Northeast Asia Peace and Security Network DAILY REPORT For Wednesday, March 18, 1998, from Berkeley, California, USA

I. United States

1. ROK-DPRK Talks

Reuters (Elif Kaban, "NORTH KOREA INVITES SOUTH TO DIRECT TALKS," Geneva 03/18/98) reported that Li Gun, deputy head of the DPRK delegation to the Geneva peace talks and DPRK ambassador to the UN, said Wednesday that the DPRK was ready to resume direct talks with the ROK. Li stated, "We are ready for direct inter-Korean dialogue. But we want it to take place on the Korean peninsula and not abroad." He added, "We have proposed the dialogue and now we are waiting for the South Korean response." However, Li said that it was unlikely any direct talks could take place within the next few month, adding "Timing would be very sensitive." He continued, "Once [the ROK] agree[s] to meet, then we would discuss the agenda. When, how, where exactly I don't know." Asked if ROK-DPRK talks might obviate the need for the Geneva process, Li said, "North-South Korean dialogue has its own track and it will move on its own track." He said that while the DPRK did not reject an ROK offer to set up two inter-Korean sub- committees to look into creating a peace mechanism and confidence-building measures, "before we form the sub-committees, we need to finalize the agenda." ROK spokesman Oh Il-son said that the ROK was waiting for more details. Oh stated, "We do not know the exact context of North Korea's willingness. We have to clarify it. There have been various conditions in the past." Meanwhile, ROK Foreign Minister Park Chung-soo was quoted as telling President Kim Dae-jung, "North Korea's side has told our representative that North Korea was willing to hold North-South talks in the near future and asked if we were going to continue with four-party talks after North-South talks have been established."

The Associated Press (Alexander G. Higgins "S.KOREA SEEKS EXACT TERMS FOR TALKS," Geneva 03/18/98) reported that an anonymous ROK official said that the DPRK has to elaborate on its proposal for inter-Korean dialogue before the ROK can respond. He stated, "Basically the North Koreans indicated their willingness to have talks, but exactly what that means, exactly when, how, that sort of thing" remains to be determined. In Seoul, ROK President Kim Dae-jung welcomed the DPRK's move, stating that "the door to inter-Korea dialogue is always open."

2. Four-Party Peace Talks

The AP-Dow Jones News Service ("SOUTH, N. KOREA MOVING TOWARD AGREEMENT ON KEY PROCEDURE," Geneva, 03/18/98) reported that PRC assistant foreign minister Chen Jian said Wednesday that the DPRK and the ROK moved toward agreeing on crucial procedures for the four-party peace talks. He stated, "There's more than a 50 percent chance of reaching an agreement" to form working groups to deal with different issues. He added, "Everybody feels the same, that if we want to have substantive discussion, subcommittees or smaller groups, whatever you call it, will have to be formed."

Reuters ("US REPORTS PROGRESS IN KOREA PEACE TALKS," Geneva, 03/18/98) reported that US Assistant Secretary of State Stanley Roth, chief US negotiator at the four-party peace talks in Geneva, said Wednesday that the talks have "made some progress." He gave no further details. PRC assistant foreign minister Chen Jian said that heads of delegations would go on a "Swiss excursion" on Thursday and continue meeting while their officials would stay in Geneva for consultations. He stated, "We worked all day and I have used all my efforts to find a middle ground. No one is intentionally obstructing the talks."

United Press International ("N. KOREA DEMANDS U.S. WITHDRAWAL," Geneva, 03/17/98) and the Associated Press (Geir Moulson, "LITTLE PROGRESS IN KOREA PEACE," Geneva, 03/17/98) reported that, during the second day of the four-party peace talks on Tuesday, the DPRK repeated its demands for a withdrawal of US troops from the Korean peninsula and called on the Clinton administration to enter into a bilateral peace accord with the DPRK. A US State Department official said, "there is no change in American policy, and there is not going to be one" on US troops. He added that the US approach remains to focus on the less contentious issues now and leave the politically sensitive ones until the end of the process. PRC Assistant Foreign Minister Chen Jian said that during Tuesday's session everyone went over their negotiating positions, "so now we know our limits."

