North Korea Said Ready to Quickly Begin Closing Nuclear Reactor

North Korea would only need a day to begin closing down its Yongbyon nuclear reactor after receiving funds it has linked directly to its willingness to pursue disarmament, New Mexico Governor Bill Richardson said today after a visit to Pyongyang (see GSN, April 10).

Officials from the United States and Macau yesterday agreed to free $25 million in funds that had been frozen at Banco Delta Asia, Agence France-Presse reported.

“The North Korean government told us that with that issue resolved, (it) would move promptly, within a day after receiving the funds,” Richardson said in Seoul, after his delegation spent several days in North Korea.  “And therefore within that day (it would) invite the [International Atomic Energy Agency] inspectorate to Pyongyang to draft the terms for shutting down the Yongbyon reactor.”

North Korea in February agreed to make those moves by Saturday in exchange for 50,000 tons of fuel oil and related aid from other nations participating in the six-party talks.  Additional assistance would be supplied once Pyongyang follows through on nuclear disarmament.

Progress on implementing the February agreement has been stalled while Pyongyang waited for its money.  Officials there proposed pushing back the deadline by a month due to the delay, Richardson said.

“We let them know that this was not acceptable and the issue was dropped,” he said.  No more than a few days would be needed to close the reactor, Richardson added.

Banco Delta Asia must now inform North Korea that it can reclaim the money, which the bank froze after it was linked by Washington to counterfeiting and other illicit North Korean activities.  “That should happen late this afternoon, or tomorrow morning,” Richardson said.

“So the BDA issue is resolved.  We need to move forward,” he said.

Assistant Secretary of State Christopher Hill, lead negotiator with North Korea, concurred:  “The D.P.R.K. has access to their accounts now.  We think it is a really important time to get on with the ever urgent task of denuclearization” (Lim Chang-Won, Agence France-Presse/Yahoo!News, April 11).

An IAEA team is ready to travel to North Korea for talks on inspection procedures and the ultimate denuclearization schedule, the Yonhap News Agency reported (Yonhap News Agency, April 11).

The frozen funds resulted from a U.S. effort to crack down on suspected North Korean counterfeiting of $100 bills.  The Treasury Department in 2005 said it was ready to move against Banco Delta Asia, which it believed was helping move the currency on to the international system, the Washington Post reported today.

The September 2005 announcement that Banco Delta Asia had been linked to money laundering almost killed the bank and led institutions internationally to cut ties with Pyongyang.

The move came just as negotiators in the six-party talks announced that North Korea had agreed in principle to nuclear disarmament.  Afterward, officials in the Stalinist state refused to participate in talks for more than a year, angered over what Washington said was a criminal matter that should not be tied to the nuclear negotiations.  Negotiations began again late last year.

The Bush administration finally this year had to agree to close the investigation and return the money — half of which it strongly connects to criminal activity — in order to move forward with the nuclear deal.  Transferring the money also proved unexpectedly difficult, with Chinese banks unwilling to accept it and North Korean officials resistant to the plan to put the funds toward humanitarian purposes. 

Some of the funds would go back to third parties rather than the government in Pyongyang, the Post reported.  That raises questions in Washington on whether the release of the funds will actually satisfy North Korea.

“The United States started on this path not understanding what the impact would be,” said Henry L. Stimson Center senior associate Alan Romberg.  “This should be an object lesson:  Be careful what you do, and play through how you would undo it” (Glenn Kessler, Washington Post, April 11).

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