China's doorway to N. Korea feels sanctions pinch

The contract covered all the details -- a clean dorm for the workers, hot showers three times a week, and time twice a week to "study the policies and worship" the leader Kim Jong-un.

"They look at their leader like he's a god," Lin said, noting the salaries were to be paid directly to the North Korean manager.

As he spoke to AFP on his office sofa sipping tea, he rattled off the UN resolution numbers that have crippled his once thriving garment business.

UN Resolution 2371 turned Lin's plans upside down -- his workers arrived two days after China announced its implementation: no new contracts with North Korea.

For the past 10 years, Lin hauled material and cloth to factories across the river in Sinuiju and Pyongyang, where North Korean workers turned it into exportable jackets, coats, and other clothing.

As new sanctions came down, he saw the writing on the wall and began planning.

"We thought if we can't trade with North Korea, well we can get North Koreans to work for us in China."

Today, Lin's three-floor garment factory is mostly empty. There are no able and cheap Chinese workers in the city, he said. Garment imports from the North have also been sanctioned.

There were 30,000 North Koreans working in Dandong before the August sanctions but nearly 6,000 have gone home, he said.

- Dandong New District -

Many of the apartments, shopfronts and restaurant spaces in Dandong's New District are empty.

"There's nothing over here," said Yue Yue, a real estate agent at the New District's Singapore City development, where only one-third of the apartments have been sold.

"We've dropped the prices a bit for the apartments further from the river," she admitted, noting they had been lowered more than 30 percent.

"I'm hoping for the bridge to open."

Lu of the Border Institute says that is not likely with the current sanctions regime in place.

North Korean-run businesses in the city have begun to close, with several restaurants forced to shut their doors.

Truck and train traffic on the older, narrow one-lane Sino-Korean Friendship Bridge that carries most of the trade is said to be down.

Roughly 90 percent of the North's past exports have been sanctioned and new measures now target goods travelling in the other direction.

Wang Xueliang, who runs the Dandong Balance Trade Company, said he is no longer allowed to send tractors, trucks and cars to the North.

Before he could sell one or two vehicles a month to North Korean clients who paid in yuan or dollars.

China cut off all vehicle sales to the North in early January, he said.

"For the moment we will keep operating," Wang said. "But it's having an effect."

Source: AFP