President Trump’s strategic approach using economic leverage to gain U.S. national security has established a very rare victory in the U.N. with unanimous support for Security Council sanctions against North Korea. Yes, China and Russia supported.
Remember, from Day #1 of his administration President Trump was faced with a threat from N-Korea. On his departure President Obama told the incoming new President Trump that North Korea would be his #1 Geopolitical national security challenge.
The MSM will likely never give President Trump credit for the remarkable long-term economic strategy he deployed to gain China and Russia’s support today.
UNITED NATIONS (Reuters) – The United Nations Security Council imposed new sanctions on North Korea on Saturday that could slash by a third the Asian state’s $3 billion annual export revenue over Pyongyang’s two intercontinental ballistic missile tests in July.
The U.S.-drafted resolution bans North Korean exports of coal, iron, iron ore, lead, lead ore and seafood. It also prohibits countries from increasing the current numbers of North Korean laborers working abroad, bans new joint ventures with North Korea and any new investment in current joint ventures.
The unanimously adopted resolution adds nine individuals and four entities to the U.N. blacklist, including North Korea’s primary foreign exchange bank, subjecting them to a global asset freeze and travel ban.
“We should not fool ourselves into thinking we have solved the problem. Not even close. The North Korean threat has not left us, it is rapidly growing more dangerous,” U.S Ambassador to the United Nations Nikki Haley said after the vote.
“Further action is required. The United States is taking and will continue to take prudent defensive measures to protect ourselves and our allies,” she said, adding that Washington would continue annual joint military exercises with South Korea. (read more)
There’s high probability to believe that China will violate these sanctions even though they voted to support them.
As such, President Trump has established the framework for unilateral punitive trade action against China if Treasury Secretary Mnuchin, Commerce Secretary Ross, Secretary of State Tillerson identify any violations.
The upcoming bilateral ‘fair trade deals’ with China now have an additional groundwork for compliance with China’s future economic activity toward North Korea.
Here’s how Team Trump pulled it off:
President Trump, Secretary Mnuchin and Secretary Ross have positioned a severely consequential trade reset between the U.S. and China.
[Trump and Ross delayed an announcement on trade sanctions against China which was scheduled for Friday.]
♦Second: The enhanced U.S. energy export initiatives, in conjunction with lower oil prices, an outcome of U.S. energy policy and a mutually beneficial relationship between President Trump and Arab states in the GCC, have severely weakened the economic position of Russia.
Russia’s energy export economy is dependent on energy prices remaining high. President Trump has brilliantly worked the geopolitical economic relationships to leverage influence over a large portion of the Russian economy.
Combine these two points and you discover the leverage President Trump’s team has created.
The Bear (Russia) and Red Dragon (China) were drawn into an economic battle space controlled by the Eagle (Trump-USA).
President Trump can offer a ‘better’ trade outcome (definitions variable) for China if they comply with Nikki Haley’s sanctions. Similarly President Trump can negotiate with Russia on ‘better’ or “more favorable’ terms (definitions variable) for U.S. energy shipments to Eastern Europe, again if Russia complies with Nikki Haley’s sanctions.
Previously, President Trump’s visit to Poland, and the Three Seas Summit (Baltic, Black and Adriatic Sea States), along with France and the G20 members, established economic relationships and agreements for energy export between the U.S. and Eastern Europe.
Add all this to the personal relationships developed between Trump and the Gulf Cooperation Council; then factor in the larger geo-strategic economic realm; and then overlay the leverage needed over Russia on issues unrelated to the EU,… and damn Trump’s foresight on this is incredible.
The Outcome – Now we see China and Russia holster their U.N. Security Council veto power, and actually support the sanctions against N-Korea because it is in their economic interests not to oppose the U.S. sanctions. Brilliant strategy:
When it comes to the use of economic leverage to create U.S. national security outcomes, well, we are learning at the knee of an economic master player.