Korean Peninsula Today, 03 - 06 July 2009

US Officials Meet With China on NKorea Sanctions (AFP Hong Kong)

BEIJING – A US delegation met on Thursday with Chinese officials for talks on implementing UN sanctions imposed on North Korea in retaliation for its nuclear test in May, officials said.

Delegation head Philip Goldberg -- the State Department's point man on coordinating implementation of the sanctions -- told reporters he had "very good discussions" in Beijing during the day.

"Our objective is the full implementation of the UN resolutions on North Korea," he said.

"We intend to implement these resolutions with the overall goal of returning to a path of denuclearisation and non-proliferation on the Korean peninsula."

US embassy spokesman Richard Buangan said earlier that Goldberg met with officials from China's foreign ministry.

"Mr Goldberg is leading an inter-agency delegation including the National Security Council and the departments of Treasury and Defence," he told AFP.

"The purpose of his trip is to consult with our partners in the region on implementation of UN Security Council resolution 1874."

The resolution, adopted in response to North Korea's May 25 nuclear test, calls for beefed up inspections of air, sea and land shipments going to and from North Korea, and an expanded arms embargo.

China, which supported the resolution, has been criticised by the United States in the past for lacking enthusiasm for implementing UN sanctions against North Korea, its neighbour and ally.

Goldberg declined to comment on China's commitment towards implementing the UN sanctions.

"I will leave the Chinese position to the Chinese. The US position is that we want all the various aspects of the resolutions to work. It is our intention to fully implement the resolutions," he said.

Goldberg, who holds an ambassador rank, also was tentatively scheduled to hold further talks with Chinese officials on Friday, Buangan said.

While Goldberg was engaged in the talks in Beijing, North Korea fired two short-range missiles from a base near the eastern port of Wonsan, South Korea's defence ministry said.

Goldberg told reporters he had no details on the launch.

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White House claims N. Korea sanctions are working (The Hill)

Even as the North Koreans tested four more missiles this week, the White House said Thursday that tough new United Nations sanctions are showing signs of working.

White House press secretary Robert Gibbs declined to say what evidence the administration has that the most recent round of sanctions was effectively tightening the noose on North Korea, and he warned that it will likely continue with provocative behavior.

"I think it is clear the sanctions are having an impact," Gibbs said.

When asked what the U.S. was doing in response to the most recent round of threats and missile tests from the country, Gibbs said "first and foremost, the administration is working to ensure the vigorous implementation of those sanctions."

"We continue to watch the North Koreans," Gibbs said. "They continue to do and say what they do and say."

The Thursday test-firing of four short-range, surface-to-ship missiles came two days after a North Korean vessel, believed to be carrying weapons or weapons materials in defiance of the sanctions and being followed closely by the USS John S. McCain, turned around and headed back to North Korea.

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Report: Kim Jong Il Recuperating From Stroke in Villa (Associated Press)

SEOUL, South Korea — North Korean leader Kim Jong Il has been living at an east coast villa since mid-May and is likely convalescing after reportedly suffering a stroke last year, a newspaper said Sunday citing U.S. and South Korean intelligence.

Kim's health has been the focus of keen attention since Western intelligence officials said he suffered a stroke in August before publicly naming his successor. South Korean officials say he has recovered, yet the 67-year-old looked gaunt when he appeared at the country's rubber-stamp parliament in April.

The U.S. informed Seoul that Kim had been staying at the villa in Wonsan since mid-May, the JoongAng Ilbo Sunday newspaper said, quoting an unidentified official privy to North Korean affairs. The report said U.S. military satellites, which closely monitor Kim's personal vehicles, had detected his movement.

The official said it was "certain" that Kim was not in Pyongyang and that South Korean intelligence authorities believed Kim had stayed at Wonsan for a long time.

Wonsan is also close to a launch facility from where South Korea said the North test-fired seven ballistic missiles on Saturday, defying U.N. resolutions.

The paper quoted two other unidentified officials as saying Kim was likely convalescing at the Wonsan villa.

JoongAng Ilbo said Kim may have left his youngest son, Kim Jong Un, in charge in Pyongyang, allowing him to experience running state affairs on his own.

South Korea's spy agency told lawmakers last month that Pyongyang had notified its diplomatic missions and government agencies overseas that 26-year-old son Kim Jong Un was in line to succeed his father.

But South Korean Defense Minister Lee Sang-hee said last week that intelligence suggested a final decision on succession had yet to be made.

South Korea's Unification Ministry, which handles relations with North Korea, and the National Intelligence Service said they could not confirm the JoongAng Ilbo report. Calls to the U.S. military were not answered Sunday.

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N. Korean leader makes record public appearances (Yonhap)

SEOUL – North Korean leader Kim Jong-il made a record number of public appearances in the first half of 2009 compared to previous years and increased inspections of economic sites, a tally of North Korean media reports showed Thursday.

The number of Kim's public outings, as reported by the North's news outlets, totaled 77 during the period, up from 49 last year.

The figure marks a significant increase since 1995, after Kim Il-sung, Kim's father and North Korea's founder, died in 1994. He made 15 public appearances during the first six months of that year. The previous record was 60 appearances in 2002.

North Korea usually does not give the date of Kim's on-site inspections, apparently for security reasons.

The North's official news agency, television stations and other media reported 31 inspections of economic sites and activities, including visits to factories and farms, which accounted for some 40 percent of all of Kim's public appearances.

Military unit inspections and attending of arts and cultural exhibitions accounted for 28.5 percent of his reported visits. In the past, Kim's visits to military units accounted for 60 to 70 percent of his public appearances.

By traveling nationwide so often, Kim, 67, who reportedly had a stroke in August last year, is largely seen as trying to demonstrate he is still in full charge of the country, Seoul Unification Ministry spokesman Chun Hae-sung said earlier this week.

Recent photos showed Kim wearing sneakers when walking on uneven surfaces and flat dress shoes at farms and factories, instead of his signature platform shoes.

