The latest round of sanctions against DPRK (UNSCR 2375) began as a tough measures blocking all oil and gas exports to North Korea, textile trade, worldwide ban on travel by key regime figures and organizations.
The compromise resolution is a modest reduction in oil exports from PRC to DPRK, and a ban on textiles exports. Reduction in oil exports are virtually impossible to enforce as reporting is strictly up to the exporters.
The PRC has not reported oil exports since 2014 despite the obvious fact that oil continued to flow. The textile ban appear to be a major hit until the specific exclusion “for which written contracts have been finalized prior to the adoption of this resolution”.
There is no limit on the duration, scale or scope of the contracts, provisions for automatic renew, or any UN supervised registry of such contracts a priori: Making it nothing more than an unenforceable gesture.
In other words, the US was unable to overcome PRC and Russian veto against bona fide sanctions, let alone their willingness to enforce what is agreed to.
Meanwhile, the PRC have now communicated to the Trump Administration officially and unofficially their stance on the North Korean standoff.
PRC will stay “neutral” if DPRK attacked first, but if US attacks first and tries to overthrow DPRK’s regime, PRC will intervene on the side of DPRK.
PRC also responded strongly to the Trump Administration threat to “stopping all trade with any country doing business with Pyongyang” with the PRC Foreign Ministry labeling it “unacceptable” and “unfair”.
Targeting of PRC entities and individuals for sanctions is explicitly rejected by PRC – a remarkable bolt hole for Chinese nationals that freely operate across the border.
Tightening these measures are pending depending on what PRC and Russia do to enforce the agreed sanctions thus far.
Step-by-step, both PRC and Russia and nominal US allies probable stance when war breaks out are being revealed.
Many observers dismissed President Trump’s tweet stopping trade with China as “hyperbole”, describing it as “apocalyptic” and unlikely to be “practical”.
Taken to the logical conclusion, such action will require blocking trade not only with the PRC directly, but indirect trade with OECD countries that amount for the majority of PRC’s overseas markets. That would indeed, appear to be catastrophic.
The question is, has it ever happened before?
Very few of today’s generation recall that just prior to World War I, Germany was one of (if not the) largest trading partner of all major economies including UK, US, France, etc. German and American steel exports had overtaken British industry whom dominated the industry in the 19th century.
Britain became a net importer dependent on German imports. Germany had substantial overseas investments in Britain, France, and the US including many valuable patents and trademarks. The German merchant shipping fleet was second only to Britain’s.
In today’s language, the pre-first world war era was the first golden age of globalization.
When the first world war broke out, these trade, investment and people ties immediately became subject to controls. Initially, all belligerents instituted controls on enemy owned business and property to prevent their use by enemies or otherwise not properly contributing to the war effort. These efforts then expanded to control of enemy aliens and confiscation of their property.
Post war, the victors seized the alien assets of the losers typically as reparations. Hence, Bayer AG’s American assets was sold to Sterling Drug – an American company.
A substantially similar picture happened with World War II with German and Japanese assets abroad. On July 26, 1941, the US seized Japanese assets amounting to three quarters of its trade and nearly 90% of its oil supply as part of its embargo against Japanese occupation of French Indochina (Vietnam). This was before hostilities were formally initiated by Japan on December 7, 1941.
The historical precedent is that being a large, important, and key trading partner is not a barrier or hindrance to economic sanctions and / or military action that cut those ties.
The PRC cannot count on their large trade ties to insulate them from the US if that is what it takes to deal with an existential threat.
Anyone who think that investment, trade, both direct and indirect, and people to people ties with PRC cannot be severed ought to consider the precedents of World Wars I & II.
This brings us back to the PRC’s relationship with the US and allies. The relationship between the US and PRC remains based on the three communiques: First United States – PRC Joint Communiqué 28 February 1972; Second United States – PRC Joint Communiqué 1 January 1979; Third United States – PRC Joint Communiqué.
The first (Shanghai) communique states:
“The Chinese side stated that it firmly supports the struggles of all the oppressed people and nations for freedom and liberation and that the people of all countries have the right to choose their social systems according their own wishes and the right to safeguard the independence, sovereignty and territorial integrity of their own countries and oppose foreign aggression, interference, control and subversion. All foreign troops should be withdrawn to their own countries.”
For Korea and Japan, it states:
“It firmly supports the eight-point program for the peaceful unification of Korea put forward by the Government of the Democratic People’s Republic of Korea on April 12, 1971…..It firmly opposes the revival and outward expansion of Japanese militarism and firmly supports the Japanese people’s desire to build an independent, democratic, peaceful and neutral Japan.”
These statements, dating from 1972, illustrate how PRC have not changed their policy to be supportive of DPRK’s longstanding policy to expel the US from the Korean peninsula. PRC also support expelling the US from Japan. The abandonment of mutual defense pacts between the ROK and Japan with the US goes without saying.
