US sanctions on North Korea unveiled Wednesday by Secretary of State Hillary Rodham Clinton may sound like a move in the right direction: hurting the pariah state’s elites by targeting illicit and lucrative activities like counterfeiting and contraband sales.
But the measures are unlikely to produce the desired effect of coaxing Pyongyang back to stalled international talks on its nuclear program, some North Korea experts say. The moves resemble piecemeal steps of the past, they add, and are unlikely to strike where it hurts: the regime’s access to under-the-table international funds.
“If I were in Pyongyang, I would not be trembling in my boots about this,” says Nick Eberstadt, a North Korea specialist at the American Enterprise Institute in Washington.
Secretary Clinton, accompanied by Secretary of Defense Robert Gates, announced the measures while on a visit to South Korea intended to show US resolve toward the North. The trip was also meant to show support for the South in the aftermath of the deadly attack in April on a South Korean naval vessel, the Cheonan. Washington and Seoul blame Pyongyang for the attack that killed 46 South Korean sailors. The North denies responsibility.
Clinton and Secretary Gates included a visit to the De-Militarized Zone, 30 miles north of Seoul in their stopover, touring a building in a so-called “truce village” that straddles the north-south border.
At one point, curious North Korean soldiers peered through the building’s windows at the high-profile American visitors – a surreal juxtaposition, given that the sanctions that Clinton announced are designed in part to hit the North’s powerful military.
Clinton provided only a broad overview on the new steps against the North that will target the arms sales and other activities that fund the regime, as well as the purchase and importation of luxury goods used to reward the regime’s elites in the military and other administrations. More North Korean officials will be hit with travel bans while asset freezes are to be expanded.
The US is also planning to step up collaboration with international banks to curtail the North’s money laundering – the one measure that analysts say holds out any real hope of influencing Pyongyang.
“The one approach that has caught North Korea’s attention in the past is financial sanctions that disrupt its access to the international banking system,” says Ken Lieberthal, a senior fellow in foreign policy and a Northeast Asia expert at the Brookings Institution in Washington. “If we are not resorting to any Treasury-Department-sponsored efforts to get at North Korea’s banking activities abroad,” he adds, “there is reason to lack confidence that more sanctions will have any significant effect.”
The one US action analysts cite as successful: the US Treasury's designation in 2005 of the Macau-based Banco Delta Asia as a primary money launderer of North Korean illicit assets. That action prompted a wave of cooperation from other international financial institutions, including Chinese banks, that had no desire to run afoul of the treasury. North Korea took note, and eventually returned to the six-party nuclear talks, but in exchange for securing the release of $25 million held by Banco Delta Asia.
That deal was tantamount to a backing down by the US, some experts now say, especially since North Korea went on to pursue further nuclear-weapons progress.
“The Banco Delta Asia approach was the single effective stratagem, in part because it had the Chinese leadership on board, and that alarmed the North Koreans,” says Mr. Eberstadt, author of “The End of North Korea.” But, he says, the US “blinked” to get the six-party talks going again, “and once North Korea won that tug-of-war, it created an environment in which North Korea was convinced it could win in successive tugs-of-war with the US.”
But even if the latest sanctions do include serious financial measures that eventually prompt Pyongyang’s return to six-party talks, that could simply be the resumption of a pattern whereby Pyongyang talks while building nukes, analysts say.
“The real question, if the talks resume, is so what?” says Mr. Lieberthal. Neither Republican nor Democratic administrations have been successful over two decades at curtailing the North’s nuclear ambitions, he says, adding that the Obama administration “shows no signs of being in the mood to reward North Korea” to prompt its cooperation, a pattern he says the North has become accustomed to.
“So even if the talks resume at some point, would they produce any serious results?” he asks. “I remain very skeptical about that.”