United Nations sanctions on North Korea's important textiles industry are expected to disrupt a business largely based in China and pose compliance headaches for clothing retailers in the United States and around the world.
The UN Security Council imposed a ban on North Korea textile exports and a ceiling on the country's import of crude oil ratcheting up sanctions designed to pressure North Korea into talks about its nuclear weapons and missile programs. Retailers in the United States and other countries have intentionally limited their exposure to North Korea in recent years, as tensions over the country's nuclear programme increased. The industry has sought to strengthen control over its supply chain since a textile factory collapse in Bangladesh killed more than 1,100 people in 2013.
Larger retailers, such as Walmart, have the ability to keep North Korea-produced goods out of their stores. But smaller brands may face enforcement challenges, feel experts. Textiles were North Korea's second-biggest export after coal and other minerals in 2016, totaling $752 million, reveals Korea Trade-Investment Promotion Agency figures. Nearly 80 per cent went to China. According to the North Korea experts, enforcement of the textile ban along North Korea’s 1,400-km border with China - where goods are sometimes smuggled across, often on boats at night - could be challenging.