Today President Obama issued an Executive Order freezing the assets of certain persons with respect to the Democratic People's Republic of Korea (North Korea). This new Order expands the scope of the national emergency declared in Executive Order 13466 of June 26, 2008 and takes additional steps to address that national emergency. In the new Executive Order, the President finds that certain actions and policies of the Government of North Korea constitute an unusual and extraordinary threat to the national security, foreign policy, and economy of the United States.

The Order targets the government of North Korea's continued involvement in a wide range of proliferation and other illicit activities in defiance of UN Security Council Resolutions (UNSCRs) 1718 and 1874 and other illicit activities in defiance of international norms. The Order directs the Secretary of the Treasury, in consultation with the Secretary of State, to target for sanctions individuals and entities facilitating North Korean trafficking in arms and related materiel; procurement of luxury goods; and engagement in illicit economic activities, such as money laundering, the counterfeiting of goods and currency, bulk cash smuggling and narcotics trafficking. This new Executive Order supplements existing U.S. sanctions targeting proliferators of weapons of mass destruction (WMD) and those who support them, under which North Korean entities and individuals have been designated to date.

President Obama also identified the following entities and individual for sanctions by listing them on the Annex to the Order:

· The Reconnaissance General Bureau (RGB), North Korea's premiere intelligence organization involved in North Korea's conventional arms trade;

· RGB commander Lieutenant General Kim Yong Chol;

· Green Pine Associated Corporation, a North Korean conventional arms dealer subordinated to the control of the RGB; and

· Office 39 of the Korean Workers' Party, which provides critical support to North Korean leadership in part through engaging in illicit economic activities and managing the leadership's slush funds.

The U.S. government has longstanding concerns regarding North Korea's involvement in a range of illicit activities conducted through government agencies and associated front companies. North Korea's nuclear and missile proliferation activity and other illicit conduct violate UN Security Council Resolutions 1718 and 1874, and these activities and their other illicit conduct violate international norms and destabilize the Korean Peninsula and the entire region. In signing this Order, President Obama has frozen the property and interests in property of the three entities and one individual listed on the Annex. This Order provides the United States with new tools to disrupt illicit economic activity conducted by North Korea.

* Arms proliferation: North Korea has long been engaged in the sale of conventional arms to countries in the Middle East, Southeast Asia, and Africa. Since the 2009 adoption of UNSCR 1874, which bans all arms transfers from North Korea, authorities in Asia, Africa, and the Middle East have seized North Korean shipments suspected of carrying prohibited arms and related materiel.

* Narcotics trafficking: During the past three decades, North Korean citizens, diplomats and government officials have engaged in narcotics trafficking. Officials in Turkey, Egypt, Taiwan and Japan have linked North Korean officials to narcotics possession, distribution and smuggling.

* Counterfeiting currency: The United States continues to investigate North Korea's manufacture and distribution of the highly deceptive counterfeit of the U.S. $100 and $50 bills, also known as the "supernote." The United States Secret Service has made definitive connections between the supernote and the government of North Korea. Since its first detection in 1989, the Secret Service has seized approximately $63 million of supernotes globally.

* Procurement of luxury goods: UNSCR 1718 requires Member States to prohibit the direct or indirect supply, sale of transfer to North Korea of luxury goods, which North Korean leadership uses to secure the loyalty of elites and the military. In July 2009, Italian authorities prevented the sale of luxury yachts worth more than $15 million to an Austrian company because they were ultimately destined for North Korea.

* Deceptive financial practices: North Korea continues to engage in deceptive financial practices to disguise the true nature of its transactions, using government agencies and front companies to engage in WMD and missile proliferation-related and other illicit activities and to evade detection by financial institutions around the world. All of the conduct above is facilitated by the deceptive financial practices North Korea engages in to disguise the true nature of its transactions.

President Obama identified the following entities and individual for sanctions by listing them on the Annex to the Order:

The Reconnaissance General Bureau (RGB)

The Reconnaissance General Bureau is North Korea's premiere intelligence organization, created in early 2009 by the merger of existing intelligence organizations from the Korean Workers' Party, the Operations Department and Office 35, and the Reconnaissance Bureau of the Korean People's Army. RGB trades in conventional arms and controls the North Korean conventional arms firm Green Pine Associated Corporation (Green Pine), which was also identified for sanctions by the President today for exporting arms or related materiel from North Korea.

The RGB is commanded by General Kim Yong Chol, who was also identified for sanctions today.

Green Pine Associated Corporation (Green Pine)

The conventional arms firm Green Pine Associated Corporation was subordinated to the control of the RGB in 2009 and has been identified for sanctions by the President for exporting arms or related material from North Korea. Green Pine specializes in the production of maritime military craft and armaments, such as submarines, military boats and missiles systems, and has exported torpedoes and technical assistance to Iranian defense-related firms.

Green Pine is responsible for approximately half of the arms and related materiel exported by North Korea and has taken over many of the activities of the Korea Mining Development Trading Corporation (KOMID), which is listed in the Annex to Executive Order 13382 of June 2005. KOMID was also designated by the UNSCR 1718 Committee to be subject to the provisions of paragraph 8(d) of UNSCR 1718.

Office 39 of the Korean Workers' Party (Office 39)

Office 39 of the Korean Workers' Party engages in illicit economic activity to support the North Korean government. It has branches throughout the nation that raise and manage funds and is responsible for earning foreign currency for North Korea's Korean Workers' Party senior leadership through illicit activities such as narcotics trafficking.

Office 39 controls a number of entities inside North Korea and abroad through which it conducts numerous illicit activities including the production, smuggling, and distribution of narcotics. Office 39 has also been involved in the attempted procurement and transfer to North Korea of luxury goods.

· Office 39 produced methamphetamine in Sangwon, South Pyongan Province and was also involved in the distribution of methamphetamine to small-scale North Korean smugglers for distribution through China and South Korea. Office 39 also operates poppy farms in North Hamkyo'ng Province and North Pyongan Province and produces opium and heroin in Hamhu'ng and Nachin.

