Egyptian business executives ordered $23 million worth of rockets from North Korea for the Egyptian army in a complex and illicit arrangement that was thwarted by U.S. intelligence services, The Washington Post reported on Monday.

The failed deal prompted a United Nations investigation and a series of U.S. complaints over Egypt's sanction-defying attempts to purchase North Korean weaponry, just one link in the chain of a global arms trade that the report describes as a "vital financial lifeline" for the country's leader, Kim Jong Un.

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Egypt's purchase was foiled when U.S. intelligence officials spotted a rusty freighter flying Cambodian colors chugging toward the Suez Canal. A message was then transmitted from Washington to Cairo, warning about the ship's North Korean origin and crew, and the fact that its mysterious cargo was hidden by bulky tarps.

Open gallery view A rocket-propelled grenade, the weapon that Egypt sought to purchase from North Korea. In this image, it is being used by a Kurdish Peshmerga fighter in Iraq in 2014. Credit: Reuters

When customs officials searched the vessel upon its arrival in Egyptian waters, they discovered a stock of over 30,000 rocket-propelled grenades hidden under bins of iron ore in what the UN report would later describe as the "largest seizure of ammunition in the history of sanctions" against Pyongyang.

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Although the Egyptian Embassy in Washington claimed Cairo had cooperated with the UN by detecting and destroying the arms – thus abiding by UN restrictions on arms purchases from Pyongyang – U.S. officials said that Washington had essentially forced Cairo to foil the shipment by alerting authorities through diplomatic channels.

Following the UN report, the Trump administration decided in July to withhold $290 million in military aid cut out for Egypt over its military deals with North Korea, which, according to the report, has become "a kind of global eBay for vintage and refurbished Cold War-era weapons."

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The U.S. State Department said at the time that aid to Egypt was being reduced because of what it called the country's lack of progress on human rights and a new law restricting the activities of nongovernmental organizations. Its statement did not refer specifically to the relationship between Egypt and North Korea, but said that issues in dispute had been raised with Cairo.

In response, Cairo said the decision could have negative consequences for the mutual interests of the two countries, and canceled a meeting that had been scheduled between Egyptian Foreign Minister Samah Shoukry and Trump’s aide and son-in-law, Jared Kushner.

Egypt's ties with North Korea are not new. Cairo has been close with the hermit kingdom since at least the 1970s. North Korean pilots trained Egyptian fighter pilots before the Yom Kippur War, and Egypt was later accused of supplying Scud missiles to Pyongyang.

According to a report by South Korea's Yonhap news agency, Egypt's defense minister announced in September that his country had cut its military ties with North Korea.

Mohammed el-Menshawy, an Egyptian analyst based in Washington, told The Associated Press at the time that the Trump administration had been privately urging Cairo to cut military ties with Pyongyang.

"The recent cut in the U.S. military aid to Egypt was a clear message to Cairo: You choose us or North Korea, you cannot have military relations with both of us," he said. "Cairo got the message and it cut ties with North Korea."

Reuters and AP contributed to this report.