Intelligence officials from the US-allied countries say that Moscow may be trying to help Pyongyang with access to the international financial system in exchange for missiles and ammunition, as per The New York Times.
Russia is increasingly leaning on military imports from authoritarian nations like Iran and North Korea in its war against Ukraine. North Korea supplies the full range of artillery munitions and some short-range ballistic missiles. The first debris of a North Korean missile was earlier documented in northeastern Ukraine’s Kharkiv City.
In January, the White House said it had evidence that North Korea had provided ballistic missiles to Russia while Pyongyang was expecting to receive military hardware from the aggressor country.
The extent of Russia’s provision of military technology to North Korea remains uncertain, but the establishment of new banking ties signals a deepening relationship between the two countries. This growing partnership likely emboldens North Korea, as it intensified its aggressive threats against South Korea, according to US officials. In 2023, it fired hundreds of artillery shells in waters near South Korean border islands and said it regarded South Korea as a “hostile state.”
Reportedly, Russia has permitted the release of $9 million from $30 million in frozen North Korean assets held in a Russian financial institution, funds the economically struggling country intends to use for purchasing crude oil.
Moreover, a North Korean front company recently opened an account at another Russian bank in a step that reportedly says about potential assistance from Moscow in bypassing UN sanctions that restrict dealings between most banks from doing business in North Korea. These sanctions have severely constrained North Korea’s economy, isolating the country from international financial networks, according to intelligence officials.
The newly established bank account is held in South Ossetia, a self-proclaimed independent state in the Caucasus region with strong ties to Russia, the officials told The New York Times on the condition of anonymity.
Access to financial networks is just one of North Korea’s priorities, with experts suggesting that what Pyongyang wants most from Russia includes advanced military hardware such as satellite technology and nuclear-powered submarines. However, the significance of the banking arrangements for North Korea lies in their potential to support the country’s economy, which relies heavily on imports.
North Korea could leverage Moscow’s connections to other countries, including Türkiye and South Africa, that are still trading with Russia after it was targeted with sanctions over the Ukraine war.
If Moscow permits North Korea to use its Russian banks or releases frozen assets, it means a shift in the willingness of the government to engage with North Korea on financial and commercial terms, according to Juan C. Zarate, a former assistant Treasury secretary and expert on financial crimes.
While the release of $9 million in frozen assets by Russia may appear modest, North Korea welcomes any alternative means of accessing capital, said Zarate.
Meanwhile, the UK sent satellite images to a panel of UN experts of North Korean cargo shipments to Russia as proof that Pyongyang is violating international sanctions by providing weapons to Moscow for use in its invasion of Ukraine.
Satellite images captured between September and December 2023 showed three Russian ships loading containers at North Korea’s revived Najin port before transiting to Russian ports.
The Guardian: UK provides evidence of North Korea supplying arms to Russia
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- North Korea uses Ukraine “as test site for nuclear-capable missiles,” South Korea says at UN SC meeting
- US calls UN Security Council meeting over North Korea’s missile supply to Russia
- North Korea supplies ballistic missiles, launchers to Russia, White House confirms
- Ghost ships reveal North Korea’s secret arms trade with Russia, posing threat to Ukraine – Bloomberg
- North Korea supplies Russia with full range of artillery ammo, including gun and mortar shells, rockets
- North Korean arms transfers to Russia estimated over 500,000 artillery rounds in two months, OSINT group says
- Seoul: North Korea likely sends missiles as well as shells to Russia
