Reading Western media, one can get the impression that the sanctions introduced after the nuclear missile tensions of 2016 significantly hit the DPRK economy. That famine, followed by the “Maidan” and regime change, is already knocking at the door. Is this true?
No. The effects of any sanctions manifest themselves roughly in a year and a half, but even now, it is possible to note a few interesting developments.
Fact No.1. According to the Japanese newspaper – Tokyo Shimbun quoting North Korean sources, the sanctions allowed to partly solve the power supply problem. As a result of the ban on the import of North Korean coal, power supply to Pyongyang was normalized.
However, the Japanese media misrepresented the fact – coal supply to China had started to decline even before the sanctions: after successfully implementing the reforestation programs, the coal began to be sold to the general public to ensure that the villagers did not cut down the woods.
Fact No.2. As the Indian agency ANI reported on June 23, in spite of the sanctions, Pakistan has been delivering equipment and various materials to Pyongyang that could be used in the development of its nuclear program: heat resistant alloys, Monel and Inconel, vacuum induction furnaces where uranium and plutonium could be melted. Supplies have been organized through a Chinese intermediary company. The Chinese government knew about it, but did nothing.
Yes, this can be part of the Indo-Pakistani information war, but Swiss lifts in Masik ski resort in North Korea appeared in a very similar way.
Fact No.3. According to the South Korean military, North Korea started to equip its patrol boats with the American Gatling quick gun system. South Korea and the United States are trying to identify the channels that North Korea used to get the guns, and that they were likely purchased through “one of the Middle Eastern countries.”
Fact No.4. As the Xinhua News Agency reported on July 11, a special tour program was launched in the border province of Liaoning in north-eastern China, which allows Chinese tourists to visit the North Korean border town of Sinuiju without a passport for a half-day period. The only thing necessary is to request permission to travel to Dandong, pay 350 yuan and go through customs control in the DPRK. It is reported that during the first three days of the program, nearly a thousand Chinese tourists obtained entry permissions.
Apparently, this is how “all the channels are closing down”, but that’s not all.
Fact No.5. Hong Kong-based company Shenzhun has already developed a plan to create an international tourist area, and is building the basic infrastructure on the eastern slope of Mount Baekdu located on the border of North Korea and China. Baekdu attracts a large number of tourists, but almost all of them visit the Chinese side, which provides better transport and tourist infrastructure. Now, however, “the Korean part” is being developed, for which in April 2015, the 20 square kilometre area in that construction region was declared an international tourism zone by the DPRK authorities.
Fact No.6. As the South Korean news agency Yonhap stated (albeit with a reference to anonymous sources in the area of the China-North Korean border), North Korean authorities have forwarded the Chinese a proposal to build a highway together, which will run from China through the DPRK up to the border with the South. The North will pay for the project with its coal, gold and other natural resources. If the sources are correct, the agreement on the construction of this highway was reached in October 2015, when Liu Yunshan, a member of the Politburo of the Communist Party of China, attended the celebration of the 70th anniversary of the Workers’ Party of Korea. Then, against the background of the nuclear and missile crisis, the project was postponed. However, under the new situation, the ceremony for the initiation of the construction project shall reportedly be held on July 27, the day of signing of the truce agreement of the Korean War in 1950-1953.
Moreover, according to the Russian and Chinese diplomats and experts, the living standards (at least in Pyongyang) do not seem to fall. In addition, the regime has actively invested in the construction of new districts, more similar to Hong Kong or Seoul, with standard multi-storey buildings up to 35-40 floors, following the Chinese model.
It should be again noted that the issue of maintaining a truly harmful sanctions regime is largely dependent on China. Let us recall that when imposing sanctions in accordance with the UN resolution, Beijing noted that it would buy North Korean minerals as long as the money used for their payment will not evidently be used for military purposes. Like Russia, China will ban something only if there are “reasonable grounds” to suspect that received payments from these transactions will be used to fund the North Korean nuclear program. There are no further clarifications on what these “reasonable grounds” include, which means that there is a potentially gray area. And if there is no solid evidence of the nuclear missile program involvement, there is no reason not to trade.
Perhaps this is why the USA and its allies are actively looking at introducing their own additional sanctions and searching for every smallest reason to impose some further limitations on the DPRK. How effective this will be aside from being used for propaganda purposes, only time will tell.
Konstantin Asmolov, Ph.D. in History, Chief Research Fellow at the Center for Korean Studies of the Institute of Far Eastern Studies of the Russian Academy of Sciences, exclusively for the online magazine “New Eastern Outlook”.