I. NAPSNet

1. Six Party Talks

USINFO (“RICE SAYS DISCUSSIONS CONTINUE ON RESUMING KOREA NUCLEAR TALKS”, 2007-01-08) reported that intensive discussions are under way on when it might be appropriate to resume formal negotiations. Rice and her ROK counterpart met in Washington January 5 to discuss bilateral relations, Iraq and efforts to persuade the DPRK to move forward with a verifiable agreement on a nuclear-free Korean Peninsula that it signed in 2005. If the DPRK indicates that it is willing to return to the talks ready to respond to earlier proposals in a more constructive way, Rice said, the talks could resume soon. The DPRK has not offered any substantive response to ideas floated during the last round of negotiations. ROK Foreign Minister Song Min-soon said the DPRK needs to know that possessing nuclear weapons capability does nothing to guarantee its security or help resolve its existing economic problems.

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2. US and DPRK Talks on Financial Sanctions

Reuters (“U.S. AND N.KOREA PLAN SANCTION TALKS: SEOUL”, 2007-01-08) reported that the United States and DPRK have tentatively agreed to meet later this month to discuss financial sanctions imposed on the DPRK. At the Six Party Talks the DPRK said it would not scrap its atomic weapons program until the United States ended its financial sanctions. ROK Foreign Minister Song Min-soon said after meetings in Washington over the past few days that a compromise on holding talks on the financial measures might have been reached. “No date has been fixed yet, but I was told North Korea and the U.S. have provisionally reached a compromise to hold it in the week starting on January 22,” he said on the weekend, according to a Web posting on South Korea’s Overseas Information Service. State Department spokesman Sean McCormack told reporters in Washington no date had been fixed but the United States hoped to hold the talks this month.

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3. US on 2nd DPRK Nuclear Test

Joong Ang Ilbo (“U.S. OFFICIALS: NORTH READYING 2ND BLAST”, 2007-01-06) reported that U.S. defense officials told reporters that the DPRK appears to be preparing for another nuclear weapons. Government officials in Seoul said that although there had been some signs of activity at a suspected test site, there was nothing to be seen that signaled an imminent test. Citing comments by several unnamed senior defense officials, ABC News reported that the activity was similar to that seen just before the first nuclear test. People and vehicles, those U.S. officials reportedly said, had been moving in and out of at least one area foreign intelligence officials believe could be a test site. Although the official line in Seoul was that the government is watching but sees no “special signs” that another test is being readied, a military source was not so sure. Noting the difficulties of seeing very much of the preparations for an underground test, he cautioned that the possibility of another blast had to be considered seriously.

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4. Japan on 2nd DPRK Nuclear Test

Associated Press (“REPORTS INDICATE N. KOREA PLANS NEW TEST”, 2007-01-05) reported that a Japanese Foreign Ministry official warned of tougher measures against the DPRK if the nation conducts a second nuclear test. The remarks came amid U.S. media reports saying that Pyongyang has appeared to have readied for another nuclear test. Nori Shikata, assistant press secretary for Japan’s Foreign Ministry did not say what other steps might be taken, but said they would be pursued through the United Nations, which authorized trade restrictions against the DPRK after its October test. Any additional moves would be met with what Japan calls the ”pressure approach,” Shikata said.

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5. Japan – DPRK Relations

Donga Ilbo (“JAPANESE OFFICIAL TO VISIT N. KOREA”, 2007-01-09) reported that Taku Yamasaki, the former vice president of the Liberal Democratic Party, will visit the DPRK on January 9.Analysts says his visit to the DPRK is to pave the way for former prime minister Junichiro Koizumi’s 3rd visit. Japanese Legislator Yamasaki met with Wu Dawei, the Chinese Vice Foreign Minister, on January 8 before visiting the DPRK, and he will stay in Pyongyang for 4 or 5 days.

