BURNS-SASAE-LEE TRILATERAL MEETING OCTOBER 14,

S E C R E T SECTION 01 OF 05 STATE 111761 SIPDIS E.O. 12958: DECL: 10/20/2018 TAGS: EAID PREL JA KS SUBJECT: BURNS-SASAE-LEE TRILATERAL MEETING OCTOBER 14, 2008 Classified By: U/S for Pol Affairs Burns for reasons 1.4 (b and d). ¶1. (C) SUMMARY: On October 14, Under Secretary Burns hosted a US-Japan-ROK trilateral meeting with Japanese Deputy Foreign Minister Kenichiro Sasae and ROK Deputy Foreign Minister Lee Yong-joon. The wide-ranging meeting covered Afghanistan and Pakistan, Iran sanctions, dealing with a resurgent Russia, engaging with China, North Korea issues and U.S. participation in regional fora. Participants agreed to hold the next trilateral meeting in Tokyo, in early 2009. During a brief bilateral pre-meeting, DFM Lee met with U/S Burns (see para 24) and raised a set of bilateral issues. End Summary. Building a U.S.-ROK-Japan Trilateral Mechanism -------------- -- ¶2. (SBU) U/S Burns opened by stressing the value of trilateral meetings between the United States, Japan and the ROK. U/S Burns noted that Northeast Asia would likely be a key focus of the next administration,s foreign policy, regardless of who wins in November. Japanese DFM Sasae said that the U.S. presence and commitment to the region was essential for Asia-Pacific peace and security. Sasae agreed that regular U.S.-Japan-ROK trilateral coordination would be an important part of U.S. regional engagement and suggested this sub-regional dialogue continue on an informal basis at the Under Secretary/Deputy Foreign Minister level. Afghanistan/Pakistan - Focus on the Border -------------- ¶3. (S) DFM Sasae said the GOJ shared the U.S. view that the situation in Afghanistan and Pakistan was of central strategic importance. Priority one is security and the international community should work on a "concerted strategy" to build Afghan police and military capacity. Second is to support President Karzai politically and economically in the run-up to next year,s election. Sasae noted that Japan had already pledged $2 billion in assistance for Afghanistan and was looking at additional measures, but cautioned it would take time to develop consensus given the political situation in Tokyo. ¶4. (S) Sasae was fairly confident that Japan would be able to extend its Indian Ocean refueling mission in support of coalition activities. He mentioned other "small but symbolic" GOJ steps such as bringing Afghan police to Japan for training. ¶5. (S) DFM Lee said the ROK generally shares Japan,s views on Afghanistan. The ROKG supports the Karzai-led government and hopes it will be able to assert greater control over areas of Afghanistan outside of Kabul. The ROK has sent one Provincial Reconstruction Team (PRT) to Afghanistan, and is considering sending more teams. In addition, the ROKG is considering providing more support for police training and financial support for the Afghan National Army (ANA). On October 31, the ROK plans to send a survey team to Afghanistan to study what assistance is needed. The survey team will provide recommendations before the end of 2008. ¶6. (S) Turning to Pakistan, DFM Sasae said that the unstable political situation, terrorists on the Afghan border, and tremendous economic challenges faced by Islamabad were of serious concern to Tokyo. He urged the U.S. to pressure Saudi Arabia to do more to help Pakistan financially. The ROKG agreed on the seriousness of the situation in Pakistan and DFM Lee said he believes improving the security situation is essential. However, Lee noted that ROK foreign assistance to Pakistan remains quite small compared to aid provided by Japan and the United States. ¶7. (S) U/S Burns emphasized that Afghanistan and Pakistan would be a priority for the United States regardless of who wins the U.S. election and that Washington would continue to seek additional contributions from Tokyo and Seoul in the critical period ahead. He agreed that the new Pakistani government faced many serious challenges and stressed that the United States would continue to encourage Pakistani financial reform. The GOP needs to exert more control in the Northwest territorial areas for the current situation in STATE 00111761 002 OF 005 Pakistan to improve. While most of the current focus is on the Pakistan-Afghanistan border, the Pakistan-India relationship also needs monitoring, he said, noting the importance of restarting a back-channel dialogue between New Delhi and Islamabad. Iran - Coordinating Efforts -------------- ¶8. (S) Turning to Iran, DFM Lee said the ROK is very interested in the Iran nuclear situation because of its links to the North Korea nuclear issue. DFM Lee said he visited Iran about two months ago, and Iran &rolled out the red carpet,8 going to great lengths to try to justify its uranium enrichment program. Lee said the ROKG message to Iran was that there is no need to enrich uranium if your goal is to use light water reactors to generate electricity. Lee noted that the ROK imports about nine percent of its oil from Iran, and thus is unable totally to break off diplomatic or economic engagement with Iran. However, the ROKG is discouraging banks and shipping companies from initiating new contracts with Iran. DFM Lee said the ROKG will not stop the delivery of two ships that Iran ordered before the current sanctions against Iran were initiated, since each ship carries a price tag of approximately $100 million and ROK investigations into the ship building contracts have found no evidence of illegal activities. The ROKG will discourage any new shipbuilding contracts with Iran, he said. ¶9. (S) U/S Burns emphasized that the U.S. is committed to a two-track strategy