Secretive trade

At first, it looked like just another inspection. Panamanian authorities had been tipped off that a North Korean ship coming from Cuba might be carrying drugs. But what officers found aboard the 14,000-ton Chong Chon Gang as it headed into the Panama Canal on Monday, July 15th, was anything but ordinary.

Hidden under some 240,000 white sacks of Cuban raw brown sugar were two anti-aircraft missile systems, nine missiles in parts and spares, various MiG-21 aircraft parts and 15 plane motors. The ship's crew consisting of 35 North Korean nationals was detained after allegedly resisting the search. The vessel's captain is said to have attempted to commit suicide.

A long-standing relationship

Cuba, one of North Korea's few allies, reacted by claiming the shipment as its own, with the foreign ministry listing a total of 240 metric tons of weaponry hidden in the ship. However, the Caribbean nation said in a statement that the arms discovered on the vessel were "obsolete defensive weapons" from the Soviet era.

The undeclared equipment was meant to be repaired in North Korea and returned to Cuba, Havana argued, adding that the arms were required to "maintain our defensive capacity in order to preserve national sovereignty." North Korea later confirmed that the antiquated weapons system was being transferred for repair.

Susanne Gratius, a senior researcher at the Madrid-based think tank FRIDE, explains that Havana has maintained diplomatic relations with Pyongyang since 1960. "Since Cuba has close relations with China, North Korea is seen as part of an alliance of socialist regimes opposed to US hegemony," the expert told DW, adding that North Korean military mission visited Cuba and held talks with President Raúl Castro and members of Cuban armed forces. Whether the arms shipment was discussed in that meeting, is, however, unclear.

A violation of UN resolutions?

Although Cuban authorities stressed that they remained "unwavering" in their commitment to international law, peace and nuclear disarmament, Gratius believes that Pyongyang's attempt to smuggle weapons is likely to be regarded as a violation of UN resolutions linked to North Korea's nuclear program. Pyongyang has conducted three nuclear tests since 2006 and a string of long-range rocket launches.

Among other measures, current UN resolutions ban North Korea from importing and exporting weapons, with the exception of small arms. It also lets countries inspect cargo inside or transiting through their territory that originated in North Korea.

"With the arms deal, Cuba violated several UN resolutions and the incident will have negative consequences for relations with the Unites States, particularly because we don’t know how long Cuba has been shipping weapons to Pyongyang," said Gratius.

Nonetheless, she says, due to other priorities and to avoid further international debate, both Cuba and the US are interested in downplaying the incident. "Under Raúl Castro, Cuba has reduced its aggressive discourse against the United States and is involved in an internal reform process and after the incident involving former NSA analyst Edward Snowden, Obama is not particularly willing to provoke a new conflict with Latin American partners."

IHS Jane's, a global analytics firm, said in a statement that the radar equipment discovered aboard the ship "could have been en route to North Korea to augment Pyongyang’s existing air defence network." North Korea’s air defence network "is arguably one of the densest in the world, but it is also based on obsolete weapons, missiles and radars," the company stated.

Secretive trade deals

However, IHS analysts also said the Cuban explanation was potentially credible and that Havana could have been sending the systems to North Korea for an upgrade. "In this case, it would likely be returned to Cuba and the cargo of sugar could be a payment for the services.

This second scenario seems plausible to many experts, including Markus Kaim, international security expert at the German Institute for International and Security Affairs. Kaim argues that Pyongyang has barely any need for antiquated weaponry, since it already has Soviet-era arms at its disposal.

This view is shared by Hugh Griffiths, a specialist on illicit trade at the Stockholm International Peace Research Institute (SIPRI). "Cuba was not supplying Pyongyang, Pyongyang was servicing this equipment for Cuba and would have returned the cargo," Griffiths told DW.

The expert says that North Korea has a track record of repairing, upgrading or servicing military equipment for states that use old Soviet or Chinese weaponry in exchange for commodities. "In 2010 a shipment of North Korean tank engines was intercepted at sea by the South African navy," Griffths said. According to the British analyst, the tank engines - some of which were transported by air and successfully delivered - were being transported from North Korea to the armed forces of Congo-Brazzaville.

Griffiths therefore believes that Panama's discovery of the Chong Chon Gang cargo sheds some light on North Korea's secretive trade dealings: "The combination of sugar and missiles highlights how North Korean licit and illicit trade is combined for shipment in a single vessel."

Furthermore, this is not the first time the Chong Chon Gang has been detained. According to a Security Council report issued in 2012 the vessel was stopped in late January 2010 by authorities in Ukraine. Local officials confirmed the seizure of limited quantities of ammunition, narcotic drugs and psychotropic substances, and other contraband goods, according to the report.

Finding ways to get equipment

However, Griffiths points out that sometimes "dual use" equipment is supplied by foreign states to North Korea. One of the most recent examples is said to be the supply of 16 axel special trucks by China. Quoting from a UN report, Griffith says that the North Koreans told the Beijing that the large lorries would be used for forestry purposes.

But the UN report shows photographs of the trucks transporting missiles in a very prominent manner during a military parade in the centre of Pyongyang, he says.

The North Koreans might be poor and not really be able to afford foreign weaponry that is much more sophisticated than their vast stockpiles of ageing Soviet-era equipment, Griffiths says. "But this example shows that when they really need equipment from foreign countries they find ways of acquiring it."