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Time to Destroy North Korea’s Revenue Generation

The Biden team believes it can shame North Korea into being a responsible actor. But Kim cares not about international prestige but about survival, and right now Putin and Xi are offering better terms.

North Korea
Image of Kim Jong Un. Image Credit: North Korean State Media.

North Korea will “pay a price for this in the international community.” That’s how National Security Advisor Jake Sullivan responded on Tuesday to news that North Korean leader Kim Jong Un, who will travel to Russia this month to meet Vladimir Putin, may supply additional materiel for Moscow’s war in Ukraine. That would be an effective approach if Kim cared about his global standing. But the dear leader only responds to one thing: economic pressure that threatens his strategic priorities. And so far, the Biden administration has focused more on issuing strong rhetoric than on destroying North Korea’s revenue generation.

The Biden administration first revealed North Korea’s export of rockets and missiles to the Wagner Group, a Russian private military company, in a flashy briefing in late January. National Security Council spokesperson John Kirby stood before imagery of railcars traveling in mid-November 2022 between Russia and North Korea and predicted that Wagner would “continue to receive North Korean weapons systems.” He promised consequences, and the administration designated Wagner as a significant Transnational Criminal Organization several days later.

But the administration’s North Korea policy has been largely muted. Washington condemned North Korea’s actions and shared the information on the weapons transfers with the UN Security Council’s panel of experts. Both actions reinforced their preferred path: humiliate Kim into changing course. Unfortunately for the administration, Kim has no shame.

Kim’s political prison camps and other human rights abuses are crimes against humanity and the world has let him escape without any punishment. Kim is not going to be shamed by American officials standing behind a podium in the White House briefing room.

The administration squandered eight months since the initial briefing on Russia-North Korea cooperation by relying solely on rhetoric and shunning impactful sanctions. Of course, the administration would object to that characterization, and Sullivan tried to defend the Biden team’s policy. He explained that the administration in mid-August imposed “targeted sanctions to try to disrupt any effort to use North Korea as a conduit or as a source for weapons going to Russia.” But a closer look at those sanctions reveals the administration’s misguided approach.

According to the U.S. Treasury Department, the sanctions targeted three companies linked to a “sanctions evasion network attempting to support” North Korea-Russia arms deals. These companies were owned or controlled by Ashot Mkrtychev, a Slovakian national whom Treasury designated on March 30. Treasury explained that between the end of 2022 and early 2023 Mkrtychev worked as an intermediary between Russian and North Korean officials for the transfer of “over two dozen kinds of weapons and munitions for Russia in exchange for materials ranging from commercial aircraft, raw materials, and commodities to be sent to the DPRK.”

It is possible that Mkrtychev was an entrepreneur and found an opportunity to make a quick profit facilitating Russia-North Korea arms deals. More likely is that Putin and Kim are so dismissive of the Biden administration’s response that they decided to cut out the middleman and just work directly with each other. That could explain why Sergei Shoigu, Russia’s defense minister, visited North Korea and toured a weapons expo, providing an opening for the forthcoming leader-level summit.

The administration’s sanctions misfire illuminates a larger problem: The administration has largely shunned using meaningful sanctions to counter Pyongyang’s weapons advances. Sanctions have atrophied since 2018, when former President Donald Trump pursued summit-level diplomacy with Kim. But Biden has continued this dangerous policy and has not implemented congressionally mandated sanctions that passed by overwhelming bipartisan majorities.

There is a better path. Kim has four strategic priorities: nuclear weapons, ballistic missiles, North Korean elites, and the military. He likely judges every action, including aid to Russia and bolstering his relationships with Putin and China’s Xi Jinping, against how they help him advance these priorities.

That provides an opportunity for the administration to impact the North Korea-Russia relationship by destroying Kim’s revenue generation. If Kim does not have the money to buy luxury goods for his elites, or build nuclear weapons and ballistic missiles for the military, he could see his grip on power slip.

The administration should begin by targeting every sanctions evader aiding North Korea wherever located, including in China and Russia. Pyongyang relies on both countries for importing materials and financing its transactions abroad, since North Korea’s financial system is largely cut off from international finance. Washington should remember that Kim is building additional nuclear-tipped intercontinental ballistic missiles. President Biden needs to prioritize this threat by targeting Chinese banks, companies, and individuals.

The Biden team believes it can shame North Korea into being a responsible actor. But Kim cares not about international prestige but about survival, and right now Putin and Xi are offering better terms. Biden can change that calculus by devastating Kim’s economy. And in so doing, Biden would ultimately help Ukraine’s war effort.

About the Author and His Expertise 

Anthony Ruggiero is a senior fellow and senior director of the Nonproliferation and Biodefense Program at the Foundation for Defense of Democracies. He previously served as the National Security Council’s director for North Korea (2018-2019) and senior director for counterproliferation and biodefense (2019-2021) in the Trump administration. Follow him on X: @NatSecAnthony.

