Korean Peninsula Today, 29 July 2009

Today’s highlights:
1) A US State Department official stated that North Korean call for dialogue fails to meet the international demand for resumption of Six-Party Talks
2) A South Korea-based North Korean defector-run media outlet reported 34 people are either dead or missing in Yangkang Province in North Korea due to the recent monsoon
3) The World Food Program documents showed that the food aid in North Korea is providing limited rations only to 1.3 million people instead of the originally targeted 6.2 million
4) China seized of 154 lbs of strategic metal shipment at the border bound for North Korea, which could be used for missile enhancement
and 5) The Korean Sharing Movement stated that it is expecting a delay for the planned visit to Pyongyang due to lack of formal invitation by the North

NKorean call for dialogue 'fails to meet' demands: US (AFP)

Washington – North Korea's call for dialogue "fails to meet" demands it return to nuclear disarmament negotiations with the United States and four other countries, a senior US official said Monday, AFP reports.

North Korea's foreign ministry said there was a "specific and reserved form of dialogue" that Pyongyang would entertain over the nuclear impasse, in what observers said was a direct overture to the United States.

But a senior State Department official told AFP the statement "fails to meet" US and international demands for North Korea to resume disarmament talks with the United States, South Korea, China, Japan and Russia.

"We have a (six-party) framework and the North Koreans need to recommit to denuclearization through that framework and implement their obligations," the official said, speaking on condition of anonymity.

The United States has repeatedly refused to sidestep the multilateral negotiations and insisted there is no chance of direct talks.

North Korea's foreign ministry Monday again dismissed the forum.

"Any attempt to side with those who claim the resumption of the six-party talks without grasping the essence of the matter will not help ease tension," a foreign ministry spokesman said in a statement carried by state media.

"There is a specific and reserved form of dialogue that can address the current situation."

The spokesman did not elaborate on what form such a dialogue could take.

"What Pyongyang calls for is a direct US-North Korean dialogue," said Kim Yong-Hyun, a North Korea expert and professor at Seoul's Dongguk University.

The North quit the six-party talks after the United Nations Security Council censured it for a long-range rocket launch in April. In May, it also staged its second nuclear test, further ratcheting up tension.

State Department spokesman Ian Kelly, referring to longstanding policy, told reporters the United States is "open to a bilateral dialogue, but only in the context of the six-party talks, only in a multilateral context."

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34 Dead in Yangkang Province Flooding (Daily NK)

Changchun, China – Torrential rains which recently hit Haesan, Yangang Province in North Korea apparently resulted in 34 dead or missing persons and 41 homes being swept away in the waves.

An inside source in Yangang Province told The DailyNK by phone on the 24th, "Many residential homes gave way and many casualties resulted from the downpour. The employees of factories and enterprises have been mobilized to work on recovery projects, but this will most likely take a long time."

The source said, "Due to the rainfall, Yeonbongdong, Tapsungdong and Haehwadong were flooded, and 41 single-story homes collapsed. The number of deceased or missing people has reached 34. Usually, two or three households, four or five in some cases, occupy each residence, so at least 100 families have experienced some kind of damage."

He explained the weather that caused the tragedy, "Rain started falling, but it stopped early on the morning of the 11th. But then it really began to pour between two and three in the afternoon. Thumbnail-sized hailstones started coming down, then falling in buckets."

"The victims of the downpour were mostly elderly people staying at home, children and some who were lost in the current while trying to salvage their belongings. If the rain had fallen at night instead of during the day, I do not know what kind of a tragedy might have resulted."

The flooding was mostly in Yeonbongdong, as well as Haehwadong and Haeheungdong. By comparison, Masan and its surrounding region were less seriously affected, and the areas around Hwajeonri and Kumsandong experienced hardly any damage at all.

The reason for Yeonbongdong and Haehwadong being so seriously affected seems to have been the construction of a road on top of a stream which flows in front of the Kim Jong Suk College of Education.

"The citizens in Yeongbongdong have actually been concerned about possible rainfall damage since the building of the road over the water," the source reported, claiming that the calamity was not simply a flood disaster, but a man-made one.

Currently, the roads in the Yeonbongdong area have completely been destroyed, forcing all vehicles to take a detour. Even middle school students have been mobilized to dig and carry the clay and sand to fill the roads.

The source relayed news that the North Korean authorities are allowing those households whose homes collapsed in the downpour to temporarily stay in surrounding factory buildings, and have begun recovery projects including repairs to damaged roads. Those citizens who have been mobilized for these projects have apparently been facing substantial hardships such as having to carry mud on their backs.

