[Cankor] Report #273

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CANADA-KOREA ELECTRONIC INFORMATION SERVICE

CanKor # 273

Friday, 16 February 2007
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This week's CanKor Report presents a full-edition focus on -- (what 
else?) -- the recently concluded agreement at the third phase of the 
fifth round of Six-Party Talks in Beijing. The deceptively artless 
title "Initial Actions for the Implementation of the Joint Statement" 
(referring to the September 2005 agreement) conceals what most 
commentators consider to be a significant change of tone and 
methodology in the Six-Party process. The collection of opinions 
presented in this issue attest to the controversy that this document 
aroused, before the ink on the signatures had a chance to dry.

Following the full text of the document is a short article that 
appeared in the English-language edition of North Korea's Central News 
Agency already hinting at a differential interpretation of what had in 
fact been agreed. Not that ordinary DPR Koreans would have paid undue 
attention to this agreement in the midst of celebrating Kim Jong Il's 
65th birthday!

Critics on both sides of the engagement divide have had a field day 
evaluating whether this agreement represents a breakthrough in 
diplomacy, or capitulation to the DPRK's uncanny ability to extract 
rewards for bad behaviour. Choosing among too many excellent 
commentaries and analyses has been a challenge.

Robert Carlin and John W. Lewis educate us on "What North Korea really 
wants."
The Nautilus Institute's Australian Executive Director Peter Hayes 
calls the Beijing deal "one small step in the right direction," 
calling those who denounce it as a revival of the old Agreed Framework 
"completely wrong."
Canadian David Frum, who as a former White House speechwriter was 
credited with inventing the "axis of evil" sees the nuclear deal as a 
demonstration of the "lethal failure of strategic vision" in the 
second Bush administration.
Former State Department North Korea director Ken Quinones sees the 
deal creating numerous new problems without solving any fundament 
issues, saying, "Paradoxically the strongest advocate appears to be 
President Bush, along with China and South Korea."
Robert Gallucci, chief US negotiator during the 1994 nuclear crisis 
says that it is plausible, though not a certainty, that the DPRK will 
follow through with gradual disarmament and full disclosure of North 
Korea's nuclear stockpiles, if they "believe they're getting the 
political relationship they want with the United States and that they 
can rely on that relationship."
"Its about time" say James Goodby, former US ambassador to Finland and 
senior Finnish diplomat Markku Heiskanen. The agreement "could mark 
the first step towards a new era in Northeast Asia." Without expecting 
miracles, the authors say, "This approach deserves support. It is 
perhaps the last best hope for averting catastrophe."
*************************************************

Contents:
FOCUS: Six-Party Agreement

1.   INITIAL ACTIONS FOR THE IMPLEMENTATION OF THE JOINT STATEMENT
     http://www.ft.com/cms/s/0444b940-bb48-11db-afe4-0000779e2340.html

2.   THIRD PHASE OF FIFTH ROUND OF SIX-PARTY TALKS HELD
     http://www.kcna.co.jp/item/2007/200702/news02/14.htm#1

3.   KIM JONG IL'S 65TH BIRTHDAY AMID PROGRESS IN NUCLEAR ROW
     http://deseretnews.com/dn/view/0,1249,660196232,00.html

4.   CRITICS BLAST DEAL AS REWARDING 'BAD BEHAVIOR'
     http://www.usnews.com/usnews/news/articles/070213/13nkorea.htm

OPINION
5.   WHAT NORTH KOREA REALLY WANTS
     http://www.washingtonpost.com/wp-dyn/content/article/2007/01/26/AR2007012601363.html

6.   THE BEIJING DEAL IS NOT THE AGREED FRAMEWORK
     http://www.nautilus.org/fora/security/07014Hayes.html

7.   WASHINGTON'S RAW DEAL
     www.canada.com/nationalpost/news/issuesideas/story.html?id=366d1b1b-fc3f-44a7-85b6-786dee733835

8.   CAN THE NEW NUCLEAR DEAL WITH NORTH KOREA SUCCEED?
     http://www.nautilus.org/fora/security/07015Quinones.html

9.   ROBERT GALLUCCI ON DEALING WITH NORTH KOREA
     http://www.foreignpolicy.com/story/cms.php?story_id=3733

10.  IT'S ABOUT TIME!
     http://www.nautilus.org/fora/security/07016GoodbyHeiskanen.html
*************************************************

FOCUS: Six-Party Agreement

*************************************************
1.   INITIAL ACTIONS FOR THE IMPLEMENTATION OF THE JOINT STATEMENT
     (Official Statement) Financial Times, 13 February 2007

The Third Session of the Fifth Round of the Six-Party Talks was held 
in Beijing among the People's Republic of China, the Democratic 
People's Republic of Korea, Japan, the Republic of Korea, the Russian 
Federation and the United States of America from 8 to 13 February 
2007.

Mr. Wu Dawei, Vice Minister of Foreign Affairs of the PRC, Mr. Kim Gye 
Gwan, Vice Minister of Foreign Affairs of the DPRK; Mr. Kenichiro 
Sasae, Director-General for Asian and Oceanian Affairs, Ministry of 
Foreign Affairs of Japan; Mr. Chun Yung-woo, Special Representative 
for Korean Peninsula Peace and Security Affairs of the ROK Ministry of 
Foreign Affairs and Trade; Mr. Alexander Losyukov, Deputy Minister of 
Foreign Affairs of the Russian Federation; and Mr. Christopher Hill, 
Assistant Secretary for East Asian and Pacific Affairs of the 
Department of State of the United States attended the talks as heads 
of their respective delegations.

Vice Foreign Minister Wu Dawei chaired the talks.

I. The Parties held serious and productive discussions on the actions 
each party will take in the initial phase for the implementation of 
the Joint Statement of 19 September 2005. The Parties reaffirmed their 
common goal and will to achieve early denuclearization of the Korean 
Peninsula in a peaceful manner and reiterated that they would 
earnestly fulfill their commitments in the Joint Statement. The 
Parties agreed to take coordinated steps to implement the Joint 
Statement in a phased manner in line with the principle of "action for 
action".

