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Businesswoman’s Fate a Test of China’s Resolve on North Korea

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 — Ms. Ma’s network had expanded to 43 entities on four continents, C4ADS said in new report last month. Some of them, the organization’s research suggested, 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 Ms. 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 Ms. 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 Ms. 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 Ms. Ma’s name, though her husband manages them, according to workers there. “His wife was arrested, but he is fine,” one said.

Ms. 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.”

Source: NYT > World

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