KCN-eh? December and January’s Other North Korean Developments

Scott LaFoy 0:02

I want to see if Kim Jong-un does what he did last year at the parade and wear a white suit with a white tie.

Andrea Berger 0:12

You're listening to the Arms Control Wonk podcast, the leading podcast on arms control, disarmament, and nonproliferation. My name is Andrea Berger, and I'm a senior research associate at the Middlebury Institute of International Studies at Monterey.

Scott 0:26

And I'm Scott LaFoy, analyst at NK Pro and super producer for the Arms Control Wonk podcast.

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Yeah. So sorry, listeners. We had a lovely episode all set up for you. And then there were a set of very nice contractors, but they were in my hallway drilling and lowering the ceiling in my building, which seems like adding insult to injury personally. So my side was unintelligible.

Andrea 1:30

We kept trying to make links back, jokes basically about Scott living on an oil rig and relating this back to energy sanctions on the DPRK to make it less bad, but we just gave up in the end. So glad to have you back without your contractors. Thank you very much. We've got two months worth of stuff to talk about now, so we've got to be extra efficient today.

Because we're going to talk through Kim Jong-un's New Year's speech, which kicked off the year. We're going to talk through some Olympic dialogue stuff. Maybe get your predictions, Scott, on Juche Fest on the 8th of February. Oh, yeah, yeah. And then maybe touch on the Vancouver meeting, foreign ministers meeting that happened in Canada, and some of the ship-to-ship transfer stuff, which is the weedy part of sanctions that I love to get into.

Yeah, let's get straight on that. What did you think of Kim Jong-un's New Year's speech this year?

Scott 2:32

As far as Kim Jong-un's New Year's speeches go, it's pretty good, actually. He focused a good bit of time on deterrence. It was overwhelmingly a domestic speech. We were talking about, oh, I can't reference back to what we were talking about because it's completely lost. There was a lot of, of course, inter-Korean dialogue. Things and a whole lot of focus on domestic industry, which we expect, a whole lot of talking about blast furnaces and tractors.

But of course, my focus in that was the deterrence end of it, because he focused on the completion of the state nuclear forces. They have their deterrent. They, what is it, safely and transparently tested their ICBM program, which is very interesting, sort of responsible state wording, and emphasized that he has a button on his desk, which we have talked

Andrea 3:24

Length about on the pod, so I'm not, we're not gonna go into, but I still love the button. I was in Monterey last week and we did one of the trivia nights in, in Monterey at a very badly themed British pub, but our team name was I Like Big Buttons and no, no one really got it. So we I sort of hung my head in shame.

We won, though, so it didn't matter if people got it. We won. Solid. But yeah, so Kim Jong-un has a button on his desk. Trump has a bigger button. Right, and that kicked off that whole thing that was charming to watch.

Scott 4:00

It would be very interesting, though, from a propaganda standpoint, since the North Koreans have walked us sort of through almost every part of their subsystems on their missiles, it would be very interesting if they start doing that with command and control. Like if Kim Jong-un showed up to this upcoming parade with a football or realistically just a big leather briefcase that a third party was... That would be enough.

Oh man, it'd be very good. That would be a very interesting propaganda move for... I mean, whether or not it's true. I feel like that's something really easy to fake and really easy to feed us, but like...

Andrea 4:32

It would be sufficiently mystifying. Do you remember the parade where they brought out the guys with the backpacks? Yes, that's exactly what I was thinking about. Yeah, like that, with the sort of radioactive sign on the backpack and everyone was like, what are those backpacks? It would be like that.

Scott 4:48

What if it's just the same backpack? It's just there's one man standing near him.

Andrea 4:52

Maybe a briefcase with the same sign as the backpack.

Scott 4:55

Just make it as unambiguous as possible. This is the football.

Andrea 5:00

Yep. So, yeah, you pulled out a really interesting point there from the speech, which was something that a lot of the media latched onto in his statement, which was basically Kim Jong-un stood up and said, this time last year, I stood before you all and said that on behalf of the party, we are going to pledge to enter the final stage of prep for our ICBMs.