· In 2009, Office 39 was involved in the failed attempt to purchase and export to North Korea -- through China -- two Italian-made luxury yachts worth more than $15 million. Halted by Italian authorities, the attempted export of the yachts destined for Kim Jong-il was in violation of United Nations sanctions against North Korea under UNSCR 1718, which specifically require Member States to prevent the supply, sale, or transfer of luxury goods to North Korea.

Office 39 previously used Banco Delta Asia to launder illicit proceeds. Banco Delta Asia was identified by the Treasury Department in September 2005 as a "primary money laundering concern" under Section 311 of the USA PATRIOT Act because it represented an unacceptable risk of money laundering and other financial crimes.

Identifying Information:

Entity: Reconnaissance General Bureau

AKA: Chongch'al Ch'ongguk

AKA: RGB

AKA: KPA Unit 586

Location: Hyongjesan-Guyok, Pyongyang, North Korea

Alt. Location: Nungrado, Pyongyang, North Korea

Individual: Kim Yong Chol

AKA: Kim Yong-Chol

AKA: Kim Young-Chol

AKA: Kim Young-Cheol

AKA: Kim Young-Chul

Location: Pyongan-Pukto, North Korea

DOB: circa 1947

Alt. DOB: circa 1946

Entity: Green Pine Associated Corporation

AKA: Chongsong Yonhap

AKA: Ch'o'ngsong Yo'nhap

Location: c/o Reconnaissance General Bureau Headquarters, Hyongjesan-Guyok, Pyongyang, North Korea

Alt. Location: Nungrado, Pyongyang, North Korea

Entity: Office 39

AKA: Office #39

AKA: Office No. 39

AKA: Bureau 39

AKA: Central Committee

AKA: Bureau 39

AKA: Third Floor Division 39

Address: Second KWP Government Building (Korean – CH'O'NGSA), Chungso'ng, Urban Town (Korean -- DONG), Chung Ward, P'yongyang, North Korea

Address: Chung-Guyok (Central District), Sosong Street,Kyongrim-Dong, Pyongyang, North Korea

Address: Changgwang Street, Pyongyang, North Korea

###

Former U.S. President Jimmy Carter is in North Korea to secure the release of Aijalon Mahli Gomes, a 30-year-old American missionary who was sentenced in May to eight years of hard labor and fined $700,000 for illegally entering the North. Carter met Pyongyang’s nominal leader Kim Yong-nam and may even sit down with Kim Jong-il. The trip is significant because the release of an American civilian has once again brought a former U.S. president out of retirement at a time when tensions are high between Washington and Pyongyang as well as on the Korean peninsula. What’s more, it comes at a time when the Dear Leader’s health is said to be deteriorating. History has shown that the political environment tends to warm after a former U.S. president flies to the rescue.

Why Carter?

President Carter is no stranger to freeing hostages in North Korea. He did it in 1994, which in effect defused the first nuclear crisis by bringing the two sides to the negotiating table. He is also well-liked by North Korea and has negotiated with Kim Il-Sung, founder of the regime and Kim Jong-il’s father. Carter is also a symbol of peace and has consistently urged the U.S. to engage North Korea with dialogue regardless of circumstance.

However, Carter has been known to take matters into his own hands and he may be tempted to put his spin on U.S. foreign policy once again. In 1994, he brokered a deal to improve U.S.-North Korean relations in exchange for denuclearization, the scope of which was first brought to the Clinton administration’s attention during a CNN broadcast of Carter’s voluntary trip. Unable to reverse the work of a former president, the Clinton administration had to use Carter’s deal as the foundation of the 1994 Geneva Agreed Framework.

Pyongyang may misinterpret Carter’s visit as President Obama’s willingness to move beyond the Cheonan incident and ease pressure against the North. The challenge will be to ensure that Carter does not engage in freelance diplomacy again, especially since his personal views run counter to the Obama administration’s current containment policy, although the door is open for rewarding good behavior.

The Cable reported Carter was chosen because he is not an acting U.S. official. However, Yonhap News (Korean text only) reported that Pyongyang specifically requested President Carter via an intermediary, Professor Hans Park at the University of Georgia, during his trip to North Korea trip early July.

Objectives & Options

U.S. and South Korean officials are tight-lipped on details of Carter’s visit. What's more, North Korea continues to be a black-box, which is why it is easy to speculate rather than offer concrete arguments based on confirmed facts. Still, some cautious observations about the potential objectives of the different actors involved can be made based on history and present circumstances:

a) U.S. – Private, Humanitarian Mission? The U.S. administration maintains that Carter’s trip is strictly “humanitarian and private,” which were the same words used when former U.S. President Bill Clinton visited North Korea to free two American journalists at a tense diplomatic time. Many North Korea watchers immediately interpreted Carter’s visit as Washington dispatching an envoy, but the State Department has denied this.

If, in fact, Carter’s trip is purely a private humanitarian mission as the U.S. claims, then prospects for a breakthrough depend on Kim Jong-il (see more on this below). It is unclear whether Kim will follow his late father’s footsteps and attempt to engineer another breakthrough in the nuclear saga.

However, the public seems to be forgetting that Gomes walked into North Korea with the intention of getting caught. The missionary was said to have been on a mission: to spread Christianity and covert North Korea. To rescue Gomes may prompt him to head right back to the North. If there are more like him with the same mission, and if this become a pattern, Pyongyang may see it as another money-making opportunity since it slaps fines in the hundreds of thousands of dollars.

b) U.S. & South Korea – Nuanced “Exit Strategy?” Until now, the Obama administration’s rhetoric and actions have made it clear that it is willing and ready to forego dialogue on the nuclear issue until after a North Korean leadership transition. Washington will soon slap more sanctions on Pyongyang and tensions are running high with the North having fired artillery near the de facto maritime border after a joint South Korea-U.S. military exercise. However, Secretary of State Hillary Clinton reportedly ordered fresh options be examined out of frustration with the current policy.

