WASHINGTON (Reuters) – Frustrated that China has not done more to rein in North Korea, the Trump administration could impose new sanctions on small Chinese banks and other firms doing business with Pyongyang within weeks, two senior U.S. officials said.
The U.S. measures would initially hit Chinese entities considered “low-hanging fruit,” including smaller financial institutions and “shell” companies linked to North Korea’s nuclear and missile programs, said one of the officials, while declining to name the targets.
It would leave larger Chinese banks untouched for now, the official said.
The timing and scope of the U.S. action will depend heavily on how China responds to pressure for tougher steps against North Korea when U.S. and Chinese officials meet for a high-level economic dialogue in Washington on Wednesday, the administration sources told Reuters.
President Donald Trump and his top aides have signaled growing impatience with China over North Korea, especially since it last week test-launched its first intercontinental ballistic missile, which experts say could put all of Alaska in range for the first time.
U.S. officials have also warned that China could face U.S. trade and economic pressure – something Trump has held in abeyance since taking office in January – unless it does more to restrain its neighbor.
The so-called secondary sanctions now being considered are a way for the United States to apply targeted economic pressure on companies in countries with ties to North Korea by denying them access to the U.S. market and financial system.
Word of the sanctions plan comes as U.S. ambassador to the United Nations Nikki Haley seeks to overcome resistance from China and Russia to a U.N. Security Council resolution imposing stiffer international sanctions on Pyongyang.