Last week, U.S. President Donald Trump met with Chinese President Xi Jinping for the first time. While the two agree on the need to strengthen cooperation between the U.S. and China, there are several agenda items that are likely to become contentious, not least of which is North Korea. Trump has accused China of not doing enough to reel in North Korean leader Kim Jong-un. White House advisors say that behind closed doors Trump is likely to call on China to cut off its financial support, even threatening sanctions. A factor missing from the administration’s calculation is the role of Chinese fishing vessels in North Korean waters, which reveals an added layer of complexity to last week's meeting.
With a soaring population and a growing middle class hungry for seafood, both as a source of protein and status, China has witnessed increased demand for fish. This demand has depleted Chinese territorial waters, which are overfished by over 30 percent. The Chinese government has long recognized the unsustainable stress that growing demand places on its fisheries. Since 1990, Beijing has attempted to mollify these concerns by instituting moratoriums on fishing during the summer. Despite this restriction, its fishing fleets continue to push the country’s fisheries toward collapse.
Recognizing that the fishing industry’s impact on Chinese waters has reached a tipping point, the Minister of Agriculture in August 2016 instituted a policy to decrease the country’s fishing fleet. In January 2017, Beijing introduced another policy that aims to cut the fleet’s catch by one-sixth. However, we can assume that these measures will be used to protect territorial waters, where China has a vested interest in protecting the sustainability of its fisheries. However, even as the Chinese government recognizes the environmental and economic necessities to protect their territorial fisheries from complete depletion, it also needs to meet growing demand. Its strategy has been rooted in a policy of encouragement, even subsidization for its fishing fleets, which includes buying rights abroad, subsidizing fuel, and even providing coast guard escort to fishing grounds. All of this serves to meet the domestic demand, but it is also a form of power projection, consistent with its aggression in the South China Sea.
The encroachment of Chinese fishermen has inflamed tensions across the region, garnering wide coverage and catching the attention of senior officials in the Trump Administration, most recently in remarks by Secretary of State Rex Tillerson on his visit to China. The Stimson Center’s continuing research indicates that encounters between South Korean authorities and Chinese fishermen have become more tense, even violent. In the second half of last year alone, there were five incidents where the South Korean coast guard intercepted Chinese fishing vessels encroaching on their territorial waters. In one such case, a Chinese fishing boat rammed and sank a South Korean coast guard vessel.
It is worth noting that these incidents all occurred near the Northern Limit Line, a disputed demarcation of North and South Korean territorial waters. The location of these incidents begs the question of why Chinese fishing vessels are operating there. The answer lies, in part, in South Korean intelligence reports, which indicate that North Korea sold its fishing rights to China for an estimated $75 million. While there are no official estimates, some sources indicate that as many as 2,500 Chinese boats could be attaining licenses per year.
Its purchase of Yellow Sea fishing rights from North Korea diverges from China’s aggressive strategy in the South China Sea, where it has asserted its rights to fish through military action – such as the creation and militarization of its artificial islands, and the militarization of fishing. The seeming contradiction reveals Xi’s decision-making formula as he balances China’s nearly insatiable demand for fish with his desire to contain China’s rogue neighbor, with which he shares a reluctant brotherhood.
First, Xi does not want to inflame tensions with Pyongyang, which are already at an all-time low. Second, Xi relies on hardline support in Beijing that looks to maintain a Chinese relationship with North Korea. Through purchasing fishing rights, Xi has been able to circumvent the UN sanctions regime (which does not regulate the sale of fishing rights) and transactionalize the exchange of a large sum of money, which the North Koreans need in the face of U.S. efforts to financially cripple them.
However, Xi’s calculus has not gone unseen by U.S. officials. Just two weeks ago, 17 representatives in the House introduced a bipartisan bill that would amend the U.S. sanction guidelines for North Korea. A key change in the bill would allow the president to sanction any person who “knowingly, directly or indirectly, purchased or otherwise acquired fishing rights from the Government of North Korea.” While the proposed changes are a necessary first step to responding to this revelation, it poses a more complex question of how the U.S. economy is inadvertently feeding North Korea through the consumption of fish products from China – the U.S. imports upwards of $1.7 billion worth of fish products from China annually. This undermines our sanctioning efforts and adds new urgency to the implementation and expansion of traceability rules scheduled for roll-out in 2018.
In the lead-up to Xi’s visit to Mar-a-Lago, Trump called Japanese Prime Minister Shinzo Abe to discuss North Korea, and likely to put pressure on Xi. Amid speculation that North Korea sold its East Sea fishing rights to China, as well as recent reports of increased illegal fishing by Chinese fishermen in the Sea of Japan, Trump’s alliance with Japan and South Korea against North Korea could take on a new dimension. For all these reasons, it is important that the United States focus on the impact of fishing fleets, not just in the South China Sea, but to the north, where China’s hushed policy directly undermines the U.S. strategy for Pyongyang.