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6. Inter-Korean Visits

Chosun Ilbo (“MORE THAN 100,000 S. KOREANS VISIT NORTH”, 2007-01-05) reported that inter-Korean tension ran high last year over the DPRK’s missile and nuclear tests, but the number of RO Korean visitors to the DPRK passed 100,000 for the first time. Seoul’s Unification Ministry says the figure is up nearly 16 percent from 2005 and excludes travelers to Mount Kumgang who numbered more than 200,000. Only 870 DPR Koreans, however, visited the ROK last year. The bulk of RO Korean visitors were comprised of businessmen to the Kaesong Industrial Complex at nearly 88,000. The remainder was travelers going on family reunions and personnel delivering humanitarian assistance.

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7. Inside DPRK: Scarlet Fever Outbreak

Daily NK (“SCARLET FEVER SPREADS IN NORTH KOREA’S EASTERN AREA”, 2007-01-08) reported that in Yanggan, Hamhung, Hamnam, Kangwon Coastal Cities, almost the entire Eastern Area has been struck by an epidemic of Scarlet Fever. Authorities prohibited travel restricting the activities of merchants, and daily lives are being severely impacted in December 2006. Authorities are currently taking steps to blockade those regions where Scarlet Fever has broken out. As Scarlet Fever spreads on the East Coast, railway stations in the large cities are blockaded and trains passing through do not open the doors to the platform. With antibiotics, Scarlet Fever is easily cured but with deficiencies in medical supplies, the North and Eastern parts of the country appear to be suffering greatly. The current situation in the DPRK is that of reduced subsistence brought on by floods of last summer, coupled with UN sanctions resulting from their nuclear test, as well as the end of most foreign aid. Market prices have now risen even further. Authorities are hoping that Scarlet Fever will disappear with the cold weather due in late December.

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8. US-ROK Security Alliance

Chosun Ilbo (“NEW SYSTEM TO CALCULATE U.S. TROOP COST”, 2007-01-08) reported that the ROK and the US have agreed on a new system to calculate the cost of US troops stationed in the ROK. Sources at the US Embassy in Seoul say the agreement came after a meeting between Foreign Minister Song Min-soon and Deputy US Defense Secretary Gordon England in Washington. The two sides have acknowledged that it’s time to change their “push-and-pull” style of negotiating. The plan is to develop the new system within the year.

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9. ROK-Japan Sea Dispute

BBC News (“S KOREA BID TO SOLVE SEA DISPUTE”, 2007-01-08) reported that ROK President Roh Moo-hyun has proposed renaming a body of water which is hotly contested with Japan as the Sea of Peace, officials confirmed. Mr Roh made the suggestion at an informal meeting with Japan’s PM Shinzo Abe on the sidelines of the Apec summit last November. The body of water between the two is widely known as the Sea of Japan, but the ROK calls it the East Sea. Japan has reportedly not given any official response to the suggestion.

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10. Japan International Relations

Agence France-Presse (“JAPAN TO STRENGTHEN INTERNATIONAL ALLIANCES: REPORT”, 2007-01-08) reported that Japan is set to strengthen its international alliances by recognising that it shares common values with NATO, Australia and New Zealand, according to a report. The acknowledgement is likely to come in a joint US-Japan security report to be released in late January the Mainichi Shimbun newspaper said. US government officials had called on Tokyo to designate NATO, Australia and New Zealand as having “common values” with Japan and the US when the report is issued, the daily said.

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11. US-Japan Missile Defense Cooperation

Agence France-Presse (“US SEEKS HELP FROM JAPAN WITH LASER-BASED MISSILE DEFENSE”, 2007-01-08) reported that the US is seeking Japanese assistance to develop a laser system aboard military aircraft that shoots down ascending missiles, a press report said. The Japanese government will shortly consult local companies for interest in the project likely to require development of high technology as well as massive funding inputs, the business newspaper Nikkei reported.

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12. Japan Defense Policy

Kyodo (“DEFENSE AGENCY TO BE UPGRADED TO MINISTRY ON TUE.”, 2007-01-08) reported that the Defense Agency will be upgraded to a Defense Ministry on Tuesday, attaining full ministry status for the first time since its inception amid persistent concerns about its effective civilian control of the nation’s defense forces. Along with the upgrade, the Self-Defense Forces’ overseas operations for international disaster relief, U.N.-led peacekeeping and logistical support in case of a regional contingency, as well as its special missions in Iraq and in the vicinity of Afghanistan, will be redefined as main duties rather than subordinate ones as at present.

