Gang of Four

China, Russia, North Korea, Iran: Confronting the new axis of evil 

By Joseph Bosco

The American strike that killed the head of Iran’s terrorist Quds Force last week also may expose the emerging axis of aggression comprising China, North Korea, Russia and Iran.
Channeling Ronald Reagan’s condemnation of the Soviet Union as an “evil empire,”  George W. Bush’s 2002 State of the Union address labeled North Korea, Iraq and Iran an “axis of evil.” 
As with Reagan’s moral proclamation, Bush’s use of the term “evil” to describe recognized states scandalized some in the international community, although it accurately described the nature of those regimes.
 All three brutally mistreated their populations and were complicit in acts of terrorism and/or aggression.
But any suggestion that Pyongyang, Baghdad and Teheran were linked at that time in a coordinated strategy, similar to the original Berlin-Rome Axis pact in World War II, was a bit of an overstatement.
For one thing, Iraq and Iran had just fought a six-year war at the collective cost of up to a million dead.
Nor was there then credible evidence of Pyongyang colluding operationally with either Baghdad or Teheran against the West beyond harsh rhetoric and the occasional arms sales it routinely carried on with several Middle Eastern states.
Today, however, the four states named above that see themselves as implacable adversaries of the United States are, in fact, cooperating to oppose American interests whenever and wherever possible. 
They clearly adhere to the realpolitik principle that “the enemy of my enemy is my friend, or at least my ally of convenience.”
Those regimes are at odds with the United States because of divergent strategic interests, as well as fundamentally conflicting values.
But what differentiates them from other states which similar anti-U.S. interests and anti-Western values is their aggressive intentions to act on those differences — they are, in fact, aggressor states.
The National Defense Strategy (NDS) issued by the Department of Defense in 2018 declares that “China and Russia are now undermining the international order from within.”
But it noted that both powers also use traditional and nontraditional means to attack the system itself from without. 
“China is leveraging military modernization, influence operations, and predatory economics to coerce neighboring countries to reorder the Indo-Pacific region to [its] advantage.”
“Concurrently,” the NDS states, Russia has been making similar moves in its region.
“Russia seeks veto authority over nations on its periphery in terms of their governmental, economic and diplomatic decisions, to shatter the North Atlantic Treaty Organization and change European and Middle East security and economic structures to its favor.”
The threats to global security go beyond those from the major “revisionist” powers.
“Rogue regimes such as North Korea and Iran are destabilizing regions through their pursuit of nuclear weapons or sponsorship of terrorism.”
Compounding the menace each of these anti-Western sources poses individually, there is more than the semblance of a Beijing-Pyongyang-Moscow-Tehran axis.
The evidence of their coordination of efforts is right before our eyes.
Communist China has been formally allied with North Korea at least since the outbreak of the Korea War in June 1950, and it has propped up the Pyongyang regime economically ever since. 
Enabling and protecting its pursuit of nuclear weapons and ballistic missile systems to deliver them has encouraged North Korea’s defiance of both U.S. threats and inducements. 
At the same time, an alliance with North Korea has been strategically profitable for Beijing, making it the indispensable player in the growing nuclear and missile threat and providing it with enormous leverage over the West on other issues across the board.
Second only to China in its diplomatic protection of the Kim regime and its undermining of U.S. and international sanctions has been North Korea’s other giant neighbor, Russia.
 Like China, it also has extracted Western concessions for its illusory cooperation — formally supporting just enough sanctions to gain credibility in Western eyes, but never enough to bring the Kim regime into actual compliance.
Parallel with their tandem moves emboldening North Korean recalcitrance, China and Russia have deepened and broadened their bilateral strategic cooperation against U.S. security interests through a series of joint military exercises.
Over the past week, the two powers expanded their separate contributions to Iran’s military capabilities into a three-party arrangement.
China’s defense ministry announced that Russia and Iran will join the People’s Liberation Army Navy in joint naval drills in the Indian Ocean and Gulf of Oman just as regional tensions have increased with the growing U.S.-Iran confrontation. 
Beijing and Moscow leave no doubt as to whose side they are on.
Meanwhile, a potential crisis looms across the Taiwan Strait as Taiwan’s presidential election approaches and Beijing strives to influence voters to reject President Tsai Ing-wen and her refusal to yield to Chinese pressure and accept its claims over the island’s democratic sovereignty.
The death of Taiwan’s top general and other military officials in a helicopter crash last week, reportedly in an equipment-related accident, has only aroused concerns of a nefarious Chinese role in the political campaign.
American officials undoubtedly are on the alert for the likelihood of simultaneous crises erupting from members of the quartet of evil-doers.
In response to the U.S. strike that killed Iranian terrorist Qassem Soleimani, the head of Iran’s military described an “axis of resistance” among Iran’s terrorist proxies and partners in Lebanon, Iraq, and Syria.
But the China-Russia-North Korea-Iran linkages may be even more ominous and will require the sustained attention of America’s military and political leaders.
Joseph

Chinazism

Japan lists China as much bigger threat than North Korea

By Tim Kelly

TOKYO -- China’s growing military might has replaced North Korean belligerence as the main security threat to Japan, Tokyo’s annual defense review indicated on Thursday, despite signs that Pyongyang could have nuclear-tipped ballistic missiles.
The document’s security assessment on China comes after a section on Japan’s ally, the United States, the first time Beijing has achieved second place in the Defense White Paper and pushing North Korea into third position.
Russia, deemed by Japan as its primary threat during the Cold War, was in fourth place.
“The reality is that China is rapidly increasing military spending, and so people can grasp that we need more pages,” Defense Minister Taro Kono said at a media briefing.
“China is deploying air and sea assets in the Western Pacific and through the Tsushima Strait into the Sea of Japan with greater frequency.”

Japan has raised defense spending by a tenth over the past seven years to counter military advances by Beijing and Pyongyang, including defenses against North Korean missiles which may carry nuclear warheads, the paper said.
North Korea has conducted short-range missile launches this year that Tokyo believes show Pyongyang is developing projectiles to evade its Aegis ballistic missile defenses.
To stay ahead of China’s modernizing military, Japan is buying U.S.-made stealth fighters and other advanced weapons.
In its latest budget request, Japan’s military asked for 115.6 billion yen ($1.1 billion) to buy nine Lockheed Martin F-35 stealth fighters, including six short take-off and vertical landing (STOVL) variants to operate from converted helicopter carriers.
The stealth jets, U.S.-made interceptor missiles and other equipment are part of a proposed 1.2% increase in defense spending to a record 5.32 trillion yen in the year starting April 1.
By comparison, Chinese military spending is set to rise this year by 7.5% to about $177 billion from 2018, more than three times that of Japan. 

Beijing is developing weapons such as stealth fighters and aircraft carriers that are helping it expand the range and scope of military operations.
Once largely confined to operating close to the Chinese coast, Beijing now routinely sends its air and sea patrols near Japan’s western Okinawa islands and into the Western Pacific.

