Session:

4

Date/Time:

September 25, 2013 / 15:45-17:15

Moderator:

William Newcomb, United Nations

Speakers:

David Asher, Center for New American Security

Kim Joongho, Korea Export-Import Bank

Yang Xiyu, Chinese Institute of International Studies

William Newcomb, the United Nations Security Council Panel, DPRK Panel of Experts

Session Sketch

The moderator of the session, Bill Newcomb, a member of the United Nations Security Council Panel, DPRK Panel of Experts, began by describing the nature of sanctions to have been always reactive rather than preventive and then kicked off the session by introducing the key topic of the session – whether it is possible to have more effective smart sanctions.

David Asher, Adjunct Senior Fellow at Center for New American Security, began by introducing multi-agency efforts to pursue non-sanctions approach to apply pressure against the DPRK regime. Because the Kim family of the DPRK largely relies upon illicit activities such as drug smuggling and counterfeit cigarettes production, it is crucial to target these operations as part of the North Korean policy. Thus, Dr. Asher emphasized the importance of inter-agency coordination globally which would enable relevant information to be effectively shared and thus make the policy more effective. With the problem recognized, he introduced an operation called Banco Delta Asia (BDA) as an example of multinational group of task forces operated by scaring the international financial community into complying with any money laundering provisions against the government of the DPRK. Dr. Asher concluded by noting the importance of developing a new approach, notably non-sanctions-based approach, in dealing with North Korea.

Kim Joongho, Senior Research Fellow at the Korea Export-Import Bank, started by describing the state of North Korea to have a dual face. He stated that despite illicit activities bring some money to the Kim’s regime, the regime nowadays pursues more legalized ways of doing business by sending more people abroad to wire back money and learn more technologies. In his view, the North Korean regime has been shifting their focus from provocation to development at this moment and also trying to attract more foreign investors. Kim also pointed out that the problem of current sanctions regime comes from lack of understanding of the North Korean regime’s economic operation. Consequently, Kim concluded by emphasizing the need to develop smart ways of sanctioning by fully understanding what North Korean regime is interested in order to sharpen our tools to leverage North Korea.

Yang Xiyu, Senior Fellow at the Chinese Institute of International Studies, began by pointing out that despite increase in external sanctions pressure, North Korea’s economic performances have been improving. However, he claims that this does not suggest ineffectiveness of the sanctions but a natural course of North Korean economy coming from their own policy changes. Dr. Yang also described the “Dual Focuses Strategy” of the North which includes both economic prosperity and nuclear development. Later on, he criticized the nature of the strategy to be unsustainable and zero-sum. Under this circumstance, Dr. Yang criticized the current sanctions regime and strongly suggested that international community should build a comprehensive architecture under which both strategic benefits and consequences are strong as well as tangible. Therefore, he concluded by claiming that what smart sanction regime needs is bolder and decisive diplomacy on the nuclear issue to build up a comprehensive architecture, under which sanctions is just one of the pillars.

Bill Newcomb, moderator and a speaker for the session, firstly explained what smart sanctions are: smart sanctions are targeted actions, trying to affect the decision making calculus of leaders to affect the vested interests of those who have a stake in what’s going on but not to have unintended consequences. Then, Newcomb described some of the problems sanctions regime faces such as implementation issues due to capacity-gaps amongst the member states. Although sanctions worked for a while, much of the focus has given sway to politics, which determine the form and content of these resolutions, and the measures adopted, which reflect an often difficult to reach consensus. Nonetheless, Newcomb claims that efforts to evaluate the effectiveness of sanctions are indispensible. By providing more information to the member states, Newcomb hopes to increase effectiveness of the sanctions regime.

During the question and answer section, the floor was opened with discussions on the US and international community’s efforts to crack down North Korea’s illicit activities. In order to bring changes to North Korea, combination of policy and strategy is necessary. Then, a question was asked regarding Chinese attitude towards North Korea in terms of sanctions. In fact, China has cooperated and brought about profound effect although their operations were not a designated entity by the UN. Adding on to this, Prof. Yang thoroughly described Chinese economic ties with the DPRK and their relationship. As well, an issue relating sanctions to trust-building process on the Korean peninsula was raised, asking whether carrying out the sanctions will promote the trust-building process. As trustpolitik is based on firm position against North Korea, sanctions will be included as correcting tools but at the same time the South Korean government continues old ways of dialoguing. Finally, in terms of effectiveness of the sanctions regime, the most effective way is for member states to recognize that following through the sanctions process is in their favor of protecting themselves.