Fresh sanctions

Fresh sanctions
The United States has imposed new sanctions on 10 companies and six individuals primarily from Russia and China. The nation has accused these entities and individuals of helping..

The United States has imposed new sanctions on 10 companies and six individuals primarily from Russia and China.

The nation has accused these entities and individuals of helping develop North Korea’s nuclear and ballistic missile programs.

Background

The North Korean nuclear program has been a source of concern for the US and the international community for years. North Korea has conducted nuclear tests in 2006, 2009, 2013 (atomic bombs) and twice in 2016 (reportedly hydrogen bomb).

In July 2017, North Korea successfully test launched two intercontinental ballistic missiles (ICBM). The state media announced that the first ICBM, which was launched on July 3rd, was a “gift” to America. At the time, experts said that this ICBM could reach Alaska. The second one can reportedly reach a number of cities in the US including Boston and New York. US has responded by condemning the tests and carrying out joint military exercises along with South Korea.

The UN has also imposed harsh sanctions on North Korea that would significantly affect its revenue in exports.

US President Donald Trump has repeatedly called on China to take a more proactive approach in countering North Korea’s threats.

Analysis

The sanctions have been imposed on six Chinese companies and two Singapore-based companies that sell oil to North Korea. There are also sanctions on four Russian nationals, a construction company headquartered in Namibia and a Russian company among others.

China has responded by noting that US would have to rescind the sanctions or face consequences. A Chinese embassy spokesperson said, “We strongly urge the US to immediately correct its mistake, so as not to impact bilateral co-operation on relevant issues.”

US Treasury Secretary Steven T. Mnuchin in a statement noted that it was “unacceptable” to help North Korea generate revenue as it gets poured into the country’s nuclear program. He noted, “It is unacceptable for individuals and companies in China, Russia, and elsewhere to enable North Korea to generate income used to develop weapons of mass destruction and destabilize the region.  We are taking actions consistent with UN sanctions to show that there are consequences for defying sanctions and providing support to North Korea, and to deter this activity in the future.”

Three of the Chinese coal companies are accused of breaching UN sanctions. According to a statement from the Treasure Department the Chinese companies Dandong Zhicheng Metallic Materials, JinHou International Holding, and Dandong Tianfu Trade Co were “collectively responsible for importing nearly half a billion dollars’ worth of North Korean coal between 2013 and 2016.”

Assessment

Our assessment is that these sanctions would further cause deterioration in the relations US shares with both China and Russia. Currently, those relations are already tense. However, this signals that the US is trying to explore every diplomatic solution to address the growing threat posed by North Korea. Military conflict is not feasible as it would make Seoul vulnerable as well. Simply put, the US has no good options on its table right now. 

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