3. ROK Policy toward DPRK

United Press International (Jason Neely, "S.KOREA EASES RULES ON AID TO NORTH," Seoul, 03/18/98) and Reuters ("SEOUL TO ALLOW CIVIC GROUPS TO HELP NORTH DIRECTLY," 03/17/98) reported that ROK Unification Ministry spokesman Kim Chang-yon said Wednesday that the government will allow private groups to provide direct aid to the DPRK. Kim stated, "Effective from today, groups can submit proposals and the ministry will permit activities within these boundaries." He added that the ministry is still working on the legal implications of the changes. The Unification Ministry said that ROK citizens will be allowed to canvass and hold fund- raising events for the DPRK and participate in inter-Korean projects such as food-processing factories or cooperative farms. The ministry also pledged to promote private-sector aid to the DPRK to help achieve "substantial intra-Korean cooperation and exchanges."

The AP-Dow Jones News Service ("S. KOREAN PRESIDENT: NOT READY FOR REUNIFICATION - REVIEW," Hong Kong, 03/18/98) reported that ROK President Kim Dae-jung, in an interview with the Far Eastern Economic Review, said that the ROK and the DPRK are "not at the stage to attempt unification." He stated, "Rather than pursuing such an impractical and unlikely proposition as unification, I first want to realize more pragmatic steps like seeking cooperation and exchanges." Kim also said that ROK Unification Minister Kang In-dok's more hawkish image on reunification could "be helpful in persuading conservative South Koreans" to accept a policy of engagement toward the DPRK.

4. DPRK Executions

United Press International ("JAPAN PAPER: N.KOREA EXECUTED 3 'SPIES'," Tokyo, 03/18/98) reported that the Japanese daily newspaper Sankei Shinbun said that three people were executed in Pyongyang last October for allegedly spying for the ROK. According to the report, the three executed were Ham Un-gon, a vice director at the Ministry of Public Security's Political Department, So Kwan-hi, a secretary of the DPRK Workers Party of Korea in charge of agriculture, and Ri Pyong-so, president of a trading firm. The paper said that Ri and Ham were charged with state treason for allegedly forging contacts with the ROK's Agency for National Security Planning during a purge conducted in the DPRK. The main charges against So were his friendly relations with defector Hwang Jang-yop, along with allegations that he misguided the state's agricultural policy by producing padded production reports. He was also said to have mismanaged the food distribution system to the point of collapse. The report said that the execution was attended by senior party leaders at an undisclosed location inside Pyongyang after Kim Jong-il formally took power on October 8.

4. PRC Missile Purchases

The Washington Times (Bill Gertz, "U.S. MAY HELP CHINA ON MISSILES," 03/18/98) reported that the Clinton administration will offer the PRC access to missile technology now barred under human rights sanctions if the PRC agrees again to end exports of missiles to Iran, Pakistan, and other developing states. Gary Samore, a White House National Security Council proliferation official, in a March 12 letter sent to senior officials at the State, Commerce, and Defense departments, the Joint Chiefs of Staff, the Office of the US Trade Representative, and NASA, stated, "In essence, we would offer the expanded commercial and scientific space cooperation with China (in limited areas) if China meets our conditions for joining the MTCR [Missile Technology Control Regime] and controlling its missile-related exports to Iran, Pakistan, et cetera." The article said that the proposed deal will be presented in the PRC on March 25 or 26 by Robert Einhorn, deputy assistant secretary of state for nonproliferation. John Holum, director of the Arms Control and Disarmament Agency, also will discuss the proposal during his visit to the PRC next week. However, a senior administration official, stated, "This is something that is under consideration. It is not a done deal." One unnamed US government official opposed to the deal stated, "We would be rewarding China for dangerous proliferation activities." An anonymous former administration official who specializes in missile technology added, "To date, Chinese statements about abiding by the MTCR contain peculiar formulations that do not correspond to the regime's language and appear to let the Chinese think they can transfer components and technology even though they've agreed not to export complete missiles."

5. US Policy toward PRC

The Los Angeles Times carried an analytical article (Jim Mann, "Clinton's Asia Policy Puts China First," Washington, 03/18/98) which said that US President Bill Clinton has been forging a US policy towards Asia that gives greater weight to the PRC and less to Japan. The article stated, "The Clinton administration seems to have concluded that China, more than Japan, is the key to preserving stability in East Asia--both political and economic." The author warned of dangers inherent in the administration's approach, saying, "Whenever an administration becomes enamored of the strategic importance of China, the result is to give Beijing vastly greater leverage in dealing with the United States. Moreover, there are long-term risks involved in minimizing Japan's significance to the United States." He concluded, "Clinton's decision to speed up his visit to Beijing is not just an itinerary, but a strategy, and a questionable one at that."