Written By

Anthony Ruggiero is a senior fellow and senior director of the Nonproliferation and Biodefense Program at the Foundation for Defense of Democracies. He previously served as the National Security Council’s director for North Korea (2018-2019) and senior director for counterproliferation and biodefense (2019-2021) in the Trump administration. Follow him on X: @NatSecAnthony.



  1. Webej

    September 7, 2023 at 6:17 pm

    »If Kim does not have the money to buy luxury goods for his elites, or build nuclear weapons and ballistic missiles for the military, he could see his grip on power slip.«

    Same theory that sanctions would cause Russian oligarchs to rise up and ditch Putin. How’s that working out so far? Putin has never had so much control over the oligarchy class and their investments.

    Does Kim need money to build weapons & missiles?
    Is it a question of money?

    Almost everything raised in the article is complete speculation of deliberate disinformation on the party of the intel community.

  2. Gavin Longmuir

    September 7, 2023 at 6:47 pm

    Yes, sanctions have worked so well against Cuba over the last half-century. And sanctions have brought Russia to its knees — laughing! So let’s sanction North Korea, with whom we do no business.

    The US does not run the world. The DC Swamp creatures cannot even do a decent job of running the US. It is time for the US to get out of the losing proposition of trying to tell other countries what to do. Close down those hundreds of overseas military bases; leave NATO; cut back military spending significantly; and start to focus on making life better for US citizens.

  3. 404NotFound

    September 7, 2023 at 7:44 pm

    The US has become the most dangerous threat to peace in the 21st century, and worse, it is being led by an unhinged geriatric man hobbled by dementia and other hidden illnesses.

    Thus, US now is very much like Germany under Adolf Hitler.

    Soon, it will easily become 1,000x more dangerous when its arms merchants successfully develop hypersonic weapons and the leader decides to deploy them abroad.

    So, the onus is now on the Ukrainian neo-nazi forces to inflict massive massive hurt on the Russian military in east ukraine to force Vladimir Putin to resort to the use of nukes.

    Use of nukes will shake world markets and induce massive panic and riots and anarchy inside the US and cause it to collapse from within.

    Use of nukes will also force the geriatric leader of the US to go totally bonkers and lose his marbles and begin the process of self-destruction.

    Thus, may the ukro neo-nazis replicate the (early) successes of the germans during summer 1941 when they eliminated Soviet forces and headed for the gates of Moscow.

    Putin must be forced to employ nukes against America’s foot soldiers in Europe and unleash the tide of self destruction in Washington. The tsunami of internal collapse caused by US civil war.

  4. 403Forbidden

    September 7, 2023 at 9:57 pm

    The US is not god on earth; it doesn’t have the right to destroy anything. See the results of US attempts to destroy other countries, like, iraq and libya or afghanistan.

    The US however has the right to boycott other countries, but in this regard, US has been a total abject failure.

    The US has tried to strangle the economic advancement of other nations through boycotts and sanctions, but they have instead ploughed straight ahead.

    Why has the US failed.

    US failed because of the constant wishy washy and blowing hot and cold stance of the leader in washington.

    In other words, other people see the US as highly unreliable and always prone to playing tricks.

    One moment US appears as if it’s like to be mother teresa, the next moment, it appears to act like adolf hitler or genghis khan.

    Thus before US can affect the direction and path taken by other nations, it must change the flipping flopping being wantonly exercised in washington.

    Currently, the US leader in washington is a corrupt man and mired in scandals, but he tends to judge others on a whim. Who is he. Father God ?

    The US needs to do away with such muck before it can change the course of international events and happenings.

  5. Arash

    September 7, 2023 at 11:10 pm

    Dear author, North Korea and its nuclear arsenal will be here long after you are gone.
    The only thing that will get destroyed is your dream of stopping North Korea!

  6. George Gordon Byron

    September 8, 2023 at 6:31 am

    A typical view of the “white gentleman” on the supposedly “uncivilized world”…
    16 thousand sanctions have been imposed against Russia. Many thousands have also been introduced against the DPRK.
    Gogol. Taras Bulba: “What, son, did your lyakhs help you?”
    I wonder if the Author would like the rules introduced from the outside in his personal family life?

  7. Jim

    September 8, 2023 at 9:42 am

    I really don’t know how much additional sanctions would help us. I guess they’d be worth trying. But a coup against Li’l Kim, let alone regime change, is unlikely. We have to put him in a position where he’ll be amenable to reason based on enlightened self interest, which should be possible unless he’s really crazy. He could actually gain a lot materially and geopolitically if he would just stop acting like a juvenile delinquent. How do we open meaningful talks? Do you think he’d still listen to Dennis Rodman?

  8. Jim

    September 8, 2023 at 9:59 am

    North Korea has been a burr under the saddle for a long time, now.

