North Korea has long been an isolated nation, characterised by political and economic instability. In recent years, the country has gradually been turning a corner, offering glimpses of potential less rigid, more transparent and more modern government. One area where this may be especially true is its international relations with the rest of the financial and trading world – namely, whether North Korea is on Swift.
The Society for Worldwide Interbank Financial Telecommunication (Swift) is an international, cooperative banking network that enables financial and trading institutions all over the world to securely and reliably exchange financial transactions. In order to be part of the Swift network, a state must meet certain criteria and receive confirmation of membership from the organization.
Whether North Korea is currently part of the Swift network is a source of debate, as there are conflicting reports coming out of different sources. Despite this difference of opinion, there is agreement that North Korea has expressed interest and is looking to become a member. In 2013, the country’s Foreign Trade Bank has been given a Swift code, suggesting that at least some level of integration with the network had been achieved. However, there are also indications that North Korea doesn’t currently meet all the required criteria to become a full Swift member.
Regardless of whether North Korea is officially a Swift member, one area of potential cooperation is increasing trade between the two countries by allowing North Korean access to the network. This would make it easier for North Korean companies to send and receive payments from foreign entities, though it would not offer the same level of security afforded by full membership.
Given the potential for developing closer ties with the West, North Korea should be considering joining Swift. Should this happen, it would open up new opportunities for the country to engage in international commerce and would remove some of the obstacles currently in its path. This would also be a boon for its citizens, as it would make it easier to send and receive money. While there are still some challenges to be faced, having access to Swift would signify a big step forward in international relations and could open up further possibilities in the future.
Potential Benefits of Joining Swift
If North Korea were to join Swift, it could see considerable benefits. For starters, it would reduce the amount of effort and paperwork needed to initiate and carry out transactions across different currencies and jurisdictions. This could make trading cheaper and faster, as well as more reliable for companies. Additionally, joining Swift would improve North Korea’s reputation amongst other nations, allowing banks and investors to have greater confidence in its financial system.
Moreover, the system would also allow North Korean citizens to access and make payments from their accounts in foreign banks. This would help to put the country on a more equal footing with other nations, as well as empowering its citizens by giving them access to a much wider range of financial products.
Political Implications of Joining Swift
While North Korea joining Swift could bring about many benefits, it would also carry significant political implications. However, this should be seen as an opportunity, rather than a problem. Having access to a secure and efficient payments system would be a major step forward in bringing the country into the modern world and affording it with a level of credibility in international circles.
In addition to this, greater access to the Swift system would help to create a more open society in North Korea. It could reduce the risk of sanctions, help combat financial crime and force the government to pass greater levels of transparency in its finances. This, in turn, could lead to greater levels of economic and diplomatic co-operation with other nations, boosting North Korea’s economy and giving it greater access to the global market.
Challenges for North Korea Joining Swift
Of course, North Korea joining Swift would not be without its challenges. Firstly, North Korea would need to demonstrate a commitment to international standards of financial transparency and security, as required by the organization. This could be a lengthy and difficult process, and would involve ensuring that the country’s systems and infrastructure are up to the task.
In addition to this, North Korea would need to be willing to submit to periodic reviews by the Swift organization, in order to ensure that it is complying with the network’s standards. This could involve a degree of intrusion that some may view as unwelcome, but it is an unavoidable part of joining the Swift system.
International Political Responses to North Korea Joining Swift
The potential for North Korea joining Swift has drawn mixed opinions from the international community. The United States and other Western countries have tended to take an opposed stance, citing concerns over the potential for mismanagement and abuse of the system, as well as its potential as a conduit for terrorism funding and money laundering.
On the other hand, China and Russia have generally been supportive of North Korea’s Swift bid and view the potential access to the payments system as a way of increasing economic cooperation with the country. China, in particular, is keen to develop closer economic ties with the North Korean government and believes that having access to the Swift system could help bring this about.
Conclusion
The question of whether North Korea should join Swift is complex and far-reaching, and will ultimately be decided by the network themselves, who will assess whether the country meets all of their criteria for membership. That being said, there is no denying the potential for North Korea joining Swift to unlock a wealth of economic opportunities for the country and its citizens, as well as being a major step in helping it to integrate further into the global financial system.
