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Northeast Asia Peace and Security Network DAILY REPORT For Thursday, August 20, 1998, from Berkeley, California, USA |
1. Alleged DPRK Underground Nuclear Facility
Nucleonics Week (Mark Hibbs, "CLAIM DPRK RESUMED NUCLEAR WORK BYPASSED
U.S. OFFICIAL CHANNELS," Bonn) reported that diplomatic sources in Europe
and several US executive branch officials said on August 18 that they
were deeply skeptical of reports that the DPRK is building a secret
reprocessing plant. The officials said that if US intelligence had in
fact concluded that the DPRK is building a new reprocessing plant or
reactor, such a finding would normally be reported to nonproliferation
officials in US agencies who handle reports tracking clandestine foreign
nuclear programs. However, nuclear intelligence handlers in at least
three key US agencies were not apprised of such a development in the
DPRK. One US official described as routinely informed of such data was
quoted as saying, "We read about it in the papers and are just as puzzled
as you." One senior US nonproliferation official said that, as routine
intelligence data shows that the DPRK is ''building thousands of tunnels
all over the country at any one time, for all kinds of projects, it is
possible that somebody in Washington is spin-doctoring information about
this kind of activity to project it as a serious nuclear threat.'' In
Europe, diplomatic sources said that governments of the European Union
(EU) were likewise never briefed by the US government on the intelligence
findings. The sources said that, since the New York Times report said
that the US had already briefed the ROK, European governments would
request a clarification from the US Department of State. One source said
that European governments "would be very dismayed" if it turned out they
had not been informed, given the EU's involvement in the Korean Peninsula
Energy Development Organization (KEDO). However, European officials said
they were less inclined to blame the State Department for not informing
them, and more inclined to suspect that the claim was leaked to undermine
the Clinton Administration's efforts to raise funds in the US Congress to
pay for KEDO. An International Atomic Energy Agency (IAEA) spokesman
said August 18 that the agency would try to visit the underground site if
a member state of the Nuclear Nonproliferation Treaty (NPT) were to
submit an official request for a "special inspection," but diplomatic
sources considered that unlikely. The sources pointed out that, without
hard information to positively identify the construction site as a
nuclear project, the DPRK would be on solid ground to reject any special
inspection request. IAEA spokesman Hans-Friedrich Meyer said on August
18 that the IAEA first heard of the alleged nuclear construction in the
New York Times report.
The Chicago Tribune (Michael A. Lev, "N. KOREA'S INTENT HARD TO
DECIPHER," Tokyo, 07/18/98) reported that US analysts are divided on the
intent behind the DPRK's apparent underground construction project.
Scott Snyder of the US Institute of Peace stated, "We've always known the
North Koreans are good at tunneling. Even now that we have found out
about this new site, it raises the question: Is this all there is, or is
there more?" He added, "The only way to resolve this is to engage
completely in the type of weapons inspection process going on in Iraq.
That involves, in all likelihood, defeat in a war before you can get a
country to acquiesce to that sort of intrusion." Some analysts said that
if the DPRK is beginning construction on a new secret nuclear facility,
it could mean that the military is serious about reviving its nuclear
weapons program, or it could be a ploy to induce new negotiations for
further aid. Joel Wit at the Henry L. Stimson Center said that the DPRK
may be reacting to delays in the construction of two light-water nuclear
reactors. He stated, "From the North Korean perspective, this could all
look like the West is playing for time until North Korea collapses or is
so weak that they have to do whatever the West wants."
2. DPRK Economic Outlook
The Economist Intelligence Unit carried an analytical article ("NORTH
KOREA: COUNTRY UPDATE," 08/17/98) which said that the prospects that at
least some of the DPRK's economic problems will begin to be addressed in
the short-term look good due to the ROK's new "sunshine policy."
However, for the longer term, the outlook remains extremely bleak. The
article said that the most immediate effect of the Asian financial crisis
on the DPRK is the failure of the Peregrine-Daesong Development Bank,
which had been involved in one of the DPRK's two banking joint ventures
with western partners. New owners are being sought for Peregrine. The
other major DPRK investor hurt by the crisis is Loxley of Thailand, which
has telecommunications interests in the Rajin-Sonbong free trade zone.
