Watch Out for the Blowback of Secondary Sanctions on North Korea

While tensions continue to flare along the Korean peninsula, the Trump administration struggles to articulate its strategy to persuade North Korea to halt its nuclear program. In a recent visit to the de-militarized zone, Vice President Pence warned Pyongyang to not test America’s “strength and resolve,” citing recent U.S. military strikes in Syria and Afghanistan as a forewarning. A not-so-veiled threat that the Trump administration considers “all options” to be on the table. What is unknown, however, is whether this increased rhetoric is merely saber-rattling or is the opening salvo for a true shift from Obama’s doctrine of “strategic patience.” That is, continuing to apply political and economic pressure until Pyongyang returns to the negotiating table.

Since 2006, Pyongyang has conducted five nuclear tests — a possible sixth may be on the way. In weighing its options, the Trump administration has decided to take a rather opaque approach of “maximum pressure and engagement.” While the details of “maximum pressure and engagement” are somewhat thin, it is quite likely that secondary sanctions — or the threat of secondary sanctions — will play a significant role. In fact, some in Congress have already called for Trump to tighten U.S. economic and financial sanctions against North Korea, even calling for a ban from SWIFT,  the international financial messaging system.

David S. Cohen, an Obama administration Treasury official, argues that Trump should “take a page out of the Obama administration’s Iran sanctions playbook” and apply secondary sanctions against those who do business with the North Korean regime. This now seems even more likely. This past week, the White House held a briefing for all 100 U.S. Senators on the North Korean threat — a move leaving many in Washington perplexed. After the briefing, however, officials announced that the Trump administration would pursue a strategy that includes tightening economic sanctions against North Korea, including businesses that deal with the regime.