Bloomberg News on Wednesday explained that some of China’s reluctance to support strong sanctions against North Korea stems from the losses inflicted on Chinese business interests, especially shops and import/export firms located along the North Korean border:
In Hunchun, a city of about 230,000 people near China’s shared frontier with North Korea and Russia, protests briefly broke out last month after the United Nations Security Council approved sanctions banning exports of seafood and other goods from Kim Jong Un’s regime. Dozens of wholesale stores were shuttered, dealing a blow to the packagers, distributors, drivers and restaurateurs who depend on the trade.
“Many people are unemployed now,” said Liu Guanghua, 41, who owns one of the few businesses still open on what’s known as Seafood Street. “Sanctions should be against the North Korean government, but this impacts regular people in China and North Korea.”
Towns on the southeast fringe of China’s rust belt were already struggling with the decline of heavy industries such as steelmaking and coal mining before becoming collateral damage in the U.S.-led push to isolate North Korea. The risk of social unrest due to job losses is a sensitive issue for Chinese President Xi Jinping, particularly as the Communist Party prepares for a twice-a-decade reshuffle of top leaders next month.
The Bloomberg piece goes on to explain that the Chinese provinces in question developed trade relationships in North Korea to recover from the loss of central government support for state-run industries in the nineties when China was applying for membership in the World Trade Organization.
With China handling about 85 percent of both imports and exports with North Korea, the risk economic collapse and political instability in the border region are deemed intolerable by Beijing, especially at a moment when China strives to project both economic strength and political unity.