Those identified in the report include a Chinese businessman and his sister said to be connected to a ship intercepted by Egypt a year ago while smuggling 30,000 North Korean rocket-propelled grenades. Just days earlier, the U.S. Navy had been conducting exercises with Japan Maritime Self-Defense Forces in the same body of water.
North Korea's ongoing pursuit of weapons of mass destruction is a "clear and present danger to all", U.S. Defense Secretary Jim Mattis said.
In recent weeks the U.S. has sent a fleet of warships into North Korean waters, and brought several new launchers for a defence missile system to South Korea to cope with any military threat from north of the border.
Last September the North conducted its fifth nuclear test, triggering global outrage and further sanctions.
The South's new president Moon Jae-In first proposed the ambitious idea to Federation Internationale de Football Association chief Gianni Infantino in a meeting on Monday, although Korean officials acknowledge China is likely to be lukewarm.
Any flare-up in the long-running dispute over "comfort women" could complicate efforts by Seoul, Tokyo and their ally Washington to cope with North Korea, which has been ramping up weapons tests since past year in defiance of global sanctions.
Moon said after the new launches that his government "won't back off even a single step and make any compromise" on the issue of national security.
Citing "escalating confrontation and heightened risks of catastrophic conflict" on the Korean peninsula, the World Council of Churches has called for the lifting of sanctions against North Korea.
The nominee to lead the Unification Ministry, Cho Myoung-gyon, has deep understanding of the new administration's North Korea policy and the issues facing the two Koreas, the presidential office said. It swept over the site before making a U-turn a few kilometers south of the site, the official said. In 2014, several other suspected North Korean drones were found south of the border and experts said they were crude and low-tech but could be considered as a potential security threat.
North Korea has so far conducted a total of five nuclear tests, in 2006, 2009, 2013 and twice in 2016, and numerous missile test-launches.
It added that it was a mistake to think that sanctions could not succeed against a country like North Korea, which was less isolated than it appeared.