In today’s Report:

I. United States

II. Republic of Korea

III. Announcements

I. United States

1. DPRK Economy

Reuters (“N.KOREA’S TRADE VOLUME FALLS FOR SIXTH STRAIGHT YR,” Seoul, 6/03/97) reported that the DPRK’s Korea Trade-Investment Promotion Agency (KOTRA) said on Tuesday that in 1996 the DPRK’s foreign trading volume dropped 3.7 percent to US$1.98 billion, its sixth straight annual decline. Exports fell 1.3 percent to US$730 million from a year ago and imports dropped 5.0 percent to US$1.25 billion, producing a trade deficit of US$520 million for the year. Imports of agricultural and food products jumped 48 percent to US$180 million in 1996, KOTRA’s statement said. The agency said the ROK was the DPRK’s third largest trading partner last year: the DPRK imported US$69.6 million in goods from the ROK and exported US$182.4 million.

Reuters (“N.KOREA ALLOWS CURRENCY CONVERSION IN SPECIAL ZONE,” Seoul, 6/02/97) reported that a ROK Finance Ministry official said on Monday that the DPRK will allow its currency to be exchanged directly with US dollars in a bid to boost business in its Rajin-Sonbong free-trade zone. The official, who asked not to be identified, said the DPRK would set the exchange rate at 200 DPRK won per dollar. The existing system, under which foreigners exchange hard currency for special units at an official exchange rate of 2.16 DPRK won per dollar, will remain in place elsewhere in the country. The official noted that the black market exchange rate is 100 DPRK won per special currency unit.

In today’s Report:

I. United States

II. Republic of Korea

I. United States

1. KEDO Delegation’s Visit to DPRK

The Associated Press (“NUCLEAR OFFICIALS VISIT NORTH KOREA,” Seoul, 6/02/97) reported that the DPRK’s official Korean Central News Agency (KCNA) said that a team of US, ROK and Japanese nuclear experts arrived in the DPRK on Saturday to discuss construction of two nuclear reactors by the Korean Peninsula Energy Development Organization (KEDO), under the 1994 accord between the DPRK and the US. “The negotiation will finally discuss the technical and practical issues concerning the start of the construction project,” KCNA said, giving no further details. KEDO has said its 44-member delegation and DPRK officials will discuss the use of postal and communications systems, employment of North Korean workers, and the use of hospitals during the visit, which ends June 7.

2. DPRK Food Aid

United Press International (“RED CROSS BOOSTS N.KOREA AID FIVE-FOLD,” Seoul, 5/31/97) reported that the International Federation of the Red Cross (IFRC) announced plans to supply enough food aid to the DPRK to feed 700,000 people, five times as many as it currently assists. The announcement followed an assessment of the current situation that calls the lead-up to October’s harvest “the most critical period.” Geoff Dennis, a former IFRC representative in Pyongyang who led a recent three-person visit to the DPRK, said Sunday, “With the substantial donations from particularly the S

In today’s Report:

I. United States

II. Republic of Korea

III. Japan

IV. Announcement

I. United States

1. US-DPRK-ROK Meeting

The Associated Press (“U.S., KOREA ENVOYS PLAN PEACE TALKS,” Washington, 5/30/97) reported that officials from the US, the DPRK and the ROK met Friday in New York, and that US State Department Spokesman John Dinger said the US was hopeful that the effort to gain the DPRK’s acceptance of the proposed four-party peace talks “is moving in the right direction.” The meeting in New York was the first trilateral discussion since the US and the ROK failed in a similar effort more than a month ago to induce the DPRK to agree to the talks proposal. The DPRK’s desire for promises of large-scale food aid in exchange for their participation in the peace talks has been a major obstacle. Dinger said the discussions in New York are part of a “process.” “One step in that process is today. Hopefully, another step will be four-party talks. Hopefully, the ultimate conclusion will be a peace treaty,” he said.

2. DPRK Famine Situation

The AP-Dow Jones News Service (“S. KOREA SAYS N. KOREA EXPECTED TO WITHSTAND FAMINE,” Seoul, 5/30/97) reported that ROK Unification Minister Kwon O-kie, the ROK’s top DPRK policy maker, told a seminar Friday that foreign aid will enable the DPRK to overcome its current food crisis. “North Korea will have enough grain from its own stocks and imports to sustain itself until the summer harvest in August,” Kwon said. The UN’s World Food Program has said that the

In today’s Report:

I. United States

II. Republic of Korea

III. People’s Republic of China

I. United States

1. DPRK Naval Vessel Enters ROK Waters

Reuters (“NORTH KOREAN NAVY BOAT SPARKS DEFENSE SCARE,” Seoul, 5/29/97) reported that the ROK Defense Ministry said a DPRK navy patrol boat intruded into ROK waters Thursday, apparently by mistake as it shadowed a PRC cargo ship. “The ship was first spotted at 2:05 p.m. and returned by 3:00 p.m.,” a ministry official said. “It seems that the ship mistakenly entered our waters.” It was spotted just south of a nautical demarcation line separating the two Koreas. Four ROK navy vessels were immediately dispatched to the area, but there was no contact with the DPRK boat. The ministry official said it was the first such incursion since May 1996, but gave no further details.

