- The Washington Times - Tuesday, January 30, 2007

2:40 p.m.

SEOUL — Chinese officials announced today that six-party nuclear disarmament talks will resume on Feb. 8 amid published reports that the United States was willing to see some North Korean funds released from a bank in the Chinese autonomous territory of Macau.

Chinese Foreign Ministry spokeswoman Jiang Yu said the round should concentrate on implementing a September 2005 joint statement on denuclearization of North Korea, raising hopes for a breakthrough.

The negotiations have been stalled since that statement because of U.S.-backed financial sanctions on North Korea, particularly the freezing of a Pyongyang account at Banco Delta Asia, or BDA, in Macau in response to suspicions that Pyongyang was counterfeiting U.S. currency and committing other crimes.

Separate talks on those sanctions were under way in Beijing yesterday, with the U.S. delegation led by the Treasury Department’s deputy assistant secretary for terrorist financing and financial crimes, Daniel Glaser. The North Korean team was led by O Kwang-chol, president of the North’s Foreign Trade Bank.

The talks create “the opportunity to discuss the concerns of the international financial community about illicit conduct in the international financial system,” Mr. Glaser said.

“I know that there’s a lot of focus on Banco Delta Asia, and we’ll certainly be talking about the illicit conduct of that bank. We’ll also be talking about counterfeiting and other related issues.”

A spokesperson for the U.S. Embassy in Beijing confirmed by telephone that the financial talks would continue today. A Reuters News Agency report from Beijing said U.S. officials had confronted North Korean officials with documentary proof of illicit dealings at BDA.

The Treasury Department warned American and international financial institutions in September 2005 not to have dealings with BDA, a Macau-based bank that it accused of illicit activities on behalf of the North Korean government. Following the warning, international financial companies curtailed trades with BDA.

The Macau government took over the bank and froze an estimated $24 million in North Korean assets. The U.S. warning also had an effect on other international financial institutions that were fearful of being blacklisted by the U.S. Treasury.

The North subsequently has made the lifting of what it calls U.S. sanctions against the bank a condition for progress in the six-party nuclear talks. With Washington refusing to link the two issues, the North boycotted the denuclearization talks for more than a year.

There was little progress when the six-party talks finally resumed in Beijing last month, with the U.S. and North Korean financial teams meeting on the sidelines. However, both sides were upbeat after three days of closed-door bilateral meetings in Berlin earlier this month.

Though Washington insists the Berlin meetings were held in the context of the six-party talks, it was the first time the countries had met without other countries’ delegates in near proximity since the process began.

Japanese and South Korean media, citing unnamed sources, have since reported that the United States might permit the unfreezing of some $13 million held by North Korean BDA. And yesterday, South Koreas Joongang Ilbo newspaper, without naming sources, said President Bush had ordered the Treasury Department to cooperate with the State Department on the North Korean issue.

Experts say at least some of the North Korean funds held in BDA are from legitimate business.

In an interview with The Washington Times last summer, Nigel Cowie, head of Daedong Credit Bank, the Norths only foreign-run bank, said that some of his banks funds also were locked up in BDA.

He confirmed the difficulties North Korea was facing, as international financial institutions were reluctant to deal with its banks following the Treasurys September 2005 warning. This situation had forced North Korea to rely on couriers to hand-carry international currencies in and out of the country, he said.

Copyright © 2019 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide