U.S. and North Korea end frozen-funds impasse
BEIJING: The United States and North Korea have resolved a standoff over North Korean funds frozen in a Macao bank, clearing the way for talks to focus on putting in place a nuclear disarmament accord, American and Chinese officials said Sunday.
Assistant Secretary of State Christopher R. Hill, the chief American envoy at the talks, said his discussions with North Korean representatives over the weekend on North Korea-related accounts in Macao's Banco Delta Asia indicated that the issue "will not be an impediment to our six-party talks."
The North Korean officials, he said, "made it very clear that they have begun their tasks for the purpose of denuclearization."
Daniel Glaser, the Treasury Department official who has been managing the United States position on the financial dispute, said in a statement on Monday that the American and North Korean governments had reached an understanding on how to deal with the $25 million still held by the bank, which the United States has said were proceeds of illicit activities by North Korea, including trading arms and narcotics.
Glaser said North Korea proposed having its deposits transferred to an account it has at the Foreign Trade Bank of the Bank of China in Beijing. He said North Korea "pledged, within the framework of the six-party talks, that these funds will be used solely for the betterment of the North Korean people, including for humanitarian and educational purposes."
The arrangement, Glaser said, should end the matter. "We believe this resolved the issue," he said. But he said the ultimate disposition of the funds remains with banking authorities in Macao, a Chinese territory.
North Korean officials have said in recent days that they will not move forward with their commitment to shut down the nation's nuclear plant at Yongbyon by mid-April unless they recover the $25 million. Senior officials in North Korea have not yet indicated that they consider the Macao matter resolved.
State Councilor Tang Jiaxuan of China told visiting Japanese lawmakers on Sunday that the United States and North Korea had resolved the dispute, Hidenao Nakagawa, secretary general of Japan's Liberal Democratic Party, told reporters.
The United States, North Korea, China, Japan, South Korea and Russia reached an agreement on Feb. 13 that gave the North 60 days to shut its Yongbyon plutonium facility in return for aid and security pledges.
Representatives of the six nations were convening here on Monday to negotiate details of that agreement and establish groups to discuss other diplomatic and security concerns.
Meanwhile, Hill said he hoped to set up a working group to examine the delicate issue of whether North Korea had been seeking to make nuclear fuel from a second source, highly enriched uranium, as well as its better-known effort to use plutonium for the same purpose.
Bush administration officials initially asserted that the North had a clandestine uranium program under way in 2002. The assertions contributed to a collapse of an earlier agreement to freeze North Korea's plutonium program.
In October, North Korea exploded its first nuclear device, made using plutonium. It has denied seeking to build bombs using enriched uranium, but North Korean officials have said recently that they are willing to discuss the matter with the United States.