on Iran. He urged the ROK to continue to take action against Iranian banks, and discourage their companies from doing business with Iran -- especially in shipping, insurance, and banking -- as Iran will not bend unless they see there is a cost. U/S Burns said that restricting export credits can be an exceptionally effective lever to use with Iran. He emphasized that Iran must be shown that there are strong consequences for non-compliance on the uranium enrichment issue. Russia - Dealing with a Resurgent Moscow -------------- ¶10. (S) U/S Burns said that a resurgent Russia was determined to assert its self interests and that Prime Minister Putin in particular wanted to show that Russia could not be pushed around. The economic crisis, impact on Russia could become more pronounced if oil drops below USD 75 a barrel, he said. Russia needs money to pay for tens of billions of dollars in infrastructure improvements in its much neglected rural areas and cities outside of St. Petersburg and Moscow. DFM Sasae agreed that Moscow was determined to show that it &was back.8 He noted that Russia was rebuilding its military presence in the Far East, deploying fighters and conducting exercises. ¶11. (S) On Georgia, U/S Burns noted that Russia was still not complying with the August 12 agreement. An important way to show support for Georgia, he said, was to bolster it economically. The United States plans to provide USD 1 billion in aid over two years to assist in the rebuilding efforts. The European Union is also considering a large aid contribution. U/S Burns strongly encouraged both the Japanese and Korean governments to do as much as possible to help with assistance. DFM Sasae noted that Japan took the situation in Georgia very seriously and would send a "high level" official to the upcoming international donor,s conference. ¶12. (S) When asked by U/S Burns to discuss the recent ROK-Russia summit, DFM Lee responded that the meeting had focused on private sector investment opportunities, particularly in the energy sector. A proposed pipeline for natural gas that would link Siberia with the ROK via North Korea would require more than 10 years to come online. This pipeline would require continued stability and support from North Korea, as they would be able to stop the flow at any time, which would pose an energy security risk for South Korea. Thus, DFM Lee expressed great skepticism that a pipeline will be built anytime soon. For now, the arrangement requires shipping oil and natural gas by sea. Sasae said Japan intends to increase investment in Sakhalin. China - Focus on Engagement -------------- ¶13. (S) U/S Burns observed that Beijing,s relationship with STATE 00111761 003 OF 005 Moscow was evolving, with China,s hand much strengthened. A great deal of suspicion between the two countries remains, especially over competing interests in Central Asia and Siberia. DFM Sasae observed that China was dealing with enormous internal challenges, especially in its rural areas, and wondered if reforms on land use presaged a more capitalistic approach. Sasae said that the new administration of Prime Minister Taro Aso had reassured Beijing that Tokyo would continue to maintain its current China policy. Aso will meet with Hu later in October at the ASEM Summit. For Japan, food safety was the number one issue with China. ¶14. (S) According to DFM Lee, China has more influence than any other country with the DPRK. Correspondingly, the ROKG was trying to engage China in order to influence the DPRK. DFM Lee mentioned that only 2-3 years ago China only focused on strategic relations with great powers such as Russia, the United States, and Japan. Now an increasingly sophisticated and confident China was reaching out and engaging with smaller countries, especially in Africa and Latin America. The recent ROK-China agreement to upgrade bilateral relations to a "strategic partnership" should not be taken seriously Lee stated, noting that China had similar partnerships with Algeria, Mexico, and several "small African countries." ¶15. (S) DFM Lee said that refugees are the most important humanitarian issue between the ROK and China. The ROKG has implored the PRC not to send back refugees to the DPRK, and has engaged with Beijing on the issue over 40 times during the last eight months. The ROK encourages China to send refugees to a third country if they feel they are unable to send them to the ROK. However, the PRC states that they have a treaty with the DPRK that compels them to return all DPRK refugees back to the DPRK. Japanese DFM Sasae agreed that the DPRK refugee issue deserved more attention as Beijing wrongly classifies them as economic migrants. Sasae urged the United States to raise the refugee issue directly with China. ¶16. (S) Asked by U/S Burns for an assessment of the impact of the current financial crisis on China, Japan,s Sasae stated the economic crisis would have a limited impact on China as they were less exposed because of the controlled nature of their economy and currency. That said, Chinese citizens now invested heavily in stocks and were extremely worried about the markets. Sasae opined that China,s economy would continue to grow, albeit at a diminished rate as exports would be hurt. Sasae said it would be important to continue to push China toward greater involvement in international economic forums, and said that in the long-term, the current crisis would impact how Beijing approached the Doha negotiations. DPRK - Close Coordination Needed -------------- ¶17. (S) As for North Korea, U/S Burns said that the abductions issue was very important for the United States, as the President and Secretary Rice had made