6. Russian-Japanese Relations

The Associated Press ("RUSSIA TO RETURN BODIES OF POWS," Moscow, 03/17/98) reported that Russia's ITAR-Tass news agency said Tuesday that the remains of 86 Japanese officers who died in Soviet prison camps after World War II will be returned to Japan this summer. A Japanese delegation spent three days visiting Kazan and other cities in the Tatarstan region, where the prison camps were located, and examined the cemeteries where the officers were buried. Japanese specialists will travel to Russia to exhume the corpses as soon as winter snows melt. ITAR-Tass also said that a joint Russian-Japanese subcommission is set to meet in Tokyo on March 26 to work out the remaining differences blocking a peace treaty. Russian President Boris Yeltsin is scheduled to travel to Japan on April 11 for a meeting with Japanese Prime Minister Ryutaro Hashimoto.

7. Russian Nuclear Safety

The Washington Post carried an analytical article (David Hoffman, "COLD-WAR DOCTRINES REFUSE TO DIE," Moscow, 03/15/98, A01) which said that Russia and the US still rely on a doctrine that calls for quick decisions about a possible nuclear attack. In a recent example, Russian detection of a US-Norway research rocket launch on January 25, 1995, triggered a heightened level of alert throughout the Russian strategic forces, and marked the first time a Russian leader had to use his nuclear briefcase in a real alert. The article said that Russia's system of early warning of a possible attack, and command and control of nuclear forces, are suffering from obsolete equipment and gaps in the network caused by the breakup of the Soviet Union. An unnamed Russian expert on the command system was quoted as saying, "Today it's not dangerous but tomorrow it might be. It is going down." Retired general Vladimir Belous wrote recently, "a fateful accident could plunge the world into the chaos of a thermonuclear catastrophe, contrary to political leaders' wishes." The article said that Russia inherited from the Soviet Union both the deterrence concept known as Mutual Assured Destruction, and the "launch-on- attack," strategy to preserve the ability to launch a retaliatory strike even after the enemy's warheads have hit. While some Russian policymakers have called for moving away from the launch- on-warning doctrine, Anatoly Diakov, director of the Center for Arms Control, Energy, and Environmental Studies in Moscow stated, "I think there will be some kind of transition period, 10 to 15 years. Russia will save the opportunity to return to launch-on- warning, just in case... But the main priority will be a transition from launch-on-warning to a retaliatory" posture.

II. Republic of Korea

1. ROK Policy toward DPRK

President Kim Dae-jung on March 17 declared that he will not seek any "excessive" steps toward Korean unification and instead will first strive to achieve a peaceful coexistence with the DPRK. Kim made the remarks in his instructions to the Ministry of National Unification. Kim vowed to implement DPRK policies in a consistent manner on the basis of the 1991 basic agreement on inter-Korean reconciliation, non-aggression, and exchanges and cooperation. Kim also made it clear that the ROK government will not resort to "private or secret" channels with the DPRK. (Korea Times, Son Key-young, "SEOUL TO FOCUS ON PEACEFUL COEXISTENCE BEFORE UNIFICATION: PRES. KIM," 03/18/98)

2. Light-Water Reactor Project

The Asahi Shimbun reported on March 18 that the Japanese government will inform the Korea Peninsula Energy Development Organization (KEDO) that it will not be able to afford its share of the cost for building two light-water reactors in the DPRK. Accordingly, the Japanese government will inform KEDO during the next general meeting in New York, slated for March 19-20, that the Japanese Diet is not likely to approve the cost-sharing budget. The Asahi Shimbun added that such information would spark diplomatic friction between Japan and the ROK. (Yonhap News, Moon Hyung-sik, "JAPAN TO BEAR LESS BURDEN FOR LWR PROJECT," Tokyo, 03/18/98)