II. The Parties agreed to take the following actions in parallel in 
the initial phase:

1. The DPRK will shut down and seal for the purpose of eventual 
abandonment the Yongbyon nuclear facility, including the reprocessing 
facility and invite back IAEA personnel to conduct all necessary 
monitoring and verifications as agreed between IAEA and the DPRK.

2. The DPRK will discuss with other parties a list of all its nuclear 
programs as described in the Joint Statement, including plutonium 
extracted from used fuel rods, that would be abandoned pursuant to the 
Joint Statement.

3. The DPRK and the US will start bilateral talks aimed at resolving 
pending bilateral issues and moving toward full diplomatic relations. 
The US will begin the process of removing the designation of the DPRK 
as a state-sponsor of terrorism and advance the process of terminating 
the application of the Trading with the Enemy Act with respect to the 
DPRK.

4. The DPRK and Japan will start bilateral talks aimed at taking steps 
to normalize their relations in accordance with the Pyongyang 
Declaration, on the basis of the settlement of unfortunate past and 
the outstanding issues of concern.

5. Recalling Section 1 and 3 of the Joint Statement of 19 September 
2005, the Parties agreed to cooperate in economic, energy and 
humanitarian assistance to the DPRK. In this regard, the Parties 
agreed to the provision of emergency energy assistance to the DPRK in 
the initial phase. The initial shipment of emergency energy assistance 
equivalent to 50,000 tons of heavy fuel oil (HFO) will commence within 
next 60 days.

The Parties agreed that the above-mentioned initial actions will be 
implemented within next 60 days and that they will take coordinated 
steps toward this goal.

III. The Parties agreed on the establishment of the following Working 
Groups (WG) in order to carry out the initial actions and for the 
purpose of full implementation of the Joint Statement:

1.Denuclearization of the Korean Peninsula

2.Normalization of DPRK-US relations

3.Normalization of DPRK-Japan relations

4.Economy and Energy Cooperation

5.Northeast Asia Peace and Security Mechanism

The WGs will discuss and formulate specific plans for the 
implementation of the Joint Statement in their respective areas. The 
WGs shall report to the Six-Party Heads of Delegation Meeting on the 
progress of their work. In principle, progress in one WG shall not 
affect progress in other WGs. Plans made by the five WGs will be 
implemented as a whole in a coordinated manner.

The Parties agreed that all WGs will meet within next 30 days.

IV. During the period of the Initial Actions phase and the next 
phase - which includes provision by the DPRK of a complete declaration 
of all nuclear programs and disablement of all existing nuclear 
facilities, including graphite-moderated reactors and reprocessing 
plant - economic, energy and humanitarian assistance up to the 
equivalent of 1 million tons of heavy fuel oil (HFO), including the 
initial shipment equivalent to 50,000 tons of HFO, will be provided to 
the DPRK.

The detailed modalities of the said assistance will be determined 
through consultations and appropriate assessments in the Working Group 
on Economic and Energy Cooperation.

V. Once the initial actions are implemented, the Six Parties will 
promptly hold a ministerial meeting to confirm implementation of the 
Joint Statement and explore ways and means for promoting security 
cooperation in Northeast Asia.

VI. The Parties reaffirmed that they will take positive steps to 
increase mutual trust, and will make joint efforts for lasting peace 
and stability in Northeast Asia. The directly related parties will 
negotiate a permanent peace regime on the Korean Peninsula at an 
appropriate separate forum.

VII. The Parties agreed to hold the Sixth Round of the Six-Party Talks 
on 19 March 2007 to hear reports of WGs and discuss on actions for the 
next phase.
*************************************************

2.   THIRD PHASE OF FIFTH ROUND OF SIX-PARTY TALKS HELD
     Korean Central News Agency (KCNA), 13 February 2007

The third phase of the fifth round of the six-party talks took place 
in Beijing from February 8 to 13. The talks that proceeded in a 
sincere atmosphere discussed the ways of denuclearizing the Korean 
Peninsula.

At the talks the parties decided to offer economic and energy aid 
equivalent to one million tons of heavy fuel oil in connection with 
the DPRK's temporary suspension of the operation of its nuclear 
facilities.

And the DPRK and the United States agreed to solve their pending 
issues and kick off the bilateral talks aimed at opening full 
diplomatic ties.

At the just-concluded talks the parties agreed to have the sixth round 
of the six-party talks in the future.
*************************************************

3.   KIM JONG IL'S 65TH BIRTHDAY AMID PROGRESS IN NUCLEAR ROW
     Kwang-Tae Kim, Associated Press, 16 February 2007

Thousands of people danced and brought flowers in North Korea's 
capital Friday to celebrate the 65th birthday of "dear leader" Kim 
Jong Il, amid progress in ending its nuclear programs and speculation 
abroad over who will eventually succeed him. The ruling Workers' Party 
and the military threw a banquet to honor Kim, under whose leadership 
the isolated country has suffered chronic food shortages. The official 
Korean Central News Agency did not report whether the feast was 
attended by Kim, who rarely makes public appearances. Pyongyang's wide 
boulevards were festooned with flags and banners.

Kim's birthday is one of North Korea's most important holidays and one 
in which the personality cult inherited from his late father, the 
country's founder Kim Il Sung, is arguably the most visible. As on 
other major holidays, groups of people and soldiers visited a statue 
of Kim's father, who died in 1994 but is still called the "eternal 
president," to offer flowers, and bow in respect or salute in the cold 
morning air.

"At the time of this significant February holiday I want to see 
President Kim Il Sung more than ever. That's why I've come to this 
statue early in the morning," Ri Un Ha, a North Korean woman, told AP 
Television News.

North Koreans usually receive benefits such as extra food on holidays, 
but it remains unclear whether the country can dole out such largesse 
this year, given chronic food shortages and UN sanctions imposed over 
its Oct. 9 nuclear test.