The article also cited reports that one of the DPRK's few businessmen,
Kim Jong-u, may have been purged. On the other hand, it pointed to signs
that the DPRK is beginning to embark on de facto economic reform, a
process that will be aided by the ROK government's open approach to the
DPRK. The article stated, "Seoul's new policy has the potential to
transform inter-Korean relations into something resembling those that
have prevailed for the past decade between China and Taiwan. Political
enmity and security risks will remain, but henceforth these will be
delinked from business and civilian contacts." However, it added that
the effect of this policy will be dependent on how many ROK companies
choose to invest and how the DPRK responds. The article also pointed to
the designation of two new free zones in the ports of Nampo and Wonsan as
"the thin end of a wedge" for the opening of the DPRK. It argued, "With
the official economy all but moribund, osmosis from such capitalist
enclaves can hardly fail to affect the wider body politic." It
concluded, "Once South Korean visitors bringing aid and investment become
a familiar sight in the north, it will be hard to convince North Koreans
that southerners are either ogres or impoverished.... The question is
whether the boost to their own prospects thanks to southern funds will
make northerners grateful and quiescent; or whether the dawning of the
real truth--that the sufferings they have endured were man-made and
unnecessary--will bring an outpouring of anger."
3. DPRK People's Assembly Meeting
Reuters ("N.KOREA PARLIAMENT TO MEET NEXT MONTH," Tokyo, 08/20/98)
reported that the DPRK's official Korean Central News Agency announced on
Thursday that the Supreme People's Assembly would convene on September 5
for the first time in four years. The assembly last met in April 1994,
three months before the death of Kim Il-sung. Radio Press, a Japanese
news agency that monitors DPRK broadcasts, said that while no agenda was
announced for the session, it was believed that the Assembly would elect
the state president and the prime minister and approve the budget.
4. ROK Labor Unrest
The Associated Press (Y.J. Ahn, "TALKS CONTINUE ON HYUNDAI STRIKE,"
Ulsan, 08/20/98) reported that ROK government mediators reported some
progress Thursday in negotiations to end a month-long strike at Hyundai
Motor Co. Representative Cho Sung-joon, a member of the government
mediation team, stated, "We are making progress piece by piece. But it's
too early to say we have an agreement in our hands." He added, "This is
the first showcase test on how South Korea will keep its promise to allow
layoffs." Similarly, the Korea Times argued in an editorial, "Potential
investors in Korea will decide their course of action based on the
development and outcome of the Hyundai labor row." Kim Kwang-shik, head
of the Hyundai union, said, "It's rough sailing, but the talks have not
broken down yet." Meanwhile, chief presidential spokesman Park Ji-won
said Thursday that "a minimum level of layoffs" at Hyundai is inevitable.
5. Japanese Theater Missile Defense
The Associated Press ("JAPAN'S MISSILE PLAN ON HOLD BEFORE JIANG'S VISIT
- REPORT," Tokyo, 08/20/98) reported that the Asahi daily said Thursday
that the Japanese Defense Agency will not make a budget request for a
proposed theater missile defense (TMD) program until after PRC President
Jiang Zemin completes his upcoming visit to Japan. The report quoted
unidentified government sources as saying that the agency will not
solicit the funds for fear of harming bilateral ties in advance of the
visit. A Defense Agency spokesman refused comment on the report. The
report said that the Defense Agency has earmarked a total of Y557 million
for basic research on the project from fiscal 1995 through 1998 and was
planning to request about Y1 billion as additional research spending for
next fiscal year beginning April 1, 1999. The agency will instead
request a budget for the research at the end of the year before the
government starts compiling its state budget for the next fiscal year.
6. Fissile Material Cutoff Treaty
The Associated Press ("CANADIAN APPOINTED TO CHAIR TALKS ON NUCLEAR-
WEAPON MATERIAL," Geneva, 08/20/98) reported that the Conference on
Disarmament on Thursday appointed Canadian Ambassador Mark Moher to chair
the committee discussing the proposed fissile materials cutoff treaty.
Talks are expected to progress slowly, with conference members divided on
whether they should only aim to ban future production of nuclear-weapons
material or also address existing stockpiles.
1. DPRK Human Rights
Following a meeting in Geneva Thursday, the UN Human Rights sub-committee
issued a resolution regarding human rights issues in the DPRK, urging the
DPRK to take drastic steps to improve its population's situation.
According to the ROK Ministry of Foreign Affairs and Trade (MOFAT), the
resolution was submitted to the sub-committee last Friday and was
approved by a vote of 19 for, 4 against, and 1 abstention. The
resolutions call for the DPRK to allow free entry and exit of its people,
cooperate with UN human rights protection agencies, and to disseminate
the UN human rights reports within the country. Further resolutions call
on outside agencies to support the DPRK more effectively to deal with its
famine, but also to monitor human rights abuses. A high-ranking official
at the MOFAT commented that the importance of the resolutions is in that
they tie in international agencies' aid activities to human rights. He
added that it also shows that the UN is focusing on human rights in the
DPRK. (Chosun Ilbo, "UN ISSUE RESOLUTION ON DPRK HUMAN RIGHTS."
08/20/98)
2. ROK-DPRK Relations
Radio Pyongyang finally broadcast a response to President Kim Dae-jung's
August 15 address to the nation Thursday, but sidestepped his call for a
consultative dialogue body between the DPRK and the ROK. Instead, the
broadcast criticized Kim's "second nation building policy," calling it an
attempt at diverting the public's attention from him and his policies.
