WASHINGTON - As South Korean President Moon Jae-in meets with North Korean leader Kim Jong Un for their third summit, there is increasing concern that the inter-Korean economic projects Seoul envisions could violate sanctions and fracture the U.S.-South Korean alliance.
“The South Korean government appears to be headed in the direction of, or inclined to violate bans on joint ventures with North Korea, support for trade with North Korea, and infrastructure projects with North Korea, all of which require the permission of the U.N. committee,” said Joshua Stanton, a Washington-based attorney who helped draft the North Korea Sanctions Enforcement Act that former President Barack Obama signed in February 2016.
For South Korea to carry out joint economic projects with North Korea, it would need to seek exemptions on sanctions from the on North Korea.
However, “the mandate of the committee does not include the authority to modify existing terms specified in various resolutions,” said William Newcomb, a former U.S. Treasury official who is on the U.N. Security Council’s Panel of Experts on North Korea.
If South Korea does not ask for exemptions from sanctions, Seoul will face a risk of rupturing its relationship with the U.S., Stanton said.
“It would be an extinction-level event for the U.S.-South Korean alliance,” he said. “This is an absolutely incomprehensible betrayal by a nation that calls itself our ally that Americans have defended with [their] blood and with their money.”
And if sanctions are willfully violated, Stanton said South Korea would be, “in its own way, a rogue nation.” The includes North Korea, Iran, Sudan, Syria and others.
South Korea has been planning several joint economic projects with North Korea since April’s inter-Korean summit. As the U.S. and North Korean relationship has thawed in the aftermath of the Singapore summit held in June between President Donald Trump and Kim, Seoul stepped up its plans, and a third inter-Korean summit began Tuesday in Pyongyang.
Days before Moon and Kim met, however, the U.S. announced against North Korea. On Thursday, Washington targeted North Korea’s China-based company, Yanbian Silver Star Network Technology, its North Korean CEO, Jong Song Hwa, and its Russia-based subsidiary, Volasys Silver Star, which sells IT services and products.
There is also talk of the U.S. using military force to curb North Korea from evading sanctions at sea by monitoring ship-to-ship transfers by with countries like Australia, Japan, New Zealand, Canada, France, and the U.K. as well as South Korea.
The projects has been planning with the North include constructing an inter-Korean railway, which Moon has publicly backed, reopening the Kaesong Industrial Complex, and resuming the tours to , a landmark of great natural beauty with a special hold on the Korean soul. The tours and the complex appeal to South Korean companies.
Each could violate sanctions that were imposed on North Korea in 2016 in response to its fourth nuclear weapons test and a long-range missile launch.
“In the absence of waivers and exemptions from the United Nations, which the U.S. as one of the Security Council members would have to support, Mount Kumgang and Kaesong would violate sanctions,” said Troy Stangarone, senior director of the Korea Economic Institute, who is a specialist on South Korea trade and North Korea.
Under issued in September 2017, “forming joint ventures or cooperative entities, new and existing, with DPRK (North Korean) entities or individuals” is prohibited.
Additionally, any products manufactured using North Korean labor, potentially including items fabricated in the Kaesong Industrial Complex, will be banned from U.S. commerce. T(CAATSA) adopted in August 2017 stipulates that manufacturers purge any parts made with North Korean labor from their supply chains.
While Moon is expected to attempt to broker a denuclearization deal between the U.S. and North Korea at the summit and continue Seoul’s rapprochement with Pyongyang aimed toward eventual unification, South Korea must make sure that it does not violate sanctions as it pursues inter-Korean projects, Stanton said.
“I don’t think they actually did read the sanctions,” he said. “When you look at Moon Jae-in, he will go out and make all of these promises” and when it’s pointed out that “that there’s a provision that you’re violating here … they will respond by saying it’s not sanctions violation because it’s good for everyone to have peace.”