-Edited & Reviewed by Samuel Lee.
The case of North Korea raises critical questions about the effectiveness of sanctions, and how a contextual sanctions approach can lead the way.
Through Contextual Analysis of DPRK
Sanctions are employed as a foreign policy tool to influence nations that violate international norms. Their success hinges on a well-structured strategy with clear objectives, precise targeting, and a thorough understanding of both the target nation's characteristics and the sanctioning country's enforcement capabilities. Increasingly, sanctions have offered a strategic alternative to military engagement in foreign policy. This essay explores their efficacy, focusing on North Korea (DPRK). It argues that the success of sanctions depends more on understanding the context of the sanctioned state than on the policies themselves. The key question for an effective sanctions regime is 'who to sanction?' rather than 'how to sanction?'
This research introduces “Contextual Sanctions”, a strategy that customizes economic and diplomatic measures to align with each state's unique qualities and policies, thereby enhancing sanctions' effectiveness. It emphasizes narrowing down on a few vulnerable targets, avoiding resource-intensive, broad sanctions. This approach is distinct from "targeted sanctions," which focus on specific economic sectors. Contextual Sanctions can be traced back to contextual analysis, a sociological approach developed by Scheflen (1963) in psychotherapy, where individual actions gain meaning through their relation to one another (Kendon, 1990).
This paper re-examines sanction literature, underscoring the limitations of sanctions and the necessity of tailoring them to the target nation's unique situation. Employing a 'Contextual Sanctions' framework, it analyzes DPRK's nuclear endeavors through microhistory, prioritizing DPRK's viewpoint and micro patterns (Friedlander, 1992). The study outlines the precursors to DPRK's initial nuclear test to demonstrate its resistance to sanctions, ultimately arguing for the ineffectiveness of such measures.
Sanctions as a Foreign Policy Tool: A Literary Debate
The literature on sanctions highlights key factors for success: complementary policies, international cooperation, support for the targeted populace, sender-target relationship, political system, and economic impact. This section examines sanctions' effectiveness, focusing on their general efficacy and impact on DPRK.
Sanctions' effectiveness is evaluated based on target behavior, sender goals, and global response. Commercial liberals consider economic costs, political realists prioritize strategic interests, and a conditional approach assesses state politics, where compliance depends on legitimacy, perceived threat, and costs (Blanchard and Ripsman, 2013). However, successful sanctions are not solely reliant on these factors; even with international cooperation, challenges such as coordination issues, conflicting interests, and evasion can hinder their effectiveness (Peksen, 2019).
Effectiveness is measured using two models: the Threat to Strategic Interests (TSI) and the Dependence Score. TSI gauges success by comparing economic cost to political or strategic cost for the targeted state (Blanchard and Ripsman, 2013). The Dependence Score assesses how reliant the target is on the sanctioning country, with more dependence indicating a higher chance of compliance (Miller, 2014). However, the target country's trade dependency doesn't necessarily lead to compliance. Instead, individual characteristics of the target nation are more indicative of a successful sanctions regime. This is exemplified by DPRK's ability to pivot trade towards non-sanctioning countries like China, effectively circumventing imposed sanctions (Haggard and Noland, 2017).
The common belief is that sanctions aim to economically pressure governments into complying with the sanctioning state's demands. States use sanctions due to domestic pressure or limited options. Most scholars concur that "the purpose of sanctions here is to demonstrate a willingness and capacity to act" (Barber, 1979, p. 380).
Sanction optimists promote 'smart or targeted sanctions,' aiming to target ruling elites to boost compliance and signal future sanctions. Cortright and Lopez (2000) argue that this approach significantly enhances sanctions' effectiveness. DPRK sanctions have targeted the ruling elite, especially for weapons proliferation and human rights abuses. After their 2006 nuclear test, Resolution 1718 restricted heavy weaponry, missile technology, and luxury goods (Noland, 2019).
Shagabutdinova and Berejikian (2007) and Huish (2018) present an alternative perspective on comprehensive sanctions. They recommend targeted sanctions to pinpoint specific sectors, avoiding harm to innocent civilians, and signaling the potential for harsher measures in the future. However, a fundamental issue remains: harsher sanctions seldom achieve the desired goals. “The basic paradox at the heart of the sanctions debate is that policymakers continue to use sanctions with increasing frequency while scholars continue to deny the utility of such tools of foreign policy” (Baldwin, 2000, p. 80).
Hufbauer et al. (2009) analyze sanctions using the HSE database. Success depends on goals, with less ambitious ones often working better. Targeted sanctions, though appealing, tend to have even lower success than conventional sanctions (34%) at around 20% for UN individually targeted sanctions. Sanctions are more effective on allies but can worsen problems. Pape (1997) criticizes the HSE database as excessively optimistic, contending that out of the 35 to 40 cases labeled as successful, only five truly achieved success. He argues that in such cases, factors like military coercion and domestic political pressures often had a more substantial impact in achieving desired results.
Several instances, such as U.S. sanctions against the military junta in Haiti from 1992 to 1994, demonstrated that these sanctions succeeded due to the presence of a credible military threat.