And now I'm standing before you and we have done it. So, you know, basically saying that this is a fact of life now, the DPRK has completed the state nuclear force. And many, I think, took that as, oh, well, combined with some of the inter-Korean points that Kim Jong-un makes in the speech, Is this a signal that the North Koreans are now going to take the foot off the gas pedal and stop doing nuclear and missile testing?

And we can maybe bring some life to these sort of freeze for freeze proposals that the Chinese have had going or, you know, more dialogue focused attempts to resolve the crisis on the Korean Peninsula. And I'm skeptical that his speech represents that window. I don't know what your thoughts are on this, but.

Scott 6:16

I'm not always the best for the propaganda analysis, but it struck me as skeptical just because, at a minimum, programmatically, we have so many sort of missile signatures currently being tracked that indicate a new testing regime for certain systems. This is not everything, but there are certain systems that should be tested. But the timeline's hard to tell from all the signatures I've been looking at.

So it's one of those things where I feel like they kind of have the space and they can always say that that is what the signal is, or they could go back to testing tomorrow for a lot of this.

Andrea 6:49

So I'm not... That's right, yeah.

Scott 6:51

Yeah, it's a bit tea leafy for me.

Andrea 6:53

But clearly on some parts of the program, the SSB program is a great example. I mean, I don't think we should make any assumption that they're done there. I don't even think they're probably done on the ICBM front, but I will be happily proven wrong.

Scott 7:14

We all would.

Andrea 7:15

Yeah, the thing that they did emphasize is that they're going to make an effort to quantitatively expand the arsenal and that they're going to start rolling things off assembly lines.

Scott 7:27

Yes, they said mass production.

Andrea 7:29

That's, I think, really interesting and probably one of the The things we should talk about in relation to the upcoming parade as well, because for some time we've now looked at where the DPRK is going in its development and said one of the limitations that it has here is obviously the production of launch vehicles, particularly trucks and corresponding chassis.

And, you know, and they don't seem to have enough of them yet for a massive quantitative expansion of the arsenal. But November, you know, Kim Jong-un was spending a lot of time at truck and tractor factories. And I wonder if this is going to be something we're going to see a lot more of.

Scott 8:12

Yes, I think that's certainly the message they've been trying to send. And like, you know, Will Ripley put something up on Twitter a couple of days back that said that they were planning on marching dozens and dozens of Hwasong-15 ICBMs through Kim Il-sung Square. And that's... I mean, that could be true, but if that's true, that's such an enormous tech.

That's such a trajectory change from what we've been looking at. It's possible because like, I feel like this is the trap we set for ourselves prior to every parade, which is like predicting what's going to be in the parade. And then after the April 7th, 2017 parade, where we thought like there would be two new missile systems at most.

Andrea 8:52

And there was five mods and missiles. Yeah.

Scott 8:56

Yeah, a lot of stuff that was very, very, very surprising. So if they do this, I mean, Ankit Panda just put a big, a nice thing that's sort of like a watch guide up on the Diplomat that's basically like, we're watching for these eight to nine Axel Tells. Because if there are more than six of them, they have someone has either broken sanctions to import them into North Korea or North Korea can produce them themselves.

And either way, that means that they are no longer sort of sanctions limited.

Andrea 9:26

Constrained on that end.

Scott 9:28

Yeah, exactly. Unless there's like a weird raw material issue, which I think would be less likely.

Andrea 9:33

Yep, agreed. So to throw in one kind of final thought on the nuclear elements of the New Year's speech, I thought it was pretty interesting that in the speech, He continues this trend we saw from, was it September when he made that statement in state media that was very personalized? It was his sort of personal reaction to things Donald Trump had said at the UN General Assembly.

I think that was the beginning of October or end of September.

Scott 10:06

Yeah, he almost wrote like an op-ed in KCNA.