To date, Seoul has been firm that it will not participate in a resumption of the six-party talks until Pyongyang takes responsibility for torpedoing the Cheonan. However, the South Korean position may be softening.  According to South Korean Foreign Minister Yu Myung-hwan, “Strictly speaking, the sinking of the Cheonan and our punitive measures against the North, and the resumption of the six-party talks are different in nature.”

c) North Korea – Bargaining Chip?  Some North Korea watchers caution that Carter’s trip will be used by Pyongyang to augment its legitimacy internally amid leadership succession uncertainties and bilateral tensions. The regime is also expected to herald the Carter visit as a diplomatic victory in the face of Washington's tough stance towards it. This may explain why Pyongyang reportedly (Korean text only) vowed to release Gomes if Washington were to send Carter to the rescue. The trip also follows North Korea’s official media report that Gomes attempted suicide, frustrated his country was not doing more for him.

d) North Korea – Avoiding Responsibility? Pyongyang may use Carter’s visit and dangle the prospect of resuming negotiations as another way to avoid taking responsibility for sinking the Cheonan. North Korea may be receiving China’s help to do just that. Beijing has been trying to arrange another round of six-party talks, and Carter’s trip comes on the heels of Chinese nuclear envoy Wu Dawei’s visit to the North. Wu is also scheduled to visit Seoul and Tokyo this week to discuss resuming multilateral nuclear negotiations.

Possible Outcomes & Implications

How might the current impasse look after Carter’s visit? Expect one or more of the following scenarios:

a) Breakthrough? North Korea’s latest behavior suggests that chances are low for the immediate resumption of six-party talks. Against this backdrop, Carter’s visit may be seen as an opportunity for Washington and Seoul to transition from their current policy of containment to one of engagement. However, the Obama administration has held firm to its two-track policy of pressure and talks: it will only engage Pyongyang if the regime agrees to fulfill its past nuclear commitments and returns to the six-party talks. It has also supported Seoul’s position to resume nuclear dialogue after a North Korean apology for sinking the Cheonan. If Carter’s mission does lead to some sort of a breakthrough, the South Korean public will not allow the Cheonan incident to be brushed over lightly.

Kim Jong-il’s next move is anybody’s guess. But Carter’s visit may be the last time he can take matters into his own hands directly with the U.S. as his health continues to deteriorate. It may serve as a face-saving measure for Pyongyang to return to international dialogue in light of upcoming U.S. financial sanctions that could further isolate it from the global community. The trip will also provide a clue as to whether Kim has the will to take concrete steps toward denuclearization. At the least, Carter’s visit could lead to a resumption of direct Washington-Pyongyang dialogue and possibly among all six parties. Nevertheless, the mission will be meaningless for the nuclear impasse if it does not result in a shift in North Korean behavior.

b) Feeding Bad Behavior? Following President Clinton’s trip, Pyongyang initially engaged in talks with Washington but used them to make additional demands and upped its provocations.  If this outcome repeats itself following Carter’s visit, then it will have served to vindicate North Korea’s unwillingness to compromise.

c) Inter-Korean Relations? It is unclear whether Gomes’ release will help thaw inter-Korean relations. The release of two American journalists after President Clinton’s visit led to the return of South Koreans, and the same result is widely hoped for this time as well. Four South Korean and three Chinese fishermen are currently being held in North Korea for allegedly crossing into the North’s exclusive economic zone. If they are released, it could serve as an opportunity for the two Koreas to resume dialogue.

Recommendations

- Creativity and strategic flexibility should always be explored in finding a way to break the North Korean impasse. However, the message should remain that countries must abide by certain international rules and agreements. Washington must continue to prod Pyongyang to fulfill past nuclear pledges in exchange for the other five parties upholding their end of the bargain.

- If Carter’s mission results in progress or even a breakthrough, the allies will need to carefully deal with the Cheonan attack so that it does not become a forgotten incident.

- Given Kim Jong-Il’s ailing health, contingency plans must also be made to cushion any shocks as a result of a possible collapse in the North amid a leadership succession. Seoul’s consideration of imposing a “reunification tax” signals that time may be approaching faster than expected.

By Alex Rothman

Following an August 3 report in the Wall Street Journal, the arms control blogosphere has been buzzing about a nearly finalized nuclear cooperation agreement between the United States and Vietnam. According to the Journal, and now other outlets including The Guardian and Global Security Newswire , the U.S.-Vietnam deal has considerably weaker proliferation controls than the Obama administration has demanded in the past – specifically, the agreement would allow Vietnam to retain the right to enrich uranium.

The Risks and Benefits of Enrichment

Uranium enrichment technology has both civil and military applications: it can be used to produce fuel for nuclear power plants or fissile material for nuclear weapons. Any country that possesses enrichment facilities would be able to use this technology to jumpstart a weapons program. But any country without enrichment facilities is unable to independently produce nuclear fuel for its reactors and thus required to import fuel for its nuclear energy program.

The U.S.-Vietnam Deal

The terms of the U.S.-Vietnam deal represent a significant break from the Obama administration’s previous efforts to guard against proliferation by preventing the spread of uranium enrichment technology and facilities. In its 2009 cooperation agreement with the United Arab Emirates and in recent negotiations with Jordan, the United States has insisted that the two Middle Eastern countries forgo their right to uranium enrichment as part of any nuclear trade deal. Now the administration is apparently stepping back from this position by failing to insist on similar restrictions in its agreement with Vietnam. Vuong Huu Tan, the director of the Vietnam Atomic Energy Institute, has announced that Vietnam does not intend to enrich uranium, so it is unclear why the U.S. did not insist on a legal backing for this pledge. Accepting weaker terms in an agreement with Vietnam would raise questions about a lack of consistency in U.S. non-proliferation policies and jeopardize past and future attempts by the U.S. government to limit the proliferation of uranium enrichment technology.

The Jordan Case

Vietnam is not the only country that is trying to negotiate a nuclear cooperation agreement with the United States. As reported by the Journal in June, U.S.-Jordan negotiations about a possible nuclear deal stalled specifically because the U.S. insisted on an enrichment ban in the agreement, a provision that the Jordanian government was unwilling to accept. Jordan views enrichment technology as its right under the Nuclear Non-Proliferation Treaty. Article IV of the NPT establishes “the inalienable right of all the Parties to the Treaty to develop research, production and use of nuclear energy for peaceful purposes.” The article also states that signatories have the right to the “fullest possible exchange of equipment, materials, and scientific and technological information for the peaceful uses of nuclear energy.” Jordan argues that Article IV gives the country a right to the complete nuclear fuel cycle, including enrichment technology. American officials, however, have refused to agree to Jordanian demands and have insisted that Jordan, like the U.A.E., should renounce its right to uranium enrichment.

