For North Korea, sanctions hold little sway

UN condemnation brings vows from North to restart nuclear program, pull out of six-party talks.

China's success in averting tough new United Nations sanctions against its ally, North Korea, has not stopped Pyongyang from angrily rejecting Monday's watered down UN Security Council condemnation of its recent missile test. The pariah state's violent rhetoric cast a new shadow over the Korean peninsula's future.

North Korea announced Tuesday it would restart nuclear-weapons development and pull out of "useless" international negotiations to shut down its nuclear program, slamming the UN statement as "rampantly" infringing on the country's sovereignty.

Judging by past experience, Pyongyang will get away with its intransigence. The UN Security Council statement – drafted only because China and Russia would not agree to a legally binding resolution – says merely that it will "adjust" sanctions that have barely been enforced since they were imposed in 2006.

So far, "they have had no significant impact … not enough to change North Korean policy calculations," says Denny Roy, a North Korea analyst at the East-West Center in Honolulu.

That failure appears to have prompted South Korea to raise the stakes with the North by becoming a fully fledged member of the US-led Proliferation Security Initiative. Government sources in Seoul said the cabinet decided Tuesday to join the 15-member group, initiated by then-President George Bush in 2003 and dedicated to blocking shipments of missiles and weapons of mass destruction. Until now, Seoul has been only an observer, for fear of antagonizing Pyongyang.

The 2006 sanctions, agreed to in the wake of North Korea's test of a nuclear device, have had little impact, partly because they were very narrowly framed. They banned UN member states from buying or selling only items related to ballistic-missile, nuclear, or weapons-of-mass-destruction programs, as well as luxury goods.

They have had negligible effect also because the United Nations has done little to enforce even those limited sanctions, leaving it up to member states to decide what to do. Last year, the UN committee set up to monitor compliance with the sanctions regime did not even meet.

UN Security Council Resolution 1718, which imposed the 2006 sanctions, asked a UN committee to draw up a list of North Korean companies and individuals associated with Pyongyang's missile and nuclear programs. Their overseas assets were to be frozen, and individuals were to be forbidden from foreign travel. No such list has yet been prepared.

By the end of last year, only 73 countries – little more than a third of UN member states – had informed the world body of the steps they had taken to enforce the sanctions. During the course of 2008, "no information relevant to the implementation of its mandate has been brought to the attention of the Committee" overseeing the sanctions, according to a report by committee chairman Giulio Terzi di Sant'Agata last December.

Though China was one of the reporting countries, it pointedly said nothing about any plans to end its exports of luxury goods, which North Korean leader Kim Jong Il reportedly employs to encourage top officials to remain loyal.

"Lack of cooperation from Russia and China" is to blame for the failure of sanctions, argues Kim Sung-hak, a political scientist at Hanyang University in Seoul. Since Resolution 1718 did not specify banned luxury items, he points out, "they left it up to each country" to decide, and "each country has different yardsticks."

In fact, Chinese luxury exports to Pyongyang actually increased from $90 million in 2006 to $120 million in 2007, according to a recent study of Chinese export figures by Marcus Noland, an economist at the Peterson Institute for International Economics in Washington.

The 2006 sanctions "have had no perceptible effect on North Korea's trade with its two largest partners, China and South Korea," who between them account for more than 50 percent of North Korea's merchandise trade, Mr. Noland wrote in his report.

China's overall trade with North Korea rose 16 percent from 2006 to 2007, according to official figures quoted by the state-run Xinhua news agency.

South Korean trade with the North peaked at $1.82 billion in 2008 on the basis of previously reached agreements, but South Korean exports in the first three months of this year were down by 39.2 percent from the same period last year. North Korean exports to the South, notably minerals such as zinc and tungsten, fell by 6.1 percent.

Seoul has not provided aid to North Korea since 2007, the last year of the presidency of Roh Moo Hyun, committed to carrying on the "sunshine" policy of reconciliation with the North initiated by his predecessor, Kim Dae Jung, in 1998. South Korea, in 2007, shipped 400,000 tons of rice and 350,000 tons of fertilizer to the North.

Meanwhile, Chinese regulatory agencies are not necessarily in full control of the situation – although China "responsibly respects UN Security Council resolutions," Chinese Foreign Ministry spokeswoman Jiang Yu insisted Tuesday, and there have been no recent allegations that Beijing is supplying Pyongyang with banned technology.

A New York district attorney this week indicted a Chinese firm for allegedly illegally using US banks in deals to sell sanctions-busting missile and nuclear technology to Iran. The manager of the firm, Li Fangwei, has denied the charges.

The Security Council statement instructed its sanctions committee to draw up a list of banned export goods and blacklisted companies and individuals by April 24. But "adjusting" the sanctions, expected to involve minor tweaks, is unlikely to have much effect.

Washington's current specification for a luxury item, for example, bans television sales only if the sets are high-definition TV or larger than 29 inches. Even Japan, which pushed hardest for a tough UN resolution, does not outlaw financial transfers from people in Japan to North Korea.

"The one channel that might possibly have an impact would be a financial embargo," suggests Dr. Roy. "That would be a pretty substantial form of pressure."

If North Korea is to take international warnings seriously, argued Noland in his report, "they must embody credible threats of penalty," and "trade sanctions … will have to be much more broadly targeted and enthusiastically implemented."

But with China and Russia – both permanent members of the UN Security Council and involved in the six-party talks to denuclearize North Korea – firmly opposed to new sanctions, they are not going to happen, says Roy.

"Anything requiring tough action has to deal with the lowest common denominator, defined by China and Russia," he adds. "There is little prospect of serious, substantial sanctions, or of any kind of punishment that would put any serious pressure on North Korea."