New sanctions levied on North Korea after its third nuclear test this year risk pushing the country into a further humanitarian disaster

By Ben Blanchard

BEIJING, July 16 (Reuters) - New sanctions levied on North Korea after its third nuclear test this year risk pushing the country into a further humanitarian disaster by crimping relief efforts, says an aid worker who has just completed a trip to the isolated state.

Washington imposed sanctions in March on the Foreign Trade Bank, Pyongyang's main foreign exchange bank, saying it had helped fund North Korea's banned nuclear weapons programme. The measures bar bank dealings by U.S. entities or individuals.

Some European aid groups have said their banks in Europe had stopped sending money to North Korea in the wake of the U.S. sanctions, leaving them scrambling for a solution short of hand-carrying cash into the impoverished country.

Experts say Washington's move aims to make global banks that do business in the United States think twice about dealing with North Korea, in much the same way banks have become wary over ties with financial institutions in sanctions-hit Iran.

But these sanctions risk tipping North Korea over the edge, especially if it is hit by further natural disasters, said Kim Hartzner, managing director of Mission East, a Danish provider of food aid to children that has operations in the country.

"I am seriously concerned about the blockade. I'm seriously concerned about the consequences," Hartzner told Reuters late on Monday, adding that children, pregnant women and the elderly would suffer most from any disruptions to aid programmes.

"The country at large is in a state close to economic paralysis."

Natural disasters such as typhoons, heavy rain, or a smaller than expected soybean harvest would pose a tough challenge for aid groups, said Hartzner, after his fifth trip to North Korea since Mission East first gained access to the country in 2011.

"Should this happen again in a situation where stores are low and the rations need to be cut down, I think the inability to speed up the provision of humanitarian assistance could have very drastic effects," Hartzner added.

A famine in the 1990s is estimated to have killed a million North Koreans and experts say chronic food shortages reflect failures in the reclusive country's centralised economic system, which has sapped farm output.

Widespread deforestation since then has made North Korea's farm sector increasingly vulnerable to floods and drought.

North Korea is already under broad United Nations sanctions for its nuclear and missile tests, though humanitarian aid is not supposed to be targeted.

Hartzner said the new measures were hurting the work of his group, one of a handful of foreign non-government organisations allowed to operate in North Korea.

"It is very difficult to operate at the moment and yes, there have been problems in terms of bank transfers and procuring goods," he said.

Mission East has given food assistance to some 50,000 people in North Korea since 2011, and has just finished another programme for about 20,000 vulnerable people in South Hwanghae Province.

"It's a very fragile situation. We cannot afford to let down our guard. The time span to intervene and save lives is very, very short if conditions deteriorate further," Hartzner said.

(Editing by Clarence Fernandez)

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