Global Risk Outlook 2018 Volume 1 | Page 16

This caveat- in the event of war- is important. For now, the threats are all hypothetical, intended to show the North Koreans that the US means business- as well as playing to Trump ' s base- but without crossing the line into conflict. Trump plays the bad cop, while Rex Tillerson plods along as the good cop. He reiterated the US ' offer of talks without preconditions as recently as 12 December, stating that Trump himself was ' realistic ' about the fact that the North could not be expected to give up its WMD programme.
That seemed to change on 20 December. The UK ' s Telegraph ran a story claiming it had information from sources about plans for a ' bloody nose ' attack on the North. Looking more closely at the report however, the caveats are still there: the Pentagon is ' trying to find options ' and ' preparing plans '.
More sanctions on the way? Amid the loud rhetoric, it ' s easy to miss the fact that US strategy remains guided( and restricted) by broader UN consensus. In August, secondary sanctions were introduced against Chinese and Russian firms and individuals accused of aiding North Korea’ s weapons programme in accordance with a UN decision to target the rogue regime’ s foreign exchange earnings.
Trump has also insisted that all sovereign nations sever diplomatic links with the North, or face consequences. In November, Singapore suspended trade ties with Pyongyang, while Sudan and the United Arab Emirates cut off diplomatic relations the month before. However, a variety of African countries remain supportive of Kim – and will likely be targeted under future UN sanctions.
" Kim views his missile programme as a deterrent, not an offensive measure."
The role of China The main obstacle to Trump’ s sanctions strategy is the power of UN Security Council member China. China maintains close relations with North Korea, which acts as a buffer between China and South Korea. So far, China has vetoed the strongest sanctions – such as cutting off the North’ s oil supply or freezing Kim’ s assets – as it is wary of the effects that economic instability could bring. Aside from significantly watering down the UN’ s sanctions proposals, persistent vetoes or even abstentions from Beijing signal to Pyongyang that China is unwilling to dance to the tune of the UN when it comes to punishing North Korea. However, if the North continues to present a security dilemma for China over the next 12 months, Beijing’ s North Korea policy could become increasingly stringent, as indicated by reports in December that China had finally agreed to an embargo on oil trade with Pyongyang.
In November, China had called for an end to joint South Korea-US military exercises in return for a de-nuclearisation commitment from North Korea. This is highly unlikely, but we can expect Beijing to continue to push the issue, which it sees as the best way to de-escalate tensions.
Outlook Overall, the most likely scenario is that little will change in the danger North Korea’ s neighbours face. Any military confrontation would remain localised. As a minimum, South Korea and the US will be keen to avoid escalation in the first months of 2018 due to the Olympics. The enduring source of risk will be from sporadic incidents of violence along the demilitarised zone.
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