Putin in Pyongyang; Treaty signed between NK and Russia; Rasht-Caspian Railway completed; Iran exporting meds
Prohibited Transactions for the week of 17 June 2024 (#52)
This image was created in Microsoft Copilot Designer on 18 June 2024 using the prompt “two hands shaking, one with a Russian flag and the other with a North Korean flag, stencil.”
North Korea
A “Treaty on Comprehensive Strategic Partnership between the DPRK and the Russian Federation” was signed by North Korean leader Kim Jong-un and Russian President Vladmir Putin, during the latter’s visit to Pyongyang this week. An English-language summary of the treaty provided by North Korean media showed several clauses related to the economic relationship between Pyongyang and Moscow, including:
The two nations will “oppose the application of unilateral compulsory measures including the measures that assume extraterritorial nature” and will consider them illegal and contrary to the UN Charter.
If any third country engages in “unilateral compulsory measures” against either the DPRK or Russia, both sides will work to minimize the impact of said sanctions.
The two countries will work to increase the volume of trade, and work to better cooperate in the areas of customs and financial services.
The two sides will provide support for special or free economic zones of the two countries.
The two sides will support the establishment of direct ties between regions of the two countries (including cooperation between frontier regions), in an attempt to highlight the economic and investment potential that may exist on a more local level.
The two countries will cooperate in fields including space, biology, peaceful atomic energy, artificial intelligence, and information technology, as well as agriculture, education, public health, sports, culture, tourism, etc.
//With this treaty, the DPRK and Russia signal their continued resistance — and perhaps more coordinated response — to sanctions imposed by the UN, US and other nations.
The treaty also notes the two countries will cooperate in combatting threats such as
international terrorism, extremism, multinational organized crime, human traffic, hostage taking, illegal immigration, illegal circulation of money, legalization (laundering) of income obtained in a criminal way, financing of terrorism, financing of WMD proliferation, illegal acts posing threat to the safety of civil aviation and maritime navigation and illegal circulation of goods, funds, means of funds, drug, psychic energizer and their ingredients, weapons, and cultural and historical relics. //Can’t wait to hear about their efforts to counter proliferation financing, money laundering, and terrorist financing.
Putin stated in an interview with North Korean media that the two countries plan to develop an alternative payment settlement system that would not be run by Western countries.
//It’s too early to tell what effect this treaty will have on the long-term geopolitical, military and economic relationship between the DPRK and Russia. Though some very insightful analysis has already been produced (check out Sino-NK for background on the visit, as well as Yonhap for an initial read on the treaty), it will take a while longer to understand the practical changes — if any — that this comprehensive partnership will bring to Pyongyang and Moscow. It will be curious to see if this will embolden their flouting of international sanctions, and lead them to take bigger chances when smuggling goods and engaging in illicit trade.
North Korea media reported that Pyongyang and Moscow signed an agreement to build a motorcar bridge over the River Tuman that separates the two countries.
Putin gifted Kim another Russian-made Aurus limousine (see Issue #41) during his visit.
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The Stockholm International Peace Research Institute (SIPRI) Yearbook 2024 estimates that the DPRK possesses approximately 50 nuclear warheads.
According to covert reporting from inside North Korea, authorities are conducing intensive inspections of trading companies, in an attempt to crack down on activities such as smuggling goods outside of the approved rules.
According to covert reporting from inside North Korea, the Mansudae Overseas Project Group of Companies (MOPGC) — which has been sanctioned by the UN — is sending experts and engineers in art, architecture and geometric design aboard to raise foreign currency. A group of MOPGC staffers traveled to Angola, Nigeria, Zimbabwe and other countries, via the PRC in early May.
Iran
During a meeting of the Iran-Russia Joint Economic Commission, the two sides emphasized strengthening cooperation, especially on economic issues and energy production. Moscow cited the 48 percent increase in bilateral trade between the two countries during the first three months of 2024, as compared with the previous year. Iran’s oil minister noted that Russian companies have invested in the development of seven Iranian oil fields, and are in talks to lure more investors for additional oil fields.
The Rasht-Caspian Railway will be inaugurated this week, connecting the city of Rashat with the Caspian Sea. This railway is part of the International North-South Transport Corridor (INSTC).
As part of a push for the INSTC, Azerbaijan, Russia and Iran agreed to set up a working group on freight transport and will inspect border and custom terminals on the various borders between the three countries.
According to the Iranian Food and Drug Administration (FDA), Iran exports raw materials and pharmaceutical products to approximately 50 countries, and that 99 percent of the drugs used in Iran are produced domestically. //This 99 percent statistic seems misleading, since if sanction are blocking the import of many needed drugs and medicines into Iran — which previous reporting about medicine shortages would suggest — of course the majority of drugs being used by Iranians are being domestically produced. Iran likely has no problem producing generic pharmaceuticals that could be sold internationally, but that doesn’t mean internal shortages don’t exist for medicines needed for rare or highly complex diseases.
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Iran’s Bank Mellat and Tejarat Bank are contributing to the Central Bank of Iran’s (CBI) pilot test of a central bank digital currency (CBDC), which will be launched on the island of Kish in July.
Bangladesh’s ambassador to Iran said that Dhaka wishes to expand economic ties with Tehran.
//For those interested in a quick summary of the candidates for Iran’s upcoming presidential election — slated for 28 June 2024 — the Iranist has a quick rundown, and the Atlantic Council provides some background on the six men.