Andrea 10:08

That's right, yeah. And some of that filtered into the New Year's speech, too. He says at one point, in no way would the United States dare to ignite a war against me and our country. And so it's very much kind of, you know, focusing on the type of threat, especially, I think, that the DPRK perceives here, that there's going to be, you know, potential military action to initiate regime change in North Korea.

And they're seeking to deter that. But it's also just the changes in the Kim Jong Un style and language that you're seeing coming out here again.

Scott 10:43

It's very interesting. And then, I mean, I know it's easy to reduce that to be, you know, Trump makes it personal also. But it is interesting how often these things get personalized because the nuclear posture review just came out on Friday, and it includes specific language under the tailored strategy for North Korea section discussing that the Kim family in particular, I think the language was there is no scenario in which North Korea employs nuclear weapons and the Kim family survives.

It may have been Kim Regime, but it's specifically by name. Not quite as personalized, but as personalized as the NPR is probably ever going to get.

Andrea 11:27

Yeah, and certainly similar in the type of language to what was said in the UN General Assembly by Donald Trump as well, kind of giving the same sketch there of what aggression by North Korea results in. That's right. On the inter-Korean front, we definitely need to talk about this part because I compared purely the word count that was devoted to inter-Korean relations in this New Year's speech to last New Year's speech, and it's definitely longer.

And unsurprisingly... You know, there were pledges made here and statements about Kim Jong-un's openness to pursue greater dialogue on an inter-Korean basis, so between the North and the South. And that has kicked off North Korean participation in the Olympics, which wasn't necessarily something that many people expected prior to the New Year's speech, but isn't entirely surprising Now that, you know, we know where Kim Jong Un wanted to take his beginning of the year address here.

Scott 12:40

That's right.

Andrea 12:41

We started in January. We had several talks, rounds of talks at the demilitarized zone between North and South Korea over the North's participation in the Olympics. But the South Koreans were also kind of probing what, Where they could go with this dialogue in a broader sense. So there were kind of more ambitious things that the South was suggesting that the North rejected.

So other types of meetings of families, of some of the security talks, though the North seems to have agreed to those now. So It wasn't just a discussion about the Olympics. You can tell that Seoul was prodding for more. And it has made some progress on that front. And it had walls thrown up in its face on other avenues.

Scott 13:33

Yeah. And I actually got to write something short about this over at NKA News for this, where I kind of think this was the easy win for them because the Olympics seem like the lowest, even though it's a very high profile thing, it's sort of the thing that could get done. And sort of if we're Keeping with the theme of like the double freeze things, it's just sort of creating the environment to talk about talks.

Like we're like four steps from starting anything. This kind of created an environment with the lowest chance of like just explosive disagreements.

Andrea 14:10

Absolutely. Yeah. And the South has wanted to be able to have the political opportunity and the space not only within its own alliance relationship, but generally to start these kind of smaller discussions right since Moon Jae-in came into office. And, you know. They have had much grander hopes, I think, as well. And you can see some of that ambition trying to come out.

So, for example, I remember traveling to Seoul fairly early in Moon's time in office, and the South Korean colleagues that I was speaking with in government and outside of it were asking, when would you try to pursue a high-level summit with Kim Jong-un? And I went, What? And this was, remember, this was at the time where like, you know, ICBMs were flying.

And the fact that that was still kind of an undertone to South Korean political discussion over how to treat the developments in the North was really interesting. And now that Kim Jong-un is... What's his formal title, Scott? Chair of the Presidium of the Supreme People's Assembly, is that right? He often gets described as North Korea's number two, though there's always a debate over how you count anyone below Kim Jong-un in terms of rank in North Korea.

Scott 15:37

Yeah, Kim Jong-un's the first five ranks in the government. He is the president of the Presidium of the Supreme People's Assembly of North Korea.

Andrea 15:45

That's more of a mouthful than my own title, which is difficult to do, actually. So he takes the cake on that one. But yeah, so he's going to be leading the delegation to the Olympics. North Korea announced that yesterday. And given that he's basically, aside from Kim Jong-un, the only other senior level state rep for North Korea, If he were to have a meeting with Moon, that would be pretty interesting and pretty close to that original ambition that Moon kept talking about of a high-level summit between the two countries.

