North Korea Pulls Out Of Talks

The envoy for North Korea abruptly broke off talks today over the slowness of the transfer of $25 million locked up in an investigation into a North Korea counterfeiting operation. Kim Jong-Il’s representative flew home from Beijing rather than complete the final two days of the scheduled negotiations, leading to angry denunciations from the other participants:

Six-nation talks on North Korea’s nuclear programme have ended without progress after its chief negotiator flew home amid a row over money.
The Beijing talks stalled after Pyongyang refused to discuss a deal to disable its nuclear facilities until it recovers $25m held in a Macau bank. …
A statement from the hosts, China, said the talks had been suspended with no date set for a resumption.
“The parties agreed to recess and will resume the talks at the earliest opportunity,” a Chinese government statement said.
North Korea’s chief negotiator Kim Kye-gwan made no comment as he arrived at Beijing’s airport. An Air Koryo flight bound for the North Korean capital Pyongyang left soon afterwards.

The money has sat in the Macau bank ever since the US froze it out of the international network for money laundering in connection with Kim’s counterfeiting operation. North Korea has produced high-quality fakes of American $100 notes, and may have dumped as much as a billion dollars’ worth of them into the global markets. It provided hard currency for a regime on the brink of starvation, and the Macau bank was the only outlet for the ring. The US agreed to free the money and transfer it to China, but Pyongyang got impatient with the process and quit over it.
That has not set well with the other nations at the table. China has not made any statements about it, probably hoping to keep Pyongyang involved. The Japanese, who have had to allow their issues to get back-burnered by this process, called Kim’s withdrawal a “shame” and a “waste”, considering the fact that everyone had gathered to resolve their issues. Christopher Hill, who brokered the deal mainly through back-channel negotiations, spoke more bluntly. “The day I’m able to explain to you North Korean thinking is probably the day I’ve been in this process too long,” he told reporters.
Who gets hurt by this? One has to think that the big loser is North Korea. Not only do they not get their money — the US will surely not transfer the funds nor lift the sanctions on Kim’s bank now — but they don’t get their oil, either. Their nuclear program is already a bust, and they face increased sanctions from this process, especially given the anger they left at the table.
The big winner of a North Korean bug-out could be George Bush, depending on how the US handles this. No one here had much confidence in the agreement reached with the Kim regime, considering it another version of the Agreed Framework with only incremental improvements in verification. It left wide gaps on the nuclear issue, including the disposition of extant nuclear weapons and any highly-enriched-uranium work the regime had done. Now, with North Korea reneging on their initial agreement, the Bush administration can say that they tried to reach a peaceful settlement with Kim, bending over backwards to meet his concerns — but that Kim will not negotiate in good faith under any conditions.
Unless Kim returns quickly to the table, expect Japan and the US to start putting even more economic and military pressure on Pyongyang in the coming weeks.

9 thoughts on “North Korea Pulls Out Of Talks”

  1. “One has to think that the big loser is North Korea.”
    My observation is that those who walk out of negotiations with or violate agreements with the US; e.g. N Korea, N Vietnam, Iran, Iraq; always win.

  2. This may be the time to sit down with China and work out an agreement for the reunification of Korea, sans nukes. The question is, what would we have to offer China to induce her to give up her errant cats-paw, Kim Il Jong?
    We could, of course, use the stick of reduced trade, but with most of our consumer goods being built in China, we probably can’t afford that. The obvious carrot is Taiwan, which would stick in our throat. But what American President and Congress will go to war to prevent Chinese annexation of Taiwan? It’s almost inevitable, so maybe we could turn it to our advantage, creating some kind of neutral buffer status for both unified Korea and Taiwan.
    /Mr Lynn

  3. As the old saying goes, if something looks too good to be true, it probably is.
    We most likely don’t have the THINEST idea what 60 years of paranoia does to a country. So it is time to see Chinese officials Beiging, our hats (made in China of course) in our hands and ask VERY kindly for help, which they may, or may not grant.

  4. I suspect that the State Department, therefore the Bush administration, is completely committed to salvaging an agreement.
    The timetable may change, but it’s likely that the ante to North Korea will be upped. That is what has happened in every negotiation with NoKo, this one looks little different.
    I agree with TomB that the only player in these negotiations with substantial leverage is China, who has very little incentive to push hard. As long as NoKo keeps the border closed and doesn’t throw missiles around, China can mostly ignore them,

  5. Is it too much to hope for that this scenario was played for by the US administration? Leading the Norks into a negotiation that you know they’re going to back out of and look bad doing so, why, that almost looks like competent, Bismarckian policy.

  6. Here’s a thought. Encourage the Japanese to develop nuclear weapons as a hedge against NK aggression. This will scare the hell out of the ChiComs. The US, of course, would be more than willing to persuade the Japanese to stop development if the Chinese get Kim to resign, or just kill him.

  7. Well if China can sit right accross the river from North Korea and indulge the luxury of ignoring them, why on earth can’t we? We’ve got a whole ocean!
    Can somebody please explain to me why on earth we NEED an agreement with this back-of-beyond rockpile of a country. I would think we should be embarrassed to be seen in public even talking to these goons, much less implying to the world that their signature on a piece of paper really means anything.
    Does anyone seriously imagine that they are going to invade South Korea or flip a missile over the fence, or perhaps lob one over the Sea of Japan? They can’t even demonstrate that they’ve got a salable nuclear device for the terrorist market, much less the truly vast infrastructure that it takes to develop and deploy a real threat. So what’s the deal? Why are we acting like a desperate suiter here?
    Why not just slam the doors and turn out the lights on these cretins?

  8. NKs weapons are getting older and their infrastructure weaker.
    Except for their missle tech, which is obviously suffering from QA/QC problems, they have built nothing new in a long time.
    SK, Japan, Taiwan, etc. are all getting stronger by the day, while NK is getting weaker.
    Playing firm but patient is good.

  9. Can I just point out that I don’t even bother PLAYING Powerball when it’s only at $25 million. I’m in at $50 million and above. ‘The Hills Have Eyes 2’ probably cost more than $25 large.
    So for a nation that sees itself as a major international player (they wish) to make a hugely consequental foreign policy decision on this kind of pocket change shows demonstrably that either a) they are just looking for any old lame-ass pretext to do what they fully entended to do all along…. or b) (even worse for them)… that kind of pocket change really IS a big deal. in which case they truly are a pathetic case.
    Which do you prefer, Poofy-Hair? Your call.

Comments are closed.