NAPSNet Daily Report
wednesday, july 12, 2000

I. United States

II. Republic of Korea III. People's Republic of China

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I. United States

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1. US-DPRK Missile Talks

The Associated Press (Ranjan Roy, "US, N.KOREA MISSILE TALKS END," Kuala Lumpur, 7/12/00) and Agence France Presse ("NORTH KOREA DEMANDS ONE BILLION DOLLARS FOR HALTING MISSILE EXPORTS," Kuala Lumpur, 7/12/00) and Reuters ("U.S. SAYS NO COMPENSATION TO N.KOREA OVER MISSILES," Kuala Lumpur, 7/12/00) reported that negotiations over the DPRK's missile program ended in a stalemate Wednesday, with the US refusing to pay the DPRK to curb exports of missile technology. After three days of talks, the DPRK restated their offer seeking US$1 billion a year in exchange for a halt to missile technology exports. They also refused to stop developing such weapons for self-defense. The two sides agreed to meet again at an undetermined time and location. Chief US negotiator Robert Einhorn, US Assistant Secretary of State for Non-proliferation, said, "The North Koreans should not be compensated for conducting activities they should not be conducting in the first place. We are not prepared to pay cash compensation." Jang Chang-chon, head of the DPRK's bureau on US affairs, said that the DPRK regards its missile program as part of its right to self-defense, claiming the US has deployed "thousands of missiles" around East Asia that threaten his country. Jang added, "That is why the United States has no right to make such unjust claims for the freeze of our missile capabilities. We clarified that we will continue our discussions on the condition that the U.S. gives compensation for our economic and political losses in case of suspension."

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2. US-DPRK Relations

South China Morning Post ("NORTH KEEN TO NORMALISE TIES WITH US," 7/12/00) reported that DPRK leader Kim Jong-il reportedly wants to normalize relations with the US and plans to dispatch a close aide and a senior military officer to Washington in the "near future" for high-level talks. Korean-American journalist Julie Moon, who interviewed Kim recently, said on July 11 that Kim also welcomed the June 19 lifting of US sanctions against the DPRK, saying he saw the move by US President Bill Clinton as "an encouraging sign". Moon said, "Comparing the lifting of economic sanctions to a tennis game, Mr. Kim said that now that he has the US ball in his court, he will turn it back to the US court by sending two senior officials to the US in the near future in an effort to work out normalization of relations between the two countries." Kim also said the two officials he plans to send to the US "would be the highest North Korean officials ever to visit the US." [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

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3. DPRK-Philippines Relations

Reuters ("N.KOREA, PHILIPPINES ESTABLISH DIPLOMATIC TIES," Manila, 7/12/00) reported that the DPRK and the Philippines signed an agreement on Wednesday formally establishing diplomatic ties. The DPRK Department of Foreign Affairs said in a statement that DPRK ambassador to Thailand Jo In-chol, who signed the agreement with Philippine Foreign Secretary Domingo Siazon, will serve as DPRK's first ambassador to Manila in a non-resident capacity. The statement added that the normalization of ties between the two countries left Myanmar as the only member of the Association of South East Asian Nations not to have any diplomatic relations with the DPRK.

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4. US-PRC Arms Control Talks

Agence France Presse ("CHINA SAYS IT DOES NOT INTEND TO USE FORCE AGAINST TAIWAN: US OFFICIAL," Beijing, 7/12/00) and the Associated Press (Robert Burns, "CHINA ASSURES U.S. ON TAIWAN ATTACK," Beijing, 7/12/00) reported that a senior US official said that US Defense Secretary William Cohen received assurances on Wednesday from PRC Defense Minister Chi Haotian that the PRC does not intend to use force against Taiwan, even though it reserves the right to do so. The official said that Chi reiterated the PRC's goal of securing Taiwan's reunification with the mainland, but stressed that it is seeking to settle its differences with Taiwan peacefully. The official said, "They stressed that ... even though they will not give up in any way the use of force as a sovereign nation, they do not intend to [use it.]" Cohen, who described the talks as an unscripted give-and-take, said that he urged Chi to ease tensions by reducing the threat posed by Chinese missiles targeted on Taiwan. He said, "I did mention that there could be a reduction in tension by a reduction in the missile threat itself, that to the extent there was a missile threat there would be increased pressure to provide defensive equipment." Chi dismissed US Defense Department reports that the PRC is building up short-range missile forces targeted on Taiwan as exaggerated and said that that was "entirely China's own business. On Taiwan, our policy has always been clear: it is a policy of peaceful reunification and 'one country, two systems.' Meanwhile, we've also made it very clear that we do not undertake to give up the use of force." US officials said that the US and the PRC found no common ground on US plans for a national missile defense (NMD), and the PRC denied that it was transferring missile technology to nuclear-armed Pakistan. Cohen said, "I pointed out that NMD has become a reality by virtue of the proliferation of missile technology and weapons of mass destruction. I laid out why it was important for us to be conducting the research and development. They expressed their opposition to it." Besides Chi, Cohen meets PRC Vice President Hu Jintao and the chief of staff of the Peoples Liberation Army Fu Quanyou. He is also scheduled to meet with President Jiang Zemin, Vice Premier Qian Qichen and Zhang Wannian, vice chairman of the Central Military Commission on July 13.

