Posted : 2016-01-10 16:43
Updated : 2016-01-10 20:03

Seoul, US target cash flow to N. Korean leader

North Korean leader Kim Jong-un

By Yi Whan-woo

South Korea and the United States are seeking to cut off a flow of cash to North Korean leader Kim Jong-un which is used to prop up his regime, according to Cheong Wa Dae sources, Sunday.

The sources said that Seoul is considering joining Washington's efforts to freeze Kim's overseas financial assets and scale up economic sanctions against Pyongyang in retaliation against its fourth nuclear test last Wednesday.

The allies are also pressuring China to ban its oil exports to North Korea, which is heavily reliant on fuel from China to maintain its heavily armed forces.

"South Korea and the U.S. are pushing to employ all possible means to take relevant measures that can effectively bring pain to North Korea," a Cheong Wa Dae official said.

The move comes in addition to steps taken by the U.N. Security Council (UNSC) to adopt a new resolution against North Korea for carrying out the nuclear test following previous tests conducted in 2006, 2009 and 2013.

Speculation is that China, a permanent member of the UNSC and one of North Korea's few remaining allies, will be skeptical about imposing "stern" measures, although it has agreed that Pyongyang should be punished.

The UNSC has a set of four resolutions — 1718, 1874, 2087, and 2094 — on North Korea.

Citing Pyongyang's surprise nuclear test on Wednesday, some critics have claimed that the existing sanctions are not sufficient to prevent Pyongyang from giving up its nuclear ambitions.

"Under such circumstances, it should be made clear that we'll put our priority on the UNSC sanctions while pursuing measures against the Kim regime individually or jointly with the U.S," said the presidential house official.

Some sources said that Seoul and Washington will refer to the case of blacklisting Banco Delta Asia (BDA) in 2005 to scare any financial institutions from dealing with the totalitarian state.

The U.S. shut down transactions at BDA in Macau while blacklisting the bank after it was found that the North Korean leadership, including Kim's late father Kim Jong-il, hoarded money there.

"Any bank will be in fear of being branded as a colluder of the Kim regime and I believe Washington's so-called ‘secondary boycott' will surely put Pyongyang into a corner if it is implemented," said Yang Moo-jin, a professor at the University of North Korean Studies.

It is seen that South Korea and the U.S. will urge the international community not to hire North Korean laborers or travel to the repressive state.

Studies have shown that the North Korean leadership has pocketed most of the money earned by its laborers working overseas while capitalizing on tourism as its major income source of foreign currency.

Meanwhile, sources say the most effective step against North Korea will be cutting off the oil supply from China through a small number of pipelines.

They say the Kim regime purchases 1 million tons of crude oil from Beijing every year.

But China has opposed the plan, claiming it will possibly lead to the collapse of North Korea, which would put South Korea and the U.S squarely on its border.

In a TV interview, Sunday, Foreign Minister Yun Byung-se then said, "China must prove that its promise to contribute to peace on the Korean Peninsula and throughout East Asia was not a lie.

"It is important for China to show in action that it is against North Korea's nuclear program."

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