Global Policy Forum

Punishing North Korea Won't Be Easy


By Barbara Demick

LosAngeles Times
June 11, 2009

Do you cut off the flow of cognac and caviar to Kim Jong Il? Close down the North Korean leader's personal bank accounts? Intercept ships carrying North Korean missiles?

The problem is that all these and more have been tried before in a two-decade-long struggle to restrain North Korea from developing nuclear weapons. If President Obama, as he promised last week, does take a "very hard look" at the Pyongyang problem, he will no doubt be disheartened by the failures of his predecessors.

Bill Clinton and George W. Bush seriously considered and then rejected military action, well aware that North Korea could retaliate with devastating consequences against South Korea and the U.S. troops stationed there.

Layer upon layer of embargoes and sanctions imposed on North Korea have failed to rein in Pyongyang's misconduct. The sentencing Monday of two U.S. journalists to 12 years of hard labor for trespassing is only the latest in a streak of unusually defiant behavior, even by North Korean standards. Since its May 25 nuclear test, North Korea has laughed off the myriad threats of sanctions, censure and interdictions emanating from Washington, Tokyo, Seoul and the ineffectual chambers of the United Nations.

Word that the five permanent members of the U.N. Security Council had signed off Wednesday on a draft resolution that would increase financial and weapons export sanctions on North Korea presumably didn't have Kim ready to say uncle.

Likewise, there is much talk about imposing a "quarantine," but North Korea already exists in one of its own choosing, a virtual biosphere of isolation. Kim hardly leaves the country other than for an occasional trip to China or Russia. His sons have been known to travel under false names and passports -- which would make barring foreign travel by North Korean nationals meaningless.

And the 67-year-old Kim has stockpiled enough luxury goods at his private villas to last well beyond his lifetime. Given his disregard for North Korea's 23 million citizens, sanctions are more likely to push them over the edge of starvation than to crimp his pampered lifestyle.

North Korea got away with barely a slap on the wrist after its first nuclear test in October 2006. U.N. Resolution 1718, passed after the test, barred trade in heavy weapons, dual-use technology and luxury goods.

The list of forbidden items included many of Kim's favorite indulgences -- lobster, flat-screen televisions, DVDs, iPods, furs, fountain pens, fine wines and spirits, purebred horses, porcelain and caviar. Economist Marcus Noland, who analyzed North Korea's trade data in the aftermath of the sanctions, concluded that the impact was "trivial to the point of being undetectable."

"North Korea appears to have calculated, correctly, that the direct penalties to its foreign trade for establishing itself as a nuclear power would be modest," Noland concluded in his study, published last January in the journal Asia Review.

The draft resolution now circulating among members of the Security Council would revive the 2006 sanctions and add tough new enforcement measures. It would require member states to inspect North Korean ships and aircraft to make sure they do not contain banned cargo.

But the burden of enforcement would fall largely on China, which has been reluctant to cut off its old communist ally. Almost everything that goes in or out of North Korea passes through China -- if not across the 850-mile land border, then through Chinese waters or airports. North Korea gets 90% of its fuel from China, most of its consumer goods and the majority of its food.

"I believe China is on board together with the major countries of the Security Council," U.N. Secretary-General Ban Ki-moon, a former South Korean foreign minister, said in an interview with Bloomberg News.

But others are unsure and blame China for the past failure of North Korea sanctions. "There is not a shred of evidence that China ever implemented the sanctions," Noland said in a telephone interview. "China has essentially acted as North Korea's enabler, watering down sanctions within the U.N. system, giving lip service in New York and then not implementing."

More effective than U.N. sanctions have been policies designed to shut North Korea out of the international banking system. In 2006, the Treasury Department threatened to blacklist the Macao-based Banco Delta Asia for its dealings with North Korea, which in turn forced banking regulators in the Chinese-ruled territory to freeze North Korean accounts.

"It was Kim Jong Il's piggy bank, literally," said David Asher, a former State Department official who devised the strategy to pressure the Macao bank. "We effectively delivered the message that we could radically complicate North Korea's access to the financial system."

For years, U.S. officials say, Macao had been the favorite banking hub for North Korea to launder its illicit earnings from drug running, counterfeiting and arms sales, and siphon into Kim's personal accounts the profits of its state-owned enterprises.

At times, the Chinese have found it more their style to act unilaterally and discreetly. In 2003, they cut off an oil pipeline for three days, blaming "technical problems" but in reality, according to diplomats, trying to nudge Pyongyang into nonproliferation talks.

But the Chinese have been reluctant to push too hard for fear they could cause the regime to collapse, creating a dangerous vacuum of power in the region.

The extreme poverty in North Korea also makes the idea of sanctions unpalatable. "There is always a lot of talk about how we need 'smart sanctions' that will minimize collateral damage to the public while targeting the leadership," said Scott Snyder, author of a book on negotiating with North Korea.

The international community is still searching for the "smart" part of the equation.


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