The Defense White Paper said Chinese patrols in waters and skies near Japanese territory are “a national security concern”.
The paper downgraded fellow U.S. ally, South Korea, which recently pulled out of an intelligence sharing pact with Japan amid a dispute over their shared wartime history. 

That could weaken efforts to contain North Korean threats, analysts said.
Other allies, including Australia, the Association of Southeast Asian Nations (ASEAN) and India, feature more prominently in the defense paper.

Axis of Evil: North Korea, China, and Iran are not happy with President Trump’s foreign policy

The three countries heavily criticized the US over the last 72 hours for its tough economic policies meant to change their behaviors.
By Alex Ward
North Korean leader Kim Jong Un’s regime is clearly unhappy with the state of nuclear talks with the United States. 

President Donald Trump has taken hard-line stances against North Korea, China, and Iran — and in the last 72 hours, each country pushed back on America’s pressure campaign.
On Friday, North Korea threatened to build more nuclear weapons unless the US offers some sanctions relief.

Three days later, Chinese dictator Xi Jinping said Beijing would survive the trade war with America and continue exporting goods around the world.

Also on Monday, Iranian President Hassan Rouhani vowed to “break” Trump’s latest and greatest imposition of financial penalties.
Each country has somewhat similar reasons for their anger: The US has imposed stringent economic penalties on them to force a change in behavior. 

Washington sanctioned Pyongyang to force North Koreans to dismantle their nuclear program; maintains tariffs on Chinese goods until the country opens its market to US companies; and has increased sanctions on Iran to get the country to abandon its aggressive foreign policy and pursuit of a nuclear weapon.
It’s not surprising that all three countries would bristle at America’s stances toward them. 

North Korea says it may build new nuclear weapons
The Trump administration’s strategy toward North Korea is to impose “maximum pressure” — or, mounting economic penalties and diplomatic isolation — on Pyongyang so that it has no choice but to stop its pursuit of nuclear weapons. 

The strategy has led to a sharp decline in North Korea’s economy, including a drop-off in its ability to export top goods like seafood products and iron.
But North Korea says it first wants to end hostilities between the two countries, mainly through a “peace declaration.” 

That document would be symbolic, as both sides would agree to no longer fight each other in the Korean War that ended in an armistice, not a peace treaty. 

Pyongyang claims that declaration would make it feel safer and may therefore dismantle its nuclear arsenal down the line.
The two sides are extremely far apart, making it much harder to reach a compromise, Harry Kazianis, a North Korea expert at the Center for the National Interest, told me.
Still, President Trump promised North Korean leader Kim Jong Un he’d sign the peace declaration during their Singapore summit last June. 

The problem is there’s been very little progress, which has locked Washington and Pyongyang in a diplomatic stalemate while sanctions continue to cripple North Korea’s economy.
North Korea is angry about that; a top official put out a scathing statement on Friday letting the US know it.
“The U.S. thinks that its oft-repeated ‘sanctions and pressure’ lead to ‘denuclearization.’ We cannot help laughing at such a foolish idea,” Kwon Jong Gun, a top North Korean diplomat focused on American relations, wrote in the state-run Korean Central News Agency on Friday. 

“If the U.S. keep behaving arrogant without showing any change in its stand,” Pyongyang could start “building up nuclear forces.”

US intelligence, however, shows that North Korea is still making more bombs, but aims to hide that from the US and the international community. 

Now Pyongyang wants to let the Trump administration know the window for denuclearization is closing.
Secretary of State Mike Pompeo responded to the statement on “Fox News Sunday.”
“We’ve seen this as we go through negotiations. Stray voltage happens to be all around us,” he told anchor Chris Wallace. 

“We know with whom we’re negotiating. We know what their positions are. And President Trump’s made his position very clear, no economic relief until we have achieved our ultimate objective.”
Pompeo will meet with Kim Yong Chol, arguably the second-most powerful person in North Korea, later this week for another round of talks.
Robert Carlin, a leading North Korea expert at the Stimson Center think tank, noted in the Koreas-focused 38 North website on Monday that Kwon had omitted any reference to Trump. 

That indicates “the overall tone in Kwon’s piece was not so much of confrontation but of ridicule about the US position,” Carlin wrote.

“I am worried that the detente of the last few months could be in serious trouble,” Kazianis said.

China is angry with the US over the trade war
President Trump has placed around $250 billion in tariffs on Chinese goods — about half the total worth of goods the US imports from China — this year in his escalating trade war. 

It’s part of a strategy to force Beijing to let American companies freely sell to the country’s consumers, compel it to stop stealing the intellectual property of US businesses, and cripple China’s economy in the process.
That, naturally, has rankled Xi, China’s increasingly authoritarian leader. 

During a Monday speech intended to kick off the China International Import Expo, Xi took thinly veiled shots at the US — and President Trump specifically without saying his name.
People who dislike China’s economic practices “should not just point fingers at others to gloss over their own problems,” he told the audience. 

“They should not hold a flashlight that only exposes others while doing nothing themselves.”
He did promise to cut import taxes and export around $30 trillion in products and services over the next decade and a half. 

But he also made sure to note that China would survive mounting economic pressure from the United States.
“Great winds and storms may upset a pond, but not an ocean,” Xi said. 

“After 5,000 years of trials and tribulations, China is still here. Looking ahead, China will be here to stay.”

It’s quite a defiant message, and it comes at a particularly tense time. 

Washington-Beijing relations have soured recently as the US rejects any talks with China to end the trade war, hoping the standoff will compel the country to cave to American demands. 

What’s more, President Trump and Xi plan to meet during the G20 summit later this month, and it’s possible that Xi’s speech could make that meeting a bit awkward.
It also behooves both leaders to end the spat soon. 

Last month, the International Monetary Fund (IMF) — a world body that helps keep the global economy stable — released a major report that projected the world’s economy will grow by 3.7 percent this year, which is 0.2 points lower than they had estimated in April. 

That’s the same rate of growth as in 2017, but the trade war is a major reason for the slight dip in expectations.
The IMF also noted that the trade war could curb China’s economic growth by about 2 percent over the next two years. 

If true, it would be a major blow to China’s economy, which prioritizes continued growth above all else.
It’s no wonder, then, that Xi is upset.

Iran says it will “break” US sanctions
At midnight on Monday, the Trump administration reimposed sanctions on Iran that were lifted once the 2015 Iran nuclear deal was in place. 

The goal, as the administration said, is to force Tehran to stop funding proxies in the Middle East, supporting Syrian leader Bashar al-Assad, stealing money from regular Iranians, and improving its nuclear program.
In effect, the US wants Iran to change everything about itself — or else.
Iranian leaders, and especially President Hassan Rouhani, have shown their displeasure with the Trump administration’s decision.
“We will proudly break the sanctions,” Rouhani said during a meeting of Iranian economic officials on Monday. 

That may be tough, as the US just placed penalties on more than 700 people, organizations, and vessels — mainly targeting the country’s oil, banking, and shipping industries — stopping them from accessing the international banking network and the US market.
Rouhani remains defiant despite the economic stranglehold. 