Scott 16:24

That would. That'd be very interesting. That also would allow for an easy... That's a hop, skip, and a jump away from a full summit.

Andrea 16:34

I'm still not convinced it's going to happen, but it's interesting that they're sending that high level representation to the Olympics in South Korea. And, you know, there's a question of who else goes with them, but that's a pretty interesting area to watch here. And I kept getting asked by media in particular about the Olympic talks, and everyone wanted to know what success looks like.

So I'd love your thoughts on what success looks like, but mine kind of has a range of fronts that I think we need to look at this whole exercise in the context of. So firstly, have the talks... Facilitated the exact exchange that they were designed to facilitate, which is North Korean participation in the Olympics. And while there was the potential for this all to spontaneously combust, it looks like we're probably going to put a tick in the box on that one.

Secondly, did they create any sort of political environment where North Korea felt compelled to exert restraint in its provocations, in its missile testing program in particular, even if that's temporary? And I think for now, the answer is yes. Depends if you define parading as a provocation. There are different views on that. I don't... But, you know, that's another area where we should assess these attempts at progress on the on the dialogue front with North Korea.

My my third kind of area of interest was have they yielded better insights into North Korean policy, particularly how the Kim Jong Un regime is thinking about issue linkage. So you could tell that's one of the things the South Koreans were trying to explore. Can we make progress on family reunions? And the North came back and said, not unless you do X.

So the issue linkage was an interesting thing that could be explored. And I think there was some progress made on that front. And that's all going to be really important if we actually get further in the dialogue process beyond just Olympic participation. And then my last kind of thought was, Basically, has this dialogue opened up doors to conversations between the North and the South, or indeed between the North and others, on broader subjects, especially security issues?

And particularly without compromising US alliance interests in the process of that. And everyone, you know, there's a whole bunch of people on Twitter when these talks first kick off saying, you know, they were worried that South Korea was going to give everything up to the North and, you know, the North was going to successfully use this to put a wedge in between the US and South Korea and that the South Koreans would, you know, bust sanctions in the process and wouldn't be thinking about it.

And I think the South Koreans have managed this very carefully, have thought about all of those things, have shown their thinking about all of those things, but still have managed to make some headway in opening doors to broader security dialogue with the North.

Scott 19:56

Absolutely. And that lines up pretty much with my assessment of success, which is just like like you said, I think the most important thing is that they're establishing sort of buy in for the North Koreans. They're making sure that they don't have a need or an either buy in or removing any incentive to escalate things during a very specific time.

So this could just be the short term win. But I think that's a really important point you brought up for the yielding insights onto policy is they're probing win sets. They're figuring out what the next negotiations have to be about, where the stopping blocks are. There were talks during the first round of Olympic negotiations when it was the high level group and not the lower level like working groups.

About informally bringing up security issues and that, you know, there was sort of a dance going on there where they said they brought up denuclearizations, but it wasn't part of the schedule. There was no schedule setting about it because they knew they couldn't get that on the actual docket. But they know, you know, making sure the other side knows it's coming up, figuring out what the other side links together, and sort of understanding what moves are going to be necessary in real security negotiations when they come up.

And then, like you said, the foundation for the next rounds. We have an easy win or a relatively easy win, not an actual easy win. We know how the last Olympics went and it went really badly. So setting up something that's winnable by both sides, you have relatively good optics, you have sort of an era of good feelings in which you can talk.

And hopefully no one firing off missiles or performing large-scale military exercises to get rid of that.

Andrea 21:43

It's all just sort of like a... Or performing large-scale, really embarrassing kind of propaganda displays at the Olympics. Yes. We've got to put that out there, too. There remains the possibility that North Korea throws a giant finger up at everyone and has its girl band do a song praising... You know, North Korean missiles.

Scott 22:08

That would be a pretty incredible move if all of this was to get like, you know, the Samjian Orchestra is coming and then no plot twist, it's Moranbong and we're just singing the song of the Hwasong artillerymen giving the finger, taking our ball and going home before the Olympics start.

