BLUE HOUSE OFFICIAL HOPEFUL OF IMPROVED ROK-DPRK

1. (C) Assistant Secretary to the President for Unification
Yu Joon-ha (protect) told poloff August 7 that the Lee
administration is committed to improved ties with the DPRK,
but does not expect any movement until next year. The ROKG
is determined to establish reciprocity as part of the
ROK-DPRK relationship, which will take time for the DPRK to
accept. Due to the ROK suspension of fertilizer assistance
this year, the DPRK food situation will be much worse next
year. The ROK will provide assistance when requested because
there is a broad consensus in the government that
humanitarian assistance to the DPRK is in the ROK's long-term
interest. First on the list of humanitarian priorities is
direct food assistance followed by increased flows of
information, resolution of POW/MIA issues, and restarting
family reunions. The government, Yu said, is depending on
Hyundai Asan to broker a resolution to the Mt. Kumgang
dispute, made more difficult by new and inexperienced DPRK
functionaries handling the case. End Summary.



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Improved ROK-DPRK Relations -- Next Year


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2. (C) Assistant Secretary to the President for Unification
Yu Joon-ha (protect) told poloff in an August 7 meeting that
the Lee administration is hopeful of improved ties with the
DPRK, but expects that it will be next year before there is
any visible progress. According to Yu, the Lee
administration's insistence on making reciprocity the basis
of ROK-DPRK relations will take time for the DPRK to accept.
On the other hand, the worsening food crisis will create a
new willingness on both sides for cooperation.



3. (C) After ten years of a more accommodating ROK policy,
the Lee administration and DPRK are currently engaged in a
strategic tug of war to establish new terms for the
relationship, Yu said. The Lee administration is determined
that the principle of reciprocity should be part of the
relationship and will not give ground on that point. Once
the principle is established, Yu said the administration is
hopeful of constructive engagement with the DPRK.



4. (C) The worsening food shortage will inject more urgency
into ROK-DPRK cooperation efforts. Yu said the food-shortage
situation in North Korea is not critical this year. But, due
to the ROK's suspension of fertilizer assistance this year,
he expects the food shortage to be much worse next year,
possibly prompting the DPRK to become more amenable to
dialogue with the ROK.



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Humanitarian Aid on ROK Terms


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5. (C) The Lee administration's tougher image
notwithstanding, Yu said there is a broad consensus across
multiple elements of the ROKG that the ROK must engage the
DPRK and that humanitarian assistance is important to the
ROK's long-term interests. Yu equated food assistance to
North Korean children with a contribution to the health of
future citizens of a unified Korea--a remote possibility, but
one that the ROK must be prepared for nonetheless, he added.
Yu also speculated that continued food assistance from the
ROK, over time, would bring about more positive perceptions
of the outside world among DPRK aid recipients to the extent
that they know who provided the aid. He clarified, however,
that no matter how dire the need, the ROK cannot provide
assistance until the DPRK accepts the Lee administration's
new terms of engagement.



6. (C) Yu listed direct food assistance as the top
humanitarian priority. He put finding effective ways of
getting more information into North Korea about the outside
world as the second priority followed by resolution of
POW/MIA issues and restarting family reunions. He did not
include North Korean refugees on the list of priorities.
Asked about the omission, Yu said that the refugee issue was
too closely entwined with the ROK's complicated relationship
with China to resolve alone. Instead, to deal with this
issue the ROK needed to rely on UNHCR and other like-minded
countries such as the United States.



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Outsourcing Mt. Kumgang Negotiations


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7. (C) Yu said the ROKG was depending on Hyundai Asan, the
South Korean developer of the Mt. Kumgang tourist facilities,
to act as an intermediary with the DPRK to resolve the Mt.
Kumgang shooting incident. Because the ROKG currently had no
open line of communication with the DPRK, and because the
DPRK appeared determined to reject direct cooperation with
the ROK, Yu said the government had no choice but to rely on
a third party to explore a compromise. Yu said the Lee
administration was willing to soften its demand for a joint
investigation of the incident but that the DPRK had further
to go in finding a compromise by abandoning its call for an
ROK apology for the incident.



8. (C) Regarding the Mt. Kumgang incident, Yu said the
diplomatic and political problems were made worse by new and
inexperienced military hardliners in charge of the DPRK
committee that handled the matter. (Yu noted at this point
that new functionaries moved into position at some point over
the past year.) According to Yu, more experienced DPRK
functionaries would have disposed of the victim's body and
never admitted to the shooting--in Yu's opinion, making the
matter easier to resolve from the DPRK perspective. But the
less-experienced handlers made the issue more difficult for
the North Korean side to resolve by producing the body and
conceding the basic facts of the killing.



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Comment


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9. (C) For everyone in the LMB administration involved in
North Korea policy, these are very frustrating times. The
Ministry of Unification (MOU), previously a hive of activity
dealing with the day-to-day management of North-South
projects, is now a quiet office complex, reduced mostly to
analyzing the latest broadcasts from Pyongyang lambasting the
ROK's policy. Within the ROKG, opinions are broadly divided
between the career bureaucrats in MOU and the Blue House who
want to see a kick-start to engaging the North and the
political appointees who believe that the North must accept
at least some of the South's terms. As the wait gets
longer--and as the North Koreans become even more critical of
the South--the ROKG will show more "flexibility". For now,
however, the ROKG is not quite there, mostly because the
South Korean public supports President Lee's tougher policy
toward the North.
VERSHBOW