“We have to make Americans understand that they cannot talk to the great Iranian nation with the language of pressure and sanctions,” he said during a televised address.
While the sanctions are meant to hurt the regime — and could do so — they currently impact regular Iranians the most. 

In October, a top UN court ruled that the US had to ease its sanctions on Iran for humanitarian reasons. 

Specifically, the US was told it could not restrict exports to Iran of food, medicine, and other items because it threatened the lives of ordinary citizens there.
It’s unclear if the pressure on the Iranian people could lead to a revolt that would eventually topple the regime, but it seems that’s what the US administration wants. 

John Bolton advocated as much before he joined the administration as national security adviser, although officials deny regime change is the goal.

China – not North Korea – is our biggest threat to peace, South Koreans say

Poll finds steep rise in those ranking China the most threatening country to inter-Korean peace, while 91 per cent believe it does not want Korean reunification
By Lee Jeong-ho

China is the country presenting the biggest barrier to peace on the Korean peninsula, surpassing North Korea for the first time, according to a new poll of South Korean citizens.
In the survey, released on Tuesday by the Institute for Peace and Unification Studies (IPUS) at Seoul National University, 46 per cent of respondents viewed China as “the most threatening country to peace on the Korean peninsula”, a dramatic increase from 2016, when 17 per cent said China was the most threatening.
Only 33 per cent viewed North Korea as the country posing the biggest threat, well down on 64 per cent last year and the first time it had been eclipsed by China since the survey began in 2007, the institute said.
The poll of 1,200 men and women aged 19 to 74 was conducted by Gallup Korea between July 12 and August 3.
China “does not want inter-Korean reunification”, according to 91 per cent of respondents, compared with 90, 88 and 53 per cent for Japan, Russia and the United States respectively.
IPUS senior researcher Choi Gyu-bin suggested the figures stemmed from the dispute over the Terminal High Altitude Area Defence (THAAD) system, an American anti-ballistic missile defence system deployed in South Korean territory since 2016.
“China’s economic retaliation to Seoul’s decision to allow THAAD to be deployed in South Korea has had a negative impact on South Koreans’ perception of China,” Choi said.
Beijing saw THAAD as a threat targeting China, compromising the country’s national security by monitoring its military activities, rather than a way to deter or curb North Korea’s nuclear ambitions.
China then embarked on an aggressive unofficial campaign to stop Chinese tour groups traveling to South Korea. 

Its boycott cost South Korea’s tourism industry 7.5 trillion won (US$6.7 billion) between January and September last year, according to data compiled by the South Korean national assembly’s budget office.
The Chinese government also targeted the Seoul-based multinational conglomerate Lotte – which had agreed to provide land for THAAD – by fining it for its advertising practices and shutting down a large number of its supermarkets in China for fire regulation violations. 

China has also intensified its customs inspections of South Korean companies.
“[The survey results] may also be a [simple] reaction due to a rapid increase in intimacy towards North Korea,” Choi said.
Summits between the two Koreas, as well as between North Korea and China and between North Korea and the US, accounted for the fall in negative perceptions of North Korea, he said. 

North and South Korea vowed during their summits to end their seven decades of hostility.
Half of the survey’s respondents considered China a country “to be cautious of”, more than double the 24 per cent stating that opinion in 2015, before the THAAD dispute. 

Only 13 per cent considered China a partner for cooperation – the lowest figure since the survey began.
Half also said the rise of China did not help bring about peace on the Korean peninsula, whereas 22 per cent felt it would positively influence the region.
“While THAAD retaliation is considered a direct cause, US-China conflict, territorial disputes in East Asia and the assertive ‘Belt and Road Initiative’ are some of the indirect factors responsible for the results,” Choi said.
Seoul has recently made efforts to rebuild its relations with Pyongyang, taking part in three inter-Korean summits since April with another expected in Seoul by the end of the year.
“An inter-Korean joint military committee will be activated soon to avoid accidental military collisions,” the September Pyongyang Declaration stated. 

“The two Koreas have agreed to enhance exchanges and cooperation.”
Meanwhile, 53 per cent of respondents said that South Korea must maintain a “neutral” position during the escalation of the US-China conflict, while 39 per cent and 8 per cent said Seoul must improve cooperation only with Washington and Beijing respectively.

Senate blocks ZTE deal in rebuke of Trump deal

The move comes less than a week after Trump entered into an agreement with telecom giant. 
By Leigh Ann Caldwell

In a major rebuke to Donald Trump, the Senate has adopted a measure that would block the administration's deal with Chinese telecom giant ZTE, pitting the president against Congress on what many senators say is an issue of national security.
The Senate's move comes less than a week after the administration struck an agreement with ZTE that would have kept the telecom company engaged in the U.S. market.

The president’s deal with ZTE would have forced the company to pay a $1 billion penalty, reorganize its company and allow U.S. compliance officers in exchange for being able to sell its products inside the U.S.
But the bipartisan senate amendment, which has been added to the must-pass National Defense Authorization Act, would essentially kill that agreement by retroactively reinstating financial penalties and continuing the prohibition on ZTE's ability to sell to the U.S. government.
Sen. Tom Cotton, R-Ark., who is one of the co-sponsors of the measure, said that the amendment would likely put ZTE out of business.
“ZTE said they couldn’t remain in business, or at least not remain anything other than a cell phone hand-held business, if the denial order from March was in effect. And this would essential put the denial order back into effect,” Cotton told reporters.
The telecom company is a mechanism for espionage by, in part, selling phones in the U.S. that can be tracked and enabled to steal intellectual property.
The U.S. slapped sanctions on ZTE in 2016, prohibiting the company from doing business in the U.S. for seven years, when it violated U.S. sanctions against Iran and North Korea. 
The Commerce Department placed additional sanctions on the company after it failed to follow through with its reorganization plan and lied to the U.S. government about it.
A bipartisan group of senators praised the amendment, saying it protects the U.S.’s national security.
“The fact that a bipartisan group of senators came together this quickly is a testament to how bad the Trump administration's ZTE deal is and how we will not shy away from holding the president's feet to the fire when it comes to keeping his promise to be tough on China,” Senate Democratic Leader Chuck Schumer said in a statement.
The amendment was added just as Commerce Secretary Wilbur Ross was on Capitol Hill briefing senators about a component of the president’s ZTE deal.
Sen. John Cornyn, R-Texas, left the meeting saying he was supportive of the Senate’s effort.
The NDAA still has to pass the Senate and the House of Representatives must still agree to the defense bill with the measure included before it can advance.
Trump would then face a choice: Veto a critical defense bill to save the ZTE deal or allow the administration's deal to collapse.
Sen. Cotton said the president won’t veto the bill “because the bill pertains many other critical priorities.”

Axis of Evil

U.S. MILITARY PREPARED TO FACE CHINA AND NORTH KOREA AHEAD OF MAJOR ASIA CONFERENCE
BY TOM O'CONNOR

The Pentagon said it was prepared to take on both China and North Korea as Defense Secretary James Mattis headed to Singapore for a major international security conference.
Marine Corps Lieutenant General Kenneth F. McKenzie Jr., joint staff director at the Defense Department, told reporters Thursday that, although he would not compare the threats posed to the U.S. by China and North Korea, "we are prepared for both." 