3. DPRK Diplomacy

The DPRK will replace its ambassador to Russia Son Sung-pil by dispatching Vice Foreign Minister Park Eui-june, reported diplomatic sources in Moscow on March 17. (Kyunghyang Shinmun, "DPRK AMBASSADOR TO RUSSIA TO BE REPLACED," 03/18/98)

III. People's Republic of China

1. Four-Party Peace Talks

Jie Fang Daily ("PEACE MECHANISM AGREED TO BE ESTABLISHED ON KOREAN PENINSULA," Geneva, 03/18/98, A3) quoted PRC assistant foreign minister Chen Jian as saying that the four-party talks on Korean issue have entered into a stage of discussing substantial issues instead of procedural matters. As chair of the talks, Chen Jian said that all the four parties have agreed in principle to the establishment of a peace mechanism on the Korean Peninsula to replace the armistice mechanism. Under that agenda all concerns can be raised and discussed, Chen said.

2. US Troops in ROK

People's Daily ("DPRK REQUIRES THE US TO WITHDRAW TROOPS FROM ROK," Pyongyang, 03/18/98, A6) reported that an article in March 17's Rodong Shinmun emphasized that the withdrawal of US troops from the ROK will benefit not only the peaceful reunification of Korean Peninsula, but also the peace and stability in Asia and the world. Another commentary, published by the DPRK official newspaper Democratic Korea on March 17, pointed out that it is dangerous to transform the organization system of a US unit in the ROK into a field army. It said this measure was provocative and posed a threat towards the DPRK. The commentary asked the US to consider the result which would be brought about by the measure.

3. ROK-DPRK Trade Relations

Jie Fang Daily ("TRADE BETWEEN NORTH AND SOUTH KOREA INCREASES," 03/18/98, A3) reported that the trade between the DPRK and the ROK is increasing every year. From last January to November, trade between the two Koreas reached US$296 million, up 26 percent compared to the same period of 1996. The ROK's exports to the DPRK totaled US$112.8 million, an increase of 67 percent, and DPRK exports to ROK were US$183.2 million, up by 9.4 percent.

4. ROK Food Aid for DPRK

People's Daily ("ROK TO PROVIDE GRAIN AID TO DPRK," Seoul, 03/10/98, A7) reported that the ROK government said on March 9 that it planned to provide aid of 50,000 tons of grain to the DPRK, through the UN World Food Program. China Daily ("50,000 TONS OF GRAIN TO AID HUNGRY IN KOREA," Seoul, 03/18/98, A11) said that Lee Jong-riol, director-general of humanitarian affairs of the ROK, said that the delivery would likely take place between the end of April and early May. Lee also said that the government hoped to provide food aid directly to the impoverished DPRK in the future after the two sides begin talking directly.

People's Daily ("RED CROSS BETWEEN TWO KOREAS TO HOLD MEETINGS," Seoul, 03/16/98, A6) reported that the ROK Red Cross informed its DPRK counterpart on March 13 that the ROK agreed to accept the DPRK's offer to hold a meeting in Beijing. The ROK will send a delegation composed of 3 persons to take part in the meeting on March 25. The third shipment of food aid from the ROK is a subject of the meeting.

5. ROK Policy toward DPRK

China Daily ("ROK TO KEEP CONTROVERSIAL LAW LIMITING CONTACTS," Seoul, 03/12/98, A11) reported that ROK's new government will not abolish a controversial law prohibiting unauthorized contacts with the DPRK. ROK President Kim Dae-jung made the announcement on March 11. Under the law, violators are punished with heavy jail sentences. However, Kim, calling himself a victim of abuse of the law, pledged that his government will not allow the National Security Law to be used, as under past dictatorships, as a means to suppress internal dissent in the ROK. Before becoming president, Kim said he would consider modifying the law, but not abolishing it. The international human rights organization Amnesty International and influential members of the US Congress have urged that the terms of the law be rewritten to prevent abuse.

6. Opening of DPRK Airspace

China Daily ("HISTORIC FLIGHT," Seoul, 03/04/98, A11) reported that a Korean Air cargo jet on March 3 became the first commercial ROK plane to cross DPRK-controlled airspace since the 1950-1953 Korean War. Korean Air officials confirmed the path of the cargo flight, which left from New York and passed through DPRK airspace before reaching Seoul.