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No Food for N.Korea without Monitoring, Says U.S. (Chosun Ilbo)

The U.S. will not resume food aid to North Korea unless there is a guarantee that the food will be distributed properly among North Koreans who need it. U.S. State Department spokesman Ian Kelly told reporters Wednesday, "We currently have no plans to provide additional food to North Korea. Any additional food aid would have to have assurances that it would be appropriately used."

"We remain very concerned about the well-being of the North Korean people, but we are very concerned because we need to have adequate program management in place, monitoring and access provisions, and we don't have that right now," he added.

Kelly said North Korea rejected U.S. food aid in March, expressing regret that Pyongyang threw out all NGO food monitors by the end of March.

Meanwhile, the World Food Programme said there has been no single donation for the food aid program for the North since its nuclear test in May, and the program has been downsized to one-third of the original plan.

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U.S. Says N.Korea Rejects Further Food Aid (Voice of America)

In the latest of a series of moves toward apparent self-isolation, North Korea has informed the United States that it no longer wants American food assistance. U.S. officials are expressing disappointment over the move because of continuing food shortages in that country.

Despite the lack of diplomatic relations with the communist state, the United States has been the largest single donor of food aid to North Korea since the country's famine in the mid-1990s.

The aid program was severed in 2005, but it resumed again by mutual agreement last year amid United Nations forecasts of increased hunger in North Korea.

At a news briefing, State Department Acting Spokesman Robert Wood said North Korea informed the United States of its latest decision in a terse statement through diplomatic channels within the past few days. Wood said the United States is obviously disappointed over the action because of its impending impact on needy North Koreans. "Clearly this is food assistance that the North Korean people need. That is why we are concerned. This humanitarian assistance that we provide to the North has nothing to do with the six-party talks. This is about our true humanitarian concern for these people. And as you know, the food situation in North Korea is not a good one, and so we are very concerned about it," said Wood.

The U.N. World Food Program said late last year that despite a better-than-expected 2008 harvest, North Korea would need major outside food assistance this year and that nearly nine million people there were in serious need. Wood said the United States has delivered nearly 170,000 metric tons of food since the aid arrangement was renewed last May, with the most recent shipment of 5,000 tons of cooking oil and corn/soy blended flour arriving in late January.

The two countries have had disputes over U.S. demands for Korean-speaking international monitors in North Korea to assure that American food actually gets to those in need, but the spokesman would not speculate as to why Pyongyang is ending the program.

North Korea has recently severed links and cooperation accords with South Korea, and taken other steps seen here as belligerent, including announced plans for a satellite launch next month that U.S. officials see as a disguised long-range ballistic-missile test.

The Chinese-sponsored six-party talks on North Korea's nuclear program have been stalled for several months over Pyongyang's refusal to accept a verification regime for the declaration of its nuclear activities it made last June.

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SKorea Says NKorean Missiles Can Hit Key Targets (Associated Press)

South Korea says North Korean missiles could hit key government, military targets in South

The ballistic missiles that North Korea test-fired this weekend were likely capable of striking key government and military facilities in South Korea, a defense official said Sunday, amid growing concerns over Pyongyang's firepower.

North Korean state media did not mention the launches but boasted that the country's military could impose "merciless punishment" on those who provoke it.

Pyongyang launched seven missiles into waters off its east coast Saturday in a show of force that defied U.N. resolutions and drew international condemnation and concern.

The missiles appear to have traveled about 250 miles (400 kilometers), meaning they could have reached almost any point in South Korea, an official at the South Korean Defense Ministry said on condition of anonymity, citing department policy.

The official said the exact details of the launches were still under investigation.

North and South Korea, which fought a 1950-53 war, still face off across the world's most heavily fortified border. The United States, South Korea's key ally, has 28,500 troops stationed in the country as a deterrent.

The North's main Rodong Sinmun newspaper said in a commentary that "our revolutionary forces have grown up today as the strong army that can impose merciless punishment against those who offend us," crediting the country's "military first" policy.

The commentary was carried Sunday by the official Korean Central News Agency.

Last month, the North threatened a "thousand-fold" military retaliation against the U.S. and its allies if provoked.

North Korean leader Kim Jong Il has been devoting much of the country's scarce resources to his 1.2 million-member military under the policy.

South Korea's Yonhap news agency — citing a South Korean government source it did not identify — reported that five of the seven ballistic missiles landed in one area, indicating their accuracy has improved.

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N. Korea Using Malaysian Bank To Deal Weapons With Myanmar (Yonhap)

SEOUL -- North Korea sought payment through a bank in Malaysia for its suspected shipment of weapons to Myanmar [Burma] that is being carried on a freighter tracked by the U.S. Navy, a source said Saturday [4 July].

The visit by a U.S. envoy to Malaysia this weekend will focus on ways to cut off the payment transaction for the cargo from the bank in Malaysia to North Korean leader Kim Jong Il, the source said.

"Kim will have a hard time collecting his money," the high-level source said, speaking strictly on condition of anonymity. The source declined to identify the bank due to diplomatic concerns.

Philip Goldberg, the U.S. coordinator for the implementation of a U.N. Security Council resolution that punishes North Korea for its May 25 nuclear test, is scheduled to arrive in Malaysia on Sunday.

The visit comes after the White House said late last month that U.S. President Barack Obama discussed North Korea and financial regulations with Malaysia's Prime Minister Najib Razakon by phone.

It also comes as North Korea's Kang Nam [Kang Nam 1] freighter is apparently returning home after being tracked by a U.S. Navy destroyer that suspects it is carrying cargo banned under the resolution.

Resolution 1874, which reinforced sanctions that were imposed after North Korea conducted its first nuclear test in 2006, bans Pyongyang from exporting any type of weapons -- light or heavy.

According to another source in Seoul, the Kang Nam is believed to be carrying small Soviet-era arms such as AK-47 rifles and RPG-7 anti-tank launchers.

AK-47s and RPG-7s are two of the most widely traded Soviet-era weapon types that North Korea is capable of producing on its own.

"Kim appears to have received earnest money for the shipment, but it is a small sum compared to the payment held up in Malaysia," the source said.