The two Asia-Pacific allies have drifted apart in recent years as Pyongyang accelerated its nuclear program, but China remains a staunch opponent of expanding U.S. military activity in the region and especially in the South China Sea.
"We take both threats seriously. Certainly, China has a much larger nuclear capability and you've got to take that into account, China has a much larger economic engine that you have to take into account so the threats are very different," McKenzie told reporters at the Pentagon.
"When you consider North Korea, the first thing you look at is their capricious and unpredictable behavior spanning back several decades," he added.
An H-6H bomber shoots off flares during the Golden Dart-2018 aerial combat competition, April 18, 2018. China recently landed one of its H-6 bomber variants on disputed islands in the South China Sea, prompting the U.S. to disinvite it from a major upcoming naval exercise.

Both countries are likely to be high on the agenda of the London-based International Institute for Strategic Studies' annual Shangri-La Dialogue, scheduled to begin Friday. 

Among those set to speak at the event are Indian Prime Minister Narendra Modi and Singapore's President Halimah Yacob along with the defense ministers of Australia, Canada, France, Germany, Indonesia, Japan, New Zealand, the Philippines, Qatar, the Seychelles, South Korea, Sri Lanka, the U.K, the U.S. and Vietnam.
The nations involved shared U.S. concerns about Chinese activity in the South China Sea, where Washington has accused Beijing of militarizing a set of disputed islands to enforce vast territorial claims. 

Mattis said Tuesday he planned a "steady drumbeat" of freedom of navigation and other naval operations in the contested waters and would "confront what we believe is out of step with international law," according to the Associated Press.
Among other experts and top military officials, Chinese Lieutenant General He Lei, Senior Colonel Zhao Xiaozhou and Senior Colonel Zhou Bo were also set to make an appearance at the Shangri La Dialogue. 

China has countered U.S. claims by asserting sovereignty over the disputed islands and arguing any military installations there were necessary to maintain self-defense against a much more powerful U.S. military posture.

A map shows construction on the disputed Spratly Islands in the South China Sea as of January 23, 2018.

When asked about the U.S. military's capability to battle China on the South China Sea islands, McKenzie told journalists that "the U.S. military has a lot of experience in the Western Pacific taking down small islands," a reference to Pacific theater against the Japanese Empire during World War II.
The U.S. defeated Japan in 1945 and subsequently occupied the southern half of the Korean Peninsula, the northern half of which was taken by fellow Allied power and future Cold War foe, the Soviet Union. 

The U.S. and the Soviet Union formed opposing satellite states that went to war in the 1950s, creating the current hostility between the U.S. and North Korea, which has since developed nuclear weapons and intercontinental ballistic missiles.
North Korea's latest and youngest supreme leader, Kim Jong Un, has offered to denuclearize and meet face-to-face with President Donald Trump in another Singapore summit set for June 12. 

Trump canceled the talks last week after a diplomatic spat between U.S. and North Korean officials, but has suggested they may be back on as top North Korean official Kim Yong Chol met with Secretary of State Mike Pompeo in New York.

Death of a Gangster

Rogue Company ZTE is First Victim of the China-U.S. Trade War

By Raymond Zhong

ZTE's logo on a building in Shanghai. The firm said it had ceased “major operating activities” after the Trump administration banned it from using components made in the United States.

SHENZHEN, China — Not Apple. Not Huawei. 

The first casualty of the high-tech cold war between the United States and China might be the biggest electronics maker you’ve never heard of.
The Chinese firm ZTE said on Wednesday it had ceased “major operating activities” after the Trump administration banned the company last month from using components made in the United States. With manufacturing halted at the ZTE plant in Shenzhen, factory workers have been getting called in for training sessions every other day or so — a snooze, they say. 

The rest of the time, they loaf around in nearby dorms.
Trading in the company’s shares has been suspended for weeks. 

Staff members have been instructed, in new guidelines reviewed by The New York Times, to reassure anxious clients, while being sure to avoid discussing with them the American technology from which the firm is cut off for the next seven years.
One of China’s most internationally successful technology suppliers, with about $17 billion in annual revenue, ZTE is facing a death sentence. 

The Commerce Department has blocked its access to American-made components until 2025, the company failing to punish employees who violated trade controls against Iran and North Korea.
American microchips power ZTE’s wireless stations. 

American optical components go into its optical fiber networks. 

Google’s Android operating system runs its smartphones. 

ZTE’s moment of crisis, if it leads to the company’s collapse, could also show how the tech war might ripple around the world.
The company has 75,000 employees and does business in more than 160 countries. 

It is the No. 4 smartphone vendor in the United States. 

And its telecommunications gear supports the digital backbone of a great swath of the developing world.
The wireless carrier MTN, which serves 220 million people in 22 nations in Africa and the Middle East, said last week that it was assessing contingency plans, “given our exposure to ZTE in our networks.” 

The chief executive of the Norwegian carrier Telenor, which has large operations in Asia, said the company was “following the situation closely.”
Several employees described the situation inside ZTE on condition of anonymity, fearing reprisals from their employer. 

A company spokeswoman declined to comment.
The United States has for years deemed ZTE and Huawei, its much larger rival in network gear, to be national security threats. 

Large American mobile carriers already shun the companies’ telecom equipment. 

The White House is mulling an executive order that would make it harder for government agencies to buy from them.
In response to the sanctions issued last month, ZTE said it had worked to improve its compliance practices. 

It has requested a stay on the export ban and has sent additional information to the Commerce Department in support of its argument.
Zhongxing Telecommunications Equipment’s corporate predecessor was established in 1985, as a joint venture between a state-owned aerospace factory and two other firms. 

Within a few years, the company was producing equipment for phone operators in the Chinese countryside, before expanding into cities and then overseas.
“Zhongxing” means “China Prospers.” 

The company’s controlling shareholder is Shenzhen Zhongxingxin Telecommunications Equipment, which is nearly half-owned by two Chinese state entities. 

Several members of the firm’s board also have leadership roles at Zhongxingxin. 

ZTE says Zhongxingxin does not interfere in its business decisions. 

Working on a circuit board at a ZTE plant in Shenzhen, China.

The electronics maker released its first smartphone for the American market in 2011. 

Within two years, it was a top-five vendor in the United States, largely targeting people who wanted a phone but not a long contract with a cell carrier. 

Even in China, the company has not had great success selling smartphones.
“It’s extraordinarily impressive, what they’ve done in the U.S.,” said Avi Greengart, a consumer tech analyst with the research firm GlobalData. 

“So many Asian companies either said they would come to the U.S. and then had to pull back — like Xiaomi, like Huawei. Or they invested in the U.S. and weren’t able to make it work.”
ZTE’s secret, Mr. Greengart said, was a light touch. 

