EAP PDAS STEPHENS' JUNE 1 MEETING WITH ASSISTANT

C O N F I D E N T I A L SEOUL 001836 SIPDIS SIPDIS NSC FOR CHA E.O. 12958: DECL: AFTER KOREAN REUNIFICATION TAGS: PREL MNUC MARR ECON KN KS SUBJECT: EAP PDAS STEPHENS' JUNE 1 MEETING WITH ASSISTANT MINISTER OF UNIFICATION PARK CHAN-BONG Classified By: DCM Mark C. Minton. Reasons 1.4 (b, d). SUMMARY -------------- ¶1. (C) In a June 1 meeting with EAP PDAS Kathleen Stephens, Assistant Minister of Unification Park Chan-bong stated that the DPRK's latest display of uncooperative behavior in inter-Korean dialogue led Seoul to question whether the DPRK leadership was experiencing some new internal strife in its policies toward inter-Korean relations. The ROK would demand the resumption of the test-run of the inter-Korean railway at the June 3-6 economic cooperation vice ministerial in Jeju. Park and PDAS Stephens shared concern about the reports of possible North Korean missile activity, with Stephens noting that the DPRK's latest actions cast doubt on whether it truly decided to denuclearize and appeared to be attempting to divide the United States and the ROK. Park assured PDAS Stephens that the ROK would not let that happen, and that Seoul would continue to urge the DPRK to cooperate on the nuclear issue in all inter-Korean dialogue. END SUMMARY. ¶2. (U) On June 1, EAP PDAS Kathleen Stephens met with Assistant Minister Park Chan-bong, Ministry of Unification (MOU),to discuss the ROKG's assessment of the DPRK's recent behavior and inter-Korean dialogue. Park was accompanied by Kim Jung-ro, MOU Director of International Cooperation. PARK: EMPLOYING 100,000 KIC WORKERS BY 2007 "TOO AMBITIOUS" -------------- -------------- ¶3. (C) Park updated PDAS Stephens on the current status of the Kaesong Industrial Complex (KIC),explaining that 96 foreign ambassadors to the ROK would visit the KIC on June 12, accompanied by officials from MOU, the Ministry of Foreign Affairs and Trade (MOFAT),the National Intelligence Service (NIS),and other ROKG agencies involved in national security and economic affairs. In total, approximately 130 people would participate in the visit to the KIC. The ROK planned to employ up to 100,000 North Korean workers at the KIC by next year. Park noted, however, that he personally thought this was too ambitious since the DPRK might be resistant to exposing such a large number of North Koreans to South Korea's vastly superior pay and working conditions. He also anticipated that, even with North Korea's approval, such an increase in the number of North Korean workers would inevitably result in increased labor conflicts. DPRK'S UNCOOPERATIVE STANCE A SIGN OF NEW INTERNAL STRIFE? -------------- -------------- 4, (C) Park said the DPRK's latest display of uncooperative behavior in recent inter-Korean dialogue confounded the ROKG. It had canceled the May 25 test-run of the inter-Korean railway with only a day's notice, arguing that: (1) the ROK did not foster an environment for inter-Korean peace, as evinced by the burning of the DPRK flag by South Koreans and the ROK's refusal to redraw the Northern Limit Line (NLL) in the West Sea; (2) the ROK was using inter-Korean cooperation and the late-June visit of former President Kim Dae-jung to the DPRK for its own political gains; and (3) the ROK had set up only a handful of "symbolic" factories at the KIC and was not being sincere enough in its approach to developing the KIC and inter-Korean economic cooperation in general. This, combined with Pyongyang's rejection of the ROK's proposal for a second inter-Korean defense ministerial during the May 17-19 inter-Korean general officer-level military talks, made ROK officials wonder whether the DPRK had some new internal conflict with respect to North-South engagement. ROK TO URGE RESUMPTION OF RAILWAY TEST-RUN IN JEJU TALKS -------------- -------------- ¶5. (C) Park stated that he could not determine whether Pyongyang's new attitude was the result of the reported division between its military hardliners and its bureaucrats who favored economic reform, or whether Kim Jong-il himself was orchestrating the apparent change in the DPRK's posture vis-a-vis the ROK for political reasons. He opined that the DPRK likely felt "cornered" by South Korean and international media reports of Pyongyang's intransigence on the railroad issue. Acknowledging that North Korea had taken a large step backward in its engagement with Seoul and the international community, Park underscored that the ROK would urge the DPRK to resume the test-run of the inter-Korean railway at the June 3-6 vice ministerial-level economic cooperation talks in Jeju. He noted, however, that it was difficult to predict whether the DPRK would be cooperative in light of the clear differences between the two sides in their respective agenda items for the talks. DPRK EAGER FOR DEAL IN JEJU, ROK TO DEMAND TEST RUN -------------- -------------- ¶6. (C) In response to PDAS Stephens' question on the ROK's assessment of the economic and agricultural conditions in North Korea, Park said he did not have updated information. He pointed out, however, that the DPRK's dismal economic conditions made it dependent on South Korean assistance even during the best crop years. He noted that Pyongyang was eager to conclude a deal at the economic cooperation vice ministerial that would grant the ROK exclusive development rights for North Korean mineral mines in exchange for ROK provision of raw materials for garments, shoes and soap. As such, the ROK would take advantage of the DPRK's needs and leverage the deal on resuming the test-run for the inter-Korean railway. Park stated there remained sufficient time to conduct the test-run, as former President Kim Dae-jung's visit was scheduled for June 27-30. Because Kim had to travel with extensive medical equipment due to his health conditions, the best way to travel was by rail. Noting that ROK negotiators were working to arrange Kim's travel overland with their DPRK counterparts, Park said travel by car was a possibility. Such a trip would not, however, be easy for Kim given his physical condition. PDAS STEPHENS: WASHINGTON WOULD TAKE MISSILE TEST SERIOUSLY -------------- -------------- ¶7. (C) PDAS Stephens affirmed U.S. concerns about reports of North Korean activity portending a missile test. A missile test by North Korea would be at odds with the Six Parties' stated goals in the September 19 Joint Statement of Principles. Underscoring that the United States was eager to resume the Six Party Talks and implement the Joint Statement, PDAS Stephens stressed that the DPRK's reluctance to return to negotiations raised doubts about whether it had truly made the strategic decision to denuclearize. Moreover, the DPRK's behavior since the last round of the Six Party Talks seemed aimed at dividing the United States and the ROK. SEOUL WOULD NOT LET DPRK DIVIDE U.S. AND ROK -------------- ¶8. (C) Park assured PDAS Stephens that Seoul would not allow the DPRK to drive a wedge between the United States and South Korea. The ROK was fully cognizant of Washington's concerns and, as such, worked hard to inform the Embassy before and after each session of North-South dialogue. The missile issue was a concern for the ROK as well, especially its potential impact on inter-Korean dialogue. Conducting a missile test would, however, make it difficult for the DPRK to conclude a favorable deal at the economic cooperation vice ministerial. The ROK would maintain its position that the DPRK must cooperate with South Korea and the international community on the nuclear issue. Park, underscoring that the ROK had strongly urged the DPRK to return to the Six Party Talks during the April 21-24 inter-Korean ministerial, stated that the ROK would continue to link inter-Korean economic cooperation to progress in the DPRK nuclear issue. VERSHBOW