China appears to be making a key concession on North Korea

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Donald Trump Xi Jinping

AP Photo/Alex Brandon

President Donald Trump shakes hands with Chinese President Xi Jinping during a dinner at Mar-a-Lago, April 6, 2017.

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Chinese President Xi Jinping appears to be on board with the US when it comes to North Korea's nuclear program.

The Chinese leader said his country "insists on realizing the denuclearization of the peninsula ... and is willing to maintain communication and coordination with the American side over the issue on the peninsula," after a call with President Donald Trump on Tuesday.

Beyond words however, China seems to be making another move that underscores its interest in bringing Pyongyang to heel.

On April 7, Beijing's customs authorities issued an official order directing trading companies to return North Korean coal cargos, according to Reuters. That order came after the late-February ban on coal imports from Pyongyang, which was issued in response to North Korea's missile tests.

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Days later, a dozen North Korea ships sailed home from Chinese ports, leaving 2 million metric tons of coal stranded in Chinese ports.

The rejection of North Korean coal marks a shift in China's dealings with its isolated neighbor. Beijing has long used the coal trade to shore up the regime in Pyongyang, which relies on coal for about 40% of its total exports.

While China has been willing to criticize Pyongyang, its past soft-peddling on sanctions and other measures against North Korea have reflected Beijing's desire to balance the need for stability on the Korean Peninsula with moves to temper North Korea's military ambitions.

North Korea China coal imports

REUTERS/Stringer

An worker walks between front-end loaders used to move imported North Korean coal at Dandong port in the Chinese border city of Dandong, Liaoning province, December 7, 2010.

In March 2016, weeks after the UN applied a new set of sanctions, Chinese shippers and traders told Reuters that they hadn't gotten any word from Beijing about curbing North Korean coal imports, and observers suggested at the time that China was pushing for or had secured an exemption for its coal purchases.

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"Coal is a big lever for them," Adam Cathcart, a North Korea-China specialist at the University of Leeds, told Reuters in mid-March 2016. "They're wise from the Chinese standpoint to keep some leeway (so) they're not branded as sanctions violators if a train goes from China to North Korea (carrying resources)."

"China fears that harsher sanctions may destabilize its northern neighbor, which could potentially send millions of refugees over the border," Bethany Allen-Ebrahimian wrote this week for Foreign Policy. "But recent missile tests - and growing international pressure - have only narrowed Beijing's options."

Now, with Pyongyang's aggressive testing of missiles and Trump's hardline stance on relations with China and North Korea, Beijing appears more willing to push Kim Jong Un's regime.

china north korea

Reuters/Joseph Campbell

Chinese and North Korean flags outside the closed Ryugyong Korean Restaurant in Ningbo, Zhejiang province, China, April 12, 2016.

The US's threat of intervention on the Korean Peninsula was probably not the deciding factor in Beijing's change of tone on North Korea, however.

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Though China was dismayed by the deployment of the US-made THAAD anti-missile system to South Korea, strategists in Beijing were likely confident the US would be hesitant to launch military action against North Korea.

Prior to Trump's meeting with Xi this month, US officials said a key goal was getting China onboard with using economic leverage against North Korea, and coal would be a central part of that.

The specter of economic retribution from the US - which has become a major source of coal for China - coupled with concerns about Pyongyang's advancing nuclear capabilities probably moved China toward a stricter stance on North Korea.

"I think that [the Chinese] are quite worried about what Trump might do in the area of trade and economics - that's really credible," Bonnie Glaser, director of the China Power Project at the Center for Strategic and International Studies, told Business Insider earlier this month.