Sectors Hit by Sanctions on North Korea

The recent news of hacking attack on Sony was alleged to be a state-sponsored attempt by North Korea in retaliation for the movie The Interview. Following that, North Korea suffered a severe Internet outage which it blames on the US. These developments have led to new hostilities between US and North Korea and new US sanctions (in addition to existing ones) on the communist country. Apart from sanctions from US, North Korea is also having sanctions imposed by multilateral organizations like the United Nations, as well as other countries like Japan. (See related: Countries sanctioned by US and Why) These sanctions impact various industries in both countries. Though North Korea remains a closed economy, the US is also losing out. (See related: How North Korean Economy Works?)

US Relations with North Korea

US and the Democratic People's Republic of Korea (DPRK) do not have any formal diplomatic relations. Since the Korean War, the US has maintained sanctions and regularly reinforced them with new additions under its Trading with the Enemy Act. As of today, North Korea remains on the US' most restrictive list (Country Group E) with complete restriction on various economic activities between the two countries. US federal regulations either impose a complete ban or a require strict licensing for items to be exported/re-exported as listed on the Commerce Control List (CCL) and for related services, including repairs associated with such products. The list and industry sectors listed below either need a license, need to adhere to strict specifications of products and services, or are completely banned.

Defense Sector

Essentially, the entire defense sector is banned from business with North Korea. It overlaps with a few other civilian restrictions, such as the ban on sale of large vessels, including those for sea, air, or land transport.

Chemicals

On the banned list are a large list of chemicals, including compositions and solutions. Additionally, associated apparatus and equipment for chemical operations, as well as for health and safety are also banned. The covered chemicals and associated apparatus are used in, but not restricted to, the following areas: mining, quarrying, agriculture, pharmaceutical, fertilizers, medical, veterinary, environmental, waste management, and the food industry.

Materials

The following materials are banned from export to the DPRK: metals and alloys, including wrought or fabricated materials, casting materials, fibrous or filamentary materials, ceramic materials, high energy materials and packaging materials.

Medical Sector

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Sectors Hit by Sanctions on North Korea