North Korean nuclear talks break down

Updated: 2007-03-22 20:33
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North Korean nuclear talks break down
North Korea's Vice Foreign Minister Kim Kye Gwan takes his seat before the opening of the six-party talks on North Korea's nuclear programs Monday, March 19, 2007 in Beijing. [AP]
North Korean nuclear talks break down
BEIJING - Talks on halting North Korea's nuclear program broke down Thursday, throwing into doubt efforts to meet deadlines next month for UN inspectors to verify the closure of Pyongyang's main nuclear reactor.
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China issued a statement saying the latest round of talks, which never got off the ground this week because of a dispute over the transfer of North Korean money frozen in a Macau bank, would take a recess but did not give a restart date.

"The parties agreed to recess and will resume the talks at the earliest opportunity to continue to discuss and formulate an action plan for the next phase," the statement said.

Even before the statement was released chief North Korean negotiator Kim Kye Gwan had flown out of Beijing, after staying away from the talks for several days, upset that US$25 million in North Korean funds had remained stuck at the Banco Delta Asia in Macau, a Chinese territory.

"This round of talks started with the BDA problem and ended with the BDA problem," Japanese envoy Kenichiro Sasae said of the negotiations to follow up an agreement reached last month calling on Pyongyang to give up its nuclear ambitions in exchange for energy aid and political concessions.

The money in the Macau bank had been frozen by a US investigation into money laundering and counterfeiting, but the United States agreed earlier this week it could be released.

Chinese negotiator Wu Dawei said that in a last-ditch effort to salvage the talks he called Kim late at night to persuade him to take part in the talks.

"When I called Vice Minister Kim Kye Gwan it was 11:15 at night ... He got out of bed after taking his sleeping pills to take my call," Wu said.

Wu then had to convince an operator at the hotel of US envoy Christopher Hill to wake Hill at 1:30 a.m. to discuss the impasse.

"I reckon Hill hadn't thought there was any work going on at that hour," Wu said.

Sasae said talks needed to resume quickly, otherwise there would be problems meeting a deadline set in a February 13 denuclearization agreement that calls for UN inspectors to verify the closure of North Korea's main nuclear reactor at Yongbyon by April 14.

"The actions in the initial phase must be taken within 60 days and it will be heavily affected by the pace of our settlement of the BDA problem," he told reporters.

But Hill told a news conference he is still optimistic the deadlines can still be met.

"It is our strong view that we are still on schedule" in meeting a 60-day requirement, Hill said, referring to an April 14 deadline that calls for UN inspectors to verify the closure of North Korea's main nuclear reactor at Yongbyon.

Hill added he still expected other goals requiring Pyongyang to declare all of its nuclear programs and for energy aid to be sent to North Korea to be met by the end of the year.

The North Korean funds were to have been sent to its bank account at the Bank of China in Beijing but officials said that was held up because of the Chinese bank's worries that accepting the money would cause problems because the funds had been the center of criminal investigations.

"The Bank of China has concerns (about accepting the money) and not all the concerns have been assuaged," Wu said.

In Tokyo, Prime Minister Shinzo Abe criticized North Korea for not being constructive.

"It's clear there is nothing for North Korea to gain from this kind of move," Abe said. "This kind of attitude is meaningless."

North Korea will only be accepted by the international society if it takes concrete steps toward complying with its commitment to dismantle its nuclear programs, Abe said.

This round of talks has been dogged by the bank troubles since it started on Monday.

Russian envoy Alexander Losyukov, who also left for home Thursday, was quoted by ITAR-Tass news agency as saying "the whole problem came from the American side."

He said the United States failed to assure the Chinese side that the Bank of China could receive the funds, which were linked to a counterfeiting and money laundering investigation, without fear of facing US sanctions or a "negative attitude" from the banking community and the US government.

Banco Delta Asia was blacklisted by Washington on suspicion the funds were connected to money-laundering or counterfeiting. The North boycotted the international nuclear talks for more than a year over the issue.

Under the February 13 deal, the North is to receive energy and economic aid and a start toward normalizing relations with the US and Japan, in return for beginning the disarmament process. The regime would ultimately receive assistance equivalent to 1 million tons of heavy fuel oil if it fully discloses and dismantles all its nuclear programs.