The company’s American managers have had significant leeway in tailoring their products to the local market. 

“That’s not the way many of its competitors work,” he said.
The company was, for instance, quick to spot that Americans were gravitating toward larger phones. It offered inexpensive devices with big screens — if not those with the highest resolution — and fingerprint readers at a time when such features were considered premium.
To build its brand, ZTE has sponsored several National Basketball Association teams. 

In February, the company and the Cleveland Cavaliers celebrated Chinese New Year at a game against the Brooklyn Nets. 

The Quicken Loans Arena in Cleveland was decorated with Chinese lanterns. 

An acrobat rode around the court on a unicycle at halftime.
In Africa, ZTE and Huawei have helped connect many of the continent’s fast-growing economies, often with the help of generous export financing from Chinese state banks. 

ZTE has laid thousands of miles of fiber optic cable in Ethiopia and it recently signed an agreement with MTN of South Africa to test fifth-generation wireless, or 5G.
Some of the company’s deals with cash-stricken governments have attracted accusations of corruption and overbilling. 

On the whole, though, ZTE is known in Africa for good service, said Dobek Pater, a telecom expert at the research firm Africa Analysis.
“The initial perception — of Chinese companies coming in and being very secretive and not wanting to have much to do with the locals — has changed over the past decade,” he said.
In Iran, it was secrecy of another kind that got ZTE into trouble.
The company used an elaborate system to sell American-made goods there, and then lied and deleted emails when the Commerce Department began to investigate. 

It even made plans to resume shipments to Iran while the investigation was ongoing, according to the Commerce Department.
“At home, they might have been doing some things not according to standards, and then, when it came time to internationalize, they might not have done so entirely properly,” said Gu Wenjun, chief analyst at ICwise, a semiconductor market research firm in Shanghai.
“For other companies thinking about how to follow the rules and manage internal risks, I think this is going to serve as a wakeup call,” Mr. Gu said.
Late last Friday, ZTE management sent an email to staff members updating them on the company’s efforts to reconcile with Washington.
“Even the longest road has an end,” the email concluded. 

“Even the longest night ends in day. Let us stay resolute and confident, and, full of hope, greet the coming dawn!”

China Cyberspies Mined Japan Firms for North Korea Secrets

• Lure related to defense industry suggests possible motive
• Hackers left text in malware mocking security researchers

By David Tweed

Chinese hackers have targeted Japanese defense companies, possibly to get information on Tokyo’s policy toward resolving the North Korean nuclear impasse, according to cybersecurity firm FireEye Inc.
The attacks are suspected to come from a group known as APT10, a Chinese espionage group that FireEye has been tracking since 2009. 

One of the lures used in a “spear-phishing” email attack was a defense lecture given by former head of UNESCO, Koichiro Matsuura. 

Two attacks took place between September and October 2017.
“Lure content related to the defense industry suggests that a possible motive behind the intrusion attempt is gaining insider information on policy prescription to resolve the North Korean nuclear issue,” said Bryce Boland, chief technology officer for the Asia-Pacific region at FireEye.
China’s Ministry of Foreign Affairs didn’t respond to a faxed request for comment Friday. 

The suspected attacks coincided with a dramatic escalation in tensions over North Korea’s nuclear weapons program as Kim Jong Un tested a hydrogen bomb and U.S. President Donald Trump threatened to “totally destroy” the country. 

The U.S. and Japan have been coordinating their diplomatic and military pressure campaigns against the country, and neighboring China is anxious to avoid a clash on its border.
Tensions have eased since the two Koreas started talking ahead of the Winter Olympics and Winter Olympics and Trump granted an unprecedented meeting with the North Korean leader. 

Earlier this month, the foreign ministers of China and Japan agreed to work closely to push the regime to surrender its nuclear weapons program, although Japanese officials continue to express skepticism about Kim’s willingness to make a deal.

Multiple Attacks
The latest cyberattacks mirror other recent hacks with geopolitical overtones investigated by FireEye. Among the most recent, a wave of incursions on mainly U.S. engineering and defense companies linked to the South China Sea, where China’s claims for more than 80 percent of the water clash with five other nations. 

In 2016, the website of Taiwan’s Democratic Progressive Party was attacked months after the party won elections, securing its leader Tsai Ing-wen the presidency.
“We believe APT10 is primarily tasked with collecting critical information in response to shifts in regional geopolitics and frequently targets organizations with long research and development cycles,” Boland said, citing firms in construction and engineering, aerospace and military, telecommunications and high-tech industries.
In an unusual development, the hackers inserted lines of text in the malware associated with the Japanese attacks mocking the security researchers. 

Such gems included, “I’m here waiting for u,” “POWERED BY APT632185, NORTH KOREA,” and “According to the analysis report, some Japanese analysts have always been portrayed as a bit of joke.”
Also under attack since November 2017 have been Japanese healthcare companies. 

“China’s new push on pharmaceutical innovation as a national priority, along with rising cancer rates, will likely drive future espionage operations against the healthcare industry,” Boland said.
Mandiant, a unit of FireEye, alleged in 2013 that China’s military might have been behind a group that had hacked at least 141 companies worldwide since 2006. 

The U.S. issued indictments against five military officials who were purported to be members of that group.

Axis of Evil

China Illegally Transferred Cargo to North Korea
VOA News
A North Korean military security guard keeps watch over the USS Pueblo in Pyongyang, North Korea, Jan. 24, 2108.

Japan says its military has witnessed a cargo transfer between China and North Korea on the high seas that it suspects violates United Nations economic sanctions on Pyongyang.
The foreign ministry said Tuesday a maritime surveillance plane and an escort ship spotted a North Korean-flagged tanker, identified as the Yu Jong 2, floating alongside a small ship last Friday about 250 kilometers off the Chinese city of Shanghai in the East China Sea.
The nationality of the other ship is unknown, but the ministry said the words "Min Ning De You 078" were written in Chinese on the ship's bow, which translates as an oil ship from Ningde city in China's coastal Fujian province.
The ministry says it has reported the suspected transfer to the U.N. Security Council. 

This is the third such incident reported by Tokyo this year.
Pyongyang is subject to a series of U.N. Security Council sanctions over the regime's continued testing of its nuclear and ballistic missile weapons, including one prohibiting all member states from facilitating or engaging in ship-to-ship transfers of goods to or from North Korean-flagged vessels.

Sina Delenda Est

China's Push Into Western Pacific Alarms U.S. Allies in Asia 
By Ting Shi and Isabel Reynolds

With the Trump administration warning of a possible war with North Korea, U.S. allies in Asia are sounding the alarm on another risk: a clash with China in the western Pacific.
China has recently accelerated air and naval excursions in sensitive areas near Japan and Taiwan, part of a longstanding quest to expand its military presence further from its shores into the Pacific Ocean. Leaders in Tokyo and Taipei have called on Beijing to back off while strengthening their defenses.
Earlier this month, Japan observed for the first time a Chinese submarine entering the contiguous zone (12 nautical miles to 24 nautical miles from shore) around Japanese islets in the East China Sea. That came shortly after Taiwanese President Tsai Ing-wen warned that China’s increased military patrols around the island threatened to destabilize the region.

