China and Russia Go Along With More Sanctions Against North Korea

The US proposal was passed in a watered-down form

Tue, Sep 12, 2017
|
1,480Comments
MORE: Politics

The UN Security Council has unanimously voted to step up sanctions on North Korea in retaliation for the country’s recent sixth and most powerful nuclear test. The 15-member Security Council passed the resolution unanimously, with both China and Russia siding with the US against North Korea, which however should not come as a surprise because as previewed this morning, the US drastically watered down its original sanctions proposal, which now excludes Trump's prior demands for an oil import ban as well as international asset freeze on the government and leader Kim Jong Un, in order to win the support of Moscow and Beijing. This was the ninth sanctions resolution unanimously adopted by the 15-member council since 2006 over North Korea’s ballistic missile and nuclear programs.

Despite the compromises, U.S. Ambassador Nikki Haley said the resolution would cut North Korean exports by 90% and reduce the refined products available to North Korea by 44% and fuel by 30%. “Today we are saying the world will never accept a nuclear armed North Korea,” she said. “This will cut deep.”

Well, not really: the resolution slashes 55% of the country’s gas, diesel and heavy fuel imports, imposing a ban on condensates and natural gas liquids, a cap of 2 million barrels a year on refined petroleum products, and a cap on crude oil imports at current levels, in other words N.Korea's oil flow remain untouched (as a reminder, China supplies most of North Korea’s crude). According to US officials quoted by Reutrs, North Korea imports some 4.5 million barrels of refined petroleum products annually and 4 million barrels of crude oil.

The new resolution also will impose an embargo on all textile trade and require inspections and monitoring of North Korea’s sea vessels by member states, but doesn’t provide for the use of military force to gain access to the ships.

advertisement
According to the WSJ, a proposed ban on North Korean foreign workers, a source of an estimated $1 billion in annual revenue to the regime, also was reworded to allow countries to employ North Korean nationals if deemed vital for humanitarian reasons. It also doesn’t apply to workers who hold contracts taking effect before the adoption of the resolution.

Previously, China and Russia - veto-holders on the 15-member Security Council - had voiced opposition to harsher measures and threatened to block the vote if the ban on oil remained. China is reluctant to pressure the North Korean regime to the brink of collapse fearing instability at its border, a flow of refugees and a possible American military presence. Both Russia and China have said they favor direct talks and not sanctions.

Nikki Haley said that the sanctions will target $1.3 billion in North Korea revenue. The US ambassador to the UN added that the "strong relationship between Trump and Xi played a key role in negotiating the new UN sanctions", or translated: China imposed its terms on the US proposal so that China would note veto the mostly optical measure, to avoid making Trump look weak again in the UN. She also said that the US is "not looking for war" with North Korea, and added that North Korea has not yet "passed the point of no return." That said, by now it is completely unclear just what would entail passing said "point of no return."

After a week of intense negotiations, a unanimous Security Council vote against North Korea was viewed as politically more important than a strong U.S. stand that risked division, diplomats said. “Any perception of weakness on the side of the Security Council would only encourage the regime to continue its provocations and objectively create the risk of an increasingly extreme situation,” said France’s Ambassador François Delattre.

Of course, further provocations by the regime at this point remain all too likely. And so, now attention turns to Pyongyang and North Korea's response: overnight, the state-run KCNA agency unleashed numerous warnings and threats toward the US should the sanctions pass.  “In case the U.S. eventually does rig up the illegal and unlawful ‘resolution’ on harsher sanctions, the DPRK [North Korea] shall make absolutely sure that the U.S. pays due price,” the spokesman of the country’s Foreign Ministry said in a statement.

However, it is unclear if these drastically watered down sanctions, which have China's explicit blessing, will be sufficient to prompt another ICBM launch and/or nuclear test. In any case, keep an eye on those flashing red headlines.

Source: Zero Hedge

advertisement

Click here for our commenting guidelines