Little by little is too little

On July 8 the United States Institute of Peace hosted a panel discussion titled “The North Korea Sanctions Regime a Year After Singapore.” The panel featured Dan Wertz, Program Manager at the National Committee on North Korea, Joshua Stanton, a DC-based lawyer who played  a significant role in North Korea sanctions, Stephanie Kleine-Ahlbrandt, a member of the UN Panel of Experts (Resolution 1874) dealing with North Korea, and Elizabeth Rosenberg, Senior Fellow at the Center for a New American Security. Frank Aum, former Senior Advisor for North Korea at the Defense Department, moderated the discussion.

Stanton views the history of US leadership on North Korea issues as many “instant gratification policies” instead of better thought out and more effective long-term policies. North Korea is highly dependent on access to US financial systems because of the status of the dollar. Since many North Korean transactions have to go through US banks, financial sanctions blocking transactions and freezing North Korean accounts can be highly effective. 

Stanton believes the conversation on sanctions relief is coming about two years too early. More pressure on the Kim regime is needed so that he has a diplomatic incentive to work with the US. Even small sanctions relief is enough for North Korea to catch a breather and continue the status quo. The argument that North Korea can’t survive without nuclear weapons and therefore won’t give them up is ahistorical, according to Stanton, because North Korea has survived for decades without nuclear weapons and can continue to do so. The threat to North Korea is mainly internal.

On possible sanctions relief, Stanton clarifies that Congress has set strict rules dependent not only on issues such as nuclear disarmament and denuclearization but also contingent on human rights, human trafficking, and other issues. The current direction in congress is towards stricter rules for sanctions relief, with the goal of complete, verifiable and undisputed denuclearization of North Korea. The US has to work together with its allies to set up financial sanctions that pressure Pyongyang while at the same time allowing transactions for non-military purposes that benefit the North Korean people. Humanitarian aid should be given to North Korea regardless of political or military actions since it benefits the poor and starving civilians, a point all the panelists agreed on.

Kleine-Ahlbrandt notes that the goal of the UN sanctions regime is to persuade North Korea to dismantle its nuclear and missile programs and prevent the proliferation of WMDs. Sanctions shouldn’t be the objective, which is to catalyze what she calls “effective dialogue.” At the same time the negative impact of sanctions on the economy and civilian population of North Korea should be limited. The UN sanctions regime is broad, but member states have insufficiently implemented the sanctions and evasion tactics by North Korean entities and individuals have undermined compliance. North Korea currently has full access to the international financial system through complicit foreign nationals, a network of agents, and cyberattacks aimed at financial institutions.

Wertz views the sanctions as having a threefold purpose: signaling to North Korea that provocative actions such as missile tests come at a cost, constraining progress on WMDs and other military capabilities, and coercing North Korea through sanctions pressure to make concessions and abandon the nuclear program in exchange for sanctions relief. Coercion is difficult because translating economic pressure to political actions is difficult. UN sanctions, which are focused on the missile and nuclear programs, can be modified if political consensus is reached within the UNSC on whether North Korea’s behavior warrants relief.

US sanctions are trickier since they are premised on a broad range of topics from WMDs to human rights, cyber-attacks, currency counterfeiting and more. The executive branch has some leeway on how it administers individual sanctions or waives them on a case by case basis, but to lift sanctions as a whole the White House has to certify to Congress that North Korea has made significant progress on several of the issues listed. This divergence of US and UN sanctions could potentially lead to a clash if North Korea abandons its nuclear program but doesn’t improve on human rights or other issues. 

Wertz suggests that a program of phased sanctions relief in return for meaningful concessions on the nuclear program could be in the US interest down the road and lists five principles for sanctions relief:

1. Any trade of sanctions relief for North Korean nuclear concessions should be premised on the ultimate goal of denuclearization but should also make sense on its own terms.
2. The US should start with the sanctions that have the least direct connection to the nuclear program and can be most easily adjusted and snapped back.
3. The US shouldn’t ease up on measures intended to deny hard currency to North Korea until it can guarantee the money won’t be funneled to military programs.
4. Sanctions relief should be structured in a way that pushes North Korea towards an open economy and minimal respect for labor rights.
5.  If sanctions relief goes forward the United States and allies should continue to enforce sanctions that haven’t been lifted, but not expand the scope of sanctions.

Rosenberg suggests the lack of compliance with sanctions is in part because many individuals or companies don’t understand or know about the rules. Awareness and compliance protocols in industries other than finance are rare. Before sanctions are removed, Rosenberg says it is valuable to think about what unwinding sanctions could look like. Sanctions shouldn’t be lifted as an incentive; behavioral change has to happen before sanctions are lifted because they are in place for specific concerns. Instead more work should be put into establishing communication and cultural as well as diplomatic exchanges as incentives, none of which require sanctions relief. 

Rosenberg also warns that a “little-by-little” approach to removing sanctions in exchange for limited progress doesn’t work. North Korea’s track record of cheating on sanctions means incremental change might create a façade behind which North Korea can do as it pleases. The only politically viable way ahead for the US is major sanctions relief after North Korea makes major and verified progress on denuclearization.

Here is the video of the event: