. 

auricle's picture

“The Kremlin really believes the North Korean leadership should get additional assurances and confidence that the United States is not in the regime change business,”

Hah. That's the only game the US .gov is in.

Blankone's picture

"The Kremlin really believes the North Korean leadership should get additional assurances and confidence that the United States is not in the regime change business,”

Those in the Kremlin must be stupid. The US always gives assurances, they even have photo opps with the targets, along with public declarations of cooperation and positive direction. Then they destroy and kill them.

The ONLY thing that works is the degree to which a country can defend itself. And that means WMD's. Would Russia like to give up it's WMD's and rely upon the good heart of the US?

khnum's picture

Hmong,Karen,Montagaurds,Cambodians,Cubans,Iranians and Chilians will all tell you the value of a US assurance is about the same as used toilet paper.

Hkan's picture

Confident Russian challanger! Next uppercut....Gold backed rubel?

U.S. down counting started.....

besnook's picture

the zionazis lost the mid east and ukraine and now they think they can win on russia/china turf in korea? they have truly lost whatever bit of sanity left in their minds.

Amun's picture

is not about sanity, perhaps more about being intelligent enough

to comprehend that Soviet Russia and Comminist China  in the 20th century were two bulldogs

that could not face an amerizionazi because they were chained and kept back by their communist ideologies

but in the 21st century everyone is at least a capitalist at worst - an imperialist

China and Russia are now lean, mean and hungry bulldogs with no chains holding them back anymore

Beware you fat amerizionazis

RedDwarf's picture

The Sauidi deal, now this.  Russia is trying to force America to deal with Russia as a major world power, and forcing the UN and EU to recognize them as well.

This is the Russian response to the American / Israeli sanctions and Trump's hands being tied.  They are no longer trying to play it cool and friendly, they have decided to turn up the heat.

fockewulf190's picture

The Russians liked Oblunder because they knew he was a total pussy. That is also why China made it's move in the South China Sea.

11b40's picture

Agreed, but they do it quietly and effectively, while we strut around the world with our chest puffed out making a mess wherever we go.  We are propelled by a multitude of special interests feeding in the DC swamp.  They are focused and in sync, with their National interest the deciding factor in foreign policy.  Us, not so much.  We elect partisan hacks and fools, beholden to the highest bidder for short term personal gain.

rejected's picture

Russia is trying to force America to deal with Russia as a major world power

What part of Russia's 2000 nukes mostly parked off the US coasts does NOT make them a world power?

RedDwarf's picture

Are you dense?  Yes they have nukes, that would never have meant they could have supported Syria, made these inroads to Saudi Arabia, and so forth.  That took a operational military that could operate in the Middle Eastern theatre.

Nukes are actually mostly a deterrent for being invaded or attacked.  It is not an effective way to PROJECT force.

Son of Captain Nemo's picture

With North Korea as "lets make a deal" (https://southfront.org/mr-trump-gave-warning-shot-air-hit-leg/)

Donald "Yeltsin" to Vlad Putin... You already know our situation?... We're hard up because of all the damage we've created in the ME and Eastern Europe in our looting operation(s) gone bad for the past 28 years... We're $24 trillion in the "shitter" and need a hand out otherwise we'll be starting WWIII.

Please Russia give U.S. a $5 trillion interest free loan on "lay away" and the threats of human extinction by our mouthpiece will "STOP"! For NOW at least...

Oh... And this needs to be mentioned. We're real sorry about the last 3 decades in your Country arming Chechens to destabilize your Country killing hundreds of thousands, and attempting to over run your oil, media and banks, along with freezing your assets in our banks.

We realize these were not very nice, but lets let bygones be bygones and we'll "move along" as if nothing ever happened. That is after of course you give U.S. our interest free loan on lay away!...

garcam123's picture

How does one say, "Go Suck your mother's cock." in Russian?

Son of Captain Nemo's picture

John?... "John Brennan"???...

That you?!!!

zeroboris's picture

"EEdee nahkhuy" is a universal go-phrase.

Mustafa Kemal's picture

"How does one say, "Go Suck your mother's cock." in Russian?"

 

I wouldnt even know how to say that in english. But Im not sure what your point is

Cozy Vanilla Sugar's picture

The US is not hard up for cash. As long as exporting interests control the "creditor" countries such as China, they will continue to end up with too many USD than they know what to do with (as a result of printing and selling their own currency to weaken it), most of which will find their way to the only market capable of handling it - US Treasuries.

The US gov debt issue debate is used for internal political purposes but it's clear the US will pull a Russia and ultimately default or inflate away.