Sanctions on the sly

As of March 1st, a Japanese law preventing uninsured vessels from entering its ports has gone into effect. In more clear terms, that means:

A ship insurance law that came into force in Japan on Tuesday will exclude most North Korean vessels from its ports and slash trade, though Tokyo is wary of imposing full-fledged economic sanctions on Pyongyang despite public anger over Japanese citizens abducted decades ago.

A majority of Japanese voters support sanctions but Prime Minister Junichiro Koizumi has been wary of taking such tough action, fearful it could scuttle international efforts to bring North Korea back to six-nation talks on its nuclear program.

[...]

Most North Korean ships traveling between the North and Japan are over 100 tonnes but only 2.5 percent of them were insured as of 2003, a Japanese Transport Ministry official said.

Sanctions on the sly...good move for a government anxious to assuage angry voters without officially affecting the status of multilateral talks with North Korea, right? Not so fast:

Others also said the insurance law would have only a limited impact on the North's economy since it would not affect drug smuggling, believed to dwarf its legitimate trade with Japan.

Drugs are believed to be brought in by smaller ships that are exempt from the insurance requirement, and could also be carried by ships of different flags.

Takashi Kadokura, a senior economist at Dai-ichi Life Research Institute, said nearly 700 billion yen worth of amphetamines are believed to be brought into Japan annually from North Korea, compared with 17.6 billion yen in official imports from the North in 2003.

Which brings us to our next interesting subject: how does North Korea gather foreign currency? Let's take a look. First, we have drugs (here and here); next we have counterfeit American dollars (here and here); last...but certainly not least, an active program to export missile technology (here and here). It's no wonder North Korea has been likened to a "gangster confederacy."

North Korea
Japan
Proliferation
Gangster state