hankyoreh

UN Security Council Resolution 2371 North Korea sanctions

Resolution 2371 on sanctions against North Korea, which was unanimously adopted by the UN Security Council on Aug. 5, includes intensive measures that could shut off a large portion of North Korea’s hard currency through external trade.

But experts are saying the sanctions alone are unlikely to prevent North Korea from advancing its nuclear and missile capabilities in the short term.

The latest resolution for sanctions includes bans on all North Korean coal and iron. According to KOTRA data, North Korean exports of solid mineral fuels such as coal and lignite totaled some US$1.19 billion last year, or 42% of all exports (US$2.82 billion).

That percentage is believed to have fallen this year after UN Resolution 2321 last November, which stated the aim of reducing coal exports to 38% of 2015 levels. The latest resolution also incorporated existing provisions waiving sanctions in cases where exports of a third country‘s coal pass through North Korea’s Rajin Port. This could be seen as a nod to Russian coal exports to other countries by way of Rajin.

At US$74 million, North Korean iron ore exports did not account for a very large percentage of all exports last year. Exports for precious metals and nonferrous metals such as copper and nickel are also minimal - indicating that the ban on coal imports was the real heart of the resolution.

Apart from coal, iron ore, and nonferrous metals, a large part of the sanctions concerned seafood exports, which were included in a resolution for the first time. North Korea exported around US$195 million worth of fish and crustaceans last year, an area that experienced a 75% gain from the year before. Leader Kim Jong-un has also been seen emphasizing the importance of the seafood industry, paying visits to numerous People’s Army seafood project sites between late 2016 and early 2017. The resolution does allow exports for up to 30 days from its UNSC adoption date for previously contracted items.

The resolution did not target garments, which accounted for 25% of all exports (around US$720 million) last year. Garment exports follow a structure where toll processing is carried out in North Korea through subcontracting from China.

The UNSC predicted the latest export bans would have the effect of blocking US$1 billion (1.126 trillion won) in hard currency, or roughly one-third of North Korea’s annual exports. Soon after the resolution’s adoption, US President Donald Trump tweeted that it would have a “very big financial impact” on North Korea and deliver “over one billion dollars in cost to N.K.”

In addition, the resolution banned UN member countries from new hiring of North Korean workers. It’s an area where Pyongyang was already expressing concerns under UNSCR 2321. North Korea reportedly has over 50,000 workers deployed in some 40 countries.

A South Korean Ministry of Foreign Affairs official explained that the measure was “a kind of ‘cap’ system that allows [countries] to maintaining the total number of workers they had employed at the time the UNSC adopted the resolution.”

“They will be able to hire new workers if there is any shortage in their total numbers,” the official said.

The resolution further banned the forming of new joint ventures with North Korea and new investment in existing ones. Vessels designated by the UN Sanctions Committee (DPRK) as violating UNSC resolutions were also banned from entering ports in UN member countries.

Also noteworthy is the resolution‘s reference to recent test-launches “which the DPRK has stated were tests of intercontinental ballistic missiles.” The qualification appeared to be a reflection of objections from Russia, which has claimed that North Korea test-launched intermediate-range missiles rather than ICBMs.

Analysts said that while the resolution may succeed in blocking a substantial portion of future hard currency, North Korea already has a large amount of accumulated funds.

“Analyses show that North Korea has already stockpiled billions of dollars through coal exports since 2009,” said John Park, director of the Korea Working Group at Harvard Kennedy School, in a meeting with the Hankyoreh.

“It’s going to be able to hold out for a while, not just a few years,” he predicted.

Park also suggested Pyongyang could find more advanced means of circumventing sanctions the longer they go on.

If accurate, the analysis suggests a “speed gap,” where the rate at which sanctions take effect fails to keep pace with development of nuclear and missile program capabilities due to the Pyongyang regime‘s durability and cash stores. It’s for this reason that negotiations are needed to halt further nuclear and missile testing.

By Yi Yong-in, Washington correspondent, and Noh Ji-won, staff reporter

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