Andrea 22:24

Like that would be a pretty incredible move. I'm, I'm pretty convinced it won't happen. The, the orchestra is what's coming. I mean, the South Koreans are, are very carefully managing all of the lead up to this. Yes so orchestra is coming. I'm sure they will find ways to prevent songs from being switched and all of that, but you never know. Yeah, it's, and we've seen stuff so far. We've had at least

Scott 22:49

Immediately comes to mind at least one event that has failed, that didn't happen, that Kumkangsan joint activity didn't happen and won't be happening, it sounds like. So, I mean, they've built up at least enough of a rapport where stuff can fail independently of each other without bringing the whole agreement down, which is a good sign to me.

Indeed. Even if Semjian Orchestra does show up and they're just like, what do you mean we can't sing about the great history of removing Americans from... The peninsula and be like, well, okay. But is, was this concert super necessary for the Olympics? We still got that woman's hockey team. We've burned a lot of political capital on the women's hockey team.

It sounds like.

Andrea 23:27

Over the women's hockey team. Yeah. Well, I'll, I'll be watching that. That'll be super interesting. Oh yes, it will.

Scott 23:32

Yeah.

Andrea 23:35

I think the last thing to maybe note on this point is that this is not unusual for North Korea necessarily. It's not even unusual for Kim Jong-un to be making these sort of overtures. Because the North Koreans, I mean, they do this with each South Korean president. And that is a really, really crucial point here is that Moon is not special, even though he's so engagement oriented.

These sort of outreach efforts are things that the North Koreans tried, including in New Year's speeches. So making these similar types of overtures in New Year's speeches. They tried it with Lee Moon-bak and they tried it with Park Geun-hye before Moon Jae-in. And they basically, you know, they try to push at doors to see how far they'll open.

And they're doing it here again. That's why it's important to remain mindful of, you know, the potential that the North Koreans are trying to put daylight in between the position of South Korea and its allies. But, you know, this is a ripe time for North Korea to be testing this South Korean president.

Scott 24:47

Exactly. Probing winsets goes both ways. They still need to figure out how much they can...

Andrea 24:52

It really does, yeah. So that's exactly what both are doing here, as you say, and it will be fascinating to watch it play out in the next few weeks. Oh, absolutely. I'm already looking forward to the end of February podcast. You guys are going to take all my material, though, on JucheFest. I know it. You're going to do your own four-part pod series or something, and I'll have nothing left to talk about.

Scott 25:14

Oh, if we could get the schedule to work, we were talking about it in the Slack channel about doing a live stream for it, and we cannot get that. We have not been able to get that to work just for so many reasons, partially because of how the streams of the parade may end up actually practically working, and then also I'm going to be working that night because I'm going to be covering this for NK Pro.

Man, this is going to be such an... Like, this week is going to switch from low-energy...

Andrea 25:42

Basically until like wednesday 7 p.m eastern time and then it's like i have it way worse than you because i'm on london time so i have to stay up at stupid o'clock in order to watch this happen i'm gonna let you guys do the missiles and stuff and i'm just gonna point out like sanctions busting you know cars and yes and all the rest of that so that's that's where i'll jump in on

Scott 26:06

I want to see if Kim Jong-un does what he did last year at the parade and wear a white suit with a white tie. Ooh, strong look. It's a strong look. It was incredible. Oh, and you know, just on the, this is going back to the Olympics. I realized I realized I do have a story that is the people may have missed it story for the Olympic negotiations.

During the Olympic negotiations, you know how they were talking about, of course, setting up the security dialogues. And sort of one of the first things the North Koreans dropped was that, hey, by the way, the West Coast security cooperation line is back online again.

Andrea 26:41

Oh, that's right. Yep. Really important.

Scott 26:43

Surprise.

Andrea 26:44

It's back.