Resolution 1874 bans states from making financial transactions with North Korea that could help the communist state build its nuclear and ballistic missile programs.

The U.S. slapped financial sanctions on a Macau bank in 2005 to freeze US$25 million worth of North Korean assets, effectively cutting off Pyongyang's access to the international financial system.

Banco Delta Asia was also accused of helping North Korea launder money it had acquired by circulating sophisticated counterfeit US$100 bills called "supernotes."

Goldberg visited China ahead of his visit Malaysia.

Despite the resolution banning development of weapons of mass destruction, North Korea test-fired a series of missiles Thursday and Saturday into the East Sea, where it had imposed a June 25-July 10 maritime ban for a military exercise.

North Korea test-fired a barrage of short-range missiles in the days following its latest underground nuclear explosion.

The U.S. believes there are "multiple" North Korean ships used to export weapons.

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Scrutinized N. Korean Freighter Likely Carrying Rifles, Launchers (Yonhap)

SEOUL -- The North Korean freighter that changed course after being tracked by the U.S. Navy appears to be carrying conventional small arms, including Soviet-era rifles and anti-tank launchers, a source said Saturday [4 July].

"Most of its consignments are believed to be small-scale military supplies such as AK-47 rifles and RPG-7 anti-tank rocket launchers," the source said, speaking on condition of anonymity because the information has to do with intelligence.

AK-47s and RPG-7s are two of the most widely-traded Soviet-era weapon types that North Korea is capable of producing on its own, the source said.

The Kang Nam [Kang Nam 1] freighter, which had been approaching Myanmar, reversed course after being trailed by a U.S. destroyer operating under the mandate of a U.N. Security Council resolution punishing Pyongyang for its May 25 nuclear test.

The resolution bans North Korea from exporting all types of weaponry while calling U.N. member states to inspect North Korean vessels suspected of carrying banned cargo in their seas.

"The U.S. has pressured Myanmar" into backing away from its cooperation with North Korea concerning the Kang Nam, the source said, adding it is likely that the North Korean ship is returning home.

"The sanctions are starting to take a toll on the North Korean leader Kim Jong Il," the source said.

The source added no other North Korean ships are traveling the seas carrying cargo banned under the resolution, which toughened sanctions that had been imposed after North Korea conducted its first nuclear test in 2006.

"The U.S. has a list of such ships," most of which are lighter than 1,000 tons, the source said. "But no other North Korean ship is currently being trailed by the U.S. Navy."

On June 24, Pentagon spokesman Geoff Morrell said the U.S. is "interested in, frankly, multiple ships," suggesting other North Korean ships were under scrutiny.

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N.Korean ship sails home after being tracked by US: report (AFP)

SEOUL – A North Korean ship was seen sailing in international waters off South Korea's west coast Sunday after being tracked by the US Navy on suspicion of carrying weapons, a report said.

The South Korean military was on watch as the Kang Nam 1 headed back to its home port in the Yellow Sea, Yonhap news agency said. South Korean officials declined to comment.

Yonhap quoted an unnamed government official as saying the ship is expected to reach North Korean waters Monday morning.

The vessel, which left home on June 17, was originally reported to be bound for Myanmar but it changed course after being followed by the US Navy on suspicion of carrying weapons.

It was the first North Korean ship to be tracked under new UN sanctions imposed on the hardline communist country following its nuclear test in May.

Under the measures UN member states are expected to inspect ships they believe may be carrying banned weapons shipments to or from the North.

Pyongyang has responded defiantly to the UN move, vowing to build more nuclear bombs and to hit back against any attempt to search its vessels.

South Korea's chief nuclear negotiator Wi Sung-lac and his Japanese counterpart, Akitaka Saiki, will meet in Seoul Monday for talks on how to implement UN sanctions, Yonhap said.

China's chief nuclear envoy, Wu Dawei, is scheduled to visit Seoul on July 12-14.

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N. Korea fires seven ballistic missiles in violation of U.N. resolutions (Yonhap)

SEOUL -- North Korea test-launched seven ballistic missiles off its eastern coast on Saturday, South Korea said, in the latest provocation by the communist nation locked in a protracted stand-off with the U.S. and other global powers over its nuclear and missile programs.

The firing of the seventh missile that appears to be a scud type took place on the east coast at around 5:40 p.m. [0840 GMT], the Joint Chiefs of Staff in Seoul said.

"It appears to be similar to the previous six missiles fired into the East Sea earlier in the day," a JCS official said, speaking on customary condition of anonymity.

North Korea fired two missiles toward the East Sea [Sea of Japan] from the Gitdaeryong base near Wonsan, Gangwon Province, between 8:00 a.m. and 8:30 a.m. [2300-2330 GMT], according to the JCS.

It fired another one into the East Sea around 10:45 a.m., and three more at around noon, at 2:50 p.m. and at 4:10 p.m., respectively.

"All the missiles are estimated to have a range of 400-500km," another JCS official said, declining to be named and adding the military is analyzing the exact missile models.

Soth Korean officials did not rule out the possibility that what the North fired might have actually been Rodong missiles -- modifications of Scuds -- saying their flight distances may have been shortened deliberately.

Rodong-type missiles have an estimated range of 1,000-1,500km and are able to reach many parts of Japan.

The North is believed to have up to 1,000 ballistic missiles alone -- including nearly 700 Scud missiles of various types and 320 Rodong [No Dong] missiles.

Earlier this week, the North fired a salvo of four KN-01 surface-to-ship missiles from the Sinsang-ni base, South Hamgyong Province, into the East Sea, adding to tensions already running high after the North's launch of a long-range rocket in April and its second nuclear test the following month.

Officials here noted the timing of the latest missile launch, which came on the eve of U.S. Independence Day.

"The missiles fired on July 2 were analyzed to be part of military drills, but today's missiles seem to have political purposes in that they were fired a day ahead of the U.S. Independence Day," a government official said.

North Korea test-fired a long-range Taepodong-2 missile, along with several short-and mid-range missiles, on U.S. Independence Day in 2006 and detonated another nuclear bomb this year on May 25 during the U.S. Memorial Day holiday, acts that North Korea watchers said were intended to draw more attention from Washington.

