UN sanctions on NKorea may be futile

[June 13, 2009]  SEOUL, South Korea (AP) -- Sanctions can hobble countries that have bustling global trade and whose leaders give higher priority to feeding their malnourished people than building a nuclear bomb.

But that's not North Korea.

The United Nations' new sanctions against North Korea to punish it for its latest atomic test are mostly a symbolic, feel-good gesture by the international community - the moves are unlikely to stop the Stalinist regime from trading weapons with rogue nations or hobble its already crumbling economy.

The sanctions - approved late Friday by the U.N. Security Council - toughened an arms embargo and authorized ship searches on the high seas in an attempt to thwart its nuclear and ballistic missile programs.

The unanimous support for the resolution reflected the international disapproval for the North's defiance of the council after its second test on May 25 that heightened global tensions to a fever pitch.

But even though its economy is in shambles, the North will likely be able to limp along, many experts say. In some ways, the nation's financial failures help stoke its desire for developing and selling dangerous weapons. Without the ability to nuke Japan or hit Alaska with a missile, the country is just another foreign aid-addicted Third World economic basket case that can be pitied and ignored.

"North Korea is so far behind South Korea in terms of the economy and military capability, and that trend is irreversible," said Lee Woo-young of the University of North Korean Studies in Seoul. "But a nuclear weapon is something that can put North Korea on an equal footing at very low cost and very effectively."

One sanction that will likely hit the North hard seeks to deprive it of financing and material for its weapons program and bans the cash-strapped country's lucrative arms exports, especially missiles.

Pyongyang is believed to earn between $500 million and $1 billion in arms sales a year, compared with the its annual civilian trade of about $3 billion.

The provision most likely to anger the communist nation, however, deals with searches of cargo, and calls on all countries to inspect North Korean cargo at their airports, seaports or on land if the ships are reasonably suspected of carrying banned arms, weapons or the materials to make them.

But the North Koreans have proved to be wily traders in the past, and many of their customers may be nations like Iran and Syria that may not cooperate with U.N. sanctions.

Much of the freight can also be transported by plane, and one of the North's most prized products - technical nuclear know-how - is safe in the minds, hard drives and brief cases of their scientists who can travel without restrictions and transfer their knowledge in person.

The new resolution also calls on all countries to prevent financial institutions or individuals from providing financing or resources that could go to the North's weapons program - a move that could damage the North's already fractured economy.

North Korea's economy shriveled up for several reasons. Disastrous economic planning and ill-conceived mega projects played among the biggest roles.

One grandiose scheme involved mobilizing millions of workers to chop down trees on mountain slopes to create about 740,000 acres (300,000 hectares) of terraced cropland in the 1980s and 1990s.

But the terraces weren't properly reinforced, so when the summer rains came, they collapsed and the soil got washed away into reservoirs, rivers and irrigation canals - clogging up the waterways and creating a double disaster.

Its economic woes intensified when the Soviet Union and Eastern Bloc countries - huge sources of aid and trade - began crumbling in the 1980s and early 1990s. The crisis was compounded by bouts of severe flooding and crop failure, setting the stage for a famine in the mid and late 1990s that killed millions of people.

"We got used to seeing dead bodies everywhere - at train stations, on the streets," a saleswoman who survived the disaster and defected to the South was quoted as saying in a Human Rights Watch report in 2006.

Oddly though, the famine has helped the regime survive, said Jasper Becker, author of the book "Rogue Regime: Kim Jong Il and the Looming Threat of North Korea."

"One of the reasons they get by now is that the population shrank by 3 (million) to 4 million during the famine," he said. "There are fewer mouths to feed."

But Becker said the North's industry barely functions because factories are outdated, dilapidated or have been stripped of their parts by starving people who sell scrap metal to China to buy food.

"If you wanted to modernize the economy today, you would have to junk everything," he said. "You would do them a favor if you bombed it into the ground."

A gleaming new factory park in the border town of Kaesong - run jointly with South Korea - has been a good source of hard currency. But a desperate North Korea demanded a fourfold increase in wages, and a 31-fold increase in rent on Thursday - which could end up dooming the lucrative industrial park.

And with aid no longer flowing in from the North's allies in Russia and Eastern Europe, neighboring China has become the nation's biggest patron. In 2003, about 33 percent of the North's external trade was with China, according to the state-run Korea Trade-Investment Promotion Agency in Seoul. But by 2008, the amount of trade had soared to 73 percent, the agency said in a report last month.

Last year, the North imported about $2 billion worth of crude oil, petroleum, synthetic textiles and other products from China, while it exported $750 million worth of coal, iron ore and other goods to the Chinese, the report said.

The numbers highlight how much Pyongyang depends on China and the enormous amount of influence Beijing has on the regime, said Daniel Sneider, associate director of research at the Walter H. Shorenstein Asia-Pacific Research Center at Stanford University.

"The North Koreans are running a $1.25 billion trade deficit with China," Sneider said. "Given that North Korea cannot finance their trade deficit through borrowing, I take that as an effective Chinese subsidy of North Korea. Indirectly, you're subsidizing the North Korean nuclear program and the missile program."

John Bolton, the former U.S. Ambassador to the U.N., once argued that by cutting off North Korea, China could single-handedly "end this thing tomorrow."

But Yang Moo-jin, a professor at Seoul's University of North Korean Studies, said China doesn't want an unstable regime across its border. Beijing wants to maintain its influence over North Korea through the aid, while it doesn't want to see a collapse that would prompt refugees to stream across the border.

"If China doesn't take substantial action, sanctions on North Korea would have little effect," said Cho Myung-chul, a defector-turned analyst at Seoul's state-run Korea Institute for International Economic Policy.

China supported the sanctions, and the country's U.N. Ambassador Zhang Yesui said the issue should be resolved "peacefully through dialogue and negotiations." But it was unclear how hard China would work to enforce the sanctions, especially along it long porous border with the North.

When North Korea tested its first nuclear device in 2006, the U.N. passed sanctions that were not effectively enforced because the North quickly returned to stalled six-nation negotiations on ending its nuclear program. The North's total trade stood at $2.99 billion in 2006, and the figure decreased by 1.8 percent to $2.94 billion in 2007, the South Korean trade agency said.

North Korea has been carefully experimenting with reforms since 2002, lifting some price and wage controls and introducing markets selling food and consumer items. But the country seems to be backing away from these measures as the army tightens its grip on the power, said Lee at the University of North Korean Studies.

He said South Korean businessmen who travel frequently to the North tell him trade and economic officials they once dealt with appear to have less authority. They are answering more to security and military figures, he said.

Little is known about who really runs the economy. The North's news agency paints a picture of the nation's enigmatic leader, Kim Jong Il, as a brilliant economist running a booming socialist system. Reports describe how he is constantly touring farms and factories, dispensing expert advice about how to increase production.

But a transcript of a rambling speech Kim gave in 1996 during the famine suggests that he was acutely aware of his country's economic woes.

He mentioned "heart-aching occurrences" and complained that "the food problem is creating a state of anarchy," according to the text, smuggled out by the high-ranking defector Hwang Jang Yop and published in the "Monthly Chosun" magazine in Seoul.

Kim shrugged off responsibility for the economic mess by saying he was following his father's advice not to focus too much on the economy.

"If I got involved in economic work," he reportedly said, "I would not be able to handle party and army work properly."

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Associated Press writers Hyung-jin Kim and Jae-soon Chang contributed to this report.

[Associated Press; By WILLIAM FOREMAN]

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