A “Region by Region” Approach

When questioned about the reported failure to include an enrichment ban in the U.S.-Vietnam agreement, State Department Assistant Secretary Philip Crowley explained that the U.S. is utilizing a “country-by-country or region-by-region” approach:

CROWLEY: We recognize and we certainly would encourage countries to make the same decision that the UAE has made. At the same time, not every country is going to make that decision. If a country decides to pursue nuclear energy, and a country decides that it chooses to enrich on its own soil, then we would prospectively work with that country; number one, to make sure that their [sic] pursuit of nuclear energy meets all international safeguards; they [sic] work cooperatively with the IAEA. And we believe that that also would provide the kinds of security assurances that we think are important to make sure that any country that pursues nuclear power does not become a potential source of proliferation.
There’s not going to be any – we would like to see the day where there is an international regime and that fewer countries enrich. That is our broad policy goal, but we recognize that a particular approach is going to be different country-by-country or region-by-region.”

This “region by region” approach, however, is problematic for two reasons. First, the Vietnam deal undermines the precedent set by the U.S.-U.A.E. agreement and weakens the global norm against the spread of enrichment technology. As pointed out by Henry Sokolski in the National Review, the U.S.-U.A.E. deal was just a week ago considered the “gold standard” for nuclear cooperation agreements. Now, the U.S. doesn’t have a single standard for nuclear pacts. Instead, by giving Vietnam privileges over the U.A.E. and Jordan, the U.S. is returning to a policy tantamount to dividing the world into “good guys” and “bad guys.” This same philosophy led to the U.S.-India deal, which undermined the NPT and the standards of the Nuclear Suppliers Group.  Now, the Obama administration appears to be saying that East Asian countries may develop enrichment technology, but countries in the Middle East should not.

Even before the U.S.-Vietnam agreement, Jordan was unhappy with U.S. efforts to restrict the spread of enrichment technology. Khaled Toukan, the head of Jordan’s Atomic Energy Commission, complained to the Journal in June, “we believe in the universality of the NPT. We do not agree on applying conditions and restrictions outside of the NPT on a regional basis or a country-by-country basis.” Heavily dependent on oil and in possession of large uranium reserves, Jordan has strong economic incentives to develop its nuclear energy program. Moreover, Jordan is one of the U.S.’s closest allies in the Middle East. Should the U.S. agree to this deal with Vietnam, Jordan will have further reason to object to the U.S.’s double standard.

Second, if the U.S. is going to employ a region by region approach, is East Asia really the region where we want to allow the spread of sensitive nuclear technology? Yes, the Middle East is one of the most volatile places in the world, but East Asia is far from   harmonious. Densely packed with nuclear powers (Russia, China, and North Korea), East Asia is also home to Japan, which already enriches and reprocesses its own nuclear fuel, South Korea, which has been pushing for the right to enrich and reprocess its own fuel, and Taiwan, which twice attempted to develop nuclear weapons. Moreover, East Asia isn’t too far removed from South Asia, which has its own set of competing nuclear powers, India and Pakistan, and at least one potential nuclear wannabe, Burma.

The proliferation of enrichment technology is potentially destabilizing, regardless of where it takes place. But the spread of nuclear energy is not dependent on the spread of enrichment facilities. Instead, the U.S. should continue to insist on an enrichment ban in its nuclear agreements while also including provisions to ensure that countries without enrichment technology have access to an affordable, reliable supply of nuclear fuel. As one of the largest users of nuclear energy in the world and a major nuclear supplier, the United States has the economic and political leverage to shape the growth of the international nuclear energy industry. Assistant Secretary Crowley is right in working toward the goal of “an international regime [where] fewer countries enrich,” but if this regime is ever going to become a reality, it is important that the U.S. stick to its guns on the enrichment ban.

Prepared by Louis Hellman and Alex Rothman, with Laicie Olson

Download a one page PDF summary of this analysis

Iran’s Nuclear and Ballistic Missile Programs Remain Shrouded in Secrecy

Iran has committed numerous violations of its International Atomic Energy Agency (IAEA) safeguards obligations.

In a report issued February 18, 2010 under new Director General Yukiya Amano, the IAEA stated that “The information available to the Agency...raises concerns about the possible existence in Iran of past or current undisclosed activities related to the development of a nuclear payload for a missile.”^[1]

According to the IAEA’s latest report^[2] on Iran dated 31 May 2010, Iran has not provided the necessary cooperation to permit the Agency to confirm that all nuclear material in Iran is in peaceful activities; refuses to suspend its enrichment related activities or its work on heavy water related projects as required by the UN Security Council; and refuses to cooperate with the Agency concerning the possibility of military dimensions to Iran’s nuclear program.

Iran’s lack of transparency is exacerbated by its refusal to abide by the Additional Protocol, which grants the IAEA far more intrusive rights of access to suspected nuclear-related information and sites.

Current Weapons Capabilities

Iran does not currently possess a nuclear weapon of any kind.

In September 2009, Iran revealed the existence of a partially constructed underground enrichment facility near the city of Qom. Once completed, the Qom facility will house about 3000 centrifuges, leaving it capable of enriching enough uranium for one or two nuclear weapons each year, but not enough uranium to power a nuclear energy program.^[3]

In its February 2010 report, the IAEA noted that mass spectrometry data furnished by Iran indicated that it had succeeded in enriching uranium to about 20% U-235, far above the 3-5% necessary to fuel a civilian reactor, but still below the ~90% needed for a quality weapon. Iran later added additional facilities to increase this capability.

Importantly, it is far more difficult and time-consuming to enrich uranium from >1% to 20% than from 20% to 90%.^[4]

A February 2010 Annual Threat Assessment from the Director of National Intelligence suggests that Iran’s goal is not to build a nuclear weapon directly, but to reach “breakout” capability, wherein Iran could quickly create a weapon within 3-6 months should it choose to do so.^[5]

The Uranium

The IAEA defines a “significant quantity” of fissile material, or the amount needed to produce one functioning bomb, as 8 kg of plutonium or 25 kg of 90 percent highly enriched uranium.^[6] Simply obtaining this material, however, does not guarantee a deliverable warhead.

