China urges US to correct secondary sanctions 'mistake'

China has opposed secondary sanctions related to the DPRK announced by the US Treasury Department on Tuesday and called on the US government to correct the "mistake".

The US Treasury announced on Tuesday new sanctions on 16 entities and individuals, mostly from China and Russia, for alleged business ties with the missile and nuclear weapons program in the Democratic People's Republic of Korea (DPRK).

The sanctions of 10 entities and six individuals came less than two months after a June 29 announcement of sanctions by the US Treasury on a bank, a shipping company and two individuals from China.

The US Treasury statement claims that the actions complement United Nations Security Council Resolution 2371 on the DPRK, enacted on Aug 5.

"Treasury will continue to increase pressure on North Korea by targeting those who support the advancement of nuclear and ballistic missile programs, and isolating them from the American financial system," Treasury Secretary Steven Mnuchin said in the statement.

"China opposes unilateral sanctions out of the UN Security Council framework, especially the 'long-arm jurisdiction' over Chinese entities and individuals exercised by any country in accordance with its domestic laws," the Chinese embassy in Washington said in a statement on Tuesday.

It said that China faithfully implements UN Security Council resolutions on the DPRK in their entirety and fully observes its international obligations.

"If there are any Chinese companies or individuals suspected of violating Security Council resolutions, they will be investigated and treated in accordance with China's domestic laws and regulations," it said.

"We strongly urge the US to immediately correct its mistake, so as not to impact bilateral cooperation on relevant issues."

China and Russia also have proposed dual suspension – the US and South Korea halt their military drills while DPRK halts its nuclear and missile tests – as a way to ease the tensions on the Korean Peninsula. The US has rejected such a proposal.

Jonathan Pollack, a senior fellow at the Brookings Institution and an expert on the Korean Peninsula, said that despite the UN Security Council resolutions, China and the US disagree sharply about the sanctions process and on how Beijing and Washington view the available tools to constrain the DPRK's ability to access foreign currencies.

"Unless the two countries can truly reach agreement on rules of the road, then North Korea will take advantage of these differences, and this will be highly detrimental to the vital interests of both the US and China," Pollack told China Daily on Tuesday.

"I see a pressing need for the American and Chinese leaderships to undertake much deeper, private discussions to address these differences.  If they do not, North Korea will be the big winner," he said.

The announcement on Tuesday by the US Treasury came a day after the US and South Korea began their annual Ulchi-Freedom Guardian military drills, with DPRK threatening a "merciless strike" ahead of the drills.

The renewed tension followed a war of words between US President Donald Trump and DPRK leader Kim Jong-un. Trump shocked the world on Aug 8 by saying that the DPRK best not make any more threats to the US or it "will be met with fire and fury". He then tweeted that the US military is "locked and loaded". The DPRK responded by saying it planned to fire four missiles into the waters off Guam.

That tension was defused after the DPRK said it will assess "the foolish and stupid conduct" of the US before firing missiles toward Guam, and Trump then tweeted last Wednesday that "Kim Jong-un of North Korea made a very wise and well-reasoned decision. The alternative would have been both catastrophic and unacceptable."

Just hours after the US Treasury announcement on Tuesday, US Secretary of State Rex Tillerson said he was "pleased" to see the DPRK had "demonstrated some level of restraint that we've not seen in the past," referring to the fact that the DPRK has not conducted any test since the Aug 5 UN Security Council resolution.

"We hope that this is the beginning of this signal that we've been looking for – that they are ready to restrain their level of tensions, they're ready to restrain their provocative acts, and that perhaps we are seeing our pathway to sometime in the near future having some dialogue," he told a daily briefing at the State Department.