NORTHEAST ASIA PEACE AND SECURITY NETWORK 
     *****   SPECIAL REPORT   *****

October 29, 1998

The following is an excerpt of the passages dealing with funding for the 
Korean Peninsula Energy Development Organization (KEDO) from the House-
Senate Conference Report for HR4328 (Omnibus Appropriations Bill).  The 
excerpt outlines the conditions placed by the US Congress on continued 
funding of KEDO.  It can be found in the October 19, 1998 Congressional 
Record.

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Sec. 582. Korean Peninsula Energy Development Organization

The conference agreement provides that not to exceed $35,000,000 of the 
funds made available under the heading "Nonproliferation, Anti-terrorism, 
Demining and Related Programs" may be available for the Korean Peninsula 
Energy Development Organization (KEDO), notwithstanding any other 
provision of law, only for the administrative expenses and heavy fuel oil 
costs associated with the Agreed Framework.  The House bill prohibited 
funding to KEDO and the Senate amendment provided $35,000,000 subject to 
presidential certification.  The conference agreement provides that none 
of these funds may be made available until March 1, 1999.  

The conference agreement further provides that of the funds made 
available for KEDO, up to $15,000,000 may be made available prior to June 
1, 1999, if, thirty days prior to such obligation of funds, the President 
certifies and so reports to Congress that: 

(1) the parties to the Agreed Framework have taken and continue to take 
demonstrable steps to assure that progress is made on the implementation 
of the January 1, 1992, Joint Declaration on the Denuclearization of the 
Korean Peninsula, progress is being made on the implementation of the 
North-South dialogue, and North Korea is complying with all provisions of 
the Agreed Framework and with the Confidential Minute between North Korea 
and the United States; 

(2) North Korea is cooperating fully in the canning and safe storage of 
all spent fuel from its graphite-moderated nuclear reactors; 

(3) North Korea has not significantly diverted assistance provided by the 
United States for purposes for which it was not intended; and 

(4) The United States is fully engaged in efforts to impede North Korea's 
development and export of ballistic missiles.

The conference agreement also provides that of the funds made available 
for KEDO, up to $20,000,000 may be made available on or after June 1, 
1999, if, thirty days prior to such obligation of funds, the President 
certifies and so reports to Congress that: 

(1) The United States has initiated meaningful discussions with North 
Korea on implementation of the Joint Declaration on the Denuclearization 
of Korean Peninsula; 

(2) The United States has reached agreement with North Korea on the means 
for satisfying United States concerns regarding suspect underground 
construction; and, 

(3) The United States is making significant progress in negotiations with 
North Korea on reducing and eliminating the North Korean ballistic 
missile threat, including its ballistic missile exports. 

The President may waive the certification requirements of subsections (b) 
and (c) if the President determines that it is vital to the national 
security interests of the United States and provides written policy 
justification to the appropriate congressional committees prior to his 
exercise of such waiver.  The conference agreement also provides that no 
funds may be obligated for KEDO until 30 days after submission to 
Congress of such waiver. 

The conferees agree that a very senior presidential envoy is now 
necessary to help restore confidence in the Administration's North Korea 
policy, as well to engage the North Korean government at the most senior 
levels.  Therefore, the conference agreement provides that no later than 
January 1, 1999, the President shall name a "North Korea Policy 
Coordinator," who shall conduct a full and complete interagency review of 
United States policy toward North Korea, shall provide policy direction 
for negotiations with North Korea related to nuclear weapons, ballistic 
missiles, and other security related issues, and shall also provide 
leadership for United States participation in KEDO. 

In addition, the conference agreement requires the Secretary of State to 
submit to the appropriate congressional committees an annual report 
providing a full and detailed accounting of the fiscal year request for 
the United States contribution to KEDO as well as other important 
financial aspects of KEDO activities. 

The conference agreement also provides that the Secretary of Defense 
shall submit to the appropriate congressional committees an annual report 
on the degree to which KEDO's mission and the Agreed Framework continue 
to promote important United States national security interests, 
contribute to delaying North Korean indigenous development of nuclear 
weapons-related technology, and contribute to a reduction of tensions on 
the Korean Peninsula.

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End of excerpt.