An April 2010 Pentagon report submitted to Congress stated that “Iran is developing technological capabilities applicable to nuclear weapons and, at a minimum, is keeping open the option to develop nuclear weapons, if it chooses to do so.”^[7]

On April 14, 2010 Army Lt. Gen. Ronald Burgess and Gen. James Cartwright reported to Congress that Iran could potentially produce enough highly enriched uranium for a nuclear bomb within one year.^[8]

The Institute for Science and International Security (ISIS) has concluded that Iran has not made the political decision to develop a nuclear weapon; but once such a decision is made, it could make enough highly enriched uranium for a nuclear weapon within six months.^[9]

The Bomb

A Joint Threat Assessment of Iran’s nuclear and missile potential released in May 2009 concluded that Iran could, under optimal circumstances, produce a simple nuclear weapon within a year of deciding to do so.

Without substantial foreign assistance, however, Iran is not likely to possess a ballistic missile topped with a nuclear weapon capable of threatening all of Europe and/or the United States within the next ten to fifteen years.^[10]

On April 14, 2010 Gen. James Cartwright reported to Congress that it would take “another two to three, potentially out to five years to move from the idea of having the material to… something that can actually create a detonation, an explosion that would be considered a nuclear weapon.”^[11]

Cartwright further clarified that, should the enrichment of uranium and the development of a weapon take place simultaneously, “experience says that it’s gonna take you three to five years” before Iran is in possession of a capable nuclear weapon.^[12]

The Delivery Vehicle

Even in the event that Iran makes the political decision to develop a nuclear weapon, the weight of the evidence suggests that Iran will not possess a nuclear-armed ballistic missile capable of threatening all of Europe and/or the United States for years to come.

Iran has developed and deployed at least four different liquid-propelled ballistic missiles as well as the liquid-propelled two-stage Safir space launch vehicle, which put a satellite in space on February 2, 2009. These missiles use rocket motors based on Russian SCUD and North Korean No-dong missile technology.

The Shahab-3 is Iran’s longest-range deployed missile, with an estimated range of 2,000 km.

Iran’s current ballistic missiles could reach Israel, Turkey, and portions of southeastern Europe.

Today, however, the longest range Iran could deliver a 1,000 kg payload is 1,100 km.^[13] In order to threaten all of Europe and the United States, Iran would have to develop far more sophisticated missiles with a much longer range.

An April 2009 report of the U.S. Air Force’s National Air and Space Intelligence Center stated that “With sufficient foreign assistance, Iran could develop and test an ICBM capable of reaching the United States by 2015.”^[14] This exact wording would later appear in the April 2010 report submitted to Congress by the Pentagon. The prospect does not, however, seem likely.^[15]

A May 2010 report by the International Institute for Strategic Studies (IISS) found that an Iranian ICBM remains “more than a decade away from development.”^[16]

All These Estimates Are Exactly That - Estimates

There is no hard consensus as to exactly how close Iran is to acquiring a nuclear weapon, fitting a nuclear warhead on a ballistic missile, and/or developing a ballistic missile capable of reaching most of Europe and the United States.

Notes

1. Report by the Director General, “Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran” IAEA Board of Governors (February 18, 2010).

2. Report by the Director General, “Implementation of the NPT Safeguards Agreement and relevant provisions of Security Council resolutions 1737 (2006), 1747 (2007), 1803 (2008) and 1835 (2008) in the Islamic Republic of Iran” IAEA Board of Governors (May 31, 2010).

3. David Sanger and William Broad, “Inspectors Fear Iran Is Hiding Nuclear Plants,” New York Times (November 16, 2009).

4. “Iran Increases Uranium Enrichment,” BBC News (August 10, 2010).

5. Office of the Director of National Intelligence, “Annual Threat Assessment of the U.S. Intelligence Community for the Senate Select Committee on Intelligence” (February 2010).

6. Federation of American Scientists, “Technologies Underlying Weapons of Mass Destruction” (December 1993).

7. “Unclassified Report on Military Power of Iran,” (April 2010).

8. Senate Armed Services Committee, “HEARING TO RECEIVE TESTIMONY ON U.S. POLICY TOWARDS THE ISLAMIC REPUBLIC OF IRAN” (April 14, 2010), pg. 13.

9. Albright and Shire, “Misconceptions about Iran’s Nuclear Program,” Institute for Science and International Security (July 8, 2009).

10. The EastWest Institute, “Iran’s Nuclear and Missile Potential: A Joint Threat Assessment by U.S. and Russian Technical Experts,” (May 2009), pg. 5.

11. Senate Armed Services Committee, “HEARING TO RECEIVE TESTIMONY ON U.S. POLICY TOWARDS THE ISLAMIC REPUBLIC OF IRAN” (April 14, 2010), pg. 33.

12. Ibid.

13. The EastWest Institute, “Iran’s Nuclear and Missile Potential,” pg. 9.

14. See Global Security Newswire, “Iran Could Put U.S. in Missile Range by 2015, Air Force Report Warns,” (June 10, 2009).

15. Pentagon report to Congress. “Unclassified Report on Military Power of Iran,” (April 2010).

16. Iran’s Ballistic Missile Capabilities. The International Insitute for Strategic Studies (7 May 2010), pg. 143.

A fresh list of U.S. sanctions is expected to be disclosed within this month at the earliest to curb North Korea's nuclear proliferation activities and to eventually coax Pyongyang back to nuclear talks. It also comes on the heels of North Korea's sinking of the South Korean ship Cheonan. All eyes are on what new faces and entities will be added to existing international blacklists.

The new sanctions are aimed at drying up the regime’s illegal cash sources and Kim Jong-il’s personal slush funds that help feed the North’s nuclear weapons programs. The method is to blacklist North Korean individuals and entities participating in such “illicit and deceptive” activities while freezing company assets and bank accounts with ties to the North. The targets include those involved in transactions and manufacturing of:

     - Banned trade of conventional arms and weapons
     - Luxury goods
     - Currency counterfeiting and laundering
     - Drug trafficking
     - Fake cigarettes

Effective Tool?

