SWISS-DPRK TRADE VERY LIMITED

S E C R E T BERN 002060 SIPDIS SIPDIS E.O. 12958: DECL: 11/08/2016 TAGS: ETTC KNNP PARM TRGY MNUC IAEA SZ SUBJECT: SWISS-DPRK TRADE VERY LIMITED REF: A. SECSTATE 178917 ¶B. STATE 180512 Classified By: A/DCM Stan Otto, E.O. 12958, Reasons 1.4 (b) and (d) ¶1. (S) Summary: In response to REFTELS A and B, on November 7 Emboffs spoke with Swiss State Secretariat for Economic Affairs, Bilateral Economic Relations Division, Export Controls and Sanctions Chief Othmar Wyss about Swiss-DPRK trade relations. According to Wyss, Swiss trade with North Korea is very limited. No weaponry can be exported to North Korea, and the last sale of any "dual-use" mining or drilling equipment was in 2001. The majority of Swiss exports to North Korea are pharmaceutical products. Luxury watch sales have fallen off considerably, probably because Swiss watches are being retailed in China rather than directly from Switzerland. Other exports include old model auto parts and lubricants. End summary. ¶2. (S) In response to subject matter in REF A, Wyss said that Swiss companies had not exported any mining or drilling equipment or parts to the DPRK since 2001. In 2001, SECO approved the sale and export of a small boring machine (company not disclosed),valued at 380 thousand Swiss Francs (approximately $300 thousand). Since that sale, Swiss firms have sold no replacement parts to the DPRK for this machine. Wyss stated that mining and drilling equipment are dual-use items and require SECO export licenses. ¶3. (S) Wyss also discussed Swiss-DPRK trade, REF B, with Emboffs. He noted that Swiss trade figures with such countries as North Korea, Iran and Cuba are not public information, though he provided Emboffs with figures. SECO figures for Swiss exports to the DPRK are: 2006 - CHf 5.5 million (end of third quarter) 2005 - CHf 4.5 million 2004 - CHf 6.1 million ¶4. (S) Wyss also described the composition of the Swiss exports, telling Emboffs that the majority of exports to the DPRK are pharmaceutical products. The other "major" exports are old model auto parts, watches and lubricants. Given UNSCR 1718's focus on stopping certain categories of trade with the DPRK, Wyss provided more specific data on Swiss watch exports to North Korea. He noted that the Swiss government does not keep track of "high-value" watch and "low-value" watch exports, but rather limits itself to "total exports." However, the government does have a definition for "high-value" watches: any watch valued at over one thousand Swiss Francs. SECO's figures for Swiss watch exports to the DPRK are as follows: 2006 - CHf 12,000 in exports 2005 - CHf 300,000 in exports 2004 - CHf 2.5 million in exports 2003 - CHf 5.1 million in exports 2002 - CHf 6.2 million in exports 2001 - CHf 5.2 million in exports ¶5. (S) Wyss hypothesized that watch exports from Switzerland to the DPRK were falling because North Koreans can purchase these time pieces more easily in Beijing now that China is a WTO member and has its own retailers dealing in watches. ¶6. (S) Embassy Bern will continue to seek additional information to report to Washington on issues of interest from REFTELS A and B. CONEWAY