Scott 26:47

They dropped in that the East Coast line is still down for what they say were technical reasons. And walking through it was maybe the most North Korean thing I've ever heard where they said, no, the East Coast line is down. It's broken. We've tried to call you, but a forest fire caused infrastructure damage and we can't use it.

And I was just so genuinely surprised that the next sentence in the coverage wasn't, And thus we would like to ask for South Korea to pay for it so we could reestablish military communications on the East Coast.

Andrea 27:18

I missed the bit about the East Line. So I'm glad you brought that up, Scott. I completely missed that. The most inane granular thing ever, but it was just very funny to me because... You would expect it to be, please pay for it.

Scott 27:33

Yes, and it would not surprise me if like the next time we hear about it is, oh, this was reestablished immediately after the Olympic talks and it's like really nice quality now. I'm like, okay. I can imagine how that went down.

Andrea 27:43

So nice they can record podcasts on it. Other things that happened in the last two months. One was the Vancouver meeting. And as a Canadian, I have to talk about any time Canada touches this issue. That was a pretty interesting one for me to watch. For those who didn't follow this closely, Canada and the US jointly hosted a foreign ministers meeting in Vancouver in mid-January to discuss, depending on what version you listen to most closely, the US or the Canadian narrative on this, diplomatic solutions For addressing the Korean Peninsula crisis.

Scott 28:23

And just to start off on an interesting foot, would you like to tell listeners the exact phrasing for the invitation list for the countries?

Andrea 28:31

Yes. So the well, again, here, U.S. and Canadian differences. So the Americans, when they announced it, said it is going to be the U.N. command sending states plus some others. And the U.N. command is the group of the U.N. command sending states are the group of countries that contributed troops on the side of the South Koreans and the U.N. mission in the Korean War.

So they are, if you could define an anti-North Korea coalition out there, that would be basically the closest you could come to a definition of anti-North Korea coalition. So that was the language the U.S. used. The Canadians just sort of referred to relevant countries, but it was pretty clear to me that they had different visions for who was going to participate in this meeting and actually probably I read it as different visions that the US and Canada had for the meeting as a whole.

But the Russians and the Chinese did not like this at all.

Scott 29:34

Well, it makes sense. Like, if one person's calling it the UN command meetings and the other is calling it relevant countries and both exclude the Chinese and the Russians, that's still not good optics.

Andrea 29:46

To be fair, I... So some of the statements from the Canadian foreign minister a few months ago as the meeting was being set up, some of her statements suggested to me that the Canadians had originally envisioned inviting at least the Chinese. She made a statement on the record to that effect. The U.S. then contradicted her and went back to the sending states thing.

So it sounds like there was co-host kind of alignment issues on this front. But yeah, the Russians and the Chinese have been somewhat understandably calling this meeting a coalition of anti-North Korea countries. And given that the U.S. wanted to use This meeting to primarily talk about strengthening sanctions on North Korea, particularly shipping sanctions. The Russians and the Chinese viewed this as a way of circumventing the UN Security Council to build agreement for things that should have been run past the Russians and the Chinese.

And again, they're partly right. So, yes, a lot more acrimony around this conference than some might have anticipated. I wrote a piece for Arms Control Wonk, which Jonathan Cheng from the Wall Street Journal called the pre-mortem, which I felt really bad about because I didn't mean to suggest that it was dead off the hop. And I have not written a post-mortem, but...

You know, in my view, the U.S. had a very, very specific view of what it wanted to do with this meeting of countries, which was to talk overwhelmingly. And I you know, it's hard to say because not everything was was on the record and in the public domain in terms of what they said, but overwhelmingly in terms of sanctions implementation.

And so That's kind of what you would expect. Well, it is what you would expect from the White House right now. They're full force on maximum sanctions and pressure. They like using these so-called like-minded groups for advancing sanctions implementation and indeed building agreement around new sanctions design. And shipping is one of the big areas where they want to make a push on.

So that's what they did in Vancouver.

Scott 32:22

That's right.