"Holidays in North Korea mark occasions on which the leadership is 
obligated to show tangibly its ability to care for the people," said 
Scott Snyder, a senior associate at the Asia Foundation in Washington 
who served as chief of its Seoul office. North Korea's leadership 
"will be able to perform at a higher level in this area" amid reduced 
tensions with the international community following this week's 
nuclear agreement, Snyder added.

In a breakthrough deal reached in Beijing on Tuesday, the hard-line 
communist regime agreed to shut down its main nuclear reactor and 
allow UN inspectors back into the country within 60 days. In return, 
the energy-starved country would receive aid equal to 50,000 tons of 
heavy fuel oil from the other countries participating in the six-party 
talks -- the United States, South Korea, Russia, China and Japan.

"Psychologically, Kim Jong Il would not be in a somber mood," said Koh 
Yu-hwan, a North Korea expert at Seoul's Dongguk University, citing 
the nuclear deal and the prospect of economic aid.

Still, North Korea kept up its anti-American rhetoric and urged its 
people to rally around Kim, known as the country's "dear leader." In a 
joint letter of congratulations to Kim on his birthday, North Korea's 
Cabinet, ruling party, parliament and military vowed to defend the 
country from the United States.

"All of the People's Army soldiers and the people will maintain a full 
combat mobilization posture in response to US imperialists' maneuvers 
for aggression and mercilessly destroy and mop up the aggressors if 
they dare to ignite a war," KCNA, in a Korean-language report, quoted 
the letter as saying. Experts, however, said the harsh language was 
aimed at bolstering support for the leadership at home. North Korea 
regularly says the USA is plotting an attack, a charge Washington 
consistently denies. "It is a declaration of its will to safeguard its 
internal system," Koh said.

Another version of the letter's contents, carried on KCNA's 
English-language service, used weaker language and did not mention the 
United States, but lauded Kim as "the peerlessly great man."

North Korean media have reported a festive mood in the country, with 
arts performances and exhibitions of the Kimjongilia -- a red flower 
cultivated to bloom around Kim's birthday. Kim Jong Il has not yet 
publicly named a successor, prompting speculation abroad about who 
might eventually take the reclusive country's helm and whether he will 
designate one of his sons -- continuing the world's only communist 
dynasty.

Japanese Prime Minister Shinzo Abe, whose country has been at odds 
with North Korea over the abductions of Japanese citizens to be 
trained as spies, took the occasion of Kim's birthday to urge him to 
follow through on the Beijing nuclear agreement.

"In order to make it a good birthday, I hope North Korea will 
implement what the partners have decided at the six-party talks," Abe 
told reporters in Tokyo on Thursday.

Russian President Vladimir Putin and China's Communist Party sent 
congratulations on Kim's birthday, KCNA reported Friday.
*************************************************

4.   CRITICS BLAST DEAL AS REWARDING 'BAD BEHAVIOR'
     Thomas Omestad, US News, 13 February 2007

The nuclear deal unveiled today in Beijing to freeze North Korea's 
plutonium-yielding reactor and readmit inspectors is, as a smiling 
Secretary of State Condoleezza Rice said, "the result of patient, 
creative, and tough diplomacy." True as that is, her statement masks 
the range of difficulties that had to be overcome in reaching this 
point. They include not only the obvious North Korean obstinacy but 
also the nagging policy disputes within a Bush administration that, at 
times, has seemed ambivalent about doing diplomatic business with a 
troublemaking communist regime.

US officials have said they would craft their negotiating approach so 
as not to reward the North's "bad behavior" in breaking out of the 
Nuclear Nonproliferation Treaty, ejecting inspectors, manufacturing 
bomb-grade plutonium, and -- last fall -- test-firing a nuclear bomb. 
But even before many of the negotiators from the six participating 
countries left Beijing, erstwhile supporters of the administration 
were charging that it had done just that.

John Bolton, a former top arms control official and envoy to the 
United Nations, told CNN that with this "very bad deal," the 
administration would "look very weak, at a time in Iraq and dealing 
with Iran that it needs to look strong." Added Heritage Foundation 
analyst Bruce Klingner, "North Korea has again foiled attempts to 
penalize it for violating international commitments.

"The assertion by critics that North Korea had somehow bested the 
United States was, paradoxically, partially shared by many supporters 
of the deal. Their complaint: The years of delay in getting to this 
point have allowed North Korea to multiply its stockpile of plutonium 
several times over the one or two bombs' worth thought to exist when 
the crisis erupted in October 2002."This deal takes us back to the 
future," said Sen. Joseph Biden, a Delaware Democrat running for 
president. "North Korea's program is much more dangerous to us now 
than it was in 2002, when President Bush rejected virtually the same 
deal he is now embracing.

"The deal announced today at the six-party talks is, in essence, a 
broad road map for how to start implementing a September 2005 
agreement on the principles for denuclearizing the North in exchange 
for security guarantees and economic and political benefits. Pyongyang 
is now supposed to halt its nuclear reactor at Yongbyon -- verified by 
returning inspectors from the International Atomic Energy Agency --  
within 60 days. The North would get initial aid of 50,000 tons of 
heavy fuel oil. Once it irreversibly disables all of its nuclear 
facilities, it would receive an additional 950,000 tons of fuel oil --  
all told worth between $250 million and $300 million.

Five working groups on implementing the pact are to meet within 30 
days. One will focus on normalizing relations between Pyongyang and 
Washington. The Bush administration agreed to "begin the process" of 
removing the North from the US list of state sponsors of terrorism and 
from countries facing trade sanctions under the Trading With the Enemy 
Act.

The new accord brought immediate comparisons with the Clinton 
administration's 1994 "Agreed Framework" with North Korea, a bilateral 
pact that until 2002 delivered fuel aid, among other benefits, in 
return for a reactor freeze. That such a comparison is now being made 
is particularly galling to some administration backers. Indeed, 
administration insiders once informally dubbed the Bush official 
approach to North Korea as "ABC" -- Anything but Clinton. Some 
internally advocated a strategy of isolating the regime and thereby 
hastening its collapse -- but under no circumstances abetting its 
survival.
*************************************************

OPINION

*************************************************

5.   WHAT NORTH KOREA REALLY WANTS
     Robert Carlin and John W. Lewis, Washington Post, 27 January 2007

[Robert Carlin, a former State Department analyst, participated in 
most of the US-North Korea negotiations between 1993 and 2000. John 
Lewis, professor emeritus at Stanford University, directs projects on 
Asia at the university's Center for International Security and 
Cooperation. Both have visited North Korea many times, most recently 
in November 2006.]