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13. Japan Energy Efficiency

The New York Times (“THE LAND OF RISING CONSERVATION”, 2007-01-08) reported that Japan tops most global comparisons of energy efficiency in wealthy nations. Its population and economy are each about 40 percent as large as that of the US, yet in 2004 it consumed less than a quarter as much energy as America did, according to the International Energy Agency, which is based in Paris. The government in turn has used these tax revenues to help Japan seize the lead in renewable energies like solar power, and more recently home fuel cells.

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14. Sino-Japanese Relations

Kyodo (“CHINA’S HU SAYS WILL VISIT JAPAN AT ‘CONVENIENT TIME'”, 2007-01-08) reported that PRC President Hu Jintao told the head of Japan’s New Komeito party he accepts Japan’s invitation to the country and he will visit at a “time convenient for both sides,” a New Komeito legislator said. Hu made the comments as Ota handed him a letter from Abe and relayed the Japanese premier’s belief that continued top-level exchanges by the countries’ leaders are important to boost the momentum for improving bilateral relations, according to Takagi.

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15. US and Cross Strait Relations

The Associated Press (“TAIWAN PRESIDENT TO STOP IN U.S. “, 2007-01-08) reported that Taiwan’s President Chen Shui-bian will stop off in the US on his way to Nicaragua next week, officials said Saturday, in a trip that seemed certain to spark concern in the PRC. Chen is set to spend Monday night in San Francisco on his way to the ceremony in the Nicaraguan capital Managua on Wednesday, and will make a short refueling stop in Los Angeles on his way back Thursday, the office said in a statement. He is due to return to Taiwan on Friday.

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16. Fiji-PRC Relations

The Associated Press (“FIJI GOVERNMENT TO BUILD CHINA TIES “, 2007-01-08) reported that Fiji’s new military-installed government will build alliances with the PRC and other Asian nations after being shunned by Australia and other South Pacific neighbors for coming to power in a coup, the foreign minister said. New Foreign Minister Ratu Epeli Nailatikau, a former army commander, said the new government would try to restore trade and diplomatic ties with its neighbors, but that it would also seek to strengthen ties with the PRC and other Asian countries.

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17. PRC Security

The Associated Press (“CHINESE POLICE RAID ALLEGED TERROR CAMP “, 2007-01-08) reported that PRC police raided an alleged terrorist camp in a western mountain region near the border with Pakistan, killing 18 suspects and arresting 17, a police official said. Song Hongli, director of the general office of the Xinjiang Public Security Bureau, said the raid occurred Friday at a training camp run by the East Turkestan Islamic Movement, or ETIM.

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18. PRC Environment

The Associated Press (“XIE GETS NEW ENVIRONMENTAL POST IN CHINA “, 2007-01-08) reported that the PRC’s former environment minister, who resigned following one of the nation’s worst toxic spills, has been given a new job overseeing key environmental policies, state media and government Web sites reported. Xie Zhenhua was appointed vice minister of the National Development and Reform Commission. In his new job, Xie will take charge of meeting two high-priority government goals: increasing energy efficiency and reducing emissions of the air pollutant sulfur dioxide, the China Daily and Xinhuanet Web site reported.

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19. PRC Currency Issue

Bloomberg News (“CHINA SAYS IT MAY BE FLEXIBLE WITH YUAN”, 2007-01-08) reported that the PRC may increase the flexibility of the yuan should the country’s trade surplus continue to expand this year, China’s central bank governor, Zhou Xiaochuan, said yesterday. Booming exports have driven an almost eightfold increase in the PRC’s trade surplus in the last five years, according to economic analysts, spurring tensions with trading partners and challenging President Hu Jintao’s efforts to cool investment in the world’s fastest-growing major economy.

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