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5. PRC View of US Missile Defense

The Washington Post (John Pomfret, "CHINA AGAIN DEMANDS U.S. DROP MISSILE DEFENSE," Beijing, 7/11/00) reported that the PRC greeted the arrival of US Defense Secretary William S. Cohen on Wednesday with a strong reiteration of its demand that the US drop its plans for a missile defense system. A Western source in Beijing said that PRC officials have expressed exasperation at the justification for the proposed missile defense system put forward in previous discussions with US officials. The source said, "The Chinese think that argument is spurious. They want something more textured and they want real assurances that it's not directed at them." Western sources said that PRC officials have said that if the US exports technology to Taiwan for a theater missile defense system, the PRC will continue to sell missile technology to Pakistan, and possibly to countries in the Middle East. A US official said, "The Chinese would like to tie Taiwan arms sales into nonproliferation discussions, NMD, TMD -- all these things from the Chinese point of view tie into the discussion of proliferation, and it's a contentious issue." A Western source familiar with the arms control talks said, "The U.S. is going to have to make a decision. Are U.S. arms sales or TMD [sales] to Taiwan more important than whatever the Chinese are doing with Pakistan? So far, I think they have decided Taiwan is more important." [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

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6. Russian Arms Sales to PRC

The Washington Times (Bill Gertz, "RUSSIA READIES WARSHIP FOR CHINA," Beijing, 7/12/00) reported that according to US Defense Department intelligence officials, Russia has completed work on a second Sovremenny-class cruise-missile ship for the PRC. The ship was spotted in the Gulf of Finland during the last week of June undergoing sea trials. Officials said that the exercises are expected to include at least one test launch of an SS-N-22 Sunburn anti- ship cruise missile. The ship is likely to be sent to the PRC toward the end of this year. US Representative Dana Rohrabacher said, "The SS-N-22 is the most dangerous anti-ship missile in the Russian, and now the Chinese, fleet. Our Navy admittedly has scant ability to defend against this 200-kiloton nuclear-capable weapon." A US official said that he is concerned about Russian arms deliveries as part of the PRC's military modernization program. The official said that the missile destroyers and sales of Su-27 aircraft and Kilo-class submarines are alarming signs. He added, "Those are the three things that could be very important. They reflect a relationship between Russia and China that we need to keep an eye on." [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

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7. Israeli Arms Sales to PRC

Jerusalem Post (Janine Zacharia, "BARAK TO SUSPEND PHALCON SALE," Washington, 7/12/00) reported that a well-placed source said on July 11 that Israeli Prime Minister Ehud Barak has decided to suspend Israel's sale of the Phalcon advanced airborne radar system to the PRC. The source said that Barak's top diplomatic adviser, Danny Yatom, would consult with US congressional leaders about the plan ahead of a US House of Representatives floor vote on foreign appropriations on July 13. An Israeli Embassy spokesman said earlier on Wednesday that the embassy was preparing to issue a statement on the Phalcon, but declined to comment when asked about the decision. US White House Spokesman Joe Lockhart said that Israel had not yet informed the US administration of its intentions. [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

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8. Cross-Straits Relations

Agence France Presse ("CHINESE VICE PREMIER FLEXIBLE ON 'ONE CHINA': TAIWANESE LEGISLATOR," Beijing, 7/12/00) reported that Taiwanese legislator Feng Hu-hsiang said that, in a meeting on July 11, PRC Vice Premier Qian Qichen hinted that Taiwan could adopt a different interpretation of the "one China" principle from the PRC. Feng said, "He didn't care about interpretations. He just cares about the 'one China' principle. Such delicate and sensitive problems, Chinese leaders have no way of saying it, but he's indirectly saying it. We should all be able to read the hidden message in his words." Feng's visit, the first in the name of a Taiwanese political party, will include talks with Wang Daohan, head of the Association for Relations Across Taiwan Straits (ARATS), in Shanghai on July 13. Feng said that later this month officials from two major Taiwanese political parties, including the Nationalists and the People First Party, will also pay visits to China.