Sanctions are a familiar policy tool short of war to not only punish but to change an actor’s behavior. However, the effectiveness of sanctions tends to ignite hot international debate. One concern is that sanctions can hurt the civilian populace rather than their intended target. The State Department's special adviser for nonproliferation and arms control Robert Einhorn said in Seoul on August 2 that "These measures are not directed at the North Korean people. Instead, our objective is to put an end to the DPRK's destabilizing proliferation activities, to halt illicit activities that help fund its nuclear and missile programs and to discourage further provocative actions.”

Einhorn also stressed that financial institutions in other countries will be urged to sever links with North Korea. The purpose is to cut the North out of the international financial and commercial system, and the incentive for global institutions to follow suit would be to maintain reputable ties with the U.S. These measures resemble those of the so-called “BDA case” when the U.S. Treasury Department in 2005 blacklisted Macau-based bank Banco Delta Asia for allegedly laundering hundreds of millions of dollars for Pyongyang’s illicit activities. The U.S. also froze $25 million worth of North Korean assets in the bank.

This leads to the second concern regarding sanctions: Will they, in fact, change an actor’s behavior? History usually says “no.” But it can be argued that the BDA case played a crucial role in bringing Pyongyang back to the six-party negotiating table and kept them there until the signing of two more denuclearization deals in February and October 2007 that disabled its key nuclear facilities. The BDA case was effective because those sanctions targeted Kim Jong-il’s personal pocket money and even forced senior North Korean officials at international conferences to privately request that their leader’s assets be returned. The officials were also said to have hand-delivered bags of cash since the sanctions paralyzed their global financial transactions. In other words, the BDA sanctions hit the place where it hurt the North Korean leadership most, which appears to be the rationale behind the Obama administration’s new sanctions. It also proved that the US possessed a powerful and effective tool short of military force.

New Sanctions or Recycled?

Will the new round of sanctions bring fresh targets or the same names that have already appeared in different sanctions lists? The UN, the U.S. and the EU combined have already sanctioned nearly 30 North Korean entities and 18 individuals. American officials say they intend to widen the scope of existing sanctions by targeting key individuals and entities rather than increasing the number of names listed. This means that even though names are recycled, the new sanctions list is still seen as significant because it targets the North on multiple fronts. For example, if an entity already sanctioned under a WMD blacklist is also sanctioned for counterfeiting currency and drug trafficking, it would further limit the activities of the players involved.

The spotlight is shining especially bright on two North Korean entities. The first is “Room 39,” which observers anticipate to top the new U.S. blacklist. Room 39 (a.k.a Bureau 39, Division 39, or Office 39) is said to be the lynchpin of Kim Jong-il’s $4 billion slush fund and family enterprises. The covert money-making bureau formally falls under the Worker’s Party Central Committee but, in practice, is said to be directly controlled by the Dear Leader himself. Room 39 is believed to manage nearly 120 overseas branches and trading companies that help finance family and business ventures. In December 2009, the EU had placed a travel ban on Room 39’s head, Kim Dong-un, who was reportedly fired four months later to possibly evade the squeeze of sanctions. South Korean intelligence reportedly believes Pyongyang replaced him with Kim Jong-il’s high school friend Jon Il-chun, and it remains to be seen whether Jon’s name will appear on the new U.S. sanctions list.

Curiosity also surrounds the second generation of the North’s elite, an unofficial group known as the “Pong hwa jo” or “Torch Group.” Western intelligence authorities believe the off-springs of senior military and communist leaders operated a global network trafficking drugs and counterfeiting supernotes at least until 2005. It is unclear whether “Pong hwa jo” will be designated under the new U.S. sanctions.

Washington is also said to be preparing to target at least three financiers who manage Kim Jong-il’s secret overseas funds, which is in turn expected to deal a great blow to the leadership. Yonhap News reports Kim Tong-myong (Tanchon Commercial Bank director),who is already included in U.S. Executive Order 13382, may be one of the candidates. The U.S. may decide to re-enlist him not only for WMD involvement, but for his dealings in luxury goods, conventional arms, drug trafficking and counterfeiting currency as well. However, some say Kim Jong-il’s political confidantes are expected to be exempt from the new sanctions list, many of whom were designated travel bans by the EU.

Implications and Recommendations

The true effects and impact of the new sanctions will be unknown until after they are implemented as was the case in 2005 with the BDA sanctions. The effects of the sanctions will also help better assess North Korea’s network of illicit activities. Still, some initial forecasts and recommendations can be made:

- The squeeze of new sanctions will likely force North Korea to hunt for other business partners, such as failed states and rogue actors, to deal with under-the-table. The continued effectiveness of the new sanctions also depends on how Pyongyang adapts to and attempts to skirt them.

- A third North Korean nuclear test can be expected. Pyongyang tested a nuclear device after the BDA measures, and it would not be a surprise for a third test to follow the next wave of sanctions. Preparations must be made to deal with this along with more North Korean provocations after the wheels start turning on new sanctions.

- History may repeat itself with Pyongyang demanding sanctions be lifted before it agrees to any nuclear negotiations or in conjunction with its return. This was the case during “BDA” when the Bush administration unfroze Pyongyang’s assets in exchange for the resumption of talks. While this may have been viewed as the best bargaining chip at the time, history has taught us that Pyongyang will eventually turn its nuclear switch back on. If the North ever decides to return to nuclear talks, it is important to separate politics from the denuclearization timetable. In other words, new and existing sanctions should be enforced until the regime takes substantive and verifiable steps toward denuclearization to make it harder for Pyongyang to renege later. It appears the Obama administration plans to do just that, but history has also shown that initial stances can change at the bargaining table.

- China is expected to maintain its role as North Korea’s benefactor and unlikely to cooperate in any type of sanctions. Despite its vote for two UN Security Council resolutions on the North, Beijing continues to leave the aid door wide open to avoid instability across its borders. Close coordination and cooperation with Beijing is important in dealing with Pyongyang.