The broadcast said that under the current power holders, the ROK economy
is controlled by the US and Japan and subordinate to them. It blamed the
top executive of the government for dropping the economy into crisis and
the people's lives into misery. (Chosun Ilbo, "DPRK RESPONDS TO
PRESIDENT'S ADDRESS," 08/20/98)
3. Former ROK Official to Visit DPRK
Han Wan-sang, former ROK vice-minister for unification under the Kim
Young-sam government, plans to visit DPRK from August 22 to September 4,
it was announced Thursday. The Ministry for Unification said that Han
was visiting the DPRK in his position as advisor to the civic group South
and North Civilian Exchange Association, accompanied by its chairman, Kim
Seung-kyun. Han and Kim were invited to Pyongyang by the DPRK Social
Science Institute and will discuss ways of formulating cultural and
artistic exchange. Han is currently president of the Korea National Open
University. (Chosun Ilbo, "FORMER VICE MINISTER TO VISIT NK," 08/20/98)
1. US-ROK Military Exercises
People's Daily ("DPRK DENOUNCES JOINT MILITARY EXERCISES," Pyongyang,
08/20/98, A6) reported that a DPRK Foreign Ministry spokesman strongly
condemned the joint military exercises held by the US and ROK on August
18, saying that it was a military repression of the DPRK. The spokesman
said that the military exercises, which began on August 17 and will end
on August 28, involve about 70,000 troops, of which 13,000 are US
servicemen based in the ROK.
2. Four-Party Talks
Jie Fang Daily ("DPRK: FOUR-PARTY TALKS WILL NOT BE RE-STARTED UNTIL
DIFFERENCES ARE ELIMINATED," Pyongyang, 08/14/98, A3) reported that a
DPRK Foreign Ministry spokesman said on August 13 that the key for re-
starting the four-party talks is the elimination of differences between
the DPRK and the US. The spokesman made the remarks when he was asked to
comment on the forthcoming high-level meetings between the DPRK and the
US in New York. The spokesman said that if the basic problems between
the DPRK and the US cannot be resolved, the four-party talks cannot be
expected to achieve any great progress even if they are re-started.
3. ROK-DPRK Relations
Wen Hui Daily ("KIM DAE-JUNG EXPECTS TO SEND ENVOY TO PYONGYANG," Seoul,
08/16/98, A3) reported that ROK President Kim Dae-jung said on August 15
that he expected to send a special envoy to Pyongyang to discuss with the
DPRK the construction of a permanent dialogue institute and the promotion
of the exchanges between the two sides. Kim appealed that the ROK and
DPRK should surmount the consciousness of confrontation and usher in a
new era of the exchanges and cooperation between the ROK and the DPRK on
the basis of maintaining security.
4. ROK Economy
China Daily ("S. KOREAN FIRMS SUFFER LOSSES IN FIRST SIX MONTHS," Seoul,
08/17/98, A6) reported that ROK firms suffered their worst earnings in
the first half of this year, with their balance sheets plunging into the
red for the first time. In the six months to June, 543 firms listed on
the Korea Stock Exchange (KSE) posted combined net losses of 13.67
trillion won (US$10.3 billion). The KSE attributed this to three
factors: plunging domestic demand, soaring financial costs, and high
interest rates. Sales of the 543 firms, however, grew 23.5 per cent
year-on-year to 256.2 trillion won, led by trading arms of the country's
three giant conglomerates, Daewoo, Samsung, and Hyundai, the KSE said.
The trading companies benefited from the won's sharp depreciation against
the dollar, which has raised won-denominated earnings. State-run Pohang
Iron and Steel was still the most lucrative corporation, topping the list
of 333 profitable firms with a net profit rise of 26.5 per cent to 680
billion won. The performance of automakers was weak, the KSE said.
Economists have urged the ROK government to quicken the pace of shake-ups
of troubled firms, especially those affiliated with conglomerates,
warning that the ROK's economic growth potential would be eroded further.
5. ROK Labor Unrest
China Daily ("SK POLICE WITHDRAW FROM PLANT," Ulsan, 08/19/98, A11)
reported that ROK riot police abruptly withdrew from Hyundai Motor's auto
plant on August 18 after they were confronted by striking workers
wielding lead pipes and surrounded by their families. The ranks of
police, backed by tear gas, water cannons, and bulldozers, began
deploying at daybreak at the ROK's largest car factory in the southeast
city of Ulsan. It was not immediately clear why the police withdrew, or
if they would be redeployed. According to ROK media reports, the
government gave the green light to police to evict the workers and their
families on August 18. The work stoppage has crippled Hyundai, along
with its suppliers and contractors. The Ministry of Labor of the ROK
said on August 17 that the unrest at the plant had cost some 1 trillion
won (US$1 billion) in lost production.
