hankyoreh

As the matter regarding the transfer of North Korean funds tied up at Macao's Banco Delta Asia (BDA) has been settled, with Russia agreeing to help in the transfer, South Korea and the United States reportedly agreed to resume the six-party talks after implementing initial steps of the February 13 agreement. Under the agreement, North Korea should close its Yongbyon nuclear facilities in exchange for 50,000 tons of heavy fuel oil aid.

A high-ranking South Korean government official said on June 15, "Before resuming the six-nation negotiations, Pyongyang will close its nuclear facilities in Yongbyon after discussing with the International Atomic Energy Agency (IAEA), and Seoul will assist with the promised heavy oil. In that case, North Korea will have to confirm that it has received its [Macao money], which will take three or four days,'' added the official.

On February 13, the nations participating in the six-party talks to end North Korea's nuclear program - the two Koreas, Japan, the U.S., China, and Russia - reached an agreement that Pyongyang shut down its key nuclear facilities within 60 days in return for energy aid as the first step. The North's US$25 million, which has been tied up since September 2005 at Macao's BDA after the U.S. Treasury accused the bank of laundering money for the North, was promised by the U.S. to be released as part of the February 13 agreement. But it has failed to be transferred to an account where the North can access it, due to other banks' reluctance to touch money once deemed "illicit." Thus, the North has refused to carry out its side of the February 13 pact.

However, the involved countries' efforts to solve the issue surrounding North's fund seem about to pay off. Macao's authorities confirmed on June 14 that at least $20 million of North Korea's funds at BDA have been transferred out of the bank, en route to a Russian commercial bank via the U.S. Federal Reserve Bank of New York.

During an unofficial briefing on the same day, the South Korean government official said, "If the Yongbyon nuclear facilities are closed, the momentum of the February 13 agreement will regain its strength. At such time, it would be a proper step to resume the six-party talks and operate the working-level groups," which have been set up to help implement the February 13 agreement. "Above all, an IAEA probe team should enter North Korea and then seal related facilities and install cameras to monitor the situation,'' continued the official.

Considering that close consultations have in recent days occurred between South Korea and the U.S., North Korea and the U.S., and the South and the North, the official's comments may indicate that the concerned countries have already come close to agreement regarding how to proceed after the money transfer comes through.

If Pyongyang implements the agreement in a hurry, Seoul reportedly anticipates the six-nation talks will be resumed by the first few weeks of July.

When the February 13 agreement, previously hindered by the BDA problem, enters a stage of implementation, South-North relations will improve again. President Roh Moo-hyun on May 22 ordered that rice aid to North Korea be suspended until North Korea carries out the February 13 agreement. A government official said that if the February 13 agreement begins to be implemented, "North-South relations, which were dampered by the issue of the North's money transfer, could be restored to normal soon."

Seoul usually provides Pyongyang with 400,000 tons of rice annually. But after the North's missile launch and nuclear test in July and October last year, respectively, South Korea has suspended the aid, saying the resumption depends on whether Pyongyang fulfills its obligation to shut down its nuclear facilities down the line.

In response to reports by foreign media that North Korea may suggest additional conditions for its carrying out of the February 13 agreement, a high-ranking South Korean government official said, "North Korea has repeatedly said if the BDA problem is resolved, it will implement the February 13 agreement," in effect denying such claims that the North would make new demands.

It has not been officially confirmed that the funds at BDA have yet been transferred to an account at a Russian bank designated by North Korea, but there is almost no possibility that further unexpected situations will arise, many experts predict.

Please direct questions or comments to [englishhani@hani.co.kr]