Donald Trump’s “America First” foreign policy has raised concern in Asia about the reliability of the U.S. in helping to stave off Chinese pressure as it gains greater military and economic strength. 

China has a long-term goal of reuniting with Taiwan, and territorial disputes with countries ranging from Japan to Vietnam to India.
“The unpredictability of the Trump administration encourages Tokyo and Taipei to do more for their own defense,” said Ja Ian Chong, an associate professor with the National University of Singapore who specializes in Asia-Pacific relations. 

While Trump’s interactions with Xi Jinping mostly focused on North Korea and trade during his first year in office, China’s territorial claims may become more prominent going forward. 

In a strategy document released last week, the U.S. Defense Department cited China’s military modernization and expansion in the South China Sea as key threats to U.S. power.
China has pushed back against that narrative, with its defense ministry over the weekend calling on the U.S. to abandon a “Cold War” mindset. 

It blamed “other countries” for citing freedom of navigation concerns to undertake military activities in the South China Sea, where China has undertaken massive land reclamation to strengthen its claim to more than 80 percent of the area.
On Saturday, China’s foreign ministry said the country will take “necessary measures” to safeguard its sovereignty in the South China Sea after a U.S. warship entered waters near the disputed Scarborough Shoal.

‘New Normal’
The Communist Party’s official People’s Daily on Monday accused the U.S. of destroying stability in the South China Sea, and threatened to “enhance and speed up” its military capacity in the waters in response.
China has also dismissed allegations that it is encroaching on Taiwan and Japan. 

Patrols around Taiwan by Chinese fighter jets, bombers and surveillance aircraft are the “new normal,” Chinese Air Force spokesman Shen Jinke said last month. 

The Chinese submarine spotted near disputed islands in the East China Sea was monitoring the movements of two Japanese vessels, the foreign ministry said.
China’s navy began sailing through the “First Island Chain” -- including Japan, Taiwan and the Philippines -- in 2009. 

The Air Force followed suit with regular patrols in 2015, and the frequency of flights has increased from “four times per year” then to “several times per month” in 2017, according to the official Xinhua News Agency.

‘Cabbage Strategy’
Last year, Tsai said she would increase Taiwan’s defense spending by at least 2 percent each year. Priorities include new missiles, fighter aircraft and ballistic missile defenses. 

The U.S. continues to sell weapons to Taiwan and is obligated to defend the island under a 1979 law.
Japan’s cabinet last month approved a record defense budget of about 5.19 trillion yen ($47 billion), the sixth straight annual rise in defense spending under Prime Minister Shinzo Abe. 

While its missile defense purchases are primarily to deter North Korea, Defense Minister Itsunori Onodera said this month they could be used to stop other weapons.
Abe hosted Australian Prime Minister Malcolm Turnbull last week at a military base, part of efforts to strengthen a burgeoning four-way security arrangement that also includes the U.S. and India. 

In an interview with the Australian Financial Review published on Saturday, Abe said the “Quad” grouping wasn’t aimed at containing China even as he warned of instability in the region’s waterways.

‘Not Working’
“There is an attempt to alter the present status in the East China Sea and the South China Sea,” Abe told the publication. 

“So I think the security situation is becoming tougher these days.”
China is employing a “cabbage strategy” in which it gradually surrounds a disputed area with multiple layers of security, according to June Teufel Dreyer, a University of Miami political science professor and author of “Middle Kingdom and Empire of the Rising Sun” -- a 2016 book on China-Japan ties.
“To the extent Taiwan and Japan can be said to have a strategy, it is to raise their deterrence capabilities to a level that keeps the situation stable,” Dreyer said. 

“It’s not working.”

The Necessary War

Xi Jinping has entire military drilling in case US strikes North Korea
By KATSUJI NAKAZAWA

China's entire military was mobilized for a large scale exercise on Jan. 3.

TOKYO -- "Do not fear death," Xi Jinping told the more than 7,000 troops of the People's Liberation Army gathered at a military training base in Hebei Province on Jan. 3.
It was a freezing day and Xi appeared clad in thick military clothing.
The "Grand Mobilization Ceremony," as the meeting was called, was a first-of-its-kind event involving the entire Chinese military, with the Army, Navy, Air Force and Rocket Force taking part. Live streaming of the speech was delivered to more than 4,000 locations, where parallel sessions were held simultaneously across China. 

The atmosphere was tense.
Xi, who also serves as the chairman of the Central Military Commission as well as the Communist Party's general secretary, told Chinese troops to be locked and loaded.
The colossal event left no doubt that despite the warming of relations between North and South Korea, with representatives meeting for the first time in more than two years on Jan. 9, Xi has eyes on the worst case scenario.
If North Korea does not abandon its nuclear program, the U.S. will probably move faster than later. "That day could come after the Winter Olympics in Pyeongchang, South Korea," one source said. The closing ceremony is scheduled for Feb. 25.

Xi Jinping, center, inspects troops on Jan. 3 after ordering China's entire military to carry out mobilization exercises. 
Approaching by sea
China has been dead set against any country using military force against North Korea. 

But if U.S. President Donald Trump decides on this option, there will be no stopping him.
China, therefore, needs to be prepared for any contingency, including a "decapitation strike" on the North Korean leadership, or blitzkrieg tactics aimed at paralyzing North Korea's military.
A direct clash between China and the U.S. would be avoided at all costs. 

Xi knows the PLA would never be able to win such a battle. 

But if U.S. forces were to invade North Korea, China would have no choice but to use its own troops to secure its interests.
In this contingency, many observers believe China would send troops into the conflict from northeastern China, across the Yalu River, which forms the Sino-North Korea border. 

After all, this is exactly what China did during the Korean War.
But this would be a rather non-expeditious route to Pyongyang, in the central part of the country and far from the Yalu.
China may turn to history books to solve this issue.

When the Korean War broke out in 1950, North Korean troops immediately gained the upper hand driving the U.S.-led United Nations forces all the way back to Busan, in the southern part of the Korean Peninsula.
After regrouping, the U.N. forces made a surprise landing at the strategic port of Incheon, on the west coast of the Korean Peninsula, under Supreme Commander Douglas MacArthur.
MacArthur carried out the risky landing despite numerous objections. 

The operation was a big success as the U.N. forces recaptured Seoul, the South Korean capital. Today, Incheon is one of Asia's most important transportation hubs, as home to South Korea's main international airport.
Now, China could take a similar route to the one MacArthur chose 68 years ago.
Pyongyang is just inland from North Korea's west coast. 

Even if Chinese troops do not engage their U.S. counterparts, they would be able to establish a foothold near the North Korean capital.
If Xi were to turn the pages of the history book further back, he would find many examples of China attempting to land on the west coast of the Korean Peninsula.
Emperor Yang (569 - 618) of the Sui dynasty sent troops there to fight the forces of the powerful kingdom of Koguryo, or Goguryeo, which ruled the northern part of the Korean Peninsula.
Sui's offensive against Koguryo's ancient capital Pyongyang was two-pronged. 

