DATE=7/7/98
TYPE=BACKGROUND REPORT
NUMBER=5-40876
TITLE=U-S / NORTH KOREA NUCLEAR
BYLINE=STEPHANIE MANN
DATELINE=WASHINGTON
CONTENT=
VOICED AT:
INTRO: FUNDING GAPS AND OIL SHIPMENT DELAYS HAVE CREATED
PROBLEMS FOR THE 1994 AGREEMENT THAT HALTED NORTH KOREA'S NUCLEAR
PROGRAM. HOWEVER, CORRESPONDENT STEPHANIE MANN REPORTS ANALYSTS
AND SOURCES CLOSE TO THE ISSUE EXPECT THE AGREEMENT TO PREVAIL.
TEXT: IN 1994, THE UNITED STATES AND NORTH KOREA REACHED WHAT
THEY CALLED AN AGREED FRAMEWORK. UNDER THAT ACCORD, PYONGYANG
WAS TO STOP ITS NUCLEAR WEAPONS PROGRAM, SHUT DOWN OLD GRAPHITE
NUCLEAR REACTORS AND OPEN ITS FACILITIES TO MONITORING BY THE
INTERNATIONAL ATOMIC ENERGY AGENCY.
IN EXCHANGE, A U-S LED CONSORTIUM -- CALLED THE KOREAN PENINSULA
ENERGY DEVELOPMENT ORGANIZATION, OR KEDO -- WAS TO BUILD TWO LESS
CONTROVERSIAL LIGHT WATER NUCLEAR REACTORS. IN ADDITION, KEDO IS
TO PROVIDE THE NORTH WITH 500 THOUSAND METRIC TONS OF HEAVY FUEL
OIL EACH YEAR UNTIL THE NEW REACTORS ARE OPERATIONAL.
EVERYTHING WAS PROCEEDING RELATIVELY SMOOTHLY UNTIL THIS YEAR.
KEDO HAS SHIPPED SOME OF THE HEAVY OIL, BUT IT DOES NOT HAVE
ENOUGH MONEY TO SEND THE FULL 500-THOUSAND METRIC TONS AS
REQUIRED UNDER THE 1994 AGREEMENT. A U-S SOURCE FAMILIAR WITH
THE OIL ISSUE WHO ASKED TO REMAIN ANONYMOUS SAYS KEDO'S CURRENT
DEBT IS JUST UNDER 40 MILLION DOLLARS, WHICH INCLUDES PAYMENTS
MADE FOR OIL SHIPMENTS IN 1997 AND 1998.
// OPT // THE SOURCE SAYS KEDO HAS DELIVERED ABOUT 154 THOUSAND
METRIC TONS OF HEAVY FUEL OIL TO NORTH KOREA SO FAR THIS YEAR,
AND SHIPMENTS TOTALLING 66-THOUSAND METRIC TONS ARE SCHEDULED TO
BE MADE THIS MONTH. THAT MEANS 280-THOUSAND METRIC TONS REMAIN
TO BE DELIVERED BEFORE OCTOBER 20TH, AT A COST OF ABOUT 28
MILLION DOLLARS. // END OPT //
THE UNITED STATES HAS THE LEAD ROLE IN TRYING TO FIND FUNDING FOR
THE OIL SHIPMENTS. SO FAR, WASHINGTON HAS CONTRIBUTED 30 MILLION
DOLLARS AND THE CLINTON ADMINISTRATION IS ASKING CONGRESS TO
APPROVE FIVE MILLION DOLLARS MORE. STATE DEPARTMENT SPOKESMAN
JAMES RUBIN SAYS THE UNITED STATES WILL DO ALL IT CAN TO FULFILL
ITS PART OF THE AGREEMENT.
// RUBIN ACT //
WE ARE WORKING HARD TO HELP KEDO RAISE ADDITIONAL FUNDS
FROM OTHER COUNTRIES, BUT SO FAR IT HAS NOT BEEN ABLE TO
RAISE SUFFICIENT FUNDS FOR ITS HEAVY FUEL OIL DELIVERIES
THIS YEAR. WE BELIEVE THIS AGREEMENT IS AN EXTREMELY
IMPORTANT ONE, AND WE REMAIN COMMITTED TO THE SUCCESSFUL
IMPLEMENTATION OF THE FREEZE ON NORTH KOREA'S ACTIVITIES
-- THE SO CALLED AGREED FRAMEWORK.
// END ACT //
A KOREA SPECIALIST AT THE UNITED STATES INSTITUTE OF PEACE, SCOTT
SNYDER, SAYS THE FUNDING PROBLEM STEMS FROM MISUNDERSTANDINGS
OVER THE ORIGINAL 1994 AGREEMENT.
// SNYDER ACT ONE //
I SEE THIS AS MORE A RESULT OF A MISUNDERSTANDING
BETWEEN THE ADMINISTRATION AND CONGRESS, OR AT LEAST AN
INABILITY OR UNWILLINGNESS TO FOCUS ON KEDO AS A
PRIORITY ISSUE ON THE PART OF THE ADMINISTRATION UNTIL
WE'VE REACHED A CRISIS POINT. THE RESASON WHY I SAY
THIS IS ORIGINALLY FOLLOWING THE AGREED FRAMEWORK, THE
ADMINISTRATION BASICALLY SIGNALLED TO CONGRESS THAT THIS
WAS GOING TO BE A LOW COST OR COST-FREE AGREEMENT
BETWEEN THE U-S AND THE D-P-R-K (NORTH KOREA), AND THAT
IN FACT, SOUTH KOREA AND JAPAN WOULD BE TAKING OVER THE
BULK OF THE COSTS.