II. Republic of Korea

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1. US Position on Inter-Korean Relations

The Korea Times (Kim Kwang-tae, "NO OBJECTION TO SIX-WAY TALKS: BOSWORTH," Seoul, 07/12/00) reported that US Ambassador to the ROK Stephen W. Bosworth said on July 11 that the US has no objection to expand the existing four-party talks into a six-party format to include Russia and Japan. Bosworth said, "Architecture is less important than substance. Most important is inter-Korean dialogue." Regarding engagement with the DPRK, Bosworth said that the US could accept the DPRK's entry to the international community. However, he expressed caution on changing the role of US forces, saying, "Despite the very promising result of the summit, military threats still exist. Any change in the role of U.S. forces here would depend upon a change in the circumstances here. Should the threat from North Korea disappear entirely, then the role of U.S. forces would obviously be a subject of discussion between ourselves and the Republic of Korea."

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2. DPRK Defectors

Chosun Ilbo (Kim In-gu, "NK DEFECTOR NUMBERS DOUBLE OVER LAST YEAR," Seoul, 07/11/00) reported that a report released on July 11 showed that the number of DPRK defectors coming to the ROK in the first half of the year doubled to 115. The record showed that 69 people came to the ROK in the April-June period, compared to 46 during the January-March period. An official from the ROK Ministry of Unification said, "Considering more defectors enter Korea in the later part of the year, there will be more than 200 defectors by the end of this year."

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3. Inter-Korean Economic Exchanges

Joongang Ilbo (Kim Nam-jung, "HYUNDAI ASAN TO BEGIN WEST COAST INDUSTRIAL COMPLEX IN NK," Seoul, 07/11/00) reported that the Hyundai Asan Corporation plans to construct an industrial complex specializing in the manufacture of footwear on a 1.32 million-square meter area in the West Cost Industrial Complex. This will be the first phase of Hyundai Asan's DPRK project. Hyundai Asan signed an agreement on July 11, at Hyundai headquarters in Seoul, to build the industrial complex together with the Pusan Footwear-Knowledge Industrial Association. Hyundai will begin construction sometime this year, by organizing a joint business group made up of a large business group, small and medium-scale companies and the Korea Land Development Corporation.

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4. DPRK Site on Internet

Joongang Ilbo (Ye Yong-jun, "NORTH KOREA LAUNCHES INTERNET SITE," Seoul, 07/11/00) reported that the DPRK is strengthening its new open policies and courting the international community in cyberspace. The DPRK premiered its homepage, DPRKorea Infobank ( on July 10 to provide information and news related to it in the English language. Japanese and Chinese versions will reportedly be available sometime this year. The operator of the homepage is the Pan-Pacific Economic Development Association of Korean Nationals, whose headquarters are in Beijing. However, the contents of the site strongly suggest that it is actually the official homepage of the DPRK government. The purpose of the site, according to its own introduction, is to help foreigners better understand the DPRK and to provide information on the activities of National Defense Commission Chairman Kim Jong-il, news related to its government, and information on economy and investment.

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5. US-ROK Military Exercises

The Korea Herald (Kang Seok-jae, "SEOUL TO SCALE DOWN JOINT MILITARY DRILL WITH U.S. SLATED FOR LATE AUGUST," 7/12/00) reported that a government source said on July 11 that the ROK will scale down its largest joint military exercise with the US, Ulchi Focus Lens, which is scheduled for late August, in a bid to promote reconciliation with the DPRK. The source said, "No reserve forces for rear area defense will be mobilized on our side during the forthcoming military exercise." He also said that the government would announce a detailed action program for the drill late this month or in early August. He added that the action was mainly taken to help maintain the reconciliatory mood between the ROK and the DPRK created after the inter-Korean summit last month. [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

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6. US-ROK Status of Forces Agreement

The Korea Times (Son Key-young, "ROK, US TO RESUME SOFA TALKS AUG. 2-3," 7/12/00) reported that an ROK Foreign Affairs-Trade Ministry official said on July 11 that the ROK and the US have agreed to officially resume negotiations in Seoul on August 2-3 to revise the Status of Forces Agreement (SOFA). It would mark the first such meeting since September 1996. The official said, "We will launch negotiations on all issues concerned, including the criminal jurisdiction clauses of the bilateral agreement." One of the US requests is to limit the scope of crimes under ROK's jurisdiction, thus opening the way for US military authorities to handle all minor crimes. However, the ROK is unlikely to accommodate the US request, as it views this approach as an attempt to worsen an already unfair agreement. [Ed. note: This article was included in the US Department of Defense's Early Bird news service for July 12, 2000.]