South Korea's foreign ministry lashed out at the reclusive neighbor's ballistic missile launch, calling it a clear violation of U.N. Security Council resolutions that ban the communist nation from any activity related to a ballistic missile program.

"It is a provocative act that clearly violates U.N. Security Council resolutions 1695, 1718, and 1874 that bar North Korea's every activity related to ballistic missiles," the ministry said in a statement.

"The government expresses deep regret over North Korea's continued acts to escalate tensions in Northeast Asia in ignorance of the U.N. Security Council resolutions and urges North Korea to faithfully implement the resolutions," it added.

The authorities said, however, there is no sign of an imminent launch of an intercontinental ballistic missile (ICBM) from either its eastern Musudan-ri base or the new Tongchang-ri base on its west coast.

In April, North Korea threatened to test-fire an ICBM in protest of the U.N. Security Council's condemnation of its long-range rocket launch, which it claimed to be aimed at sending a communications satellite into space.

Citing satellite photos, U.S. military officials said the North has not mounted an ICBM on a launch pad or injected fuel yet, a process that takes at least a week.

A British diplomat in Pyongyang also said the North is unlikely to fire an ICBM anytime soon.

"We have se en no evidence as yet to state that there will be a launch in the next couple of days of an ICBM," Peter Hughes, the British ambassador to North Korea, said in a news conference with reporters in London via video link from Pyongyang.

He pointed out, however, that "the thing about North Korea is its unpredictability. You cannot say it will never do something."

Japan also condemned the North's missile launch.

It is "a serious act of provocation against the security of neighboring countries, including Japan," Japanese Chief Cabinet Secretary Takeo Kawamura said in a statement.

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Dprk's New Missile Launch Raises International Concerns (Xinhua)

HONG KONG -- The Democratic People's Republic of Korea (DPRK) fired a total of seven ballistic missiles on Saturday, raising international concerns over regional security.

According to South Korean Joint Forces, the seven missiles, estimated to have a range of 400-500 km, were fired off the east coast from a base near Wonsan, Gangwon Province.

The missile firing came two days after the DPRK test-fired four short-ranges off its eastern coast, which South Korean officials described as part of routine military drills.

"Although the missiles fired on Thursday appear to be part of routine military drills, the recent scud missiles seem to have political purposes as they were fired a day before the U.S. Independence Day," an unnamed South Korean official was quoted by Yonhap as saying.

Shortly after the DPRK's missile launch on Saturday, South Korea's foreign ministry expressed deep regrets over the DPRK continuing to attempt actions that elevate tensions in northeast Asia.

The ministry called the launch a "provocative action" which violates UN Security Council Resolutions 1695, 1718, and 1874, which banned the DPRK from any activity related to ballistic missiles.

The UNSC resolutions were reached when the DPRK conducted its nuclear tests, first in 2006 and the latest in May this year.

"The government will closely cooperate with other related countries to deal with the latest missile firing," South Korea's foreign ministry said in a statement and urged the DPRK to faithfully implement the resolutions.

The Japanese government lodged a protest against the DPRK through diplomatic channels in Beijing over its launching of multiple ballistic missiles into the Sea of Japan on Saturday, according to a report by Kyodo News.

Japanese Chief Cabinet Secretary Takeo Kawamura said in a statement, "It is a serious act of provocation against the security of neighboring countries, including Japan, and is against the resolution of the U.N. Security Council."

Kyodo said Prime Minister Taro Aso is expected to urge fellow leaders at Group of Eight Summit in Italy to continue coordination in dealing with DPRK's nuclear and missile development issues.

When discussing the nuclear issue on the Korean Peninsula in Moscow on Saturday, Chinese Vice Foreign Minister Wu Dawei and Russian Deputy Foreign Minister Alexei Borodavkin agreed that the situation in Northeast Asia had become a major concern as escalating tensions there could trigger a new arms race, threatening regional security.

They said all parties concerned should remain calm and refrain from taking any actions that might further aggravate the situation. The two countries called for a return to six-party talks.

The United States also called for the DPRK not to "aggravate tensions" hours after the latter fired another seven missiles on Saturday.

"North Korea (DPRK) should refrain from actions that aggravate tensions and focus on denuclearization talks and the implementation of its commitments from the September 19, 2005 joint statement," State Department spokesman Karl Duckworth said.

The DPRK, since May, has been spotted with actions in preparation for firing a new mid-range missile, as well as scud missiles, Yonhap said.

South Korea's military authorities, however, said no sign has been observed from either DPRK's eastern Musudan-ri base or the new western Tongchang-ri base, and then concluded that an intercontinental ballistic missile launch was imminent.

In April, the DPRK threatened to test-fire an intercontinental ballistic missile in protest of the UN Security Council's presidential statement which "condemned" the DPRK's earlier long- range rocket launch.

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Koreas Fail to Make Progress in Talks Over Joint Park, No Date Set For Next Round (Yonhap)

SEOUL – South and North Korea failed to make progress in their third round of talks on Thursday, Seoul officials said, with their positions wide apart over a joint industrial park and the fate of a detained worker.

Pyongyang insisted on hefty rent hikes and refused to discuss the South Korean worker, a demand that analysts say is aimed at pressuring Seoul's conservative government to shifting course.

"The North showed no change at all in its attitude, insisting that rent should be addressed foremost," Kim Young-tak, South Korea's chief delegate, said in a press briefing after returning from the joint park in the North's border town of Kaesong.

The talks were held as inter-Korean relations remained at their lowest point in a decade after Seoul conditioned its aid to Pyongyang on North Korea's denuclearization.

The third round of inter-Korean talks ended in an hour and 10 minutes in the morning, and North Korea refused to meet again in the afternoon, Unification Ministry officials said. No date was set for the next round.

In a 20-minute speech, North Korea's chief delegate Pak Chol-su renewed criticism of the Lee Myung-bak [Yi Myo'ng-pak] government and reiterated that North Korea can no longer grant South Korean firms "special favors" such as low wages and rent at the joint park, Seoul officials said.

