Report

Trump White House Stays Quiet as Russia Flouts North Korea Sanctions

The administration is concerned that Russia is doing more business with the nuclear-armed Kim regime, but it hasn’t said anything publicly yet.

An unidentified rocket is displayed during a military parade marking the 105th anniversary of the birth of late North Korean leader Kim Il-Sung in Pyongyang on April 15, 2017.  
North Korean leader Kim Jong-Un on April 15 saluted as ranks of goose-stepping soldiers followed by tanks and other military hardware paraded in Pyongyang for a show of strength with tensions mounting over his nuclear ambitions. / AFP PHOTO / Ed JONES        (Photo credit should read ED JONES/AFP/Getty Images)
An unidentified rocket is displayed during a military parade marking the 105th anniversary of the birth of late North Korean leader Kim Il-Sung in Pyongyang on April 15, 2017. North Korean leader Kim Jong-Un on April 15 saluted as ranks of goose-stepping soldiers followed by tanks and other military hardware paraded in Pyongyang for a show of strength with tensions mounting over his nuclear ambitions. / AFP PHOTO / Ed JONES (Photo credit should read ED JONES/AFP/Getty Images)

Trump administration officials and lawmakers are increasingly concerned that Russia is stepping up trade with North Korea in defiance of international sanctions, jeopardizing a U.S. effort to pressure Pyongyang over its nuclear and missile programs.

The White House, however, has yet to call out Russia publicly for its dealings with North Korea.

Russia is filling a gap left after China began to scale back some trade with North Korea in response to pressure from the Donald Trump administration, and has already replaced China as the top supplier of jet fuel for North Korea. Moscow also signed an agreement in March with Pyongyang to import more North Korean workers and opened a ferry line last month out of Vladivostok that carries passengers and cargo to the deeply isolated regime.

“It’s something we need to watch closely if we’re serious about turning the screws economically on North Korea,” one administration official told Foreign Policy.

The White House is concerned about Russia helping the North gain access to jet fuel and cash, but China remains North Korea’s crucial lifeline. “It will take some doing for the Russians to back-fill all of what China supplies,” the official added.

Russian support for North Korea presents a dilemma for a White House that has sought to isolate Kim Jong Un’s regime and improve relations with Moscow. The Russian moves undercut attempts to inflict economic punishment on North Korea for its nuclear program and missile development, and present yet another obstacle to closer ties between Washington and Moscow.

While the Trump administration has not publicly challenged Russia’s trade with North Korea, senior officials have hinted at the issue. Speaking to reporters last month, U.N. Ambassador Nikki Haley praised China for enforcing the sanctions regime but noted that “other countries are trying to fill that void.”

“If you are a country that is supplying or supporting North Korea, we will call you out on it,” Haley said. So far, however, the White House has not publicly rebuked Moscow.

The magnitude of Russian support to North Korea remains difficult to quantify, but South Korean experts have in recent months observed a significant uptick in trade between the two nations, said Go Myong-hyun, a research fellow at the Asan Institute for Policy Studies, a Seoul-based think tank.

“If China is tightening up border trade then there’s an incentive to go to the Russian side and procure what they need,” Go said.

Russia has expanded its supplies of gasoline to the North, Go said, while cautioning that Moscow’s support is unlikely to make up for what Beijing supplies. Trade between China and North Korea continues to dwarf the economic relationship between North Korea and Russia. China accounts for 90 percent of North Korea’s foreign trade, worth roughly $6.1 billion.

Russia’s trade with Pyongyang comes to just $84 million.

North Korea’s border with China and Russia is marked by significant smuggling fueled by official corruption, Go said, making it difficult to accurately estimate trade volumes and rendering official statistics unreliable.

As Pyongyang has carried out a bevy of missile tests and threatened to strike American cities and military bases, the Trump White House has described the danger posed by North Korea’s nuclear arsenal as its top foreign-policy priority. The administration has pinned its hopes on persuading China to use its leverage to force Pyongyang to drop its pursuit of intercontinental ballistic missiles.

In Congress, Moscow’s trade with Pyongyang has cast doubt on the administration’s repeated vows to apply “maximum pressure” on the North Korean regime. Lawmakers are pressing the administration for more information about Russia’s activity in North Korea and urging more action to counter the illicit trade.

Sen. Ben Cardin (D-Md.), the ranking Democrat on the Senate Foreign Relations Committee, told Foreign Policy the Trump administration has “been strangely silent on Russia’s increasing support for Pyongyang,” citing reports that “Russia is picking up the slack for North Korea’s economy in such areas as fuel oil, providing material directly of value to the North’s nuclear and missile programs, and making sure that Pyongyang has diplomatic cover at the United Nations.”