    Well, much worse, it’s a nuclear burr under the saddle.

    Many still talk of forcibly removing North Korea’s nuclear arsenal by force of arms.

    The talk is nothing but neocon fantasies… it would end up going nuclear in some fashion, either regionally or intercontinental.

    Realism dictates dealing with North Korea as it is, not as we would like it to be.

    So, what to do?

    Accept North Korea as a Nuclear Power as unpleasant as it is.

    The author is right… North Korea is focused on survival… but also respect… this likely be the best approach… if one wants to lower the nuclear temperature.

    North Korea should be brought in from the cold.

    It’s been stated that Russia has agreed to provide a ballistic missile system as a deterrent.

    I suggest we need a positive diplomacy approach to North Korea… we should not encourage paranoia in North Korea’s leader or the ruling circle around him.

    North Korea isn’t dangerous in a conventional way… I suggest an attack across the DMZ is unlikely, as it would bring a retaliation.

    Calming the waters is the best approach… the days of mindless saber rattling as North Korea perfects its ability to launch dooms day nuclear weapons is counter-productive.

    We can do better.

    But the current foreign policy elite simply can’t change their spots… we need a new foreign policy that can operate in a world where the United States isn’t trying to rule the world.

    You know, military Full-Spectrum Dominance in all regions of the world in a “rules based international order,” aka, where the U. S. writes the rules.

    They have failed, repeatedly. You don’t reward failure, you remove it from command.

  9. Brian M Foley

    September 8, 2023 at 10:15 am

    Some very strange comments regarding this article. This article on it’s face is a bit silly. There is nothing the US can do about North Korea that it isn’t already doing…except next time North Korea has a famine let’s not jump in and help out…let them starve. Studies have shown that South Korean women are now taller than North Korean men. The dietary shortages in the long term have done something you don’t see everyday, it has actually changed the developmental status within an ethnic group. Koreans are Koreans regardless of where they live on the peninsula and for there to be such a dramatic change in the physical character within a group in such a short time is frankly amazing and worrying. Short of blowing North Korea completely off the face of the Earth, there is little the US can do to hurt North Korea that the North Koreans aren’t already doing to themselves.

  10. Steven

    September 8, 2023 at 11:40 am

    lol,, 404, US aint going nowhere, so get over your delusions.

  11. Alan

    September 9, 2023 at 12:57 am

    Sanctions are just not effective. Not even secondary sanctions will have any effects with North Korea joining BRICS+ eventually.

  12. wesley bruce

    September 9, 2023 at 9:18 pm

    Short of putting US troops on the north Korean border with Russia and China you probably can’t block all trade. Trump offered Kim a deal which Kim accepted but there is evidence that South Korean communists in its parliament began blocking both Kim and Moon. There were internal push back in Pyongyang from the old generals and their sons. Then South Korea elected a new President, Yoon Suk Yeol, will not even talk to Kim. If you inherit a dictatorship how do you end it, without getting your self and your children killed by hardliners in your own population or vengeful south Koreans if you flee over the border? The writer is all stick and no carrot and your stick is broken. I doubt Kim trusts Biden. Some of us know who Obama, Biden, Clinton and Eric Schmidt was working with in 2010-12 and it was not Kim Jong Un.
    I suspect he is waiting for Trump’s reelection.

  13. GhostTomahawk

    September 10, 2023 at 5:32 pm

    Time for America to stop being an economic bully with the world’s largest most expensive military.

    Let’s end sanctions against other nations and rebuild the trust of the globe. The US has sanctions on 1/3 of the planet.

    What do we expect N Korea to do when the world bullies them and sanctions them? Let this little pissant dung heap climb out of the dark ages. They’re no threat to American hegemony.

  14. from Russia with love

    September 11, 2023 at 10:34 am

    “The administration should begin by targeting every sanctions evader aiding North Korea wherever located, including in China and Russia.”
    pursue those who evade US sanctions? in Russia?!? in Russia, on which the US has imposed over 16,000 sanctions? in Russia, which, despite these sanctions, continues to actively develop and has risen to 5th place as the largest economy in the world? the author of the article writes about that Russia that doesn’t care about US sanctions?
    ha ha ha! It looks like the author of the article drank his brain. 🙂 to complete the picture of the degradation of Western analytics, the author could add Iran to the list of countries where it is necessary to pursue circumvention of US sanctions. 🙂
    bad news guys. 2/3 of this world, those you call “the rest of the world”, do not need you. The USA is not needed.
    Also, the United States has no ability to stop cooperation between the DPRK and Russia. one can confidently speak about the end of North Korea’s isolation. 😉 I wouldn’t be surprised if the DPRK applies to BRICS. The United States has finally lost the ability to economically strangle unwanted countries. the largest economic union, currently the BRICS, is not subordinate to the United States.

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