ROK UNIFICATION MINISTER ASSESSES INTER-KOREAN

C O N F I D E N T I A L SEOUL 002037

SIPDIS

E.O. 12958: DECL: 10/14/2018
TAGS: PGOV PREL KS KN
SUBJECT: ROK UNIFICATION MINISTER ASSESSES INTER-KOREAN
RELATIONS

Classified By: Ambassador Stephens. Reasons 1.4 (b/d)


1. (C) Summary: Unification Minister Kim Ha-joong gave the
Ambassador an assessment of the current state of inter-Korean
relations during a courtesy call October 13. The DPRK's
harsh rhetorical attacks on the Lee administration continued,
Kim said, as did its refusal to meet to discuss
implementation of inter-Korean summit agreements. The ROKG
had yet to receive an official response to its offer of 50
thousand tons of food aid (corn),Kim added, but unofficially
the DPRK had declined; still, Seoul would consider how to
move forward on humanitarian assistance once there was
progress on the nuclear issue. Ideally, food aid would
consist primarily of direct assistance with a portion
contributed through the WFP. Regarding inter-Korean
projects, Kim said that Hyundai Asan was working to resume
tours to Mt. Kumgang in time to commemorate the tenth
anniversary of the opening of the resort there. Rocky
inter-Korean government relations had not adversely affected
activity at Kaesong Industrial Complex (KIC),he said, which
continued to expand. He doubted that Pyongyang would follow
through with a threat to shut down the project. The Ministry
had informed South Korean NGOs about the DPRK's concerns
about the leaflets they distribute to the North, but did not
expect this would have any affect on such activity. Minister
Kim expressed confidence that the Ambassador's tenure in
Seoul would be a success because of her understanding of
Korea. END SUMMARY.

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DPRK FIXATED ON INTER-KOREAN AGREEMENTS, ANTI-LMB RHETORIC
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2. (C) ROK Unification Minister Kim Ha-joong provided the
Ambassador with a lengthy assessment of the state of
inter-Korean relations during a courtesy call at the
Headquarters for Inter-Korean Dialogue on October 13. The
DPRK's rhetorical attacks on the ROKG persisted unabated, he
said, as they had since President Lee Myung-bak's
inauguration in February. The North also continued to insist
on implementation of all aspects of both the June 15, 2000
and October 4, 2007 Inter-Korean Summit agreements. Stating
that the ROKG respected all North-South accords, Minister Kim
made three points about the October 4 agreement: 1) it was
entered with only three months remaining in President Roh
Mu-hyun's term, 2) it consists of 45 points of agreement, and
3) full implementation would cost an estimated $14 to 15
billion. Given the cost -- and especially considering the
global financial crisis -- Kim said it would be very
difficult for the ROKG to commit to short-term implementation
of the agreement in its entirety.


3. (C) The ROKG was willing to discuss summit commitments,
Kim continued, but the DPRK had refused to do so, arguing
that Seoul must first agree to uphold all its commitments.
Furthermore, the North had given no official response to the
ROKG's June 2008 offer of food aid in the form of 50 thousand
tons of corn, turning the proposal down through unofficial
channels. The DPRK had instead continued its verbal attacks
on President Lee in an attempt to thwart the ROKG's attempts
to build consensus domestically on policy toward North Korea.
Kim said the present administration would "not be swayed" by
the North's rhetoric.

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NUCLEAR ISSUE KEY
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4. (C) Despite the North's refusal to resume dialogue,
Minister Kim said, the ROKG had made one additional proposal
regarding humanitarian assistance to the DPRK. The ROKG
would decide when and how to implement the proposal once
there was progress on the nuclear issue. Kim observed that
developments in nuclear negotiations had a broad impact both
on inter-Korean activity and relations within the region.
The Ambassador praised the ROKG's restrained response to
North Korea's verbal attacks. Noting the removal of the DPRK
from the U.S. state sponsors of terror list over the weekend
and expressing appreciation for the ROK's close coordination
within the Six-Party framework, the Ambassador said progress
toward denuclearization continued to be slower than we hoped,
but we were committed to keep working at it.

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FOOD AID: DIRECT? THROUGH WFP?
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5. (C) Elaborating on the ROKG stance on food aid and
humanitarian assistance, Minister Kim said that while direct
provision of aid was most efficient, there may not be a way
for the DPRK to accept it without a loss of face. The ROKG
was therefore considering contributions of aid in response to
an appeal from the World Food Program (WFP). Ideally, he
said, aid would be split, with most of it provided directly
and the remainder through the WFP.

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KUMGANG, KAESONG STATUS REPORTS
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6. (C) Confirming that North Korea had still not responded to
ROKG requests for dialogue on the Mt. Kumgang shooting
incident July 11, Minister Kim indicated that Hyundai Asan
was working with DPRK authorities toward a resumption of
tours to the resort before the tenth anniversary of its
opening November 18, 1998. As for Kaesong Industrial Complex
(KIC),he said that rocky inter-Korean relations had not
hindered business activity. Kim pointed out that the number
of South Korean companies and North Korean workers at KIC had
risen respectively to 83 and 34,000 over the last year, an
increase in both instances of between 80 and 90 percent.
Unlike ROKG officials, he added, South Korean businesspeople
continued to be granted access without interruption. Some
businesses were already making money on their KIC ventures,
while those still in the initial investment stage would turn
a profit within two to three years, Kim said. The ROKG was
no longer subsidizing ROKG business investment there, Kim
claimed.


7. (C) KIC was starting to deliver on its promise to affect
change in North Korea, Kim added. In the Kaesong area, on
average, one member per household worked at KIC. Because of
relatively attractive wages, Kim continued, many North
Koreans ask to have relatives employed at KIC. Those who
return to other parts of North Korea after working at KIC
share what they have experienced.


8. (C) Acknowledging that the North had threatened to shut
down KIC during recent military-to-military talks at
Panmunjeom, Minister Kim said he doubted they would follow
through. Kim Jong Il was most proud of the three
inter-Korean projects, Kim explained: the Mt. Kumgang resort,
KIC, and Kaesong city tours. The Mt. Kumgang had already
been suspended, so it was not likely the North Koreans would
shut down either of the remaining two; to do so would mean
KJI had made a mistake.

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LEAFLETS
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9. (C) Regarding DPRK complaints raised during the Panmunjeom
meeting about leaflets distributed by South Korean NGOs,
Minister Kim said the North Koreans were fully aware that the
ROKG could not stop this activity just as it could not stop
the thousands of demonstrators who took to the streets of
Seoul over U.S. beef imports in the summer. The Ministry of
Unification had informed relevant NGOs about the North's
position on the issue, but harbored no illusions that this
would change their activities.

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ROK-US RELATIONSHIP IMPORTANT, THUS DIFFICULT
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10 (C) On overall U.S.-ROK ties, Minister Kim said that the
relationship was strong at this point, but there were bound
to be difficulties from time to time. The same was true when
he served as Ambassador to China, he said. (Bio Note:
Minister Kim was ROK Ambassador to China 2001 - 2008 and
presented the Ambassador with a signed copy of his book on
China.) It is precisely because the relationship was so
important that difficulties arose, Kim concluded. That said,
Minister Kim expressed confidence that the Ambassador's
tenure in Seoul would be a success because of her "full
understanding" of Korea. He noted she had been the subject
of favorable media treatment and positive public sentiment.
STANTON