North Korea insisted that monthly wages for local employees be raised four-fold to US$300. It also sought $500 million for a 50-year lease on the park, ditching the $16 million rent deal signed when the park opened in 2004.

"Our side made it clear that the rent hike is a baseless demand and should be withdrawn," Kim said.

In a 50-minute subsequent speech, Kim demanded to know the health condition of the detained worker, identified only by his family name Yu, and pressed for his release. The Hyundai Asan Corp. engineer who works at the joint park has been held incommunicado since March on accusations of "slandering" the North's political system and trying to persuade a North Korean female employee to defect to the South.

"North Korea showed no response to this point," Kim said.

In a separate move, South Korean Foreign Minister Yu Myung-hwan said he will raise Yu's case at the ASEAN Regional Forum in Thailand later this month to draw international attention to it.

South Korea also called on the North to "immediately stop" the denunciations of the South Korean president that it carries on state media almost daily. Some of their dispatches on Thursday described the Lee administration as "evil," "fascist" and "traitors."

Kim Yong-hyun, a North Korea studies professor at Dongguk University, said any compromise by North Korea is unlikely as its chief goal is to pressure the Lee government to drop its conservative, pro-U.S. policy.

"Toward the South, it continues to be hardline to demand the fundamental change of policy. It is saying, 'We are not going to bow our head to the Lee Myung-bak government,'" he said.

Hong Ihk-hyun, an analyst with the Korea Institute for International Economic Policy in Seoul, said North Korea's underlying message is not the $500 million rent. It wants Lee's commitment on implementing the inter-Korean summit agreements his liberal predecessors reached with North Korean leader Kim Jong-il in 2000 and 2007, Hong said.

"I don't think North Korea's intention is to get more money," he said. "It is saying South Koreans should be treated the same as foreigners because the 'joint spirit' has gone."

The businesses operating at the park were dismayed. On a sales decrease and security concerns, a fur coat maker withdrew from the park last month, and a few others were considering suspending production temporarily.

"We expected some progress about the border transit and the dormitory," Yoo Chang-geun, vice chairman of the Kaesong [Kaeso'ng] Industrial Council that represents the firms investing in the park, said. "We are deeply disappointed."

The North had offered to lift a border traffic curfew, and South Korea proposed to build a dormitory and a nursery for North Korean workers. Those offers made no progress.

The industrial park is the last surviving cross-border venture born out of the first summit between then President Kim Tae-chung [Kim Dae-jung] and Kim Jong Il [Kim Cho'ng-il]. Tourism projects that took South Koreans to the North's historic and scenic spots were all suspended last year as political relations unraveled.

The joint park hosts more than 100 South Korean firms making clothing, kitchenware, electronic equipment and other labor-intensive goods with about 40,000 North Korean workers. The firms paid more than $26 million in wages to the North Korean government last year.

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North Korea says future of joint park depends on South Korea (Yonhap)

SEOUL – North Korea on Thursday denounced South Korea's "confrontational" policies and said the future of their joint industrial complex will entirely depend on Seoul's attitude, a warning that came after inter-Korean talks ended without progress.

The two sides failed to narrow differences over the joint park in the North's border town of Kaesong earlier Thursday. Pyongyang insisted on rent hikes and refused to discuss a detained South Korean worker, Seoul officials said.

"Our side emphasized that we naturally come to ask whether the South intends to continue the working-level contact or not, as it talks about 'dialogue' and 'sincerity' in front of us, but then with its back to us, behaves in a way that inspires confrontation," the official Korean Central News Agency (KCNA) said.

The statement laid out a string of examples of the incumbent South Korean government's recent policy positions that it claims "inspire confrontation" toward Pyongyang -- from a vow to strictly enforce U.N. sanctions over the North's May nuclear test, a new defense policy guideline against North Korea's nuclear and missile base and the reaffirmation of the "Denuclearization, Openness, 3000" that links Seoul's aid to North Korea to its progress on denuclearization.

North Korea also condemned South Korea's attitude at the talks as "rude and insincere," the KCNA claimed, charging Seoul rejected Pyongyang's proposals and raised "issues that have nothing to do with the agenda" of the talks, only making the dialogue more complicated.

Seoul's delegation demanded the release of the Hyundai Asan Corp. employee, who has been held incommunicado since March for criticizing the North's political system and trying to persuade a North Korean employee to defect, local officials said.

North Korea insisted that monthly wages for local employees be raised four-fold to US$300. It also sought $500 million for a 50-year lease on the park, ditching the $16 million rent deal signed when the park opened in 2004.

The proposed rent is "not high at all," considering industrial zones in foreign countries and the value of the joint park, the KCNA quoted the North Korean delegation as saying at the talks.

No date was set for the next round of the talks.

"Our side stressed that the future of the working level contact and the prospects of the Kaesong industrial complex project entirely depend on the South's attitude," the North Korean delegation was quoted as saying.

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S. Korea to take detained worker issue to ARF: foreign minister (Yonhap)

SEOUL – Seoul's foreign minister said Thursday he will raise the issue of a South Korean worker in detention in North Korea when he attends a regional security forum in Thailand later this month, a move expected to provoke the communist neighbor.

"As it is a matter related to human rights and a very grave issue...I think I will have to make reference to it" at the ASEAN Regional Forum (ARF), Minister Yu Myung-hwan said during a monthly press briefing.

North Korea detained a South Korean company worker at the troubled inter-Korean industrial park in Kaesong in late March, accusing him of criticizing the communist nation's political system and attempting to persuade a North Korean woman to defect to the South.

The North has held the 44-year-old man incommunicado and refused to give information to South Korean officials on his whereabouts.

In a similar campaign to bring an inter-Korean issue to the international stage, the South Korean minister took issue with the shooting death of a South Korean tourist by a North Korean coast guard during the previous ARF session in Singapore last year. The tourist was shot near the North's Mount Kumgang resort.

The two Koreas staged a diplomatic battle over Seoul's efforts to include the shooting incident in the chairman's statement summarizing the results of the foreign ministerial meeting between the 10 ASEAN member countries and 17 other nations, including the U.S., China, Russia, Japan, and North Korea. North Korean Foreign Minister Pak Ui-chun protested the move, forcing the Singaporean government to omit related wording.

