U.S. Seeks to Cut Off Luxury Goods for North Korean Regime

Nov 30, 2006 8:11am

With the holiday shopping season now in full swing, the U.S. government has drafted a list of items North Korean dictator Kim Jong Il and his regime won’t be able to give his friends this year. As punishment for its nuclear weapons test last month, the United Nations Security Council passed resolution 1718, which called for targeted sanctions on luxury items, aimed at the North Korean leadership. Kim is known for giving expensive watches and electronics to supporters, but if the U.S. gets its way, he’ll have to settle for something less flashy. Watches made of precious metals and plasma TVs are on a draft list of banned goods. THE BLOTTER RECOMMENDS Exclusive: Enemy Inside the Gates: North Korean Diplomats in the U.S. ‘Missiles ‘R’ Us,’ But Would North Korea Sell Their Nukes? Click Here to Check Out Who’s Blowing Hot, Cool and Smoke on the Brian Ross Homepage The North Korean dictator is also famous for his extensive wine collection, believed to include almost 10,000 bottles, but under the proposed restrictions, he won’t be ringing in the New Year with a new bottle of champagne. That will be banned along with all other types of alcohol. And he can forget about driving to the beach in a luxury Mercedes to take a ride on a new yacht. Those are on the list too, along with jet skis, Segway personal transport vehicles, iPods and other digital music players, laptops, musical instruments, sports equipment, fur coats and perfume. While Kim is known for his expensive taste, the vast majority of North Koreans live in poverty. Many North Koreans suffer from malnutrition. "While North Korea’s people starve and suffer, there is simply no excuse for the regime to be splurging on cognac and cigars," Commerce Secretary Carlos Gutierrez said in a statement. "We will ban the export of these and other luxury goods that are purchased for no other reason than to benefit North Korea’s governing elite.  The United States is taking quick action to implement the sanctions called for by the United Nations in response to North Korea’s nuclear test," he added. Both Japan and European countries are looking at implementing lists "substantially similar" to the American one, according to a senior U.S. Commerce Department official who is involved in discussions with those countries about what to sanction. The official added that while the Japanese have included some food and medicine on their list, U.S. policy does not allow the use of food as an economic weapon. "The list was carefully targeted to affect items imported for the benefit of the regime," the official told ABC News. "We were careful not to include items that would affect all North Koreans," he added. The challenge, however, will be to get all countries to agree on a similar list of sanctions. China and South Korea have extensive trade relations with Kim Jong Il’s regime, yet both have been reluctant to cut economic ties. The Commerce Department official told ABC News that the U.S. is working to get an agreement on the list with other countries, but Marcus Noland, an expert on the North Korean economy at the Peterson Institute for International Economics, is pessimistic about the effectiveness of such sanctions, since the definition of a luxury good and enforcement is up to individual countries.    "It practically invites circumvention and surely will lead to finger pointing and discord among the sanctioning countries," he said. "This is purely a symbolic gesture," he added. "Nobody plausibly thinks that taking away their jet skis will end the North Korean nuclear program." Still, these sanctions are intended as a starting point. The U.S., who only does about $6 million in trade per year with North Korea, hopes that while their sanctions will have limited impact, they will be a model for other countries to follow. "By putting forward a list and consulting with countries to come up with broadly similar lists we can put a crimp in the regime’s lavish lifestyle," the Commerce Department official said. That approach of coaxing other countries along may work, says Noland. "This is a way to do this, because nobody could criticize taking away Kim Jong Il’s iPod," he said.

You are using an outdated version of Internet Explorer. Please click here to upgrade your browser in order to comment.
blog comments powered by Disqus