Rockets bound for Egypt reveal North Korea’s dark trade
Armed with this tip, customs agents were waiting when the ship entered Egyptian waters. They swarmed the vessel and discovered, concealed under bins of iron ore, a cache of more than 30,000 rocket-propelled grenades. It was, as a United Nations report later concluded, the “largest seizure of ammunition in the history of sanctions against the Democratic People’s Republic of Korea.”
But who were the rockets for? The Jie Shun’s final secret would take months to resolve and would yield perhaps the biggest surprise of all: The buyers were the Egyptians themselves.
A U.N. investigation uncovered a complex arrangement in which Egyptian business executives ordered millions of dollars worth of North Korean rockets for the country’s military while also taking pains to keep the transaction hidden, according to U.S. officials and Western diplomats familiar with the findings. The incident, many details of which were never publicly revealed, prompted the latest in a series of intense, if private, U.S. complaints over Egyptian efforts to obtain banned military hardware from Pyongyang, the officials said.
It also shed light on a little-understood global arms trade that has become an increasingly vital financial lifeline for North Korean leader Kim Jong Un in the wake of unprecedented economic sanctions.
A spokesman for the Egyptian Embassy in Washington pointed to Egypt’s “transparency” and cooperation with U.N. officials in finding and destroying the contraband.
“Egypt will continue to abide by all Security Council resolutions and will always be in conformity with these resolutions as they restrain military purchases from North Korea,” spokesman Karim Saad said.
But U.S. officials confirmed that delivery of the rockets was foiled only when U.S. intelligence agencies spotted the vessel and alerted Egyptian authorities through diplomatic channels — essentially forcing them to take action — said current and former U.S. officials and diplomats briefed on the events. The officials, who spoke on the condition of anonymity to discuss U.S. and U.N. findings, said the Jie Shun episode was one of a series of clandestine deals that led the Trump administration to freeze or delay nearly $300 million in military aid to Egypt over the summer.
Whether North Korea was ever paid for the estimated $23 million rocket shipment is unclear. But the episode illustrates one of the key challenges faced by world leaders in seeking to change North Korea’s behavior through economic pressure. Even as the United States and its allies pile on the sanctions, Kim continues to quietly reap profits from selling cheap conventional weapons and military hardware to a list of customers and beneficiaries that has at times included Iran, Burma, Cuba, Syria, Eritrea and at least two terrorist groups, as well as key U.S. allies such as Egypt, analysts said.
Some customers have long-standing military ties with Pyongyang, while others have sought to take advantage of the unique market niche created by North Korea: a kind of global eBay for vintage and refurbished Cold War-era weapons, often at prices far lower than the prevailing rates.
Over time, the small-arms trade has emerged as a reliable source of cash for a regime with considerable expertise in the tactics of running contraband, including the use of “false flag” shipping and the clever concealment of illegal cargo in bulk shipments of legitimate goods such as sugar or — as in the case of the Jie Shun — a giant mound of loose iron ore.
“These cover materials not only act to obfuscate shipments, but really highlights the way that licit North Korean businesses are being used to facilitate North Korean illicit activity,” said David Thompson, a senior analyst and investigator of North Korean financial schemes for the Center for Advanced Defense Studies, a nonprofit research organization based in Washington. “It is this nesting which makes this illicit activity so hard to identify.”
At a time when North Korea’s other profitable enterprises are being hurt by international sanctions, Thompson said, such exports are now “likely more important than ever.”
Even by North Korean standards, the Jie Shun was a veritable rust bucket. The freighter’s steel frame was corroded from bow to stern, and its fixtures caked with coal dust from previous voyages, U.N. investigators would later report. The desalination system had stopped working, judging from crates of water bottles officials would find strewn around the crew compartments. Whether its weapons were discovered or not, the ship’s 8,000-mile voyage last summer was probably destined to be its last.
“The ship was in terrible shape,” said a Western diplomat familiar with confidential reports from the official U.N. inquest. “This was a one-shot voyage, and the boat was probably intended for the scrap yard afterward.”
Seaworthy or not, the ship set sail from the port city of Haeju, North Korea, on July 23, 2016, with a 23-manned North Korean crew that included a captain and a political officer to ensure communist-party discipline on board. Although North Korean-owned, the vessel had been registered in Cambodia, allowing it to fly a Cambodian flag and claim Phnom Penh as its home port. Using a “flag of convenience,” as the tactic is called, allows North Korean ships to avoid drawing unwanted attention in international waters. So does the practice of routinely shutting off a vessel’s transponder, behavior documented in a February U.N. report that described theJie Shun’s voyage.
“The vessel’s automatic identification system was off for the majority of the voyage,” the report said, “except in busy sea lanes where such behavior could be noticed and assessed as a safety threat.”
Still, a 300-foot-long freighter big enough to hold 2,400 passenger cars is not easily concealed. U.S. intelligence agencies tracked the ship as it left North Korea, and then monitored it as it steamed around the Malay Peninsula and sailed westward across the Arabian Sea and Gulf of Aden. The vessel was heading northward through the Red Sea in early August when the warning was passed to Egyptian authorities about a suspicious North Korean vessel that appeared bound for the Suez Canal.
The Jie Shun had not yet reached the canal when an Egyptian naval vessel ordered the crew to halt for an inspection. At first, the cargo hold appeared to match the description on the manifest: 2,300 tons of loose yellow rocks called limonite, a kind of iron ore. But digging beneath stone and tarp, the inspectors found wooden crates — stacks of them.
Asked about the boxes, the crew produced a bill of lading listing the contents, in awkward English, as “assembly parts of the underwater pump.” But after the last of the 79 crates was unloaded and opened at Egypt’s al-Adabiyah port, it was clear that this was a weapons shipment like none other: more than 24,000 rocket-propelled grenades, and completed components for 6,000 more. All were North Korean copies of a rocket warhead known as the PG-7, a variant of a Soviet munition first built in the 1960s.
A closer examination by U.N. experts would reveal yet another deception, this one apparently intended to fool the weapons’ Egyptian recipients: Each of the rockets bore a stamp with a manufacturing date of March 2016, just a few months before the Jie Shun sailed. But the label, like the manifest, was false.