Round One Goes to North Korea

Today the U.S. decided that funds frozen in Macao are not so bad after all and allowed the six party negotiations to proceed. North Korean funds had been frozen because evidence pointed to those monies' being ill-gotten gains from perpetual copyright violation and outright counterfeiting activities.

Until now, North Korea had declared it would not keep its end of the nuclear agreement by shutting down its weapons facility until the funds were unfrozen. Now that's supposed to happen. So the negotiations will not come to a screeching halt today. And the $95 million pledged to help N.Korea out of the hole its dug for itself is still alive and well, while inspectors will not be allowed until the negotiations are completed. At present, the inspection consists of watching steam rising from the facility , and the steam is continuing. Are you laughing out loud yet?

US authorities on Monday agreed to release $25m in North Korean funds that had been frozen at a bank in Macao, resolving a major sticking point to the six-party talks aimed at Pyongyang's nuclear disarmament.

Daniel Glaser, US deputy assistant treasury secretary, said the funds would first be transferred from Macao's Banco Delta Asia to a North Korean account at the Bank of China in Beijing.

Mr Glaser said the funds would then be used for humanitarian and education causes in North Korea and "solely for the betterment of the North Korean people". He said Pyongyang officials had proposed the solution, and made assurances the funds would be used for such social services.

The announcement came just hours before the latest round of the six-party talks started in Beijing, and is likely to pave the way for major progress towards the dismantlement of North Korea's Yongbyon nuclear reactor.

Pyongyang's main envoy said on at the weekend in Beijing that North Korea would not close its main reactor until the financial matter was resolved.

The dismantlement of Yongbyon, the first step outlined in the landmark February 13th denuclearisation agreement, will be the focus at this round of the talks, which involve the US, Japan, China, Russia and the two Koreas.

The February agreement stated that North Korea had 60 days to close Yongbyon and a plutonium processing plant. The International Atomic Energy Agency is in charge of verifying the process.

In exchange, Pyongyang was promised energy and economic aid, and a process to start normalising relations with the US and Japan.

The US Treasury froze the North Korean funds at BDA in late 2005, accusing the Macao bank had helped North Korea with money laundering, counterfeiting and financing weapons of mass destruction.

The move, which largely hamstrung North Korea's international banking capabilities, prompted Pyongyang to quit the international talks.

Christopher Hill, the main US envoy to the talks, has said repeatedly in recent days the financial dispute would not stall the nuclear talks.

Mr Hill said at the weekend the parties were now on a "tight deadline" to discuss the specifics of nuclear dismantlement. "There's many ways you can disable these facilities," he said. "I think we'll get through this."

However Wu Dawei, China's lead diplomat for the talks, said negotiations still faced "a lot of difficulties and obstacles".

It has been an ongoing negotiation point that the U.S. would make sure Kim Il Jong wouldn't get his brandy and movies if he didn't close down the nuclear weapon manufacturing. Now we're being really savvy, allowing the funds claimed to be gained by illegal activities to go for humanitarian ends - reminiscent of the Oil for Food Program of recent ill repute in Iraq.

Reports from neighbors indicate that the nuclear facility remains operational, although North Korea has announced that it has taken preliminary steps for its shutdown.

Until the U.S. recently came 'off its high horse' and quite claiming that it would not negotiate with N.Korea, of course, even these concessions weren't happening.

It's encouraging that the U.S. is negotiating to keep nuclear conflict from becoming the next step in our international relations. It would not appear that we're 'winning' unless the mere fact that we are keeping the negotiations alive is considered.

For this maladministration, that is an advance in negotiating skill.