World War 3: US Makes Bold Moves in Asia

World War 3: US Makes Bold Moves in Asia

World War 3: US Makes Bold Moves in Asia

The UNSC unanimously approved a new resolution on sanctions against Pyongyang on September 11. Following a series of behind-the-scenes negotiations Sunday, diplomats agreed not to ban oil exports into North Korea. Instead, the ninth set of restrictive sanctions against Pyongyang authorized an annual cap of 2 million barrels of refined petroleum products to North Korea.

It also banned the North’s textile exports – the second-biggest export for the country, which totals $752 million – according to data from the Korea Trade-Investment Promotion Agency. Chinese and Russian negotiators managed to persuade the US delegation not to impose a travel ban or asset freeze on North Korea’s leader Kim Jong-un.

On Tuesday, the North Korean ambassador to Moscow said sanctions will not make his country change its policies. Pyongyang’s nuclear program helps it to deter the “hostile policy of the US,” Kim Yong-jae added.

“Since the US is revealing its nature as a bloodthirsty beast obsessed with the wild dream of reversing the DPRK’s development of the state nuclear force which has already reached the completion phase, there is no way that the DPRK is going to wait and let the US feast on it,” the statement said, referring to North Korea by the nation’s abbreviated full name, the Democratic People’s Republic of Korea.

The Treasury Secretary echoed the words of the US envoy to the UN, Nikki Haley, by calling the fresh round of sanctions against Pyongyang “historic.” Mnuchin added “if China doesn’t follow these sanctions, we will put additional sanctions on them and prevent them from accessing the US and international dollar system.”

Washington has, so far, been reluctant to impose economic sanctions on China over concerns of possible retaliatory measures from Beijing and the potentially catastrophic consequences for the global economy.

The US could impose economic sanctions on China if it does not implement the new sanctions regime against North Korea, the US Treasury Secretary has warned. Steven Mnuchin said the restrictions could involve cutting off Beijing’s access to the US financial system.

“North Korea economic warfare works,” Mnuchin said Tuesday at the Delivering Alpha Conference in New York City. “We sent a message that anybody who wanted to trade with North Korea – we would consider them not trading with us.”

Washington runs a $350 billion annual trade deficit with Beijing. China also holds $1 trillion in US debt, which amounts to 28 percent of US Treasury bills, notes and bonds held by a foreign government.

US lawmakers, however, seemed to be more inclined to exert pressure on Beijing and other countries striking deals with Pyongyang as they demand a “supercharged” response to North Korea’s nuclear tests, including imposing sanctions on companies from China and any other country doing business in North Korea.

“I believe the response from the United States and our allies should be supercharged,” said Ed Royce, chairman of the House of Representatives Foreign Affairs Committee during a hearing Tuesday.

“We need to use every ounce of leverage… to put maximum pressure on this rogue regime,” he said, adding that “time is running out.” Royce also called on Washington to target major Chinese banks, including the Agricultural Bank of China and the China Merchants Bank for dealing with Pyongyang.

He also said China was apparently reluctant to follow through on the sanctions adopted by the UN Security Council (UNSC) against the North. “It’s been a long, long time of waiting for China to comply with the sanctions that we pass and, frankly, with the sanctions that the United Nations passed,” he said.

The committee chair went on to say the US could give Chinese banks and companies “a choice between doing business with North Korea or the United States.” He added that the US should also “go after banks and companies in other countries that do business with North Korea the same way.”

Committee members also expressed unease over the fact that the sanctions imposed on North Korea have so far been ineffective in preventing Pyongyang from developing its nuclear and missile programs.

“We’ve been played by the Kims for years,” Republican Representative Ted Poe said, referring to North Korean leader Kim Jong-un and his predecessors, as reported by Reuters.

President Donald Trump also downplayed the role of the newly adopted sanctions later Tuesday. ”We think it’s just another very small step, not a big deal. I don’t know if it has any impact,” he told reporters

North Korea

No sanctions will make North Korea change its policies, says the country’s ambassador to Moscow. The diplomat added that North Korea’s nuclear program will help his country better deter the “hostile policy of the US”.

“We have lived under US sanctions for decades. Under the harshest of sanctions. But we have acquired everything we wanted to. If the US hopes that our position would be shaken and changed, that is an illusion,” Kim Yong-jae told the Russian media.

The diplomat added that North Korea’s nuclear and rocket programs will help his country better deter the “hostile policy of the US” and protect the Korean Peninsula from a nuclear war.

“The sanctions resolution of the UN Security Council has been forced by the US, which uses the council as a tool, and is illegal. We fully reject and strongly condemn this resolution,” Ambassador Kim said.

“Instead of acknowledging the reality and making the right choice, the US is using our most justified measures of self-defense to try and strangle our country,” he said.

Earlier, the UN Security Council imposed the harshest-ever economic sanctions against North Korea, putting a cap on the amount of fuel it can buy and further restricting import of crude oil.

It also banned textile trade with the country, targeting one of its major export articles.

The measures were taken in response to Pyongyang’s latest nuclear test. North Korea detonated a device, which it said was a thermonuclear bomb small enough to fit on a long-range ballistic missile.

 

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Shayne Heffernan Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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