CHUNG DONG-YOUNG'S ADVISORS SET FOREIGN POLICY

UNCLAS SEOUL 001047

SIPDIS

SIPDIS

E.O. 12958: N/A
TAGS: ETRD KN KS PGOV PINR PREL
SUBJECT: CHUNG DONG-YOUNG'S ADVISORS SET FOREIGN POLICY
DIRECTION


1. (SBU) SUMMARY: Advisors to presidential hopeful and
former Uri Party chairman Chung Dong-young's (DY) told us
April 4 that Chung likely would leave the Uri Party to form
his own coalition party before the presidential candidate
registration deadline of April 23. Chung's advisors asserted
that DY ultimately would support the FTA, but he thought
ratification should be postponed until 2008. Chung also
hoped that the Kaesong Industrial Complex (KIC) would
eventually be designated as an "outward processing zone" in
the FTA. The advisors said the DPRK's strategy in the Six
Party Talks was to obtain heavy fuel oil for disablement of
the Yongbyon facility, and then negotiate a separate deal for
more (either light water reactors or other aid) in exchange
for dismantling their nuclear programs and relinquishing
plutonium. The advisors believed the Banco Delta Asia issue
was only a "technical problem" and would be resolved because
North Korea desperately wanted to regain its international
financial transaction capability. They asserted that South
Korean humanitarian aid to North Korea established the
groundwork for future progress on North-South relations. END
SUMMARY

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CHUNG DONG-YOUNG AND THE FTA
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2. (SBU) On April 4, the DCM hosted a dinner for foreign
policy advisors to former Unification Minister and current
presidential contender Chung Dong-young. Chung's advisors
all agreed that Chung would leave the Uri party to create his
own coalition, although Professor Kwon Manhak of Kyunghee
University said specific details would be made public closer
to the April 23 election filing deadline. Chung would
support the recently concluded FTA, Kwon said, but he
declined to comment on the degree of that support prior to
the election. According to Kwon, Chung believed the
agreement had been reached too fast and ratification should
be held after the presidential election. Chung's advisors
expressed their hope that the Kaesong Industrial Complex
(KIC) in the DPRK would ultimately be specifically designated
as an "outward processing zone" and therefore fall under the
purview of the FTA.

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YONGBYON FOR HFO AND SEPARATE DEAL FOR PLUTONIUM
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3. (SBU) According to Kim Yeon-chul, a North Korea expert and
Korea University Professor, Chung believes that an ROK-DPRK
summit, preferably at Kaesong, would help the
denuclearization process. Denuclearization would take time,
and given that nuclear weapons and fuel were North Korea's
only bargaining tools, the DPRK would not give them up
easily. The DPRK's strategy was to trade "Yongbyon for heavy
fuel oil (HFO) and make a separate deal for the plutonium."
Chung also believes that ROK aid to the DPRK was humanitarian
in nature and helped lay the groundwork for future amicable
relations. On a practical level, aid to the North resulted
in better security on the Peninsula and an increase in the
number of South Koreans in North Korea. As an example, Kim
noted that the development surrounding KIC effectively
blocked one of the North's main invasion routes to the South.
The complex employed over 11,000 North Koreans, creating
higher standards of living in the city of Kaesong and sowing
the seeds for change, Kim asserted.

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BDA
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4. (SBU) The Banco Delta Asia (BDA) issue would be resolved
amicably and soon, according to Senior Research Fellow at
Sejong Institute Dr. Hong Hun-ik, because the remaining
issues were technical in nature and, more important, because
North Korea wanted and needed to reestablish its ability to
execute international financial transactions. Consequently,
the DPRK's interest in a positive resolution was far greater
than the dollar value of the frozen funds.

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1718: NATIONAL INTERESTS SUPERSEDE INTERNATIONAL LAW
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5. (SBU) Professor Kwon commented that sanctions were not
effective against the DPRK. The DCM pointed out that
sanctions were effective if all parties adhered to them, and
that the UNSC Resolution 1718 also symbolized the
international community's strong political commitment toward
a denuclearized North Korea. Professor Kwon went on to say
that North Korean ships passing through ROK waters knew that
they "could be boarded" at any time, so the ROK assumed they
were in compliance, but he added that "national interests
often supersede international law."

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COMMENT
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6. (SBU) With popular support currently hovering under five
percent, Chung's chances of becoming president are remote at
this point. Nonetheless, given his history as Unification
Minister and his strong support for engagement with North
Korea, his campaign would likely benefit from any significant
improvements in North-South relations in the run-up to the
presidential election.
VERSHBOW