Chinese port facing North Korea defaults on $150M bond

Nov. 1 (UPI) -- A Chinese port with close ties to North Korea is defaulting on a $150 million bond as trade may be declining with the Kim Jong Un regime.

Dandong Port stated in a disclosure to the Shanghai Stock Exchange on Monday the group would be unable to fulfill its debt obligations on the three-year bond, which was due Monday, the South China Morning Post reported Tuesday.

Warnings came as early as August, when the port stated in a half-year bond report it might not be able to repay, because of an overall high level of debt.

"As the port's economic situation weakens, throughput has also fallen," Dandong Port stated. "At the same time, our logistics business has declined, eroding our revenue."

About two-thirds of China-North Korea trade had been conducted through Dandong, which faces the North Korean border city of Sinuiju.

According to the Post, 200 million tons of goods pass through the city, but official Chinese data does not indicate the share of North Korea trade.

China's implementation of United Nations Security Council sanctions has targeted key North Korea exports, including coal, textiles and seafood.

China may have also suspended oil shipments to the Kim Jong Un regime.

The cutbacks, however, may take some time to be fully implemented.

Voice of America reported Tuesday China imported 509,000 tons of North Korean coal, worth $44 million, in September.

The trading occurred after the adoption of U.N. Security Council sanctions Resolution 2371 on Aug. 14, according to the report.

VOA was quoting Chinese trade statistics analyzed by the Korea International Trade Association, a South Korean government agency.