The source relayed the local atmosphere, commenting, "No national policy has been implemented to deal with the flood damage. Without bearing any of the responsibility as a state, North Korea has just put pressure on the citizens."

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Questions Are Raised About Who Profits from UN Aid to North Korea (Fox News)

Is North Korea's dictatorial regime quietly profiting from U.N. emergency food supplies delivered to its starving people, even as the regime squeezes those deliveries down to a trickle?

Documents produced by the World Food Program, the U.N.'s flagship relief agency, outlining its current emergency operations in the insular communist state, raise a number of touchy questions about the financing and logistics of the effort, which was originally intended to feed some 6.2 million of North Korea's most vulnerable people, but which is currently providing limited rations only to 1.33 million.

The $500 million program was meant to run from September, 1, 2008 to November 31, 2009, to deliver nearly 630,000 tons of food aid to North Korea at a time when it is suffering from severe flood damage and fertilizer shortages that have led to local food price increases.

Currently, WFP says that only $75.4 million worth of food aid has been delivered under the emergency program, as international donors have recoiled at the Kim Jong Il regime's recent nuclear detonation and provocative missile launchings toward Japan and Hawaii.

WFP emergency relief program documents obtained by FOX News show that from the outset the food agency planned to pay extraordinarily high transportation costs for sending relief supplies to North Korea from around the world--about a dollar for every two dollar's worth of food aid shipped into the country under the program.

Moreover, enormous sums were involved: $130,334,172 for “external transport” of 629,938 tons of grain and other food relief supplies for the overall program. (The food supplies themselves are projected to cost $297,396,729.)

For comparative purposes, the “external” shipping costs planned by WFP for the aid program average about $206.90 per metric ton of food aid.

Click here to view the PDF version of WFP's planned cost for food aid and transportation to North Korea: http://www.foxnews.com/projects/pdf/WFP_NK_cost_breakdown.pdf

Those rates were described as “absolutely ridiculous” by an expert on bulk shipping consulted by FOX News, even for sending goods by international shipping carriers to the remote region that includes North Korea. Another international grain expert consulted by FOX News described them as “way out of line” with past and present international shipping rates for bulk grain and other basic food commodities.

What WFP has not revealed in its documentation until questioned by FOX News, however, is that a substantial, but unspecified, amount of that money is intended to move the emergency aid from China to its final North Korean destination via shipping firms owned by the Kim Jong Il government.

Nowhere in the WFP program documents, which appeared on WFP's public website only after Fox News began raising questions about them, is there any mention of the North Korean hipping involvement.

Click here to view the WFP’s entire North Korean Emergency Assistance program document: http://www.foxnews.com/projects/pdf/WFP_NK_plan.pdf

Even though WFP has not revealed how much of the $130-plus million in planned “external transport” money Kim Jong Il's shipping firms are in line to receive, an analysis of the current costs involved in getting such supplies to their second-last destination reveal that the amount slated to pay for the last leg of the journey to North Korea could be huge.

A WFP spokesman blamed the overall high cost on “ the remote geographical location of [North Korea] from place of procurement (normally Black Seas, South Africa and South America).”

All WFP food aid, he added, was first shipped to the northern Chinese port of Dalian, before moving on to the North Korean port of Nampo.

But the spokesman then added that high costs were also due to “the lack of competition of transporters for transshipment” between Dalian and Nampo.

In fact, shipments to and from Dalian, China, one of the major centers of China's huge export sector, are commonplace and hardly expensive by international standards. Data kept by the U.S. Department of Agriculture, for example, shows that grain shipments from Brazil to China between April and June of this year have varied from $32.50 to $42 per metric ton.

Moreover, those international shipping rates have been on a precipitous downward slide since June, 2008-three months before the WFP aid program began. Even allowing for higher rates from the Black Sea and South Africa, international shipping experts told FOX News that the rates would come nowhere near $206 per ton-especially as there is currently a surplus of international shipping capacity.

The same, however, apparently can't be said of transport between Dalian and Nampo-a distance of 210 nautical miles.

There, the WFP spokesman said, WFP relies entirely on “feeder vessels belonging to the [North Korean] government.”

Asked late last week by FOX News to provide specifics of the rates charged by North Korean vessels for carrying international food aid home, the WFP spokesman did not provide an answer before this article was published.

However much the Kim Jong Il regime charges for bringing food to its people, it is not the only money that WFP provides to Kim for humanitarian assistance.