These statements lay out the relationship between the PRC and the US and allies as a relationship of convenience. The PRC had no intention then, and now, for their absorption into the US dominated international system.
The opening of PRC is intended to be a temporary measure to acquire as much technology, knowhow, etc. as possible so PRC can return to the table in the future stronger but with no change to the communist political system.
During the 1980s and 90s, right through Tiananmen, the west remain convinced that it was a matter of time before economic development resulted in political liberalization. This optimistic vision appeared to have worked for other East Asian economies that are authoritarian but not communist like ROK, Taiwan, etc.
Such a process, however, did not work for any major communist state.
A communist or totalitarian state is define as a regime where the communist party is institutionalized into the government constitutionally, e.g. by stipulating their “leading role” or at least “first among equals” of all political parties or organizations.
Notably, the PRC does not have an army per se. The PRC’s military is a branch of the Chinese Communist Party — a fact often overlooked by naïve observers who wishfully believe that PRC is a normal country.
Communist regimes tend to be capable of “opening” or making changes around the edges, but there is no known major communist state, once institutionalized, that have successfully self-reformed into an authoritarian regime and then proceed down the path toward democracy.
It had to be done by regime change, or revolt from within (Russia, Germany, Poland, etc.), or invasion from without. (Kampuchea)
Why this disconnect?
The opening of trade with the PRC and the world have greatly improved the living standards of China and greatly benefitted the world. Political liberalization, however, have progressed only to the late 1990s and from then on, began to regress as the CCP began, at first in select localities, and then nationally by the 2010 onwards, to intensively apply technology to maintain and enhance CCP control over the populace.
The CCP today runs one of the most extensive surveillance and monitoring regimes in the world with the goal of perpetuating the CCP’s monopoly on power. There is no sign that any group in PRC is likely to challenge the monopoly on political power by the CCP.
Roughly, since Tiananmen, CCP’s PRC have been able to keep a few or more steps ahead of any popular unrest except for an occasional outburst in Tibet or Xinjiang or isolated protests. It is, at its core, a communist regime that do not, and cannot operate according to liberal democratic rules nor can it voluntarily give up the CCP’s monopoly on power, ever.
This speaks to the reality that the US and allies is, in the last instance, dealing with a hostile regime whose goal is fundamentally incompatible with the liberal international order.
For anyone who has doubts, China under the CCP never settled pre-revolutionary debts — Russia did — a clear sign that they have no intention of abandoning communism and CCP’s monopoly on power.
Russia affirmatively abandoned communism and settled all pre-revolutionary debts. Their conflict with the west is about geopolitics, but no longer ideological.
Settling of debts is fundamentally, an acknowledgement of historical property rights and an acceptance of a liberal economic order.
The PRC continues to reject this despite the consequences on its international creditworthiness and aspirations as a global currency, or storehouse of value. Communism is ideologically incompatible with institutions of private property.
PRC’s conflict, with the west, at its core, is ideological first, and great power politics second.
It is that factor that will drive PRC’s likely entry into the restart of the Korean war on the side of DPRK.
The only question is what form it will take and when will PRC decide “enough is enough” or if a conflict triggered or resulted in regime change in the PRC.
While the immediate problem is DPRK, the outcome of the Korean conflict is much more than just about DPRK, but about whether liberal internationalism will survive, or be truncated for at least a generation.
Xi Jinping’s crocodile tears and their diplomat’s apparent sympathetic tone toward the US and feinted compliance with UN sanctions, however watered down, and the propaganda about Xi Jinping regarding Kim Jong Un with “disdain” should not fool anyone.
A look at the history of PRC policy toward the US since 1949 reveals a clear pattern of systematically expelling the US from Asia, beginning with Taiwan (campaign stalled), Korea (stalemate), Vietnam, Cambodia, Philippines, etc.
Arming Pakistan and North Korea with nuclear weapons is part and parcel of the same design.
The longer term picture shows that CCP is winning this campaign, and should the US be self-deterred from acting, after a victory in Korea, the logical next targets will be Okinawa, and then the rest of Japan.
US allies like Canada and Australia are next.
Michael Pillsbury saw this coming.
Will the liberal internationalist establishment see it before the CCP reveal whose side they are on in the coming Korean war?
Outstanding synopsis. I have been saying for years that given its economic clout and the Wests associated “courtship” – China is the real geopolitical threat.
While America dithers with its internal political idiocies, China has been unified and steadfast in its long term strategy to overtake the west. They now control our technology, mfg, precious metals and who knows what else.
While “no one” wants war,the US needs to play hardball with China and hold them accountable for their cyber hacks, espionage, piracy, South China Sea policy etc.
The issue is simply – is anyone listening? America is “the Frog in the Kettle” and I am not aware of any political leadership that truly plays the long game. This is where the CCP is a superior approach to the two party American system. They do not deviate from the long game. Time to shift trade alliances to India in a massive way.