A Japanese daily says North Korea has withdrawn from a project to develop areas near the Tumen River.

The project, known as the Great Tumen Initiative, is an intergovernmental cooperation mechanism in Northeast Asia supported by the United Nations Development Program (UNDP). Member states include South and North Korea, China, Russia and Mongolia.

The Yomiuri Shimbun said Thursday that the Chinese government is embarrassed by the North’s withdrawal from the program, as Beijing announced last month that it would upgrade the development initiative to a national strategic project. The paper said the North’s withdrawal will make it difficult for China to pursue the river project as planned.

The paper said the North apparently withdrew from the project in protest of U.N. sanctions imposed on Pyongyang for conducting a nuclear test in May and amid concerns that the North Korean regime might collapse if it rapidly opens its doors.