The WFP documents show that the government was to receive an additional projected $5,039,504 as a transport fuel subsidy if the relief program gets back into full swing. The “fuel reimbursement levy” amounts to $8 per ton of aid delivered, and according to the WFP spokesman, is normally not provided to countries that receive food aid-they are expected to chip in for this cost on their own--except under a waiver that North Korea has been granted.

So far, the Kim regime's National Coordinating Committee, a subsidiary of the Ministry of Foreign Affairs, has received $1.16 million under this waiver since September 2008, with the promise of an additional $361,400 to come. The WFP spokesman emphasized that the money was not paid in hard currency.

The same apparently applies to $4,409,566 intended by WFP to enhance a “capacity building strategy of government counterparts” envisaged in the relief plan. According to the WFP spokesman, this means management training and information systems upgrades for the Kim government to handle the new food aid. WFP is also paying for warehouses and equipment to handle the aid. So far, the regime has only $103,200 of the projected total, with another $155,000 committed.

Amid all the fuzzy math of the WFP relief program, there is a final quirk: the inexplicably high transportation costs work to the benefit not only of the Kim regime, but also to the benefit of WFP.

As a matter of standard practice, WFP charges a standard 7% management fee against “direct operational costs” of such relief efforts to support its worldwide operations, over and above the costs it incurs in the specific relief exercise. These, in WFP-speak, are known as the organization's “indirect support costs.”

Based on direct operational costs in North Korea of $445,033,971-including the $133.3 million in “external transport” costs-- WFP expected to reap $32,948,811 as its 7% share of “indirect support costs.”

Its 7% “indirect support” levy on the extraordinary $130.3 million transport bill would amount to about $9.1 million.

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China seizes smuggled metal bound for North Korea (Reuters)

BEIJING – Chinese border police have seized 70 kg (154 lb) of the strategic metal vanadium bound for North Korea, a local newspaper said on Tuesday, foiling an attempt to smuggle a material used to make missile parts.

The U.N. Security Council has tightened restrictions on North Korea in response to its May 25 nuclear test. The sanctions are meant to cut off the North's arms trade.

Although the seizure is in line with China's own export controls, Chinese analysts had predicted Beijing would step up inspections on road and rail traffic into North Korea to help enforce the tightened sanctions.

Altogether 68 bottles totaling 70 kg of vanadium worth 200,000 yuan ($29,280) were seized at the Dandong border with North Korea, the Dandong News said.

"Customs agents at the Dandong border crossing inspect six boxes of the rare metal vanadium found hidden under boxes of fruit in a truck stopped during border checks," the newspaper said in a front-page caption of a photo dated July 24.

Vanadium is a metal that strengthens steel and protects against rust. It is alloyed with steel to make missile casings, as well as high speed tools, superconducting magnets and jet engines.

China restricts the export of vanadium and other minor metals as part of a domestic policy meant to preserve strategic metals, encourage investment in processing industries and control international price fluctuations.

On Monday the chief executive of a Japan-based trading company pleaded guilty in a Japanese court to illegally exporting to North Korea two tanker trucks that could be used as missile launch pads, the Kyodo news agency said.

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Aid group's Pyongyang visit likely to be postponed (Yonhap)

SEOUL – A South Korean lawmaker and a group of civic aid officials' planned visit to Pyongyang for talks on humanitarian aid will likely be postponed due to an apparent breakdown of communications over protocol regarding cross-border entry, officials said Tuesday [28 July]

Rep. Chung Eui-hwa of the ruling Grand National Party, who also serves as joint head of the Korea Sharing Movement (KSM), a civic aid group, has requested government permission to make a four-day visit to Pyongyang starting Wednesday to meet with officials of the North's Korean Council for Reconciliation and Cooperation (KCRC) to discuss medical and other humanitarian support projects.

The scheduled trip, which the government was largely expected to approve, however, will likely be canceled or postponed as the KCRC has not sent an official invitation to Chung and the civic group officials. The two sides have initially agreed to conduct the meetings, according to officials.

"We're not exactly sure why the North hasn't sent us the invitation. Normally invitations for these kind of talks are delivered a day or two before the set date," one of Chung's aides said.

Kang Young-sik, secretary general of the KSM, also expected a postponement of the visit.

"We've requested the invitation for the visit, which was discussed beforehand. We've received no reply and are not sure of the reason," Kang told Yonhap News Agency.

The government has tentatively decided to authorize the visit by Chung and seven officials at the organization if the delegation is given an official invitation. It would likely mark Seoul's first approval of a visit by a non-government group to North Korea since Pyongyang carried out its second nuclear test on May 25.

Earlier requests by the KSM were rejected due to the state of inter-Korean relations, which have frayed in recent months following the North's nuclear and missile tests.