Those who think that dealing with North Korea is impossible are wrong. 
Unfortunately, those who think that it is, in fact, possible to deal 
with North Korea often are not much closer to the truth. The basic 
problem is that people of both views simply haven't figured out what 
it is that the North really wants.

We tend to confuse North Korea's short-term tactical goals with its 
broader strategic focus. We draw up list after list of things we think 
might appeal to Pyongyang on the assumption that these will constitute 
a "leveraged buyout," finally achieving what we want: the total, 
irreversible denuclearization of North Korea.

But this list of "carrots" (energy, food, the lifting of sanctions) 
does not include what the North thinks it must have. It can, of 
course, help keep the process on track and moving ahead, and it could 
help cement a final deal and hold it together through the inevitable 
political storms. But these things are not the ends that North Korea 
seeks.

North Korea feeds our misperceptions by bargaining so hard over 
details and raising its initial demands so high. For our part, we tend 
to be taken in by Western journalists' repetition of stock phrases 
about it being "one of the poorest nations," "one of the most 
isolated," "living on handouts." Accurate or not, these factors are 
irrelevant to Pyongyang's strategic calculations.
Those who realize that North Korea does not have visions of grand 
rewards sometimes move the focus to political steps that many see as 
"key" to a solution. These include replacing the armistice with a 
peace treaty, giving the North security guarantees, discussing plans 
for an exchange of diplomats. But these, like the economic carrots, 
are only shimmering, imperfect reflections of what Pyongyang is after.

What is it, then, that North Korea wants? Above all, it wants, and has 
pursued steadily since 1991, a long-term, strategic relationship with 
the United States. This has nothing to do with ideology or political 
philosophy. It is a cold, hard calculation based on history and the 
realities of geopolitics as perceived in Pyongyang. The North Koreans 
believe in their gut that they must buffer the heavy influence their 
neighbors already have, or could soon gain, over their small, weak 
country.

This is hard for Americans to understand, having read or heard nothing 
from North Korea except its propaganda, which for years seems to have 
called for weakening, not maintaining, the US presence on the Korean 
Peninsula. But in fact an American departure is the last thing the 
North wants. Because of their pride and fear of appearing weak, 
however, explicitly requesting that the United States stay is one of 
the most difficult things for the North Koreans to do.

If the United States has leverage, it is not in its ability to supply 
fuel oil or grain or paper promises of nonhostility. The leverage 
rests in Washington's ability to convince Pyongyang of its commitment 
to coexist with the Democratic People's Republic of Korea, accept its 
system and leadership, and make room for the DPRK in an American 
vision of the future of Northeast Asia. Quite simply, the North 
Koreans believe they could be useful to the United States in a longer, 
larger balance-of-power game against China and Japan. The Chinese know 
this and say so in private.

The fundamental problem for North Korea is that the six-party talks in 
which it has been engaged -- and which may reconvene soon -- are a 
microcosm of the strategic world it most fears. Three strategic 
foes -- China, Japan and Russia -- sit in judgment, apply pressure and 
(to Pyongyang's mind) insist on the North's permanent weakness.

Denuclearization, if still achievable, can come only when North Korea 
sees its strategic problem solved, and that, in its view, can happen 
only when relations with the United States improve. For Pyongyang, 
that is the essence of the joint statement out of the six-party talks 
on Sept. 19, 2005, which included this sentence: "The DPRK and the 
United States undertook to respect each other's sovereignty, exist 
peacefully together, and take steps to normalize their relations 
subject to their respective bilateral policies."

And that is why the North so doggedly seeks bilateral talks with 
Washington. It desires not "drive-by" encounters, not a meeting here 
and there, but serious, sustained talks in which ideas can be explored 
and solutions, at last, patiently developed.
*************************************************

6.   THE BEIJING DEAL IS NOT THE AGREED FRAMEWORK
     Peter Hayes, The Nautilus Institute, 14 February 2007

[Peter Hayes is Executive Director of the Nautilus Institute and 
Professor of International Relations at RMIT University.]

The latest round of the Six Party Talks resulted in a joint agreement 
to implement a phase of "Initial Actions" including:
     ** The DPRK will freeze plutonium production and processing at 
Yongbyon and will let IAEA inspectors back into the country to monitor 
and verify this freeze;
     ** Five working groups will be set up on US-DPRK relations, 
US-Japan relations, energy and economic aid, Armistice and security 
issues, and denuclearization of the Korean Peninsula;
     ** Provision of 50,000 tons of heavy fuel oil equivalent of 
emergency energy assistance to the DPRK within 60 days.

The six parties also agreed to undertake the "next phase," defined as: 
"provision by the DPRK of a complete declaration of all nuclear 
programs and disablement of all existing nuclear facilities, including 
graphite-moderated reactors and reprocessing plant -- economic, energy 
and humanitarian assistance up to the equivalent of 1 million tons of 
heavy fuel oil (HFO), including the initial shipment equivalent to 
50,000 tons of HFO, will be provided to the DPRK."

US CAVE-IN?
The Beijing Deal has been attacked already as a sell-out and 
reminiscent of the 1994 US-DPRK Agreed Framework under which the DPRK 
froze its nuclear fuel cycle and got two light reactors and half a 
million tones of heavy fuel oil per year until the reactors were 
complete. The old Agreed Framework collapsed in 2002 when the United 
States accused the DPRK of pursuing uranium enrichment outside of the 
Agreed Framework.

The ultra-hard line critics have got it wrong, again.

