hankyoreh

Jang Jung Soo, Editorial writer

WASHINGTON D.C.= The February 13 agreement on North Korea's nuclear status has spun its wheels for five months, but now that the issue of North Korea’s suspended funds has been resolved, the parties involved can now proceed with full implementation of the accord. It now looks like a series of previously-agreed upon actions will go forward as planned, including: the closing of the reactor at Yongbyon, the resumption of the six-party talks, the distribution of heavy oil to Pyongyang and the opening of a series of issue-specific, working-level talks.

It was U.S. President George W. Bush's decision to permit the New York Federal Reserve to transfer the money that made this breakthrough possible. His choice to act has surpassed a barrier and proved decisive in determining whether the February 13 agreement would be resuscitated or not. Had Bush not become involved, the agreement might have failed before reaching the first hurdle.

North Korea’s demand that the money be transferred through an American bank appeared to be impossible at the outset due to the restrictions of the U.S. Patriot Act, Section 311 of which prohibits all financial institutions in the U.S. from handling illegal funds. Bush, too, appeared to be unwilling to compromise any further. Following his meeting with Japanese prime minister Shinzo Abe in May, Bush threatened that America’s patience ‘‘is not unlimited.’’

U.S. government hard-liners, led by vice president Dick Cheney, took the lead on North Korean policy, and the U.S. Treasury Department's Office of Terrorist Financing were at the vanguard of this movement. The State Department, which had assumed leadership within the U.S. government during the February 13 agreement, found itself on the sidelines. It was because of this that follow-up negotiations on the agreement went nowhere.

However, Bush has sided with the State Department. He found the perfect card to play, too, the New York Federal Reserve - to which Section 311 does not apply. It was a victory for those who are realists about North Korea. Bush appears to have been worried about the political cost he would have to pay, both domestically and internationally, if he sent the whole North Korean nuclear issue back to square one.

What is notable about his decision is that he has made it clear that he has no intention of going back, or acting as if there had never been any negotiations, despite American conservatives’ criticism of the agreement. The fact that top U.S. negotiator Christopher Hill was permitted to go to North Korea is an extension of this. Some Korean affairs experts in Washington predict that, having found himself in a situation where there are few other choices, Bush will have to pursue an American-style Sunshine policy that accomplishes the denuclearization of the Korean peninsula through dialogue and negotiation with North Korea and the improving of relations. The policy will inevitably, however, come with certain limitations since it is not likely to assume the wholesale doing away with what North Korea calls hostile U.S. policy.

Meanwhile, just because the issue of North Korea’s suspended funds has been resolved does not mean that North Korea is going to be able to freely approach international financial institutions. The banks of the world are going to be watching the U.S. Treasury Department and will make decisions about future financial transactions with North Korea based upon their actions.

Nevertheless, Christopher Hill and those in favor of the negotiations have a stronger position now that Bush has turned back to a more practical approach. It is not entirely impossible that there could be landmark improvements in relations between Washington and Pyongyang in the future, depending on how North Korea now responds. At the same time, it is highly likely that there will be rapid progress in discussions about how best to achieve peace on the peninsula because South Korea, China and, of course the U.S., all share an interest in fully pressuring Pyongyang to abolish its nuclear ambitions through the establishment of a peaceful regime. However, it seems unlikely that Pyongyang would actively get involved in any such discussions without there first being a normalization of ties between it and the U.S., making a fundamental improvement in relations between Washington and Pyongyang all the more essential to achieving a permanent peace on the Korean peninsula.