GOP query deal on frozen North Korea funds
By Demetri Sevastopulo in Washington
Republican politicians on Tuesday raised concerns about a US deal to help North Korea recover $25m in frozen funds, a step Pyongyang insists is necessary for implementation of a de-nuclearisation accord.
US officials said Russia had agreed to help transfer the funds, in a move that should test whether Pyongyang intends to implement the landmark deal reached during six-party talks in February.
Pyongyang had insisted that the US find a way to transfer the funds, which have been frozen in Macao’s Banco Delta Asia since the US Treasury accused the bank of helping the Stalinist regime launder money from counterfeiting and drug trafficking.
But Ileana Ros-Lehtinen, the top Republican on the House foreign affairs committee, and several colleagues on Tuesday asked the Government Accountability Office to assess whether the transfer breached US law. The Bush administration says the move has been vetted by its lawyers.
Under pressure from the US state department, the Treasury agreed that all the funds could be unfrozen. But international banks refused to facilitate the transfer of money because of the previous allegations that it was tainted.
US officials say they are confident they have found a solution to the impasse which threatened to derail the nuclear accord. The funds will be transferred later this week to the Far East Commercial Bank, a Russian financial institution where North Korea holds an account.
One US official said this was the “real deal”, adding that the money would be transferred to the Russian bank via the Federal Reserve in New York and Moscow’s Central Bank.
If the funds are transferred it will bring a sense of relief to Chris Hill, the US negotiator on North Korea, who has been urging colleagues to be patient, despite the fact that the deadline to halt activity at the Yongbyon nuclear reactor passed in April. The six-party talks comprised the US, China, Japan, North and South Korea and Russia.
In a recent phone call to Shinzo Abe, the Japanese prime minister, that was leaked to the media, President George W. Bush expressed irritation that the issue had not been resolved despite assurances from his cabinet members.
“[The transfer] is going to remove any excuses the North Koreans have for coming back to the talks,” said Michael Green, former Asia adviser to Mr Bush now at the Center for Strategic and International Studies.
“The process can restart. But it does seem to me that we have paid a big price to get here in terms of delay and the lessons we have taught Pyongyang about consequences, or lack thereof, for non-compliance. We have spent a lot of effort getting them their money. Let’s hope [North Korean leader] Kim Jong-il doesn’t now ask for a toaster as part of his new bank account.”