Yu said it is still unclear whether Pak will attend this year's ARF meeting. If Pak does attend, it would be the first time the reclusive nation has joined a major international event since its May 25 second nuclear test and the ensuing adoption of the U.N. sanctions resolution.

Yu added that South Korea is continuing consultations on a plan to hold a separate meeting with the U.S., China, Russia, and Japan for discussions on the North Korean nuclear issue.

As the North is refusing to return to the six-party talks, Seoul has been pushing for a five-way gathering aimed at discussing ways to bring Pyongyang back to the bargaining table and resume the denuclearization process.

"Consultations are under way on when and how the (five-way) meeting will be held," he said.

China, however, the host of the six-party talks, has been cautious about the new format.

Diplomatic sources said the upcoming ARF may provide the stage for the meeting as all the top diplomats from the five nations will attend it. But the South Korean minister said he was skeptical of the possibility.

"For now, I think it would be difficult to hold such a meeting (at ARF)," he said.

China's top nuclear envoy Wu Dawei has just begun a tour of Russia, the U.S., Japan, and South Korea for consultations on the nuclear issue, according to the Chinese foreign ministry spokesman Qin Gang.

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Hyundai Group won't give up projects in N.K.: chief (Korea Herald)

South Korea's Hyundai Group will not give up its business projects in North Korea, despite heightened tension on the divided Korean Peninsula following the North's second nuclear test and other belligerent acts, the group's chairwoman said, according to Yonhap News.

Hyun Jung-eun, chairwoman of Hyundai, the parent of Hyundai Asan Corp. in charge of doing business with North Korea, admitted the group is struggling with financial woes as two major tour programs to the North's scenic Mount Kumgang and border city of Kaesong were halted.

South Korea has halted the tour to the North's mountain since July last year, when a 53-year-old South Korean housewife was fatally shot dead by North Korean guards while vacationing there.

Another tour to the North's ancient city of Kaesong was also closed late last year amid escalating tension.

"Hyundai Asan as well as Hyundai Group are undergoing difficulty as tours to Mount Kumgang and Kaesong were stalled," Hyun told employees at a group pep rally on Saturday.

"But I won't give up (hope for our) businesses in North Korea,"

Hyun said, urging employees not to "lose hope" of resuming the tours.

The future of inter-Korean business projects, including a joint industrial park in Kaesong, has become increasingly clouded as North Korea ratchets up tension.

North Korea conducted its second nuclear test in May and fired several missiles after the United Nations imposed sanctions against the North's test-firing of a long-range missile.

On Saturday, North Korea launched seven short-range missiles into waters off its east coast, drawing immediate condemnations from South Korea, the U.S. and Japan.

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N. Korean Fishing Boats Cross Maritime Border in Yellow Sea (Yonhap)

SEOUL -- Two North Korean fishing boats returned to their country about four hours after they crossed into South Korean waters due to poor visibility Sunday, South Korea's Joint Chiefs of Staff said.

The two North Korean boats appeared to have violated the Northern Limit Line (NLL), the de facto maritime border between the two Koreas in the Yellow Sea, as dense fog caused them to drift off course, the officials said.

The boats crossed the NLL at 11 a.m., 26km off Yeonpyeong Island in the northeast Yellow Sea, the officials said.

The South Korean navy notified the North's patrol boats of the fishing boats' violation, but they stopped short of responding to the notification, officials said.

A North Korean patrol boat crossed over the NLL and towed the troubled boats back to the North's side at 3:12 p.m., according to officials.

A similar intrusion by North Korean fishing boats took place on June 30, 12.6km northeast in waters off Daechong Island in the Yellow Sea.

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Ministry Says ROK To Increase Defense R&D Spending To Counter DPRK Threats (Yonhap)

SEOUL – South Korea said Friday it will raise its funding for defense research programs by nearly one third over the next half decade to help counter North Korea's nuclear and missile threats.

The share of research and development investment in the annual defense budget will rise from 5.6 percent this year to 7.4 percent in 2014, the Ministry of National Defense said in a statement.

The mid-term National Defense Plan for fiscal 2010-2014 "prioritizes the procurement of defense capabilities against the nuclear and missile threat of North Korea," it said.

Last week, South Korea unveiled a 599.3 trillion won (US$469 billion) program aimed at obtaining the ability to monitor every North Korean nuclear and missile base independently by 2020 and bomb it if necessary.

The program, which was a revision of a 2005 defense reform plan, came after North Korea conducted its second nuclear test on May 25 following its first test nearly three years earlier.

North Korea has also test-fired a series of short-range missiles since the latest underground atomic explosion, including four off the east coast on Thursday. It is believed to have moved an intercontinental ballistic missile to a base on its west coast for a potential test-flight.

"The areas in which defense capacity will be improved" include the ability to quickly strike enemy targets to take the lead should a war break out on the Korean Peninsula, the South Korean ministry said.

The plan has won the approval of President Lee Myung-bak, ministry officials said.

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S. Korea mobilizes maritime squads (Washington Times)

YEONGJONG ISLAND, South Korea – On their island base in a tense Yellow Sea, black-clad commando squads armed with automatic weapons surge up ladders onto the deck of a training ship, fast-rope down building exteriors and detonate explosives.

The Special Sea Attack Team (SSAT), an elite South Korean Coast Guard unit tasked with countering maritime terrorism, is preparing to respond with tougher policies to North Korean shipping in response to North Korea's missile launches and its second nuclear test in May. North Korea fired four short-range missiles into waters off the east coast Thursday, Yonhap news agency reported.

"We have not got word from above yet," said Inspector Joung Ku-so, who was suited in body armor and bristling with weapons. "But we are practicing boarding drills for PSI," he said, referring to the U.S.-led Proliferation Security Initiative that aims to block ships from carrying weapons materials to the North.

North Korea is expected to test its long-range Taepodong-2 intercontinental ballistic missile (ICBM) on Saturday, to coincide with Independence Day celebrations in the United States.

