Science, Technology, and Public Policy

Last week, President Trump signed a new executive order that paves the way to impose sanctions against any foreign bank that conducts business with North Korea, going well beyond current UN financial sanctions. These so-called secondary sanctions, which are penalties applied to third-party foreign banks (i.e., not directly against North Korean entities), are particularly focused on Chinese banks.

"For US regulators, 2014 was a banner year for collecting fines against sanctions violators, according to The Economist. In June, BNP Paribas—France’s largest bank, and one of the largest in the world—agreed to shell out $9 billion to the US Department of Justice for violating sanctions against Cuba, Iran, and Sudan. This past month, US regulators slapped Germany’s Commerzbank—the country’s second-largest bank, with a similar global presence—with a $1 billion fine, after launching an investigation into its dealings with sanctioned countries. The increases in fines have signaled an aggressive, zero-tolerance policy toward violators, as well as a willingness to use the extraterritorial provisions of sanctions, which allow regulators to punish foreign-based banks..."

"The surge in interest in Africa by China and India requires a different approach that does not view the continent as a helpless victim of foreign influence. To that end African countries are seeking to replace classical foreign policy that focuses on access to markets in return for raw materials with a new vision of economic diplomacy."