The main military units crossed the Yalu River. 

Meanwhile, naval units sailed from the Shandong Peninsula to the west coast of the Korean Peninsula.
The Tang dynasty, which succeeded the Sui dynasty in 618, also faced off against Koguryo. 

Like the Sui dynasty, the Tang dynasty sent invasion forces by sea as well as by land.
Tang dynasty troops left Laizhou, on the Shandong Peninsula, now Yantai, in Shandong Province, crossed the Yellow Sea and landed on the west coast of the Korean Peninsula. 

Koguryo finally collapsed in 668.

Members of the People's Liberation Army Marine Corps are seen in training at a military training base in Bayingol, East Turkestan.

China's marine corps
In modern warfare, it is the marines that handle sea crossings. 

Should the U.S. invade North Korea, China could reach areas near Pyongyang swiftly if it used its marine corps. 

The Chinese marines -- who have copied many elements of the U.S. Marine Corps -- and their amphibious vehicles would be delivered by landing craft.
Interestingly, on the night of the mobilization ceremony, Jan. 3, the state-run China Central Television's news program turned its focus on one aspect of the military: the treasured marine corps.
Xi's speech also touched upon the marines.
The marine corps is based in Zhanjiang, Guangdong Province, far from the Korean Peninsula. 

But the marines actually hold training exercises on the Shandong Peninsula, across the Yellow Sea from the Korean Peninsula.
A major naval hub in China, the Shandong Peninsula is home to the Liaoning, China's first aircraft carrier. 

In early December, the marine corps was engaged in training exercises at multiple military ports on the Shandong Peninsula. 

The drills had to do with carrying military equipment by ship, according to official Chinese media reports, including one by China Military Online, the military's official news website.
If China were to send troops from both land and sea, the two troops would have different missions.
Those ground troops crossing the Yalu River would head straight down to Punggye-ri, some 100km from the border, where they would take control of the nuclear test site.
North Korea's main military facilities are near the Chinese border, where they are less likely to come under attack from the U.S. 

American forces, after all, would likely hesitate to launch air strikes that might affect the Chinese side of the border and trigger a Sino-U.S. war.
If U.S. surgical air strikes on targets in North Korea fail, the Americans and North Koreans could get bogged down in a war, and the Chinese military would have no choice but to move, albeit in the name of preventing an influx of North Korean refugees.
In a move that apparently reflects Xi's judgment, the Jilin Daily, a Communist Party newspaper in Jilin Province, on the border with North Korea, in early December published an unusual feature warning readers to prepare for a possible nuclear war.
Preparations are now being made in Jilin and Liaoning, another northeastern Chinese province that borders North Korea, as well as on the Shandong Peninsula in case war breaks out on the Korean Peninsula.

U.S. nuclear button is "much bigger" 
Trump, Xi and North Korean leader Kim Jong Un are now engaged in psychological warfare.

Kim Jong Un makes a statement from his desk in this undated photo released by North Korea's Korean Central News Agency on September 22, 2017. 

Kim, in a New Year's Day address, threatened the U.S. by saying that "a nuclear button is always on my desk," while signaling a conciliatory approach to South Korea. 

North Korea will send athletes to the Pyeongchang Winter Olympics.
Trump responded by tweeting that his nuclear button is "much bigger and more powerful." 

Several days later, however, the U.S. president expressed a willingness to talk to Kim by telephone -- if certain conditions are met.
For Xi, who just managed to solidify his power at the Communist Party's 19th national congress last October, it is a new set of worries. 

The war of words between the U.S. and North Korean leaders are no laughing matter.
It looks to be an interesting year for Asia.

World War III Casualties
	2016 Population	Killed		Survivors
CHINA	1 373 541 278	1 057 119 689	77%	316 421 589
UNITED STATES	323 995 528	19 089 783	6%	304 905 745
EUROPEAN UNION	513 949 445	371 356 958	72%	142 592 487
RUSSIA	142 355 415	30 924 816	22%	111 430 599
INDIA	1 266 883 598	1 158 499 174	91%	108 384 424
PAKISTAN	201 995 540	175 747 473	87%	26 248 067
JAPAN	126 702 133	114 241 889	90%	12 460 244
VIETNAM	95 261 021	84 340 688	89%	10 920 333
PHILIPPINES	102 624 209	92 732 902	90%	9 891 307
KOREA, NORTH	25 115 311	21 141 050	84%	3 974 261
KOREA, SOUTH	50 924 172	47 636 302	94%	3 287 870
TAIWAN	23 464 787	22 278 490	95%	1 186 297
	4 246 812 437	3 195 109 214	75%	1 051 703 223

Axis of Evil

Businesswoman’s Fate a Test of China’s Resolve on North Korea
By STEVEN LEE MYERS

Friendship Bridge, linking Dandong, China, to North Korea. From the border city, the Chinese businesswoman Ma Xiaohong conducted trade that violated international sanctions. 

DANDONG, China — Not long ago, Ma Xiaohong was the public face of China’s trade with North Korea.
By age 44, she had built a commercial empire accounting for a fifth of trade between the Communist neighbors. 

She was appointed to the provincial People’s Congress, granted special privileges to export petroleum products to the North and feted by officials as a “woman of distinction.”
Now, Ma’s fate has become a test of China’s willingness to support President Trump’s efforts to throttle North Korea’s nuclear ambitions.
Last year, American prosecutors indicted Ma on charges of using her companies to help North Korea evade international sanctions. 

After a briefing by American diplomats in Beijing, the Chinese announced their own investigation into Ma’s main company.
Fifteen months later, however, it is unclear what has become of Ma. 

The government says it has not found evidence to support the American charges that she or her partners aided North Korea’s weapons program. 

Though she remains under investigation for “economic crimes,” it is not clear whether she was ever arrested or where she is now.

Ma in a company photo. Since China announced an investigation in 2016, her whereabouts has been shrouded in mystery.

A review of Ma’s case — involving interviews with officials, diplomats and others, as well as searches in corporate registries — underscored China’s deep ambivalence as it has come under increasing pressure to enforce sanctions against North Korea. 

While China is on the record opposing the North’s pursuit of nuclear weapons, it is wary of being seen imposing punishments at the bidding of the United States, especially against its own citizens.
North Korea’s agreement on Tuesday to send athletes to the Winter Olympics in South Korea next month, and to hold talks and other exchanges with the South, may have been symbolic and perhaps a cynical effort to bide time. 

Yet it suggested that the rising diplomatic and economic pressure, meant to deny it the financial and material resources needed to develop nuclear weapons and ballistic missiles, may have had some effect on the North’s leader Kim Jong-un.
Kim has given no signal that he would give up his nuclear ambitions, but after the North’s initial overtures, Mr. Trump wrote on Twitter that the talks were evidence that “sanctions and ‘other’ pressures are beginning to have a big impact on North Korea.”
China has shown a willingness to support tougher sanctions at the United Nations Security Council over the last year, but it has done so grudgingly. 