2. DPRK Food Aid

Reuters (“HASHIMOTO SAYS JAPAN MAY GIVE FOOD TO PYONGYANG,” Tokyo, 5/29/97) reported that, according to Japan’s Kyodo news agency, Japanese Prime Minister Ryutaro Hashimoto hinted Thursday that Japan may reverse its policy on food aid to the DPRK and agree to provide help if the ROK formally asks it to do so. “If the South Korean government asks us for assistance to compatriots in North Korea, there is room for the Japanese side to change its stance (on giving food aid),” Kyodo quoted Hashimoto as telling a group of visiting ROK newspaper editors. “We are ready to think about that (food aid) if we are asked to render aid by the South Korean government. Anyhow, we will have int

In today’s Report:

I. United States

II. Republic of Korea

I. United States

1. DPRK Nuclear Plant Site Visits

The AP-Dow Jones News Service (“TEAM TO VISIT N. KOREA TO DISCUSS BUILDING NUCLEAR PLANTS,” Seoul, 5/28/97) reported that forty-four US, ROK and Japanese officials will visit the DPRK later this week to discuss details of building the two new nuclear power plants stipulated under the 1994 Agreed Framework. The Korean Peninsula Energy Development Organization (KEDO), the international consortium overseeing the construction of the plants, said that the team is made up of 10 KEDO officials, plus 27 ROK, three US, and four Japanese advisors and experts in legal, transportation, communications, and other fields. During the May 31-June 7 visit, the two sides are to discuss administrative details, including the use of postal and communications systems, employment of DPRK workers, and the use of hospitals. Talks on these issues began in April.

2. DPRK Food Aid

United Press International (“FOOD AID ARRIVES IN N.KOREA,” Seoul, 5/28/97) reported that the DPRK’s official news agency said Wednesday that 59,000 tons of food aid has arrived to help avert food shortages. The government news agency said food from the US, Europe, and other aid donors will help relieve “temporary difficulties” caused by flood-damaged crops.

US Defense Department Spokesman Ken Bacon (“PENTAGON SPOKESMAN’S DAILY BRIEFING, MAY 27,” USIA Transcript, 5/28/97) stated, in response to a question regar

In today’s Report:

I. United States

II. Republic of Korea

III. Russian Federation

I. United States

1. ROK Red Cross Food Aid to DPRK

The Associated Press (“KOREAS AGREE ON FOOD SHIPMENT,” Beijing, 5/27/97) and Reuters (“RIVAL KOREAS SIGN FOOD AID AGREEMENT,” Beijing, 5/27/97) reported that ROK and DPRK Red Cross officials agreed Monday on terms for the shipment of 50,000 tons of food to the hunger-stricken DPRK by August. The food, mostly corn, amounts to a six-month supply for 600,000 people. Red Cross spokesman Johan Schaar said this is more than four times the number of North Koreans currently receiving Red Cross aid. He also said about one-third of the promised aid — 15,000 tons — already is being shipped by train from the PRC. The United Nations estimates that 4.7 million North Koreans — a fifth of the population — risk starvation this summer without massive food aid. The head of the DPRK delegation, Paek Yong-ho, said that the amount of promised aid was “quite small in comparison with the total effect of the disaster.” “I cannot say it’s enough, but anyhow it will help,” he said. Paek asked for 100,000 tons of aid at one point during the talks. The ROK originally offered 40,000 tons. Both sides made other significant concessions to reach Monday’s agreement, the first direct agreement between the Red Cross societies of the two countries in more than a decade. The DPRK Red Cross agreed to accept aid labeled as having come from ROK donors, to send food to areas or people designated by ROK donors, and to open more delivery

In today’s Report:

I. United States

II. Republic of Korea

III Japan

I. United States

1. US Secretary of State on Four-Party Talks

US Secretary of State Madeleine Albright (“ALBRIGHT PRESS CONFERENCE AT STATE DEPT. MAY 23,” USIA Transcript, 5/23/97) replied to a question as to whether the US intends to introduce any “new ideas” to “kick-start” the proposed four-party Korean peace talks. Albright stated, “Well, first of all, I think that while maybe our proposal per se has not changed, I do think that in the last months there has been some positive reaction to them — that in the talks that took place in New York there had been agreement in principle to have these talks and now there has been a delay in finding the time. I would say that we are very much on the right track and that it is a matter of seeing what the conditions are to make sure that those talks do, in fact, take place.” Referring to her upcoming meeting with ROK Foreign Minister Yoo Chong-ha, Albright continued, “Obviously, we are going to be talking about this. This is an issue of concern both to the South Koreans and to us because, ultimately, what both countries are looking for is stability in the Korean Peninsula. So we are just going to be, I think, discussing specifically how one can take advantage of the agreement in principle to have the talks.”