The Agreed Framework provided two reactors at a cost of about $4 
billion to the DPRK on a 2% per year concessional financing basis. In 
present value for the capital and operating costs, and assuming the 
power would have been exported to South Korea on a commercial basis 
(the North Korean grid being incapable of operating these reactors), 
the total "annuitized" cost the reactors would have been about $300 
million per year for the DPRK.

The export earnings from the ROK would have been about $700 million 
per year from the two DPRK reactors exporting power to the ROK grid. 
The DPRK would thereby have earned about $368 million per year in 
profit. To this, we add an additional $150 million per year for 1/2 a 
million tons of heavy fuel oil that would have gone to the DPRK each 
year until the reactors were complete under the old deal.

The total net present value that the DPRK stood to gain in the Agreed 
Framework was about $4.6 billion (this would have been spread over 30 
years from the time the reactors began operating). The economics were 
important in the Agreed Framework, although it foundered primarily on 
the failure of both parties to implement their commitments to 
normalize political and security relations.

WHAT DO THEY GET IN THE BEIJING DEAL?
A measly 50,000 tons of heavy fuel oil in the next 60 days, provided 
they freeze their plutonium facilities and the talks in the working 
groups go well over this time frame. When they have fully "disabled" 
their fuel cycle, they get another 950,000 tons of heavy fuel oil (or 
equivalent value from other energy assistance). At the earliest, this 
would be in two years. The present value of this fuel is about $257 
million or about 6 percent of the $4.6 billion value of the old deal 
that they gave up when they opted for nuclear weapons. And, they get 
none of it until phase 2 is completed, and phase 3 of actual 
disarmament defined and presumably well underway.

And the 50,000 tons to be sent in the first 60 days given by the 
United States and other parties as a good faith down-payment is 
worth -- a tiny $15 million versus the $4.6 billion that they gave up 
when the opted for nuclear weapons. It is purely symbolic and is the 
price to be paid to get Pyongyang to continue to talk about phase 2 
and 3; and if they don't talk turkey in the working groups, even that 
is likely to evaporate.

WHAT DOES ALL THIS TELL US?
At minimum, it tells us that the DPRK leadership values its nuclear 
arsenal to be worth at least $4-5 billion. (This calculation doesn't 
capture the other putative economic benefits such as the ability to 
substitute nuclear for conventional military cost, nor the costs 
incurred by acquiring and testing nuclear weapons; nor the 
non-economic costs and benefits of being perceived to be a "nuclear 
weapons state," at home and abroad).

Second, it suggests that the DPRK haggling over energy at the last 
moment in the Beijing talks was just that -- totally predictable, 
tactically smart and strategically stupid, ambush behavior; but not 
show-stopping as proved to be the case, yet again.

VICTORY FOR THE DPRK?
Contrary to the ultra-hard line critics, others have argued that the 
United States has not only caved-in, but that the DPRK has already won 
the nuclear game. They note that in the Joint Statement's phase 2, the 
nuclear fuel cycle is to be "disabled" but nowhere in is there any 
reference to a timetable for actual disarmament and what the DPRK can 
expect to obtain in return for giving up its nuclear devices and 
fissile material already extracted from the fuel cycle. For that, one 
has to return to the September 2005 principles adopted at the previous 
meeting of the Six Party Talks wherein the DPRK reaffirmed its 
non-nuclear commitments, but does not specify how this will be 
achieved.

Conversely, it is inevitable -- and consistent with the September 
principles -- that the DPRK will return to the provision of the 2 
reactors as part of a disarmament deal. At the Beijing talks, the DPRK 
demanded 2 gigawatts of power according to media reports. The United 
States will have to meet the DPRK on this score in a phase 3 "actions" 
if it wants to convert the Beijing Deal into an implemented agreement.

Thus, the DPRK is a long way from getting what it wants-political and 
economic security -- although it gets to sit on its small pile of 
nuclear weapons for the foreseeable future.

CONTINUED DEADLOCK
By virtue of the Beijing Deal, the DPRK has kept the United States at 
bay in the short-term. It forced the United States to settle for the 
prospect of progress in talks on disarming its nuclear weapons in 
return for an immediate freeze worth about $15 million.

Simultaneously, the onus has been put back onto China to make the 
United States perform and to keep China off the DPRK's back. The DPRK 
obligations in the Beijing Deal are relatively easy to implement and 
follow well-worn routines from the 1990s with the IAEA. They have kept 
open the modality and timing whereby they would actually disarm in 
accordance with the September 2005 Principles. Now that there is 
progress in the Six Party Talks, the DPRK can also demand that the ROK 
provide half a million tons of food aid suspended by Seoul due to lack 
of progress in the talks.

We are still left uncertain as to what values -- in particular, the 
political and security benefits that flow from normalizing political 
and economic relations with the United States -- are dominant in the 
DPRK leadership's mind, and are worth more than the political and 
economic value of the DPRK's nuclear arsenal. No doubt the 
denuclearization working group will find out more on this score soon!

Meanwhile, we can be assured that the fuel oil "bribe" to the DPRK to 
participate in talks about its weapons will have little impact on the 
DPRK's calculus in the pending negotiations. Even the prospect of a 
million tons of oil in a couple of years isn't worth much compared 
with their nuclear arsenal and is more a litmus test of American 
intentions than anything else. In fact, we doubt that the DPRK can 
usefully absorb a million tons of additional heavy fuel oil in one or 
two years given the parlous state of their energy infrastructure.

There seems no more prospect after the Beijing Deal than before that 
the DPRK will do anything more than wait until it can test the 
genuineness of American intention in creating a less hostile political 
and security relationship before it gives up any of its actual nuclear 
weapons capacities.

In a still-to-be-negotiated phase 3, one might anticipate that the 
DPRK would hand over some but not all of their fissile material and/or 
nuclear devices in light of residual uncertainty about American 
intention. The meaning of disablement in phase 2 also remains to be 
determined. The DPRK is likely to leave the dismantlement of the 
Yongbyon reactor until last in the disarmament process, should we ever 
get that far, in case they feel they need to resurrect their ability 
to make more plutonium.