III. People's Republic of China

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1. DPRK-Australian Relations

People's Daily (Li Xuejiang, "NEW STEPS IN AUSTRALIAN-DPRK RELATIONS," 7/11/00, P6) carried an article saying that the relationship between Australia and the DPRK is moving towards improvement. After the two countries announced the resumption of diplomatic relations on May 8, the article said, the Australian ambassador to the PRC, who concurrently serves as Australian ambassador to the DPRK, went to Pyongyang on July 4-8. He presented the credentials to Kim Yong-nam and met DPRK officials of different departments, the report said. The normalization of Australian-DPRK relations, which was well received by the international community, undoubtedly was conducive to peace and stability in Asia-Pacific area, the article concluded.

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2. PRC-DPRK Relations

People's Daily (Xu Baokang, "BEIJING BANQUET MARKS CHINA-DPRK FRIENDSHIP TREATY," Beijing, 7/12/00, P4) reported that DPRK Ambassador to the PRC Chu Chang-jun hosted a banquet on the evening of July 11, marking the 39th anniversary of the signing of the Treaty of Friendship, Cooperation and Mutual Assistance between the two countries. Buhe, vice-chairman of the Standing Committee of the National People's Congress of China (NPC), said at the banquet that in line with the spirit of the friendship treaty and mutual support, the PRC and the DPRK are not only continuously expanding and deepening their exchanges and cooperation in the fields of politics, economics and culture, but also have made important contributions to maintaining peace and security on the Korean Peninsula and in Asia. He said that the PRC will consistently support the improvement of DPRK-ROK relations through dialogues and their realization of self-determination and peaceful reunification. The PRC will continue to make its active efforts to maintain peace and stability on the Korean Peninsula, Bu said. Chu Chang-jun called Kim Jong-il's visit to the PRC an important event in bilateral relations, adding that the DPRK is fully prepared to promote cooperation with the PRC in political, economic and other areas.

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3. PRC-US Relations

People's Daily (Zhang Jingyu, "JIANG MEETS US GUESTS," Beijing, 7/12/00, P1) reported that PRC President Jiang Zemin met with Rabbi Arthur Schneier, president of the Appeal of Conscience Foundation of the US, in Beijing on July 11. After recalling their first meeting in Beijing two years ago, Jiang said that he appreciated Schneier's efforts in promoting Sino-US exchanges, particularly between religious figures. Jiang said that the current Sino-American relationship "is generally good." All those with strategic and long-term perspective would agree that the advancement of such a relationship is "in the fundamental interests of the two peoples and conducive to world peace and stability," he said. During the meeting, Jiang briefed the guests on the PRC's policy on religion issues, the report said.

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4. PRC-US Arms Control Talks

People's Daily ("FM COMMENTS ON SINO-US ARMS CONTROL TALKS," Beijing, 7/9/00, P2) reported that PRC Foreign Ministry spokesman Sun Yuxi said on July 8 that the PRC and the US ended two days of meetings on arms control and anti-proliferation on July 7 in Beijing, during which they exchanged "comprehensive, in-depth and frank" views. This remark followed meetings between PRC Vice-Minister of Foreign Affairs Wang Guangya and the US special adviser to the president and under-secretary of state for arms control and international security affairs, John Holum. Sun said that the two countries have made important progress on arms control and anti-proliferation over the past 10 years, especially during the Clinton administration. The PRC and the US have thus played a positive role in maintaining international and regional peace and security, Sun said. The PRC side outlined its stance on the US missile defense program, stressing the importance of safeguarding and observing the Anti-Ballistic Missile (ABM) treaty. The PRC expressed concerns about the negative impact of the US National Missile Defense (NMD) program and the US- Japanese joint research and development of the Theater Missile Defense (TMD) system, Sun said. Sun reiterated the PRC's firm opposition to arms sales to Taiwan by any country, including providing Taiwan with TMD-related assistance. The PRC and the US agreed to continue such high-level meetings on arms control on the basis of equality and mutual trust, Sun said. During his stay in Beijing, Holum also met separately with Liu Huaqiu, minister in charge of the Central Foreign Affairs Office, Xiong Guangkai, deputy chief of the General Staff of the Chinese People's Liberation army, and PRC Vice-Minister of Foreign Affairs Yang Jiechi, the report said.