7. Kim Dae-jung's Foreign Policy

Jie Fang Daily ("CHALLENGES AHEAD," C3, 03/07/98) said that ROK President Kim Dae-jung will meet some difficulties with his diplomatic agenda. The first problem is how to push forward the negotiations with the DPRK. Kim has suggested holding a summit with the DPRK, and the DPRK recently showed its willingness to cooperate with the ROK. However, under the current political situation in the ROK, Kim has to make some compromises with the conservative opposition so that his policy can progress. Another problem Kim faced is how to strengthen the ROK's relations with the US and Japan. The newspaper said the fishery dispute between the ROK and Japan may worsen in the future.

8. PRC-US Relations

The PRC welcomed US President William Clinton's decision to move up his visit to the PRC, People's Daily ("CHINA WELCOMES CLINTON'S TOUR DECISION," Beijing, 98/03/18, A1) reported. PRC Foreign Ministry spokesman Zhu Bangzao said at a news briefing on March 17 that PRC and US officials are preparing for President Clinton's visit, scheduled for late June. The PRC believes that President Clinton's state visit to the PRC will push Sino-US relations onto a new stage.

China Daily ("US NOT TO SPONSOR ANTI-CHINA BILL AT UN," Washington, A1, 03/16/98) reported that the US government has decided to give up its bid to sponsor a UN Resolution critical of the PRC's human rights record in spite of mounting pressure from Congress. PRC Vice-Premier and Foreign Minister Qian Qichen told a press conference on March 12 in Beijing that the PRC was prepared to ink the pact, which guarantees freedom of thought, conscience, religion and expression. Both the White House and the State Department of the US responded positively to the PRC announcement.

Commenting on the US decision to not sponsor an anti-PRC draft resolution at the UN Human Rights Commission meeting, PRC spokesman Zhu Bangzao said on March 17 that this is wise and will allow Sino-US ties to proceed healthily and in a stable manner. China Daily ("CHINESE OFFICIALS GREET CLINTON'S TOUR DECISION," 03/18/98, A1)

Jie Fang Daily ("SINO-US RELATIONSHIP HAS A GOOD MOMENTUM OF DEVELOPMENT," 03/17/98, B4) published a commentary which said that there are some noticeable positive indications in Sino-US relations. It said that the summits between PRC and US presidents provide guarantee and drive for the development of bilateral relations. The bilateral relationship will keep developing as long as the two sides respect each other and hold consultations on the basis of equality.

9. PRC Policy on Taiwan

According to People's Daily ("QIAN QICHEN COMMENTS ON CHINA'S POLICY," A1, 03/13/98), PRC Vice-Premier and Foreign Minister Qian Qichen said at a press conference on March 12 in Beijing that conditions are ripe for conducting political talks between the two sides of the Taiwan Straits under the "one China" principle. If a step-by-step approach is to be adopted, Qian said, the first step can be to discuss the issue of ending the state of hostility by the two sides. To make preparation for that discussion, the two sides may have contacts first and hold talks on such procedural matters as the name, form and method of discussion. All these propositions are fair and reasonable, the Vice-Premier said, because, according to the experience of previous talks conducted by the Association for Relations Across the Taiwan Straits and the Straits Exchange Foundation, the obstacles hindering the technical talks between the two organizations were always of a political nature. Before the reunification of the motherland, Qian said, all that "one China" could mean were that "both sides of the Taiwan Straits identify themselves with the position that there is only one China in the world and Taiwan is a part of China, and the sovereignty and territorial integrity of China are not allowed to suffer a split."

10. Asian Financial Crisis

Beijing Review ("CHINA FACES EXPORT CHALLENGES," March 9-15, 1998, P. 4) said that the sharp devaluation of currencies among the PRC's neighbors will pose great challenges to the export sector of the PRC. Zhou Xiaochuan, director of the State Administration of Foreign Exchange of China, said that the country's income from overseas labor service contracts will be influenced somewhat since 70 percent of those contracts are concentrated in Southeast Asia and the ROK. Furthermore, he said, investment from Japan, Hong Kong, the ROK, Taiwan and Southeast Asian countries, which accounts for two-thirds of the PRC's total foreign capital, will probably drop in the future. However, the senior official still emphasized that the PRC's foreign trade will remain balanced and that the actual inflow of foreign capital will not drop sharply this year.

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