2. US Secretary of State Calls for KEDO Support

AP-Dow Jones News Service (“ALBRIGHT ASKS CONGRESS TO PAY 1997 DUES TO KEDO,” Washington, 5/23/97) reported that

In today’s Report:

I. United States

II. Republic of Korea

III. People’s Republic of China

I. United States

1. DPRK Boat Defectors’ Warnings

Reuters (“N.KOREAN DEFECTORS TELL OF STARVATION, WAR FEAR,” Seoul, 5/22/97) reported that on Thursday the recent “boat people” defectors from the DPRK told their first news conference that many DPRK citizens are starving to death and the country had been gripped by rumors of impending war against the South. “I had to struggle to feed five family members, and my parents had malnutrition from eating only flour porridge,” said Kim Hwa-ok, 41, the wife of the vessel’s captain, who arrived with their three children and his mother. “In April and May, I saw two people who had died of starvation,” she said. The ship’s engineer, Kim Won-hyung, said that rumors were spreading that DPRK leader Kim Jong-il would launch an attack on the ROK between July and October, at the end of a three-year mourning period for his father, the late “great leader” Kim Il-sung. The dire statements came at a time when South Koreans are already alarmed by statements from Hwang Jang-yop, the highest-level DPRK official ever to defect, that the DPRK could “scorch” the ROK and Japan with nuclear weapons and was preparing for conflict. The news conference was televised nationally in the ROK.

2. DPRK Denies War Intent

The Associated Press (“NORTH KOREA DECRIES WAR TALK,” Seoul, 5/22/97) reported that an unidentified spokesman for the DPRK Foreign Ministry said in a statement, carried by the country’s

In today’s Report:

I. United States

II. Republic of Korea

III. Russian Federation

I. United States

1. US Denies Plan for DPRK Special Envoy

US State Department Spokesman Nicholas Burns (“STATE DEPT. NOON BRIEFING, MAY 20,” USIA Transcript, 5/20/97) responded to a question concerning reports that the US is considering appointing a special envoy to handle relations with the DPRK. Burns stated, “I cannot confirm that report. … Frankly, I’m not familiar with any plan to appoint a special negotiator. I do know that we have excellent foreign service officers working on this. Chuck Kartman is a career specialist. He’s heading our Bureau of East Asian and Pacific Affairs. He has spent many years on Korea, understands the Korean problem very well. He’s been our point person. I know the Secretary is very pleased by the job that he’s done. Now, should it be necessary to appoint new people to work on North Korea in the future, I’m sure we’ll announce it. But I have nothing to announce, and I’m not aware of any plans to do so.”

2. DPRK Resists Providing Nuclear Information

Reuters (“N.KOREA RELUCTANT TO GIVE NUCLEAR DETAILS,” Tokyo, 5/21/97) reported that Hans Blix, head of the International Atomic Energy Agency (IAEA), said on Wednesday that the DPRK has remained reluctant to provide information on nuclear reactors suspected of being used to produce nuclear weapons. A Japanese official said Blix told Japanese Foreign Minister Yukihiko Ikeda that Pyongyang still refuses to give details on how its nuclear

In today’s Report:

I. United States

II. Republic of Korea

I. United States

1. ROK-DPRK Red Cross Talks

The AP-Dow Jones News Service (“RED CROSS OFFICIALS OF BOTH KOREAS TO MEET IN BEIJING FRI,” Seoul, 5/20/97) reported that Kang Young-hoon, head of the ROK Red Cross, said on Tuesday that his organization had accepted the counterproposal of its DPRK counterpart to meet in Beijing Friday to discuss food aid. Red Cross officials of the two Koreas met in Beijing earlier this month for the first time in nearly five years, but failed to agree on procedures to deliver food aid. The ROK Red Cross subsequently announced its willingness to accommodate a DPRK demand that it indicate the amount of food aid it was prepared to deliver, and proposed last week that both sides meet at the border or in either of the two capitals, Seoul or Pyongyang, on Friday. The DPRK Red Cross agreed to the meeting date but insisted that the contact take place again in Beijing. “I do not understand and rather regret why you insist on Beijing as a venue instead of our land, which is more convenient,” Kang said in a telephone message to his counterpart, Li Sung-ho. The ROK Red Cross will propose giving the DPRK about 50,000 tons of grain worth about US$10 million, donated by private aid groups. The ROK Red Cross will also propose that those donations be delivered by land and be marked with the donors’ names, suggestions the DPRK has opposed in the past.

2. US View of PRC Threat

The AP-Dow Jones News