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5. PRC Position on Missile Defense

China Daily (Shao Zongwei, "CHINA SLAMS US MISSILE SHIELD AGAIN," 7/12/00, P2) reported that the PRC on July 11 once again urged the US to give up developing the National Missile Defense (NMD). PRC Foreign Ministry spokesman Sun Yuxi said, "On the NMD issue, the US is faced with not only technical barriers but also wide opposition from the international community." Sun was referring to the failure of the July 7 test of the NMD program. Following the delegation led by US chief disarmament negotiator John Holum, the report said, US Defense Secretary William Cohen is now in Beijing on an official visit that will last until July 15. Describing the visit as a part of bilateral military exchanges, Sun said on July 11 that it will not be linked with other issues.

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6. Russian Attitude toward Missile Defense

China Daily ("RUSSIA QUESTIONS ANTI-MISSILE PLAN," Moscow, 7/11/00, P12) reported that Russian Foreign Minister Igor Ivanov said on July 10 that Russian President Vladimir Putin will try to persuade US President Bill Clinton at the upcoming Group of 8 (G8) summit to drop plans to deploy an anti-missile defense system. Ivanov said that the question of US plans for the National Missile Defense (NMD) would be raised when Putin meets Clinton on the sidelines of the July 21-23 summit on the Japanese island of Okinawa. He said that Putin would offer new initiatives, including further cuts to nuclear arsenals, to boost the case against the NMD, which Moscow sees as a threat to global stability.

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7. The Taiwan Issue

China Daily (Shao Zongwei, "TAIWAN NOT ON G8 AGENDA," 7/12/00, P2) reported that PRC Foreign Ministry spokesman Sun Yuxi dismissed on July 11 the suggestion that the Group of 8 (G8) summit should discuss Taiwan question, stressing that the Taiwan question is the PRC's internal affair. He added that no foreign country, group of states or international organization has the right to interfere.

China Daily (Hu Qihua, "OFFICIAL: ONE-CHINA PRINCIPLE CRUCIAL TO LINKS," 7/12/00, P1) reported that a senior official for Taiwan affairs said on July 11 that direct postal, commercial and transport links between the PRC and Kinmen, Matsu and Penghu, three islands under Taiwan's control, can be discussed in an orderly way under the one-China principle. "It all depends on whether Taiwan authorities adhere to the one-China principle and agree to have direct postal, commercial and transport links across the Straits as the objective," said Li Bingcai, vice-director of the Office of Taiwan Affairs, which comes under the State Council. Li met on July 11 with a 10-member delegation from Taiwan's pro-reunification New Party. Delegates said that they would like to see trial postal, commercial and transport links with the three islands before direct links across the Taiwan Straits are established.

China Daily (Hu Qihua, "ONE-CHINA POLICY KEY TO DEADLOCK," 7/11/00, P1) reported that a senior official for Taiwan affairs on July 10 reiterated the central government's position that adherence to the one-China principle is the only way out of the current cross-Straits stalemate. Under the one-China principle, both sides of the Taiwan Straits have equal weight in consultations to discuss the reunification issue, said Li Yafei, secretary-general of the Beijing Association for Relations Across the Taiwan Straits (ARATS) when he met a delegation from Taiwan's pro- reunification New Party. The 10-member delegation, led by a "member of parliament" in Taiwan Feng Hu-hsiang, flew into Beijing on July 9. The trip, the first to the mainland in the name of a Taiwan political party, is meant to help bring about a rapprochement between Taiwan and the mainland since the end of the civil war in 1949, Feng said. Feng said that his party opposes any form of "Taiwan independence." Both Taiwan and the mainland are parts of China, Feng added.

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8. US-Japanese Relations

China Daily ("US, JAPAN TO MEET ON TELECOMS DISPUTE," Tokyo, 7/10/00, P5) reported that the US and Japanese governments are scheduled to meet for talks this week on a row over rates charged by telecoms giant Nippon Telegraph and Telephone Corp (NTT), with Japanese officials looking set to offer a plan for faster cuts. A visit by US President Bill Clinton in two weeks added urgency to the negotiations with both sides anxious to settle the row before the summit of the Group of Eight leaders later this month. Japanese media reported over the weekend that Japan would offer a 22.5 percent cut in rates competitors pay to use NTT's local lines, the so-called "last mile," over three years - a one-year reduction from its original proposal. Some experts warn the offer may not be good enough, the report said adding that the US is vying for deeper and faster cuts.

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