The reasons for that are historical and strategic. 

North Korea has long counted on China as its only real ally, for example, but some analysts argue that economic factors also play a part.
“The Chinese don’t want to have to be doing this,” said Ken E. Gause, an expert on North Korea with CNA, a research organization in Arlington, Va. 

“There’s a lot of money to be made on that border, and there are a lot of connections between the operators on the border and their patrons back in Beijing.”
Ma’s fate remains shrouded in mystery. 

There have been rumors of political intrigues and of sweeping arrests of customs officials, but few hard facts.

Companies linked to Ms. Ma’s main company, Dandong Hongxiang, continue to operate from a building in Dandong. 

China has taken steps to shut down at least some of Ma’s trading empire, freezing her shares of her main company, Dandong Hongxiang Industrial Development Co. Ltd., for example, according to a government registry. 

The shares of three colleagues who were also charged by the United States were frozen for a time but later released, suggesting they no longer face criminal charges.
In the government’s first statement on the case in a year, the State Council Information Office responded to questions from The New York Times by saying that Ma and others face investigation for “economic crimes.”
However, the statement went on to say, referring to Ma’s main company, investigators “have not yet found evidence that the Dandong Hongxiang company and Ma Xiaohong et al are directly involved in North Korea’s nuclear missile development activities.”
The company’s headquarters here in Dandong, on the border with North Korea, has been shuttered since last spring, when the decorations for the Year of the Rooster that are still hanging on the entrance were put up for good luck.
Other subsidiaries linked to Ma continued to operate until very recently, providing revenue directly to the North Korean government. 

One is a joint venture with the North Korean government to operate a hotel, the Chilbosan, in Shenyang, the provincial capital 150 miles north of Dandong.
Ma is still listed as the deputy chair of the consortium between Dandong Hongxiang and the North Korea Liujing Economic Exchange Group. 

After reporters from The New York Times visited and made inquiries about Ma’s businesses, however, the hotel restaurant closed. 

That appeared to be in keeping with the latest round of sanctions, adopted by the Security Council in December.

Ma’s businesses include a restaurant that employs waitresses from North Korea.

China joined the council’s other 14 members in imposing the new sanctions, which would also severely limit shipments of refined petroleum. 

Chinese officials point to such steps as a demonstration of its "commitment" to halting North Korea’s weapons program.
China has already slashed imports of coal, silver and other commodities from North Korea, according to customs records. 

While North Korea continued to sell $270 million worth of prohibited goods in the six months that ended in August, according to the latest United Nations report on sanctions, trade along the border has witnessed a significant drop, distressing traders and plunging the region into recession.
The once-thriving trade across the border was what fueled Ma’s rise, and the throttling of it now seems to have contributed to her fall.
She was only 24 when North Korea, suffering the effects of famine, began to open its economy, first by allowing the export of scrap metal in 1996. 

What began as a trickle became a flood, she told Southern Weekly, a prominent Chinese newspaper, as her company bought the scrap to resell in China. 

“Then, every day we were getting nearly 10,000 tons,” she said.
Ma’s trade expanded to other products and commodities. 

Soon, she invested in companies inside North Korea, including a clothing plant and a gold mine. 

The cost of the latter, she said, was the delivery of 80 Steyr trucks built by Sinotruk. 

In January 2000, she formed Dandong Hongxiang.
By 2010, Ma had built a global conglomerate of companies that accounted for a fifth of all imports and exports between the two countries.

A hawker sells North Korean souvenirs near the Friendship Bridge. Sanctions have caused cross-border trade to drop drastically this year. 

As her businesses prospered, she boasted of close ties with officials on both sides of the border. 

They included Jang Song-thaek, the uncle of North Korea’s leader, who was an architect of the economic policies that Ms. Ma exploited. 

In 2013, he was executed for treason, accused of plotting a coup as his nephew consolidated power.
On the Chinese side of the border, Dandong recognized her as one of 10 outstanding women in the city; in 2013, she was selected as a delegate to the provincial People’s Congress, a ceremonial post in an undemocratic country, but one that indicated her connections to the political elite.
On the day in 2006 when North Korea carried out its first nuclear test, she said, she happened to be meeting with executives from one of the country’s biggest state companies, who expressed pride in the test. 

She described North Koreans as educated and worldly despite being so isolated, though her travels also showed her the deprivation many ordinary Koreans face.
“North Korea has computers; it has Coca-Cola,” she told Southern Weekly, “but North Korea is still North Korea.”
Each new round of sanctions disrupted business but then opened up other avenues. 

In 2009, under Barack Obama, the United States imposed sanctions on Korea Kwangson Banking Corp., one of North Korea’s most prominent banks, charging it with financing two companies involved in the country’s missile and arms trade.
In the months that followed, according to American prosecutors and independent researchers, Ma’s company opened or acquired new subsidiaries and shell companies in Hong Kong and other offshore havens. 

The purpose was to trade with the bank and other North Korean entities, as well as to launder money and import prohibited materials used in weapons making.

A watchtower in Sinuiju, North Korea, across the border from Dandong. 

Dandong Hongxiang added 28 subsidiaries in the two years after the sanctions on Korea Kwangson, according to a report by C4ADS, a research organization in Washington devoted to security issues, and the Sejong Institute in Seoul.
By the end of 2016 — after the American indictment — Ma’s network had expanded to 43 entities on four continents, C4ADS said in new report last month. 

Some of them were involved in selling to North Korea chemicals used in the manufacturing of nuclear bombs or missiles.
China, too, prohibits such exports, but the authorities did not move against Dandong Hongxiang until American diplomats briefed them on a secret complaint filed in the New Jersey court in August 2016 that named Ma and three executives in the company.
The Public Security Department in Liaoning, where Dandong is, responded by announcing an investigation, but the government said virtually nothing until the State Council Information Office issued its statement last week. 

Articles that had initially appeared in state media were later censored, suggesting an effort to minimize attention to the case.
A clue of Ma’s legal woes came in statements by Liaoning Darong Information Technology Co. Ltd., where she was chairwoman of the board from 2013. 

In November 2016, two months after the Chinese announced their investigation, the company ousted her. 

In a news release, it explained it had “not been able to contact Ma Xiaohong, nor are her relatives aware of the details of the situation.”
During recent visits to Dandong, few people would discuss Ma. 

Some companies linked to Dandong Hongxiang continue to function, including a transportation subsidiary occupying an office with an expansive view of the Friendship Bridge that crosses the Yalu River into North Korea. 

A woman who seemed to be in charge brusquely refused to answer questions.
In late December, another North Korean restaurant continued to operate, as did a gallery nearby selling paintings by North Korean artists. 

The businesses are registered in Ma’s name, though her husband manages them, according to workers there. 

“His wife was arrested, but he is fine,” one said.
Ma herself once seemed to foresee the risks of her business. 

“If there is any change in the political situation,” she told Southern Weekly, “our business can be smashed to pieces.”