These will be political judgments in Pyongyang, not driven by economic 
considerations. The few small carrots on the table now may trivialize 
and degrade the process, but they should not distract attention from 
the core issues, all of which remain to be negotiated.

In short, whatever its shortcomings, the critics of the Beijing Deal 
who denounce it as simply the revival of the logic and scope of the 
old Agreed Framework have got it completely wrong. We are nowhere near 
a comprehensive agreement that captures the DPRK nuclear weapons 
program. Nor did the DPRK achieve a victory over the United States in 
Beijing.

Rather, both sides wrestled the other to a standstill and then agreed 
to talk more. As such, the Beijing Deal is one small step in the right 
direction of peacefully resolving the DPRK nuclear issue by dialog.
*************************************************

7.   WASHINGTON'S RAW DEAL
     David Frum, National Post (Canada), 17 February 2007

[Canadian David Frum is a resident fellow at The American Enterprise 
Institute. He is credited with having proposed the phrase "axis of 
evil" as a former speechwriter for President George W. Bush.]

Something has gone very, very wrong in this second Bush 
administration. That is obvious to everyone. One of the few merits of 
this week's North Korea nuclear deal is that we can get a clearer view 
of what exactly the problem is -- or should I say, what the problems 
are?

FIRST PROBLEM: The deal demonstrates a lethal failure of strategic 
vision.

The Bush administration entered office determined to take a tougher 
line on North Korea than Bill Clinton. In February 2002, George Bush 
warned in his "axis of evil" speech that North Korea was arming to 
threaten world peace. In October 2002, his administration confronted 
the North Koreans with proof that they had cheated on their 1994 deal 
with the United States, secretly starting a whole new nuclear program. 
All excellent moves -- if you have a plan to follow through. But it 
turns out: there was no plan.

North Korea responded (predictably) by accelerating its nuclear 
development, completing half a dozen bombs and testing a nuclear 
device in October, 2006. Now, five years after "axis of evil," the 
Bush administration finds itself signing almost exactly the same deal 
that the Clinton administration bequeathed it, with no more safeguards 
against cheating than before. The only difference is that North Korea 
has become a declared nuclear power in the interim. And it will remain 
a declared nuclear power: Last week's deal does not call on North 
Korea to surrender its existing weapons.

All this raises the question: What was the point of confronting North 
Korea in the first place?

SECOND PROBLEM: The deal reveals a breakdown of the administration's 
decision-making process.

It's always a good idea in government to hear lots of points of view. 
But as David Sanger reports in Thursday's New York Times: "To win 
approval of a deal with North Korea that has been assailed by 
conservatives inside and outside the administration, Secretary of 
State Condoleezza Rice bypassed layers of government policy review 
that had derailed past efforts to negotiate an agreement, several 
senior administration officials said this week. 'There was no process 
here,' said an official who has been deeply involved in the issue. 
'Nothing. There was no airing of whether this is the way to deal with 
the North Koreans.'" (Ms. Rice talks often to Sanger: his reporting on 
her actions can be taken as authoritative.)

This is not the first time Rice has practised management-by-avoidance. 
As National Security Adviser during Bush's first term, it was her job 
to broker and reconcile disagreements among the national security 
bureaucracies. But when State, Defence and CIA quarrelled over how 
postwar Iraq was to be governed, Rice backed away from this absolutely 
essential issue. Each bureaucracy went on its own contradictory way. 
The United States arrived in Baghdad with no consensus at all on what 
was to happen next. Result: chaos.

In the Korean case, Rice's bypassing of the rest of the government 
again means that important questions went unasked.

For example: Under the new deal, the US has promised to remove North 
Korea from the list of state sponsors of terrorism. That may seem an 
easy concession, since North Korea is not known to have murdered any 
foreigners since 1987. However, North Korea did kidnap 17 Japanese 
citizens in the 1990s -- apparently in order to obtain language tutors 
for its spy services. Some of the kidnapped Japanese still remain in 
North Korea; none has received restitution. Understandably, these 
kidnappings ignite huge passions in Japan. Was Japan consulted before 
North Korea was offered absolution? If not, Rice's deal will inflict 
terrible damage on the all-important US-Japan relationship.

THIRD PROBLEM: The deal highlights the Bush administration's 
reluctance to convince or persuade.

At his press conference on Wednesday, President Bush was asked about 
the sharp public objection to the deal by his former UN ambassador, 
conservative stalwart John Bolton. Mr. Bolton's main objection: the 
deal offered North Korea immediate relief from US financial sanctions 
in exchange for North Korean concessions that would not materialize 
for months, if ever.

The President's reply: "I strongly disagree -- strongly disagree with 
his assessment."

Okay, but why? Why was Bolton wrong? As to that, the President offered 
a vague half-sentence that dismissed financial sanctions as "a 
separate item," and then hastily moved on. If you cannot explain your 
case, you leave behind the impression that you have not got a case to 
explain.

Of course, everyone hopes the deal will succeed. But on the evidence, 
the deal looks a lot more like a guide to better understanding the 
administration's failures.
*************************************************

8.   CAN THE NEW NUCLEAR DEAL WITH NORTH KOREA SUCCEED?
     C. Kenneth Quinones, The Nautilus Institute, 20 February 2007

[C. Kenneth Quinones is a former State Department North Korea 
Director, now Professor of Korean Studies at Akita International 
University in Japan.]

The new nuclear deal hammered out in Beijing in mid-February 2007 is a 
very tentative and limited first step toward ending North Korea's 
nuclear ambitions. Unfortunately, it creates numerous new problems 
without solving any fundament issues. Prospects for its eventual 
success could prove worrisome.

