North Korean Nuclear Talks To Recess As Pyongyang's Envoy Leaves For Home

BEIJING (AP) _ Talks on halting North Korea's nuclear program broke down abruptly on Thursday with the country's chief nuclear envoy flying home after a dispute over money frozen in a Macau bank

Thursday, March 22nd 2007, 9:01 am

By: News On 6

BEIJING (AP) _ Talks on halting North Korea's nuclear program broke down abruptly on Thursday with the country's chief nuclear envoy flying home after a dispute over money frozen in a Macau bank could not be resolved.

Kim Kye Gwan flew out of Beijing after refusing to take part in six-party talks to push forward a February agreement calling for North Korea to begin winding down its nuclear programs in return for energy aid and political considerations.

Kim waved to reporters when he arrived at the airport but did not say anything.

A Japanese Foreign Ministry official said that members of all six parties to the talks had agreed to a recess. The official, who spoke on condition of anonymity because of the sensitivity of the talks, said the decision was made after Kim left Beijing.

The breakdown raises doubts over whether it will be possible to meet a deadline set in the Feb. 13 denuclearization agreement that calls for U.N. inspectors to verify the closure of North Korea's main nuclear reactor at Yongbyon by April 14.

But the top U.S. nuclear envoy said he was still optimistic that disarmament deadlines can be met despite the breakdown.

``It is our strong view that we are still on schedule'' in meeting a 60-day requirement, Christopher Hill said, referring to an April 14 deadline that calls for U.N. inspectors to verify the closure of North Korea's main nuclear reactor at Yongbyon.

In Tokyo, Japanese Prime Minister Shinzo Abe criticized North Korea for not being constructive.

``It's clear there is nothing for North Korea to gain from this kind of move,'' Abe said. ``This kind of attitude is meaningless.''

Abe said North Korea only will be accepted by the international society if it takes concrete steps toward complying with its commitment to dismantle its nuclear programs.

Also Thursday, the aircraft carrier USS Ronald Reagan arrived in South Korea for joint military exercises, which North Korea called ``a dangerous provocation that casts a shadow'' at the nuclear talks.

This round of talks has been dogged by troubles since it started Monday, with Pyongyang refusing to take part for two days because of problems over the transfer of $25 million in North Korean funds frozen since 2005 at Banco Delta Asia in Macau under pressure from the United States.

Banco Delta Asia was blacklisted by Washington on suspicion the funds were connected to money-laundering or counterfeiting. The North boycotted the international nuclear talks for more than a year over the issue.

U.S. officials announced this week that the money would be transferred to the North Koreans, saying it was up to the Monetary Authority of Macau, a Chinese territory, to release the funds.

China had promised to resolve the issue as quickly as possible by transferring the funds to a North Korean account at the Bank of China.

So far, neither the monetary authority nor Banco Delta Asia have indicated when that would be, or said why the transfer has been delayed. But various reasons have been offered by other parties.

Russian envoy Alexander Losyukov, who also left for home Thursday, was quoted by ITAR-Tass news agency as saying ``the whole problem came from the American side.''

He said the United States failed to assure the Chinese side that the Bank of China could receive the funds, which were linked to a counterfeiting and money laundering investigation, without fear of facing U.S. sanctions or a ``negative attitude'' from the banking community and the U.S. government.

South Korea's Yonhap news agency said the money transfer was being delayed because Macau authorities were having difficulty confirming the ownership of 50 North Korean accounts, most of which are under the names of the heads of Zokwang Trading Co., a North Korean-run firm in Macau that U.S. officials have long suspected of being involved in money laundering.

``The difficulty of this issue is beyond our expectations and due to some technical and procedural issues we had not expected completely before,'' Chinese Foreign Ministry spokesman Liu Jianchao told a news conference.

A woman from the publicity department at the Bank of China, who would not give her name, said she had no information on the issue.

The six parties _ the two Koreas, the United States, Russia, China and Japan _ were in Beijing to discuss how to push forward the landmark Feb. 13 deal in which Pyongyang agreed to start dismantling its nuclear facilities in exchange for energy and economic aid.

Under deal, the North is to receive energy and economic aid and a start toward normalizing relations with the U.S. and Japan, in return for beginning the disarmament process. The regime ultimately would receive assistance equivalent to 1 million tons of heavy fuel oil if it fully discloses and dismantles all its nuclear programs.