- History has shown that foreign policy is heavily swayed by domestic politics especially before an administration exits office. The hard-lined Bush administration showed greater flexibility towards the end of its second term by engaging in talks with North Korea when its Middle East policy was in peril. It is unclear whether the Obama administration will shift its current hard-line stance since the U.S. is approaching mid-term Congressional elections and the White House will soon begin preparations for presidential re-election. It may be enough for President Obama to declare that his new sanctions helped further prevent North Korea’s nuclear proliferation particularly since he has a chance to run for office again. On the other hand, South Korea’s constitution only allows each president to serve one five-year term, and since North Korea is a top security policy, President Lee may feel pressured to demonstrate creativity before leaving office especially amid concerns over Kim Jong-il's ailing health. Still, the current state of tensions is expected for the time being, perhaps until after a leadership transition takes place in the North. But the allies should begin drawing up measures to be used at some future opportune point to show strategic flexibility so that crisis can eventually be turned into an opportunity.

- Finally, the word “reunification” has been lost in translation lately when talking about “denuclearization.” The two terms were once spoken of almost hand-in-hand. The time clearly is not ripe to discuss reunification since tensions are running high on the peninsula amid growing North Korean belligerence. However, we must not forget that the nuclear issue cannot be solved exclusively, and will eventually need to be brought back to the broader context of reunification. Preparations must also be made for a sudden collapse or instability in the North as its leader's health continues to be questionable. It is imperative that South Korea, the U.S. and China actively engage in close trilateral consultations and coordination sooner than later.

* Much of the information in this article is from the author’s personal research.

UNSC 1718 (Oct. 2006) & 1874 (June 2009)
-Entities: Korea Mining Development Trading Corporation, Korea Ryonbong General Corporation, Tanchon Commercial Bank, Namchongang Trading Corporation, Hong Kong Electronics, Korea Hyoksin Trading Corporation, General Bureau of Atomic Energy, Korean Tangun Trading Corporation
-Individuals: Yun Ho-jin (Namchongang Trading Corporation director), Ri Je-son (General Bureau of Atomic Energy director), Hwang Sok-hwa (General Bureau of Atomic Energy director), Ri Hong-sop (Yongbyon Nuclear Research Center former director), Han Yu-ro (Korea Ryongaksan General Trading Corporation director)

U.S. Executive Order 13382 (as of June 2009)
-Entities: Korea Mining Development Trading Corporation, Mining Development Trading Corporation, Korea Ryonbong General Corporation, Tanchon Commerical Bank, Amroggang Development Bank, General Bureau of Atomic Energy, Hesong Trading Corporation, Korea Complex Equipment Import Corporation, Korea Hyoksin Trading Corporation, Korea International Chemical Joint Venture Company, Korea Kwangson Banking Corp, Korea Kwangsong Trading Corporation, Korea Pugang Trading Corporation, Korea Ryongwang Trading Corporation, Korea Ryonha Machinery Joint Venture Corporation, Korea Tangun Trading Corporation, Namchongang Trading Corporation, Tosong Technology Trading Corporation
-Individuals: Kim Tong-Myong (Tanchon Commercial Bank)

European Union (as of Jan. 2010)
-Entities: Yongbyon Nuclear Research Center, Korea Pugang Mining and Machinery Corporation, Korean Ryengwang Trading Corporation, Sobaeku United Corporation
-Individuals: Jang Song-taek (Kim Jong-il’s brother in law/director of the North Korean Workers Party's Administration Department), Vice Marshal Kim Yong-chun (minister of the armed forces), O Kuk-ryol (vice chairman of the National Defense Commission), Jon Pyong-ho (secretary of the Central Committee and head of the Committee's Military Supplies Industry Department), Paek Se-bong (chairman of the Second Economic Committee of the Central Committee), Ju Kyu-chang (first deputy director of the Defense Industry Department), Hyon Chol-hae (deputy director of the General Political Department of the Armed Forces), Pak Jae-gyong (deputy director of the Logistics Bureau of the Armed Forces), So Sang-guk (chair of the Physics Department at Kim Il Sung University), Pyon Yong-rip (president of the State Academy of Sciences), Kim Tong-un (director of “Room 39” of the Workers’ Party Central Committee)

Efforts to place unique pressure on Israel over its presumed nuclear arsenal could scuttle plans for the scheduled 2012 Conference on establishing a Middle Eastern zone free of weapons of mass destruction, President Barack Obama said earlier this month. In summarizing Obama’s comments, the White House suggested that “the Conference will only take place if all countries feel confident that they can attend” and that the U.S would thus oppose the singling out of Israel at the forthcoming September IAEA General Conference. Tellingly, President Obama also stated that he appreciated “that Israel has unique security requirements” with the White House adding that “the United States will…ensure that arms control initiatives and policies do not detract from Israel’s security.”

These points imply Israeli attendance in 2012 will be unlikely should it continue to be called out in isolation at non-proliferation fora, or should there be no improvement in its “unique security” situation. Without Israel’s participation at the proposed Conference it will be difficult for States within the region to realize any tangible benefits from the meeting. Consequently, it is integral that countries and stakeholders involved with the agenda now make significant efforts to engage Jerusalem in a proactive and egalitarian manner. Simultaneously, states across the region must, at the very least, learn to develop a base level of mutual respect for one another that, with careful cultivation, can ultimately lead to full diplomatic recognition and a comprehensive peace between all.

After the NPT Review Conference agreed to its final outcome document in May, the U.S. quickly made clear that it was vehemently opposed to the singling out of Israel in relation to nuclear non-proliferation in the Middle East. However, in the 2000 NPT Review Conference final outcome document, the U.S agreed to exactly that. And although there was no consensus document agreed in 2005, many may wonder why just ten years later the U.S was so opposed to including the very same wording on Israel. The answer: it is most likely a result of the 2002 revelations surrounding Iran’s nuclear program and its continued development, in defiance of numerous UN Security Council Resolutions and sanctions.

