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More than US$20 million from North Korean accounts frozen in a Macau bank has been transferred out, raising hopes for a breakthrough in the North's stalled denuclearization procedures, media reports said Thursday.

The communist North has been refusing to honor a Feb. 13 international agreement to dismantle its nuclear weapons programs unless its US$25 million at Macau's Banco Delta Asia is released.

"According to government information, Banco Delta Asia transferred more than US$20 million out of the bank this afternoon in accordance with the client's instruction," Francis Tam, Macau's secretary of economy and finance, told reporters, according to the Associated Press.

He didn't elaborate on where the money was transferred, but it is likely that it was wired to the United States before being moved elsewhere.

According to South Korean and U.S. reports, the money was expected to be wired to the New York branch of the U.S. Federal Reserve first, then to the Russian Central Bank, and finally to a North Korean account in a Russian bank for deposit.

"We have heard reports in the foreign media that the money can be wired via the U.S. or Russia, for example. I think these routings are possible," Tam said. "Most of the money in this account has already been transferred out. There will probably not be another transfer."

Japan's Kyodo News carried a similar report in its Macau-datelined story, but said that the remaining $5 million is expected to be transferred later.

The U.S. had earlier frozen the money, accusing the bank of money-laundering for North Korea. Considering the sanctions a hostile U.S. policy against it, the communist North boycotted nuclear talks for more than a year, and performed its first-ever nuclear test during that time.

The transfer, however, had never been made amid difficulties in finding a financial institution willing to conduct it. This problem caused the North to miss an April 14 deadline to shut down its sole nuclear plant in Yongbyon, a key agreed-upon initial disarmament measure.

According to press reports, Pyongyang had wanted to get the money back through a U.S. institution, believing that action would enable it to have continued access to the international financial system, even though the North could have withdrawn the money in cash and shipped it home. Several foreign banks were also asked to help process the transfer, but they were reluctant to do so as they worried that handling the funds, once labeled illicit, would tarnish their images and cause them to be cut off from the U.S. financial system, the reports said.


SEOUL, June 14 (Yonhap News)