CHINA: North Korea nuclear talks break up with no progress

Talks on North Korea's nuclear programme ended abruptly with no progress on Thursday (March 22) after four days of negotiations were frustrated by the issue of funds frozen in a Macau bank. Throughout the session, which began on Monday, North Korea avoided discussing a February deal to shut its main nuclear reactor by mid-April, demanding that 25 million U.S. dollars in Macau's Banco Delta Asia (BDA) first be transferred to a bank in Beijing. A statement released by China, host of the talks that also group South Korea, the United States, Japan and Russia, said the six countries had agreed only to meet again. Chinese chief envoy Wu Dawei said the problem hinged on persuading the Bank of China to accept the transfer. "Whether or not the Bank of China can undertake the transfer of this money, we still need to consult with them," Wu told a news conference. Wu said the lack of discussion of denuclearisation was understandable under the circumstances. "If we do not fully finish the plans because of certain technical or procedural reasons or unexpected reasons, this is understandable," said Wu. U.S. envoy Christopher Hill said he had not anticipated the delay in the transfer of the funds to a North Korean account at the Bank of China. However, he said the denuclearisation schedule should not be affected. "It is also our very strong belief that even with the delay caused by this banking issue, really a technical banking issue, it is our strong view that we are still on schedule to meet all the 60-day requirements. And if was for us important that all parties, including the DPRK (North Korea) reaffirm the February statement, the February 13th statement," Hill told reporters waiting in his hotel lobby. Hill also said part of the problem was that North Korea was lacking in international finance experience. "This is a country that does not have very many nodes of finances, nodes of places where money can be transferred. So I think it is, I hope what is perhaps the lesson to be learned here for the DPRK is they have got to get into the international community and start working out ways that they can enter in a much more efficient way with the international financial community. And the way they need to do that is to get out of some of these practices that we highlighted when we took our action against this bank -- Banco Delta Asia. They have got to get out of that type of practice, and they have got to get out of the nuclear weapons business," said Hill. South Korean negotiator Chun Yung-woo said there was still hope the North would fulfil the first part of the February agreement and shut the Yongbyon reactor by next month in exchange for energy aid and security pledges. "North Korea stressed that the February 13th deal should get implemented, even if it is before the next round of talks, once the BDA issue is resolved," said Chun. Japanese envoy Kenichiro Sasae said it was regrettable that the denuclearisation plan were not discussed. "In short the BDA issue took over the talks from beginning to end," Sasae told reporters. "The United States announced that they will resolve this issue within a month and suggested a fixed solution plan. Unfortunately however we could not fit in the time to further discuss this due to prolonged BDA discussion including the technical matters in the financial issue. It was a big disappointment that we could not start a detailed discussion on denuclearisation." Washington said on Monday (March 19) it had ended an investigation into the Macau bank, accused of harbouring North Korean earnings from international crime, which had prompted Macau authorities to take over the bank and freeze the accounts. However, the cash remains in Macau.

ITN Source | March 22, 2007

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