North Watchers: Will Sanctions Work?

Will the sanctions imposed against North Korea by the U.S. and Japan have such an impact to make the North return to the six-party talks and abandon its nuclear program?

Many North Korean experts are doubtful about that as both the U.S. and Japan are not closely related with Pyongyang in terms of its economy.

Yang Moon-soo, professor of the Graduate School of North Korean Studies, said on July 19, “Since the U.S. and Japan have already imposed many economic restrictions on the North, the effect of additional restrictions on the North will be limited.”

Also, it is uncertain whether North Korea has suffered a blow by the U.S.’ freeze on its $24 million (around 22.75 billion won) fund in the Macao-based Banco Delta Asia (BDA).

Jeong Hyeong-gon of the Center for Northeast Asian Economic Cooperation in Korea Institute for International Economic Policy said, “The U.S. does not have many restrictions left to additionally impose against Pyongyang. Japan may prohibit the pro-Pyongyang General Association of Korean Residents in Japan (Chongryon) from sending fund to the North. Both of them, however, are not likely to hit North Korea to the point of its collapse or nuclear weapons abandonment.”

Choi Soo-young, senior researcher at the Korea Institute for National Unification, also analyzed, “The financial freeze by the U.S. and Japan will not influence the North that much as it does not have many assets overseas.”

In other words, the U.S. and Japan will succeed in freezing the North only when South Korea and China, the two biggest donors and investors, sanction it.

Apart from rice aid, South Korea last year provided the North with $212.54 million (around 203.5 billion won) from the government and private sectors and $300 million (around 287.3 billion won) worth of goods and fund.

But some also say that North Korea’s economy will be hard hit when the U.S. and Japan slap additional financial restrictions as they did on the BDA if they find bank accounts of the North, allegedly used for counterfeiting or money laundering.

Japan`s Chief Cabinet Secretary Shinzo Abe said, “The sanctions may not collapse the North, but it can trigger instability by blocking the fund that goes to its leadership, party, and military force.”

Mr. Abe made this statement in his book “To the Beautiful Country,” which will be published on July 20. The book contains his ideas on governing. He also said, “The alliance between the U.S. and Japan is inevitable for the non-proliferation of nuclear program and stabilization of the Far East region. The alliance is the best option to achieve the goals.”

Young-A Soh weappon@donga.com sya@donga.com