DPRK and Sanctions: A Contextual Analysis
“As long as the United States' hostile policy toward the DPRK and nuclear threats are not fundamentally eliminated, we will never give up our nuclear weapons first, not even in a hundred years.” — DPRK Ministry of Foreign Affairs (Pollack, 2017, p. 159)
Sanctions against DPRK, initiated in 2006 in response to its nuclear program, aim to deter nuclear pursuits, address human rights abuses, and curb illicit activities. Their effectiveness is debated due to economic impact and limited influence on the regime, partly due to inconsistent enforcement. Assessing the impact is complex and tied to economic, political, and social factors within DPRK. A contextual approach is crucial for understanding sanctions' shortcomings.
The Korean Peninsula's post-World War II division resulted in two distinct nations: DPRK, a communist state backed by the USSR, and South Korea (ROK), a democracy backed by the U.S. (Pollack, 2017). Kim Il Sung, DPRK's leader, initiated the Korean War with Soviet and Chinese support, aiming for reunification. South Korean forces were initially pushed to Busan. Subsequent U.S. intervention reversed DPRK’s gains, resulting in Chinese involvement and a stalemate along the 38th parallel. This led to substantial destruction, with approximately 85% of DPRK's buildings and 95% of its power generation capacity demolished (Cussen, 2018).
China's involvement in DPRK, including control of infrastructure by Chinese officers, created tensions with Kim Il Sung. These tensions persisted until Chinese forces left DPRK in 1956, three years after the war ended, amid concerns about Kim Il Sung’s potential removal by China or the USSR. For Kim Il Sung, “these wartime experiences instilled in him 'never again' convictions that defined his subsequent outlook and goals” (Pollack, 2017, p. 33).
During the 1960s, tensions heightened, with seven incidents suggesting the possibility of a U.S. nuclear strike on DPRK (Drezner, 1999). One such moment was the 1968 capture of the USS Pueblo spy ship by DPRK forces in the Sea of Japan (Schindler, n.d.). In 1969, the U.S. announced a 50% reduction in its forces in ROK, prompting South Korea to pursue a nuclear program. In response, North Korea also initiated its own nuclear program with Soviet assistance (Pollack, 2017). To deter nuclear proliferation, the U.S. offered nuclear protection to ROK and Japan and threatened sanctions against both Koreas. ROK complied due to their economic reliance, while DPRK pursued its nuclear program, alarmed by the threat of 600 U.S. tactical nuclear weapons on the peninsula (Pollack, 2017).
The DPRK faced a setback in the 1980s due to the USSR's decline, resulting in a 50% drop in oil imports and a sharp decline in trade with Russia—from $3 billion to $40 million between 1989-1999. This impacted both their economy and the nuclear program (Pollack, 2017). Leveraging DPRK's vulnerability, the U.S. persuaded DPRK to return to negotiations by promising to remove nuclear weapons from ROK. This resulted in a December 1991 reconciliation agreement between DPRK and ROK, where both sides committed to non-proliferation. Subsequently, the DPRK allowed inspections by the International Atomic Energy Agency (IAEA). However, when the IAEA discovered DPRK's secret plutonium reprocessing in 1992, North Korea refused inspections and threatened NPT withdrawal in 1993, which was halted by diplomatic intervention by President Jimmy Carter's visit in 1994. This culminated in the Agreed Framework of 1994 between the USA and DPRK. The DPRK agreed to halt the construction of 50 and 200-megawatt nuclear reactors. In return, the U.S. pledged heavy fuel oil (HFO) to mitigate the energy loss. The USA and ROK also established the Korean Peninsula Energy Development Organization (KEDO) to construct two non-weaponizable light water nuclear reactors (LWRs) in DPRK by 2003 (Hilpert and Meier, 2018).
International engagement brought vital relief to DPRK amid increased isolation, political succession, and a deadly famine. With Kim Jong-il now at the helm, DPRK pursued the "military-first" policy (Songun) (Haggard and Noland, 2017). International engagement didn't prompt economic reform or reduce nuclear ambitions. DPRK's unique political economy provided distinct leverage that neither engagement nor sanctions considered. Meanwhile, the engagement strategy faced challenges: Congress doubted the HFO shipment in President Clinton's normalization efforts, and KEDO struggled with consensus on LWR financing and construction. In 2000, ROK adopted the “Sunshine Policy” for engagement, emphasizing reunification dialogue. Conversely, the United States shifted its stance after 9/11, looking at DPRK with increased frustration and mistrust. The U.S. suspended HFO shipments and pushed for DPRK's nuclear disarmament, undermining previous agreements and effectively ending KEDO (Ford and Kwon, 2008).