On the plus side, the accord is a step away from confrontation toward 
preserving peace and prosperity in Northeast Asia. The Bush 
Administration, after four years of exchanging heated rhetoric with 
Pyongyang and reliance on ineffective coercive tactics like economic 
sanctions, has finally decided to negotiate with Pyongyang. Frankly, 
this has always been the only way to achieve a "peaceful diplomatic 
solution" to the North Korean nuclear issue. Simply put, at long last 
negotiations have finally just begun.But the accord's negative aspects 
outweigh its positive points. It is not a new "Agreed Framework." This 
is a tentative deal. If North Korea does not like the direction of 
future negotiations, it can pull out at anytime and restart its 
nuclear reactor. The Agreed Framework was not a tentative deal. It was 
a package deal -- all or nothing. The 1994 accord "froze" all nuclear 
activities and put all North Korean nuclear facilities under 
International Atomic Energy Agency (IAEA) monitoring. The new deal 
says that the "DPRK will discuss with other parties" the scope of 
nuclear activities to be covered. Also the details IAEA monitoring are 
to be "agreed between IAEA and DPRK." The Agreed Framework resolved 
such issues prior to its finalization.

In other words, the new agreement reverses the process that led to the 
Agreed Framework. Numerous working level discussions were held in New 
York and elsewhere to resolve the details of implementation prior to 
the agreement's conclusion. Under this new deal, North Korea can 
controls the entire process because it can threatening to unfreeze its 
nuclear activities anytime that it is unhappy with one or more of the 
working group negotiations.

Assistant Secretary of State Christopher Hill has incorrectly claimed 
that the new deal is better than the old one because it is 
"multilateral." He simply does not know his history. The Agreed 
Framework was multilateral. Prior to its finalization, the United 
States forged an international consensus supportive of the accord by 
consulting daily for eighteen months with Seoul, Tokyo, Beijing and 
Moscow, not to mention many other governments. Also, the Agreed 
Framework was designed to support the multilateral IAEA, an agency of 
the United Nations. The Bush Administration has openly and repeatedly 
belittled the effectiveness of the IAEA and its director, even calling 
for his replacement.

The new accord's shortcomings suggest that the Bush Administration was 
desperate to continue the Six Party Talks at any price. Over-extended 
militarily in the Middle East, the Bush Administration cannot afford 
instability on the Korean Peninsula. Thus it appears to have shifted 
abruptly from asserting an extremely hard line to becoming almost 
mushy on North Korea. This is certain to inflate Pyongyang's 
expectations of the concessions it can win in future negotiations. 
Also, the Bush Administration has lost the initiative in the Six Party 
Talks, and surrendered it to China and South Korea.

At the same time, North Korea has won affirmation of its basic 
stances: "simultaneous steps" and "action for action," concepts first 
defined in the 1993-94 US-DPRK bilateral negotiations and confirmed in 
China's statement after the first round of Six Party Talks ended in 
August 2003. Pyongyang has also won its long struggle for direct 
bilateral negotiations with the Bush Administration, as provided in 
the new accord's third article. In exchange, Pyongyang only has to 
shut down its twenty two year old nuclear reactor and allow the IAEA 
to return to North Korea. For this it will also receive approximately 
$400 million to do nothing.

Finally, Japan gets nothing out of the deal. On the contrary, its 
leverage for negotiating with North Korea regarding the abduction 
issue has been undercut. Also, North Korea remains free to develop 
nuclear tipped ballistic missiles which it could eventually use to 
threaten Japan's national security.

Reaction understandably has been mixed. Paradoxically the strongest 
advocate appears to be President Bush, along with China and South 
Korea. Prime Minister Abe promptly voiced his displeasure. In 
Washington, both opponents and advocates of negotiations with North 
Korea have expressed substantial reservations. Even Pyongyang has 
emphasized publicly the agreement's tentative nature. Ultimately, the 
lack of political support in many capitals and the new accord's 
complexity and numerous areas of ambiguity will make successful 
implementation extremely difficult.
*************************************************

9.   ROBERT GALLUCCI ON DEALING WITH NORTH KOREA
     Foreign Policy, Web Exclusive, Posted February 2007

[Robert Gallucci is dean of the Walsh School of Foreign Service at 
Georgetown University. He served as the chief US negotiator during the 
1994 nuclear crisis and signed the Agreed Framework between the United 
States and North Korea.]

The latest round of six-party talks has ended, and North Korea at last 
appears ready to halt its nuclear machine in exchange for economic 
aid. But after eight nuclear bombs and one nuclear test, is the deal 
several years too late? FP asked Robert Gallucci, dean of Georgetown 
University's Walsh School of Foreign Service and the diplomat who 
signed the 1994 Agreed Framework, for his take on the chances of a 
nuclear-free North Korea.

FOREIGN POLICY: What are your first reactions to the deal that's 
apparently been struck between the United States, China, Russia, 
Japan, South Korea, and North Korea?

Robert Gallucci: I think it's a good first start, and I'm pleased to 
see that we're moving down the road of negotiation ... there are a lot 
of steps to go. What everybody will want to know is, "Are we going to 
get all the plutonium? Are we going to get the uranium enrichment 
program?" And you can't tell yet ... I think this agreement has the 
prospect, if it's completed, of indeed stopping the North Korean 
nuclear program and rolling it back. But there is a long way to go 
from here to there. Both sides are going to have to work hard at this 
and have a certain amount of patience.

FP: Why do you think that the North Koreans agreed to talk now?

RG: I think that question proceeds from the wrong assumption: I think 
that the North Koreans have been prepared to talk for years, and we 
have not been. I think the correct question is, why is it that we are 
now prepared to talk?

FP: So why is the United States now willing to negotiate?

RG: I think the president of the United States made a decision, both 
after the midterm elections and after the North Korean nuclear test, 
that maybe of the foreign-policy problems he confronts -- North Korea, 
Afghanistan, Iran, and Iraq -- this is the one that he might be able 
to settle before he leaves office.

FP: This agreement apparently doesn't provide for the destruction of 
the bombs North Korea has created in the past three years, since the 
talks were last suspended. You've seen John Bolton, among others, 
criticize the deal and claim that it simply rewards Pyongyang for 
holding off the State Department for years. Isn't there a danger that 
the negotiations will demonstrate that procrastination will eventually 
yield positive results for rogue states?

