The Peninsula

Why China Will Implement the New UNSC Resolution

By Thomas Lee

In the face of a North Korean missile volley protesting the recent passing of United Nations Security Council Resolution 2270, China has once again called for calm. This will undoubtedly anger some and lead many to question whether China’s resolve to earnestly and forcefully implement the sanctions is genuine.

The new China-backed sanctions, if implemented to its fullest extent, could impose significant costs on North Korea’s economy and expose the regime’s Byungjin Line doctrine for the hollow line that it is. Taking into account that sanctions against North Korea in the past have often fallen short in no short measure due to China reluctance to act, there is a chance that Resolution 2270 may also be as ineffectual as its predecessors were.

However, there are strong indications that China will honor its promise to continue backing and fully implement the new United Nations sanctions. Dr. Shi Yinhong of Renmin University has observed that under the rule of President Xi Jinping, a  general premise that guides Chinese policy towards North Korea is that North Korea’s attitude towards China should be the greatest determining factor in deciding Chinese policy towards it. After Kim Jong-un assumed power in 2012, Pyongyang has consistently denied Beijing the traditional gesture of informing it in advance any major policy decisions. Events such as nuclear tests, rocket launches, military provocations, or international agreements were undertaken independently, giving China little to no time to prepare for the backlash that usually accompanied North Korean behavior.

This finally led to Chinese support for the United Nations Security Council Chairperson statement of April 16, 2012. It also prompted CCP authorization for Chinese state media to widely publicize the plight of the 28 Chinese fishermen who had been held for thirteen days by North Korean forces, leading to massive anti-DPRK sentiment.

Although U.S. policymakers are quick to point out the ritual cycle of North Korean nuclear politics, the ferocity of Chinese displeasure and reaction has been steadily increasing ever since China’s participation in the United Nations 2006 collective sanctions. The second wave of Chinese disapproval came in the form of the 2013 unilateral sanctions in the wake of the third nuclear test that restricted ordinary shipping to North Korea, denied imports of North Korean fishing products, and also suspended infrastructure projects with it. Not only that, China followed up by strictly prohibiting illegal banking activities in China of North Korean banks and suspending transactions with North Korea’s Foreign Trade Bank.

This revolution in Chinese policy towards North Korea, in conjunction with firm deterrence from the U.S.-ROK alliance in 2013, shocked Kim Jong-un and compelled him to reverse course towards Beijing. But with the recent missile barrage and Kim’s order for nuclear readiness, it seems that he has recovered from this shock to once again defy Chinese and U.S. authority.

Several reasons abound for Kim Jong-un’s newfound courage. Internally China is preoccupied with the decline of its economy, the fight against corruption, improving environmental degradation, and its aging population. Externally, it is dealing with U.S. hegemony in the region and the ongoing tension in South and East China Seas. Kim has placed the North Korean military under the will of the Korean Worker’s Party and has firmly consolidated his power base. On the U.S. side, Obama is in his last year in office, and many analysts doubt that the time remains to deal with another highly controversial foreign policy issue.

As long as Kim continues to ignore Beijing, the Chinese government is most likely to continue its established hard line measures against North Korea. With Chinese assistance slowly dwindling, Kim will most likely increasingly turn to the newly affluent for help. Called the “donju”, these new elite play the role of banks in funding private businesses for trade, transportation and services, and government projects for construction, mining and other nonmanufacturing activities. Although Kim Jong-Un currently protects the donju whose firms are increasingly affiliated with the party, military, and cabinet, in the long run, these self-enriching elites will be less loyal to Kim and more towards their interests. Many of the donju hold ties with Chinese “princelings”, and 80% of the goods for sale at the jangmadang are said to originate from China. At this point, as the regime is unable to deny the presence and importance of the jangmadang and has integrated them instead, Chinese hardline tactics may incentivize a Chinese-style economic reform.

The number of donju in North Korea continue to increase in number and diversify their businesses. With this growth, culture and values are shifting in ways never seen before. People now hope to eat and live well with demand for luxury apartments, amusement parks, fashion, and restaurants on the rise. Silently guiding this shift is the invisible hand of the Chinese government in a calculated gamble of “deep engagement”. Coordinating a “Sunshine Policy” style vision of bilateral relations since Hu Jintao’s time, the Chinese have continuously absorbed international criticism in the face of North Korean aggression. In return for this moderating role, they have traded sanctions on weapons of mass destruction for a hands-off policy on any action that would endanger the North Korean economy.

This desire has been reiterated in the form of UNSC Resolution 2270 as China initially argued that stronger sanction measures limiting oil, coal, and other natural resources exports would only harm the North Korean people, resulting in a final draft that allows trade for “livelihood purposes”. In 1990, South Korea, China, and Japan each accounted for 20% of North Korea’s trade but today, as much as 80% of all North Korean trade and foreign investment outside of the now suspended Kaesong Industrial Complex is accounted for by China. Other countries continue to impose sanction after sanction on the rouge state.  The two pressures from China and the donju have led to incremental reform in North Korea, with Kim providing managerial incentives and reforming state farms and cooperatives. Due to this, the economy has grown, food production has increased, and efforts are being undertaken to provide electricity.

Given China’s notoriously substandard control over import-export enforcement among its own people, it would be foolish to presume that China could control illegal goods and services flowing in and out of North Korea. What UNSC Resolution 2270 does is that it enables China to slowly siphon off the subsidies and aid that it has regularly been providing to North Korea and replace it with more trade and investment. At the same time, because of the heavy nuclear weapons controls it places on the country, China can claim that it is doing all that it can towards Korean Peninsula denuclearization. With these two incentives, there is no reason why China would not implement this new resolution to the letter.

Thomas Lee is an intern at the Korea Economic Institute of America and a graduate of American University. The views expressed here are the author’s alone.

Photo from Shaojin Alianto Tio’s photostream on flickr Creative Commons.