Andrea 32:23

Oh, in terms of things people might have missed, on the Friday before the Vancouver meeting, very cleverly timed, there was a U.S.-coordinated statement by, I think, 17 members of the Proliferation Security Initiative, which was released saying how important it is that we robustly enforce maritime provisions of recent U.N. Security Council resolutions. So the proliferation security initiative is a initiative started in the George Bush administration, George W. Bush administration, that got countries around the world to sign up to a statement of voluntary principles around ship interdiction in the case that there was proliferation sensitive cargo on board.

And it has some politicization to it as well. The Chinese do not engage with it, though the Russians do participate in PSI meetings. So, yes, that very much signaled that this was going to be, at least in part, in Vancouver, a conversation about maritime sanctions.

Scott 33:31

Right. And that is the U.S.'s shtick right now.

Andrea 33:34

It is. You've been following some of the stuff around ship-to-ship transfers, which has been pretty interesting, and around the South Koreans seizing vessels that have been engaged in prohibited activities, which was a...

Scott 33:49

A thread of activity kind of between December and January. Oh my god, it's been such a long two months. You're right. I've been, and I've been helping Leo burn out a bit for it on the satellite imagery side, because that's, that's really his, like, his thing, especially for petroleum and coal. Yep Yeah, and now the Russians are back in the game for that one, because it's not just these sketchy ships hanging out in South Korea and sort of laundering oil.

We just had, what is it?

Andrea 34:21

There was in Nedhoka and Kolmsk were the two ports, I think, with Coltrane shipment. So my understanding is that they're taking the coal over to those ports. They offload the coal from a North Korean ship, leave it for varying periods of time, sometimes just quite quickly. And then another ship will, a separate ship will come pick it up again from the same point on the dock and take it into other countries in the region again.

South Korea, Japan, etc. And that makes it, from the perspective of the buyers in, let's say, Japan, look like the stuff has come from Russia, not from the DPRK.

Scott 35:10

Right. It's a way of having DPRK. The whole strategy right now is, how does the DPRK export things without DPRK ships showing up in other people's ports?

Andrea 35:20

That's right. And not even just the ships, because you're not allowed to buy North Korean coal or a whole range of other sanctioned commodities. So how does North Korea sell that stuff without people figuring out that it's actually come from North Korea? And they're using these sort of circuitous routes and transshipment patterns in order to obscure the origin of the product that they're selling.

Scott 35:46

That's right. They're essentially laundering through other people's ports and flags, is how I kind of look at it.

Andrea 35:51

That is a really good way to look at it. They are, you know, applying some of the tactics you would see in a money laundering case to physical movement of goods here. So yeah, that's right. And we're seeing then, you know, a different set of evasive patterns when it comes to North Korean importation of products that they're not allowed to receive.

And this is where the ship to ship transfer discussion comes in, because similar scrutiny is being exerted on North Korean imports. Imports as they are on North Korean exports. And one of the dynamics we've seen, which resulted in South Korea seizing two ships, Scott, is that right, in December, and then the Japanese taking from maritime patrol aircraft, some photos of it happening again in January?

Did I get that right?

Scott 36:43

I believe that's correct. That sounds correct to me.

Andrea 36:45

So... The tactic that's been used that's resulted in South Korea and Japan kind of releasing more information into the public space is ship to ship transfers, say that five times fast. And what the North Koreans have been effectively doing Is getting non-North Korean, as far as we can tell, owned or controlled vessels, though they may be vessels that are owned or controlled by networks that North Korea is familiar with and has done business with before.

So non-North Korean owned or controlled vessels, non-North Korean flagged vessels. So these are flying a Belize or a Hong Kong flag or what have you.

Scott 37:28

Right.

Andrea 37:29

Getting those vessels to go and get stuff that they need in foreign ports and then go midway out to sea or in someone else's waters, particularly China here, and parking next to each other. So parking next to a North Korean ship and loading some of the cargo from the foreign ship onto the North Korean one, which then sails back to DPRK.