// END ACT //
MR. SNYDER SAYS THE CURRENT SITUATION COULD BE INTERPRETED AS A
CASE OF THE UNITED STATES NOT LIVING UP TO ITS COMMITMENT UNDER
THE 1994 NUCLEAR ACCORD. HE SAYS THE AGREEMENT DOES NOT
EXPLICITLY SAY THE UNITED STATES IS RESPONSIBLE FOR RAISING HEAVY
FUEL OIL MONEY, BUT IT SAYS THE UNITED STATES WILL ARRANGE,
THROUGH KEDO, THE DELIVERIES OF FUEL OIL TO NORTH KOREA.
MR. SNYDER SAYS NORTH KOREA HAS MADE KNOWN ITS DISPLEASURE OVER
THE DELAY OF FUEL OIL SHIPMENTS, BY INCREASING ACTIVITY AT ITS
CLOSED NUCLEAR PLANT.
// SNYDER ACT TWO //
THEY'VE ANNOUNCED THAT THEY ARE GOING IN AND I GUESS
CLEANING UP THE AREA OF THE REPROCESSING PLANT. AND SO,
THUS FAR, THEY HAVE NOT ACTUALLY VIOLATED THE AGREED
FRAMEWORK. HOWEVER, THIS NEW ACTIVITY IS CERTAINLY
INTENDED, I THINK, TO SEND A SIGNAL THAT IF INDEED THE
HEAVY FUEL OIL IS NOT PROVIDED ON TIME, THAT THE D-P-R-K
MIGHT TAKE STEPS THAT WOULD BE DEEMED A VIOLATION OF THE
AGREED FRAMEWORK. AND OF COURSE THAT WOULD PUT US BACK
INTO A SIMILAR SITUATION TO THE ONE THAT WE WERE IN IN
1994 WHEN THE FRAMEWORK ITSELF WAS NEGOTIATED.
// END ACT //
STATE DEPARMENT SPOKESMAN JAMES RUBIN SAYS NORTH KOREA HAS MADE
SUCH SUGGESTIONS FROM TIME TO TIME. SO FAR, HE SAYS PYONGYANG IS
IN COMPLIANCE WITH THE 1994 AGREEMENT. HOWEVER, IF THERE IS
EVIDENCE THAT NORTH KOREA IS IN VIOLATION OF THE ACCORD, MR.
RUBIN SAYS THE UNITED STATES WOULD TAKE THE MATTER VERY
SERIOUSLY.
SCOTT SNYDER SAYS HE EXPECTS THE CLINTON ADMNISTRATION TO WIN
AGREEMENT FROM CONGRESS FOR THE NECESSARY FUNDING TO CONTINUE OIL
SHIPMENTS. BUT HE SAYS IT REMAINS TO BE SEEN IF THE NEXT U-S
ADMINISTRATION, WHICH WILL COME TO OFFICE IN 2001, WILL BE AS
COMMITED TO THE NORTH KOREAN NUCLEAR ACCORD.
// REST OPTIONAL //
MEANWHILE, PREPARATIONS FOR CONSTRUCTION OF THE TWO NEW LIGHT
WATER REACTORS IS MOVING FORWARD. SOUTH KOREAN CREWS HAVE BEEN
IN THE NORTH BUILDING THE INFRASTRUCTURE NEEDED BEFORE WORK ON
THE NUCLEAR PLANTS THEMSELVES CAN BEGIN. THIS INCLUDES
ELECTRICAL AND WATER FACILITIES, ROADS AND A MEDICAL CENTER FOR
THE WORKERS.
BECAUSE OF CURRENCY DEVALUATIONS, THE ESTIMATED COST OF THE TWO
PLANTS HAS BEEN REDUCED FROM MORE THAN FIVE BILLION DOLLARS TO
FOUR-POINT-SIX BILLION DOLLARS. SOUTH KOREA AGREES TO PROVIDE 70
PERCENT AND JAPAN IS PLANNING TO CONTRIBUTE ONE BILLION DOLLARS.
THAT LEAVES A GAP OF A FEW HUNDRED- MILLION DOLLARS.
KEDO POLICY ADVISOR JASON SHAPLEN SAYS THE CONSORTIUM MEMBERS
HAVE HELD FOUR OR FIVE ROUNDS OF TALKS TO WORK OUT DETAILS OF THE
COST SHARING.
// SHAPLEN ACT //
SOUTH KOREA AND JAPAN, DESPITE THEIR ECONOMIC
DIFFICULTIES, HAVE MAGNANIMOUSLY REAFFIRMED THEIR
COMMITMENTS TO PLAY A CENTRAL AND SIGNIFICANT ROLE,
RESPECTIVELY, AND THE TALKS ARE NOW FOCUSING ON HOW TO
TRANSLATE THOSE COMMITMENTS INTO PERCENTAGE OR DOLLAR
TERMS (AND) ON HOW TO FILL ANY GAP FOR THE REMAINDER OF
THE COST ESTIMATE.
// END ACT //
MR. SHAPLEN SAYS KEDO MEMBERS ARE HOPEFUL THE ISSUE WILL BE
RESOLVED SOON. (SIGNED)
NEB/SMN/WFR/RAE
07-Jul-98 3:31 PM EDT (1931 UTC)
NNNN
Source: Voice of America
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