China Daily ("HYUNDAI STRIKE DULLS S. KOREA'S LEADING EDGE," Seoul,
08/20/98, A5) reported that the ROK government warned on August 19 that
its shaky auto industry risked losing its international competitiveness
forever if labor disputes at Hyundai Motor Co. are further drawn out.
The alarm was sounded as the country's auto firms, rattled by plummeting
sales and the insolvency of Kia Motors Corp., wage a desperate battle to
keep their heads above water. The ROK's auto production, once the
world's fifth largest, plunged 35.4 per cent on the year to 1.53 million
units in the first seven months of 1998. Auto exports also suffered a
10.1 per cent drop to US$5.45 billion.
6. PRC-Russian Relations
People's Liberation Army Daily ("CHI HAOTIAN MEETS WITH RUSSIAN GUEST,"
Beidaihe, 08/14/98, A1) reported that PRC Defense Minister Chi Haotian
met with General Nikolai Bordyuzha, director of the Russian Federal
Border Service, in the summer coastal resort of Beidaihe on August 13.
Chi expressed delight over the rapid and smooth growth of Sino-Russian
friendship and cooperative relations and noted the importance of
increasing cooperation between border agencies in the two countries. The
PRC hopes that the more than 4,000-kilometer-long border between the PRC
and Russia will become a model of peace, friendship and prosperity, Chi
said. The Russian guest also expressed his satisfaction with the
development of border cooperation between Russia and the PRC. He said
that the situation on the Russian-PRC border was steady and there were no
bad tendencies.
7. PRC-Taiwan Relations
China Daily ("ARATS SENDS PROPOSED ITINERARY TO TAIWAN," 08/20/98, A1)
reported that the Beijing-based Association for Relations Across the
Taiwan Straits (ARATS) and its Taiwan counterpart, the Straits Exchange
Foundation (SEF), are continuing discussions over arrangements for a
Taiwan representative's proposed PRC visit. The PRC suggested options on
August 19 for chief Taiwan negotiator Koo Chen-fu's upcoming itinerary.
Koo's week-long journey could be either from September 15 to 21 or
October 12 to 18, and he could visit Shanghai and Beijing, ARATS
suggested. "If Koo, his wife and SEF members want to visit the cities of
Xi'an and Nanjing, and Fujian Province, they could extend their stay in
the mainland for an appropriate period," ARATS said in a letter sent on
August 19 to SEF. ARATS has proposed that the visiting delegation be
composed of 12 people. When Koo visits the mainland, he and ARATS
President Wang Daohan may "informally exchange views on procedural
arrangements for cross-Straits political negotiation," suggested the PRC
organization's letter. The letter asked the Taiwan group to respond by
mail or let SEF Deputy Secretary-General Jan Jyh-horng visit the mainland
to discuss it.
China Daily ("AMBASSADOR: CHINA SHOULD JOIN WTO FIRST," Washington,
08/15/98, A1) reported that a senior PRC diplomat said on August 13 that
the PRC should be allowed to join the World Trade Organization (WTO)
before Taiwan gains membership. "Only when a sovereign state has become
a member of the WTO can it become possible for part of that state to
apply and become a member of that distinguished World Trade
Organization," PRC Ambassador to the US Li Zhaoxing said in reply to a
question on Taiwan's WTO membership.
8. PRC Floods
China Daily ("MORE DAQING OIL WELLS INUNDATED," Daqing, 08/18/98, A1)
reported that floodwater from the Nenjiang River is roaring towards the
PRC's largest oil field, Daqing, after it breached the second defense
barrier near Zhaoyuan Country in Northeast China's Heilongjiang Province
on the evening of August 17. A 10-meter-long breach was discovered at
the Zhaoyuan barrier on early August 17. The Shenyang Military Area
Command immediately sent 1,000 officers and soldiers to plug it, bringing
the total number of officers and soldiers on the embankment to 20,000.
Some 1,500 soldiers and workers at the Daqing oil field are building a
third defense embankment. The number of inundated wells at Daqing had
risen to 1,391 by 9:30 p.m. on the night of August 17. Another 280 wells
had halted normal production.
9. Japanese Theater Missile Defense
China Daily ("JOINT MISSILE PLAN," Tokyo, 08/17/98, A11) reported that
Japan's Defense Agency had planned its budget for joint development of
the theater missile defense system with the US, and has earmarked some
500 million yen (US$3.4 million) for the project next year. Previously,
the report said, Japan's development of the missile defense system had
been limited to basic research by computer simulation. If approved, the
budget would be a significant increase from the 80 million yen
(US$548,000) spent on the project this year, Kyodo News reported.
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