Although Israel was cited in the 2010 final document for its suspected nuclear arsenal, there was no mention of Iran - despite President Obama deeming "the greatest threat to proliferation in the Middle East, and to the NPT, [to be] Iran’s failure to live up to its NPT obligations." But regardless of the fact that Tehrans’s nuclear program is a real concern for the international community, it was always clear that Iran was never going to be called out in the same way as Israel – because Iran is a member of the NPT and therefore able to veto language in the final outcome document that it finds objectionable. And although Washington could have vetoed the language specific to Israel on Jerusalem’s behalf, given the positive momentum generated as a result of the recent ‘nuclear spring,’ it is unlikely that the Obama administration would have wanted to thwart the chances of securing a much-needed consensus document at the end of the 2010 NPT RevCon.

Another reason the U.S would have found the singling out of Israel as objectionable in the contemporary context is that the 1995 Resolution on the Middle East, often simplified in the mainstream press to merely represent a “Middle East Nuclear Weapons Free Zone (MENWFZ),”, actually calls for a lot more. Indeed, it calls

“upon all States in the Middle East to take practical steps in appropriate forums aimed at making progress towards, inter alia, the establishment of an effectively verifiable Middle East zone free of weapons of mass destruction, nuclear, chemical and biological, and their delivery systems, and to refrain from taking any measures that preclude the achievement of this objective.”

Given the WMD and missile development programs located in several countries of the Middle East, it is reasonable to think that policy-makers in Jerusalem could plausibly perceive a systemic bias in the way the call for the 2012 Middle East Conference follows language uniquely singling out Israel. This perceived bias could theoretically justify not participating in such a conference.

Taken together, it would seem that the U.S administration is fielding some legitimate concerns regarding the singling out of Israel in documents such as the 2010 NPT Revcon final document and in forthcoming forums such as the IAEA General Conference. Spotlighting Israel alone implies that its suspected nuclear arsenal ought to represent the only substantive item for discussion at the 2012 Middle East Conference, potentially allowing for problems associated with other WMD arsenals located in the region to be willfully ignored. Indeed, Iran has already used Israel as an excuse to divert attention from its contentious program until action is seen on the Israeli front. By framing the Conference in such singular terms, there is even the risk then that Middle Eastern States could potentially one day excuse leaving the NPT on the basis that Israel was reluctant to engage with or make progress toward what is actually designed to be a Middle Eastern zone free of weapons of mass destruction and systems for their delivery. This is especially so given that during the 2010 RevCon State Parties:

“expressed their concern regarding the lack of progress [toward] … the implementation of the resolution on the Middle East adopted at the 1995 Review and Extension Conference, which seriously undermines the Treaty and represents a threat to regional and international peace and security.”

In short, the prospects for the 2012 Conference could be seriously jeopardized if States within the region do not make it clear that it will operate in an unbiased and constructive way. While the dynamics of the NPT final document and IAEA Board meetings might facilitate communiqués that criticize Israel as an outlier of the NPT and prevent language highlighting other regional WMD programs, it seems that Middle Eastern States genuinely interested in realizing the goals of the proposed 2012 Conference should refrain from using language that appears discriminatory.

President Obama’s comment that he would “ensure that arms control initiatives and policies do not detract from Israel’s security” implies a second area that needs to be addressed in advance of a substantive outcome to the 2012 conference – the improvement of not just Israel’s security, but that of the entire Middle East. Indeed, while countries in the Middle East with WMD likely developed their programs for several reasons, many will cite security as a primary justification for their existence. In the absence of a major effort to improve the security situation in the region, there will be reluctance (rightly or wrongly) for many countries to even talk about forgoing WMD, whether nuclear or otherwise. Consequently, for the 2012 Conference to have any chance of bearing fruit it will be essential that inter-state relations within the Middle East improve.

Most of the countries within the Middle East still fail to recognize Israel diplomatically as a result of the Palestinian issue and related lack of progress in implementing a two state solution. Israel fears Hezbollah- and Hamas-led terrorism, conflict with its neighbors, and the possible threat of a nuclear Iran, a country that is tacitly supporting the two aforementioned groups. But it is also important to acknowledge that regional tensions are not purely Israel-focused. Indeed, there are several other issues and possible flashpoints that need to be addressed to reduce the motivation for some states to acquire or maintain stocks of WMD. These include the possible emergence of a nuclear Iran; the ongoing struggle for influence in Lebanon, Iraq and Egypt; ongoing Shi’ite – Sunni tensions; and the tensions related to the lack of natural resources (such as water) in the region – an issue that has historically sparked conflict. With such a wide range of potential problems, it will be important that States within the region find at least one common thread to work from at the Conference – something that can bring them all together, despite the continual flux of national security interests and, at times, opposing interests.

Even if arms reductions cannot begin to be negotiated at the 2012 Conference, an initial point of mutual interest for all States could coalesce around their interest in reducing the dangers of both miscalculation and possible accidental use of WMD and associated launch systems. It is precisely because tensions in the region have fluctuated so rapidly, and on such a regular basis, that this confidence building measure should be in the interest of all States in the region. It is an issue that could potentially narrow the many diverging interests of States within the region – just as it did in initial Cold War arms control negotiations. This would have the subsequent advantage of facilitating both the development of more stable inter-state relations while improving the dynamic for future disarmament talks.

In conjunction with this step, Israel should be encouraged to end its opposition to any WMD negotiations in advance of full peace and normalization. Even if Israel’s neighbors heed Obama’s advice and refrain from calling it out by name in the coming months, such an attitude will block the chances for any progress at the 2012 Conference. Israel needs to appreciate that, if it is genuinely interested in improving its security, then it must approach both issues simultaneously. Indeed, WMD negotiations in 2012 and beyond can help pave the way for negative security assurances, inter-State confidence building, and, ultimately, disarmament – all issues that will help improve Israel’s security in the long-term.

It is evident that without Israel’s participation at the 2012 Conference, it will be unlikely that much progress will be realized towards the creation of a Middle East free of WMD. Efforts must be made to ensure all parties remember that the Conference is not just about nuclear weapons, while for its part, Israel must accept the necessity of engaging in the Conference simultaneous to peace building and regional diplomacy. Finally, it is critical that all parties involved are realistic about what such a Conference can achieve and prepare themselves for what can only be a long-term effort.