Scott 37:54

Right. And this seems particularly prevalent for petroleum transfers, at least on what I've been looking at. It seems to be very common because, and I assume part of that is just the ease at which petroleum is transferred versus other Bulk cargoes. I think that's exactly right. it would be, it's pretty difficult to do ship to ship transfers of, of bulk cargo, and there's, there's a legitimate way to do, like, there are ship to ship transfers of petroleum that are legitimate. So hypothetically, you know, if you do it in an area that's so crowded that it's difficult to see you other ships that would be at your level would not necessarily be questioning it. That's right. there's, there's some cleverness going on with it

Andrea 38:30

So to give you one example, the first ship that South Korea seized went through kind of the following pattern. In October, in early October, it filled up. So it was a tanker. It filled up in a port in South Korea. It then declared that it had been filled up and set sail for Taiwan. As soon as it was kind of leaving South Korean waters, it turned off its tracker for several days.

And then, what is it, five days later, it shows up back in the same port in South. So it turns its tracker back on by Jeju Island off the south coast of South Korea, sails back into the same port. Fills up again, repeats pattern. And what U.S. and South Korean authorities have been saying, and which the Japanese have corroborated with yet more examples, is that these vessels, in the days when they've got their tracker off and they're supposedly going to Taiwan, are indeed not going to Taiwan.

They're going out into the middle of the sea, meeting up with other ships and transferring cargo over.

Scott 39:37

That's right.

Andrea 39:38

And so I had a quick look and of the numerous ships that the US requested to be designated at the UN after this was all exposed, quite a number of them were Exhibiting this exact same pattern, including with the exact same South Korean port. One of the other ships is called Billions Number 18, which I don't know if the Trump administration or if Trump himself has cargo ships, but if he doesn't, he needs to name them Billions and then number them.

Scott 40:12

I just like the idea that there's hypothetically, there's an implied fleet of billions one through 17. Yes. Which seems immensely confusing to manage on someone's like manifests. Is this billions 15 or billions five? Yep. That's such a good name for a ship.

Andrea 40:31

It is a great name for a ship. So, points all around there. But yeah, so that's been one of the things that's happening and I think that's pretty interesting actually because to me it suggests that the North Koreans are having to go through quite a bit more effort in order to get access to the goods that they need, particularly in this case energy products.

Ship-to-ship transfers are not easy things to do. They're irritating and probably quite a bit more costly for the North Koreans. And if they're having to jump through the hoop of doing them, I think it's reasonable to assume that at least some of the maritime sanctions provisions here are having at least creating irritation and creating obstacles for the North Koreans.

Scott 41:19

Oh, absolutely. They've raised the cost of doing business in a very literal, immediate way. Because now it's if the U.S. has shifted so much effort and political capital onto stamping out fringe shipping practices, at least to me, that seems like a shift into focusing on cleanup.

Andrea 41:36

Yeah, I get the sense that the US believes, and probably rightly so, that this is an area really where they can actually create quite a bit of impact in terms of creating pain on the North Koreans trying to engage in... Maritime trade. And I hesitate to use the word where sanctions are being effective because I think effectiveness is a much broader policy question.

But I do think this is an area where it seems like pain is being created or irritation in North Korean standard trading practice.

Scott 42:12

Indeed. And I mean, it makes sense. The U.S. spent... I don't know how many years trying to get energy caps and maritime caps essentially for probably this reason. Like I imagine this target's been painted for a long time ago.

Andrea 42:26

Yeah, that's probably right. And it's really an area in terms of sanctions design that they've run with, the financial element as well. But they've gone quite significantly beyond the types of maritime measures that they did in the Iranian case. So this is really trying to limit North Korea's access to the standard pathways for international trade and finance.

That's right. So, that has been a whirlwind tour of many of the developments of December and January. We are going to have a lot to talk about in February, I'm sure. Olympics, parades, who knows what else is going to jump into our news frame here on North Korea. Yeah, thanks, Scott, for doing such a condensed podcast with so much material in it and for trying to salvage our last effort as well.

It was really good talking to you, so thanks for sharing your insights. Thanks so much for having me on.

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Scott 43:56

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