“If Moscow becomes more active on the Korean Peninsula it is hard to see how that advances our interests,” Cardin said. “President Trump must be clear about Russia. Russia is not our friend or partner.”

At the U.N. Security Council, Moscow has vehemently opposed sanctions against North Korea that could undercut Russian businesses, arguing for more narrowly focused measures and pushing for exceptions for Russian firms, diplomats said.

“We’ve seen Russia take increasingly shrill positions on North Korea that frequently go beyond where the Chinese are,” said a U.N. diplomat who spoke condition of anonymity.

“Russia has taken a very hard line. If they are going to lose one ruble in trade with North Korea, more likely than not they are going to be opposing measures that would affect their trade with the North,” the diplomat said.

In discussions on a U.N. sanctions resolution last year, Moscow’s objections delayed approval of the measure until December, and Russian diplomats successfully carved out a provision that allows Russian coal ships to transit through the North Korean port of Rason.

Russia’s stance on North Korea has further complicated the Trump administration’s plans for possible diplomatic overtures to Russia. Trump entered the White House speaking of a possible rapprochement with Russia, and senior administration officials floated the possibility that the United States would lift sanctions imposed on Moscow following its seizure of Crimea and fueling a civil war in Ukraine’s east.

But during the opening months of the Trump administration, the attempt to ease tensions has hit repeated roadblocks, including increasing controversy over whether Trump aides conspired with Kremlin operatives to meddle in the 2016 election. Relations took another hit when Trump authorized a missile attack on a Syrian airbase in retaliation for the Assad regime’s use of chemical weapons, a move that infuriated the Russian government.

In recent weeks, National Security Council officials have examined Russian support to North Korea and consider it one of several obstacles to lifting sanctions on Moscow, said another senior administration official, who spoke on condition of anonymity.

Meanwhile, Washington in recent weeks targeted Russian firms doing business with North Korea. This month, the Treasury Department slapped sanctions on Ardis-Bearings LLC and its director, Igor Aleksandrovich Michurin, for its commercial dealings with a North Korean trading company alleged to be involved in Pyongyang’s missile programs and the development of weapons of mass destruction.

The Treasury Department also sanctioned the Independent Petroleum Company, a Russian firm alleged to have supplied more than $1 million in petroleum products to North Korea. In announcing the move, the Treasury Department said the company “may have been involved in circumventing North Korean sanctions.”

Although the sanctions measures will have a limited effect, “those designations should be seen as a warning,” said Joshua Stanton, an expert on sanctions who writes the blog One Free Korea.

While Russia exports jet fuel, trucks, and other goods to North Korea, it imports tens of thousands of North Korean workers for the timber and construction industries. Russia hosts an estimated 40,000 North Korean workers, and Moscow recently signed an agreement with Pyongyang to import additional North Korean workers. The arrangement provides a stream of cash for the Kim regime, as most of the wages for the workers are shipped straight to the North Korean state.

North Korea has used business ties in China to circumvent the punishing sanctions levied by world powers, as detailed in a report by the nonprofit research group C4ADS released Monday. Analysts who track the North Korean economy fear that as China cracks down on such firms, Pyongyang will try to replicate that relationship with Russian firms.

“North Korea understands that they are vulnerable by being completely reliant on China,” said Anthony Ruggiero, a senior fellow at the Foundation for the Defense of Democracies. “You could see a scenario where North Korea wants to diversify.”

And given tensions between Russia and the United States, Moscow’s support of Pyongyang may be used as a point of leverage against its American foes. But Ruggiero cautioned that North Korea may struggle to use Russian banks to gain access to the global financial system and replicate its use of Chinese firms to do so. U.S. sanctions on Russia have generally led Western banks to more closely scrutinize Russian transactions.

Russia has a long history of friendly relations with North Korea dating back to the early years of the Cold War. Maintaining economic ties with North Korea offers Moscow a way of staying relevant on the international stage and keeping both China and the United States off balance, experts said.

“It’s enough to show that Russia is a player out there and that China is not a monopoly power in the Far East,” said William Courtney of the RAND Corporation think tank, who crafted policy on Russia during his career in the State Department.

Moscow also has concluded that if China is not willing to sever all its trade with North Korea, then Russia won’t either, according to Courtney. “Russia is not going to squander all of its leverage with North Korea if China does not cut them off,” he said.

Photo credit: ED JONES/AFP/Getty Images

Dan De Luce is Foreign Policy’s chief national security correspondent. @dandeluce

Elias Groll is a staff writer at Foreign Policy covering cyberspace, its conflicts, and controversies. @eliasgroll

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