The PSI comprises more than 90 nations that have agreed to monitor and possibly inspect North Korean ships suspected of carrying illicit cargoes. Currently, a U.S. Navy destroyer is shadowing the North Korean freighter Kang Nam 1 in the South China Sea. The freighter's movements are also being monitored electronically at the South Korean Coast Guard station at Incheon.

Boarding a Coast Guard hovercraft off Incheon - South Korea's second-largest port and the location of its main international airport - for the 30-minute ride to the SSAT base, it is clear how dangerous these waters are. Coast Guard cutters mount 20 mm rotary chain guns; in the event of war, they would support naval operations.

The sea is gray and choppy, and fog often cuts visibility to zero. Mud flats and islands dot the estuary off Incheon, which lies just 20 miles south of the maritime border. Craft from South Korea, North Korea and China compete over the rich crab fishing.

Incheon was the scene of Gen. Douglas MacArthur's September 1950 seaborne landing that turned the tide of the 1950-1953 Korean War. Moreover, it was on an island off Incheon in 1969 where South Korea trained criminals in a "Dirty Dozen"-style unit in an attempt to assassinate North Korean leader Kim Il-sung. That incident was depicted in the hit 2003 South Korean film "Silmido." Mr. Kim died of natural causes in 1994.

In June 1999 and June 2002, North Korea initiated naval clashes in these waters, killing six South Korean sailors. At the time, governments in Seoul were following an engagement "sunshine policy" toward Pyongyang and withheld policies and comments that could antagonize the North.

Now, under the leadership of conservative President Lee Myung-bak, policies are tougher.

"The guidelines for rules of engagement have changed," said Coast Guard spokesman Yun Byeong-du. "In the past, vessels had to get permission from the Blue House [presidential residence] to retaliate. Now it is up to captains." The Coast Guard is just the front line in the toughest South Korean defense posture in more than a decade.

Last week, the defense ministry told the nation's parliament that South Korea was boosting its pre-emptive strike capabilities to counter the North's missile and nuclear threat. According to Yonhap, South Korea's military has moved air and artillery assets to the Yellow Sea border region as insurance against possible North Korean gunboat or missile attacks.

While the 1.19 million men of the North Korean People's Army vastly outnumber South Korea's 655,000 soldiers, analysts think the northern force is a paper tiger. Its soldiers are poorly nourished and lack both modern equipment and adequate fuel for training.

North Korea is estimated to have more than 300 artillery pieces dug in along the Demilitarized Zone that could hit Seoul, but military specialists say this gun line could be outflanked by airborne or marine landings - assets the North Korean military, lacking a maneuver element and operating without air superiority, would have difficulty countering.

And while Pyongyang's 120,000-strong commando force appears formidable, a defector from one of those units, Kim Shin-jo - captured during a 1968 raid - has said that special forces alone are not a viable threat absent an uprising among South Korea's populace. A pro-North Korea rising by affluent, sophisticated and well-informed southerners seems a remote possibility.

For this reason, many specialists think Pyongyang is building a nuclear missile-based deterrent. This is tacit recognition that its conventional military is no match for the South Korea-U.S. alliance.

"North Korea is the weakest state in the region," said Dan Pinkston, who heads the International Crisis Group's Seoul office. "They don't have the technological or economic base to compete conventionally, so they have to rely on asymmetric capabilities." In a possible indication of the North's lack of conventional strength, no clashes took place in June in the Yellow Sea despite numerous predictions that North Korea would launch naval provocations there following its recent missile and nuclear tests.

Yonhap, citing an unnamed military official, reported that all four missiles fired Thursday flew about 60 miles and identified them as KN-01 missiles with a range of up to 100 miles.

President Obama told the Associated Press in an interview Thursday that he was trying to "keep a door open" for North Korea to return to international nuclear disarmament talks, but the country must abandon its nuclear weapons programs before it can join the world community.

He expressed optimism that he could get international agreement for even tougher action if North Korea does not heed warnings to pull back.

"In international diplomacy, people tend to want to go in stages," Mr. Obama said. "There potentially is room for more later."

White House press secretary Robert Gibbs told reporters later that the Obama administration was not surprised by the missile test, saying that it was probably not the last challenge the North Koreans would pose the international community.

"The North Koreans said they were going to launch these missiles. I don't think it's surprising that they've launched these missiles," Mr. Gibbs said. "I take the North Koreans at their word that they're going to continue their provocative actions."

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Japan mulls new missile defence system: report (AFP)

TOKYO – Japan is considering introducing a new type of missile defence system to counter airborne attacks, notably from North Korea, a newspaper said.

Japan has two types of defence against airborne attacks -- the warship-installed Standard Missile 3 (SM-3) and Patriot Advanced Capability 3 (PAC-3), a surface-to-air missile that tracks and hits incoming targets.

It plans to complete the shield by early 2011, deploying the PAC-3 missiles at 11 bases and setting up SM-3 missiles on several warships.

But the two systems still will not be enough to cover the nation's territory completely, the Mainichi daily said, without citing sources.

The Japanese defence ministry is considering introducing another surface-to-air missile, the US-developed Terminal High Altitude Area Defence (THAAD) system, in addition to SM-3 and PAC-3, the newspaper said.

While the PAC-3 has a range of about 20 kilometres (12.4 miles), a THAAD interceptor can cover more than 100 kilometres, making it possible to defend the entire nation if deployed at three to four bases, the report said.

Despite its pacifist constitution and heavy reliance on the US military for protection, Japan has the world's seventh biggest military spending in 2008, according to the Stockholm International Peace Research Institute.

Washington and Tokyo have been working jointly to install a shield against attacks from North Korea, which fired a missile over Japan's main island in 1998 and tested an atom bomb in 2006.

North Korea on Saturday launched seven ballistic missiles -- which it is banned from firing under UN resolutions -- into the Sea of Japan (East Sea) in an act of defiance apparently timed for the US Independence Day holiday.