In April 2003, DPRK withdrew from the NPT, accelerated its nuclear program, and triggered a UN Security Council discussion to which it reacted by stating, “The UNSC discussion of the Iraq issue was misused by the US as an excuse for war… the Iraq war shows that to allow disarming through inspection does not help avert a war but rather sparks it” (Pollack, 2017, p. 142). Six-Party Talks, involving the US, DPRK, ROK, Japan, Russia, and China, began in 2003 to address DPRK's nuclear program. In 2005, DPRK agreed to give up nuclear ambitions for aid and concessions but continued nuclear activities. In 2006, North Korea conducted its first nuclear test, leading to UN Security Council sanctions (Pollack, 2017). Since then, it has conducted six nuclear tests while being sanctioned over a dozen times by the UN. Although the sanctions have increased in severity, DPRK hasn’t capitulated, and there is little evidence to suggest that it will.
DPRK’s Leverage and the Failure of Sanctions
The DPRK initially appeared to comply but never fully abandoned its nuclear ambitions. Although sanctions did have some effect, they couldn’t influence regime behavior. DPRK’s unique political economy shielded the regime from international pressure and sanctions. Exploring these aspects of DPRK's society and governance, beyond economic constraints, is crucial. This challenges conventional approaches to sanctioning and underscores the need to reconsider the question of “who to sanction”. In this context, we examine the DPRK through a Contextual Sanctions approach, seeking answers to two critical questions: What shields North Korea from international sanctions, and is sanctioning North Korea worthwhile?
To address the first question, the DPRK's political economy shields itself from dissent and sanctions through internal control mechanisms, economic policies, and evasion tactics. It prioritizes defense, suppressing dissent through strict political control, surveillance, and severe penalties. Political dissidents face brutal treatment in secretive detention facilities called kwanliso (Human Rights Watch, 2020). Economically, the DPRK's self-reliant Juche policy focuses on heavy industry. Additionally, DPRK employs tactics like coal smuggling, cyberattacks, and illicit petroleum imports to evade sanctions, acquire restricted technology, and generate revenue. In 1974, the DPRK established Bureau 39, a covert operation involved in various illicit activities, providing substantial funding for the country's nuclear program and other state activities through a network of legitimate and illicit companies (Fischer, 2016).
A satellite investigation in 2017 uncovered covert oil transfers to DPRK through shell companies and direct ship-to-ship transfers, including South Korea intercepting a Hong Kong-flagged tanker (Xiao, 2021). Another means of sanction busting is the “Dollar Heroes”, labor from DPRK who are sent to work under harsh conditions in countries like Russia, China, and EU states. They work long hours, earning U.S. dollars, which support the regime's finances and its nuclear program (Choi, 2013).
Based on interviews with defectors, Dukalskis (2016) found that DPRK's shadow economy was widely accepted. During food shortages, black markets served as both a relief valve for dissatisfaction and a primary source of livelihood. The state later cracked down on these markets as the economy improved, implying deliberate complacency by the state during crises. Sanctions can paradoxically strengthen autocratic regimes. Under sanctions, controlled economies and autocracies monopolize key economic sectors, exploiting opportunities for rent-seeking, ultimately extracting significant economic benefits (Escribà-Folch and Wright, 2015).
To address the second question, the Contextual Sanctions approach suggests avoiding sanctions on the DPRK, as they are highly unlikely to be effective. The DPRK's strategic stance, characterized by a centralized command economy, devotion to the self-reliant 'Juche' philosophy, and a strong militarized leadership, effectively shields it from external influences. This stance serves dual purposes: it is both an expression of defiance and a critical lever in diplomatic engagements. The 2006 nuclear test was not an outlier; it's a continuous part of the DPRK's strategy of enduring resistance. The DPRK's historical experiences—the Korean War, uneasy alliances with the Soviet Union and China, episodes of diplomatic seclusion, famines, and the collapse of the Soviet Union—have entrenched a fear of succumbing to a similar demise.
From a sanctions-focused viewpoint, the pursuit of non-proliferation in the DPRK resembles Zeno’s paradox, with complete disarmament always appearing just beyond grasp. This is partly because the DPRK views its nuclear capabilities as essential to its survival. Setting aside the ideological underpinnings, North Korea’s strategic policy of cautious but deliberate engagement, threats, conciliation, and the retraction of concessions evidences a realpolitik approach. While this alone does not justify sanctions, North Korea’s continued development of nuclear arms warrants international censure as a deterrent for other countries with similar ambitions. However, the diminishing efficacy of sanctions undermines their legitimacy as a tool of foreign policy.
Conclusion
The case of DPRK accentuates the drawbacks of using economic sanctions in foreign policy. North Korea has shown resilience against traditional sanctions, outmaneuvering the international community with a combination of engagement and hostility. As noted in the literature, the overall ineffectiveness of sanctions necessitates a more nuanced approach. Contextual Sanctions, which involves evaluating a target nation's unique characteristics before deciding on sanctions, can be a promising start.
The international community must thoughtfully weigh the ethical and economic burdens on civilian populations against the attainment of policy goals. Considering the frequent ineffectiveness of sanctions and their harm to civilians, the global community must re-examine their relevance. This crucial juncture demands a more effective, compassionate, and adaptable foreign policy approach that can not only replace sanctions but also address broader issues such as nuclear proliferation.
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