RG: Two things: [We] don't know that [the deal] doesn't require the 
destruction of fabricated nuclear weapons. But, certainly, accounting 
for the plutonium and spent fuel has to be one of the provisions of 
the deal, eventually. Second, this theory that Bolton apparently 
operates on, that we're in a situation where we have to worry about 
rewarding people or not rewarding people is not a useful construct for 
international relations. It's probably not bad if you're trying to 
teach your kids about the playground, but [it doesn't work] for 
international politics. The only question to ask is, "Would we be 
better off with this deal than without it? Does this serve the 
national security interests of the United States?" If it does, then 
let's do it. If it doesn't, then let's not. I'm not into the 
reward-and-punishment thing with the North Koreans, and it's just too 
expensive a way of looking at an issue as important as this.

FP: The United States apparently promised to consider removing North 
Korea from its list of state sponsors of terrorism. How significant is 
that move?

RG: That actually could have been done -- if my information is up to 
date -- quite some time ago, because while the North Koreans were 
guilty of some kinds of atrocious acts of terrorism in the past, we 
haven't associated North Korea with terrorists for decades. So this is 
a move that can be done in good conscience. It's consistent with a 
general effort to improve political relations between Pyongyang and 
Washington.

FP: How likely is it that Kim Jong Il will follow through with gradual 
disarmament and fully disclose all of North Korea's nuclear 
stockpiles? Will he give up his most powerful bargaining chip with the 
West?

RG: I think it's plausible; I don't think it is a certainty. I think 
it becomes more likely if the North Koreans believe they're getting 
the political relationship they want with the United States and that 
they can rely on that relationship. If they're not getting it, then 
their concern about having some way to dissuade the United States 
[means that Kim would resist] giving up that nuclear weapons program. 
So I think our behavior plays into the calculus of the North.

FP: How will this deal leave us any better off than we were in 2002?

RG: In 2002, before we confronted the North Koreans with the truth 
that we knew that they were cheating, we still needed to deal with 
that problem. We had locked up the plutonium, but there [was still] a 
secret uranium enrichment program. After we confronted them, we also 
told them that we wouldn't continue with this framework until they 
gave up this program as a unilateral first step -- and they refused to 
do it. We now are in a situation where we're saying, "OK, we'll go 
step by step with you. We'll provide some of the benefits you want, 
and you'll provide some of the restraint that we want." So we are on a 
track now that could lead to the ultimate dismantlement of their 
nuclear weapons programs. It's a new and better position to be in.
*************************************************

10.  IT'S ABOUT TIME!
     James Goodby & Markku Heiskanen, Nautilus Institute, 23 February 
2007

[James Goodby, former US ambassador to Finland and current Senior 
Fellow at the Center for Northeast Asian Policy Studies at The 
Brookings Institution, and Markku Heiskanen, a senior Finnish 
diplomat, who is currently Associate Senior Fellow of the Nordic 
Institute of Asian Studies, Copenhagen.]

The Bushies finally got it! That was the reaction of Korea watchers 
like us who have argued for years that the nuclear issue could only be 
definitively solved in the larger framework of a settlement of the 
Korean War. "More for more," some said; "enlarge the problem" was the 
way we put it. Now the US administration has adopted this approach and 
it finds itself under fire from left and right. Naturally, we believe 
this approach should have been taken earlier, even in the last 
Democratic Administration. But it is not correct to say that there is 
nothing new in it.

The agreement reached in Beijing on Tuesday by the six powers involved 
in the resolution of the North Korean nuclear issue could mark the 
first step towards a new era in Northeast Asia, a region where Cold 
War structures still remain.

FIRST, the agreement is a compromise accepted by all six players in 
Northeast Asia, including North Korea. This is a major change compared 
with the Agreed Framework of 1994 between the United States and North 
Korea. It is a clear move from traditional bilateral to multilateral 
diplomacy in the region.

SECOND, the nuclear issue was handled in parallel -- not sequentially 
as in the past -- with other relevant sectors: the normalisation of 
relations of the United States and Japan with North Korea and 
four-party talks to end the Korean War with a peace treaty. This is 
crucial in fitting all these moving parts into a balanced package 
deal.

THIRD, the Beijing agreement calls for creating a multilateral process 
of security and cooperation in Northeast Asia, one of the few regions 
of the world that lacks one. That's important for the region as a 
whole, where there have been disturbing signs of a revival of old 
animosities.

FOURTH, establishing working groups is a major step forward. This 
commits the six nations to concrete formulation of specific action 
plans. The work in all the five working groups are naturally 
interlinked, but, as it is said in the agreement, progress in one 
working group shall not affect progress in other working groups. Plans 
made by the five working groups will be implemented as a whole in a 
coordinated manner.

Economic cooperation now has an important role. The Beijing agreement 
may reflect positively, more or less immediately, on inter-Korean 
relations. The joint-Korean experiment of the Kaesong industrial park 
in North Korea may now continue. North Korea may drop its objections 
to the test runs of the completed railway corridors across the 
demilitarized zone between the two Korean states. If North Korea 
implements the denuclearization program as provided by the Beijing 
agreement this certainly will have a positive effect on future 
economic cooperation with its big neighbors China and Russia, both 
willing to support the economic recovery of a nuclear-free North 
Korea.

Normalisation of the relations between Japan and North Korea would 
open new prospects for the recovery of North Korean economy. In the 
long run it is a realistic option that a "Eurasian Land Bridge" could 
be opened from Japan via the Korean peninsula up to Europe, also by 
utilizing the new "Iron Silk Road." Europe does not have any concrete 
role in the ongoing process in Northeast Asia. But it can support the 
process as one of the major economic players in the region. Let us 
keep in mind that the European Union and Northeast Asia both share a 
frontier with the growing economy of Russia.

Will this new approach succeed? Critics are already sniping at it, 
North Korea can be counted on to be difficult, Japan is not happy that 
the abductee issue has not been resolved, and the issues themselves 
are daunting. So no one should expect miracles. But this approach 
deserves support. It is perhaps the last best hope for averting 
catastrophe, both in Northeast Asia and in the Middle East. Let's not 
forget that what happens now in Northeast Asia will have an impact on 
Iran, as well.
*************************************************

End CanKor # 273

*************************************************

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