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S. Korea seeks expansion of peaceful nuclear activity: FM (Yonhap)

SEOUL – South Korea wants to expand its peaceful nuclear program for commercial gains, South Korea's top diplomat said Thursday, signaling tough and lengthy negotiations lie ahead with its key ally, the United States, which says there is no need for Seoul to have the right to reprocess spent fuel.

Foreign Minister Yu Myung-hwan said that the Seoul-Washington nuclear cooperation agreement should be revised to allow for more activity, as it expires in 2012.

South Korea has several nuclear power plants but it is banned from reprocessing spent fuel under the 1974 agreement with the U.S.

"As the nuclear energy pact expires in 2012, there is a need to revise it at an early date," the minister told reporters, adding it is an issue that requires a cautious approach. "What we are interested in is setting the boundary of cooperation between South Korea and the U.S. for the peaceful use of atomic energy."

He pointed out that South Korea will have to depend more on nuclear energy in countering climate change.

"I think we need to have concrete consultations in the direction of maximizing commercial gains from the supply of fuel and the handling of spent fuel," he added, without going into details.

His comments apparently contradict Washington's stance.

Ellen Tauscher, U.S. undersecretary of state for arms control and international security, made it clear in a recent congressional hearing that there is no need for a revision to the current restrictions.

When Senator Richard Lugar asked, "Does the administration contemplate any changes in existing nuclear cooperation agreements, in particular those with Taiwan and the Republic of Korea (South Korea) to allow reprocessing of U.S.-origin materials in those nations?" she replied that "pragmatic consent" for reprocessing given to the EU, Japan, and India cannot be extended to South Korea or Taiwan.

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IAEA chooses Japanese as new head (Associated Press)

VIENNA – The world's top nuclear watchdog chose Japan's Yukiya Amano as its next head on Thursday — and he touched on the devastation U.S. atom bombs wreaked on his country in pledging to do his utmost to prevent the spread of nuclear arms.

The decision by the 35-nation International Atomic Energy Agency board ended a tug of war on who should succeed Nobel Peace laureate Mohamed ElBaradei, who saw his agency vaulted into prominence during a high-profile 12-year tenure.

North Korea left the nonproliferation fold to develop a nuclear weapons program on ElBaradei's watch and his agency later launched inconclusive probes on suspicions that those to nations were interested in developing nuclear weapons.

Industrialized nations backed Amano, whom they viewed as a low-profile technocrat uninterested in leaving a political footstep on the agency; developing countries supported his rival, South Africa's Abdul Samad Minty, considered ready to challenge the U.S. and other nuclear power countries on issues such as disarmament.

An initial session in March ended inconclusively and Thursday's meeting went down to the wire, with Amano winning only in the fourth round.

That and the fact that Amano barely eked out his victory, just clearing the two-thirds majority needed, reflected a continuing divide between the two camps. The divisions have served as an obstacle in one of its key tasks — probing nations suspected of secret, possibly weapons-related, nuclear activities.

While Amano was born after the U.S. nuclear strikes that ravaged the Japanese cities Hiroshima and Nagasaki in 1945, he alluded to those events in brief comments to reporters, suggesting that as a "national coming from Japan" he would work particularly hard to reduce the threat from atomic arms.

Expanding on that theme in recent comments to the Austrian daily, Die Presse, he said that he was "resolute in opposing the spread of nuclear arms because I am from a country that experienced Hiroshima and Nagasaki."

Now his country's chief delegate to the IAEA, Amano was previously his country's senior official for disarmament and related issues. He has also chaired key IAEA meetings during his more than three-year tenure as chief IAEA delegate.

He still needs to be confirmed by the board, in a session planned for Friday, and in September by the full IAEA general assembly. IAEA officials suggested both meetings would rubber-stamp the choice of Amano, saying it would be unheard of for them to overturn Thursday's vote results.

Amano collected 23 votes, to 11 for Minty — just giving him the two-thirds majority needed for victory.

Amano touched on the North-South divide gripping the agency in his post-session comments.

Saying he would do his utmost to prevent nuclear proliferation, Amano, 62, appealed for "solidarity of all the member states — countries from North, from South, from East and West" to achieve that goal.

Amano will be taking control of the IAEA at a particularly difficult time. Its nuclear investigations of Iran and Syria are both deadlocked, and it has no overview at all of North Korea, which is forging ahead with its nuclear arms program.

The Iranian investigation in particular has been affected by the deep divide between Western nations, including the United States, and developing countries that accuse the West of being indifferent to the problems of poorer countries.

Iran is under three sets of U.N. Security Council sanctions for refusing to freeze its uranium enrichment program — an activity that Tehran insists is meant to generate nuclear fuel but which can also be used to produce fissile material for nuclear warheads.

Representatives of some developing nations have privately said they share Western fears that Iran may seek to use enrichment to develop weapons. But as a bloc, they tend to support Iran's argument that it has a right to an enrichment program for generating energy.

The developing bloc also questions the West's assertions that Iran in the past ran experiments and drew up plans reflecting its interest in nuclear weapons, backing Tehran's dismissal of U.S. and other intelligence pointing to such activities.

Israel compounds the acrimony, with developing nations supporting Islamic countries critical of the West for focusing on Iran and Syria while ignoring what they say is the Jewish state's undeclared nuclear weapons capability.

ElBaradei steps down in November and the U.S. and its backers had backed Amano as a man sympathetic to their focus — nonproliferation. Minty, in contrast, was generally seen as ready to give more weight to demands by the developing countries pushing the U.S. and other nuclear weapons states to disarm.

The West had viewed Elbaradei as sometimes challenging its arguments and concerns, and for being too soft on Iran. In 2005, Washington tried unsuccessfully to block the Egyptian's appointment to another four-year term.

Without publicly saying so, the U.S. and its allies had made clear before Tuesday's voting that they favored Amano because they saw him as someone who would manage the IAEA without thrusting himself into the political fray.

John Bolton, the U.S. ambassador to the United Nations under the previous administration, hailed Amano's victory in comments indirectly critical of Elbaradei.

"I think he will reduce the politicization of the IAEA," he said. "That alone will bring back things into equilibrium."