State Dept: US Companies Must Cut Ties to North Korean Laborers

The Trump administration is warning American companies that they could face fines or even criminal charges if their supply chains involve North Korean workers.

The US State Department published a comprehensive listing online of 40 countries and about a dozen industries where North Koreans were employed in 2017 and 2018 in violation of UN sanctions. North Korean workers are generally paid only a fraction of their salaries with the remainder, sometimes as much as 70%, going to the North Korean government.

“Dangers can be lurking in global supply chains,” said Anthony Talbott, who heads the University of Dayton’s Human Rights Center.

“The only reason an American corporation would be contracting with companies using their laborers would be because their prices are significantly lower.”

The AP reports:

North Korean workers abroad typically work 16- to 20-hour shifts with only a few days off each month, said the State Department, which describes the system as a type of human trafficking. Their pay supports North Korea’s programs of weapons of mass destruction and ballistic missiles, the advisory said.

“Businesses should be aware of North Korea’s deceptive practices in order to … ensure compliance with applicable legal requirements across their entire supply chains,” the State Department said in a statement Wednesday.

The advisory also names more than 230 North Korean companies that have joint ventures with partners from China and other countries. The companies produce a variety of items, including apparel, small electronics and minerals.

American manufacturers, which import about 10 percent of their supply chains, could face legal repercussions if they bought materials produced by those joint ventures.

An AP investigation last year found North Korean women working in Chinese factories, processing seafood that ultimately made its way to American supermarkets.

Experts say the North Korean government receives hundreds of millions of dollars in foreign currency from their laborers abroad, as much as a tenth of the country’s economy. Jobs range from construction in Algeria, Kuwait, and Malaysia to positions in medical clinics in Cambodia, China, and Nigeria.

U.S. Rep. Chris Smith supported the State Department advisory, saying that human trafficking is “both a human rights atrocity and a source of foreign currency for the Kim Jong Un regime.”

Still, others are skeptical that fines will work. Ray Kuo, an assistant professor of political science at Fordham University, say that the advisory will have little impact unless China and Russia, where most North Korean workers are employed, comply.

Moreover, he added that some companies in China, Russia, and South Korea view the recent Singapore summit between Trump and Kim Jong Un as a justification for relaxing sanctions.