clear, and that he understood how sensitive it was for Japan. ¶18. (S) DFM Lee agreed that the major issues with the DPRK are abductions, the nuclear situation and the Six-Party Talks, and Kim Jong-il,s health and impact on future leadership. The ROKG believes that we need to establish an intrusive verification protocol, including sampling, that involves the International Atomic Energy Agency (IAEA). He noted that the next round of Six-Party Talks will focus on verification. ¶19. (S) Lee said he does not see any external signs that Kim Jong-il,s health questions have led to tightening of control and the ROK has not seen any tangible changes in the leadership or its influence. The ROKG believes the recently released pictures of Kim Jong-il visiting a DPRK women,s army installation were likely taken months ago and are not proof that Kim has appeared in public. Most likely the pictures were released to calm the DPRK public and to dispel internal rumors and speculation about the health of Kim, he said. ¶20. (S) The ROKG would like to normalize its bilateral relationship with the DPRK but has had little or no response from the DPRK since President Lee Myong-bak took office early this year. DFM Lee stated that the ROKG is not prepared to provide further assistance to the DPRK until tangible STATE 00111761 004 OF 005 progress is achieved. However, the ROKG does not link food aid to bilateral relations, nor to the progress of the Six-Party Talks and would be prepared to send additional humanitarian shipments if needed. Lee said that the ROKG does not completely agree with the World Food Program,s assessment of the DPRK food situation. Seoul will be prepared to offer aid in the spring of 2009 if the 2008 harvests in the North are not good, he concluded. ¶21. (S) DFM Sasae said the Japanese agreed with the ROKG assessments on Kim Jong-il,s health and said there were no obvious signs of regime instability. Regarding the Six-Party Talks, Sasae said that while Tokyo was "not 100 percent satisfied" with the DPRK,s assurances on verification, the explicit U.S. public statement of terms (and the fact that Pyongyang did not contradict it) was encouraging. The next step is to get written commitments, Sasae said. He said the verification agreement would be judged by its results and noted that a long process remained before denuclearization was completed. In the meantime, it would be critical for the allies to maintain pressure on the North. On bilateral issues, Japan remained focused on the nuclear, missile and abduction problems. Sasae said Tokyo was waiting for a response from Pyongyang on the resumption of investigation into the abductions of Japanese citizens in exchange for a partial lift of sanctions. Japan would continue to look to the United States for support on this issue. Regional Architecture -------------- ¶22. (S) U/S Burns said that U.S. interests are in regional fora that complement trans-Pacific engagement, such as APEC and the ASEAN Regional Forum (ARF). DFM Lee raised three topics: the two trilateral groups (U.S.-ROK-Japan, and ROK-Japan-China); Australia,s Asia-Pacific Community (APC) concept; and the mooted U.S.-Japan-China trilateral. South Korea wants more U.S.-ROK-Japan engagement to balance the active roster of ROK-Japan-China trilateral meetings and programs. The ROKG is waiting for more information in order to make a judgment on the Australian proposal for an APC, but believes the target date of 2020 is too far off to be effective. The ROKG has serious concerns about any proposed trilateral meeting among the United States, Japan and China, as it does not want to be left out and have the "superpowers" make all the decisions for the region. The ROK believes a four-party forum would be fairer and more productive. Sasae said Japan understood Korean concerns over a possible U.S.-China-Japan trilateral, and noted that it was the Chinese who were pushing for such a meeting, not Japan. ¶23. (S) DFM Sasae said that Japan would like to see greater U.S. involvement in regional fora. He noted that Russia was increasingly aggressive in trying to involve itself in regional groupings. Sasae urged the United States to make additional, visible, displays of interest at multiple levels. He also suggested holding discussions on ways of strengthening APEC. ROK Bilat - Work on Relocations -------------- ¶24. (C) During a brief bilateral pre-meeting, U/S Burns urged the ROK to adhere to the Status of Forces Agreement and proceed with U.S. Forces Korea base transfers. DFM Lee stated that while camp returns and issues surrounding a New Embassy Compound can be resolved with more flexibility from both sides, successfully concluding this year,s burden-sharing agreement will prove more difficult, since it requires National Assembly approval and is therefore much more politically-charged. Next Steps -------------- ¶25. (SBU) Participants agreed that this particular trilateral mechanism should continue. DFM Sasae agreed to host the next round, in Tokyo, in early 2009. He suggested we consider the idea of a trilateral ministerial meeting and even think about a U.S.-Japan-ROK Summit. ¶26. (U) Participants: The United States Under Secretary William Burns EAP/J Director Daniel Russel STATE 00111761 005 OF 005 EAP/K Director Kurt Tong P Special Assistant Mark Tesone EAP/J Colin Crosby (Notetaker) EAP/K Brian Peterson (Notetaker) Republic of Korea Deputy Foreign Minister Lee Yong-joon ROK Embassy Minister-Counselor Kim Hyoung-zhin MOFAT North American Division Director Moon Seoung-hyun Office of the President Deputy Director Lee Kyoo-ho Ki-hong Kim, MOFAT (Notetaker) Si-jin Song, MOFAT (Notetaker) Japan Deputy Foreign Minister Kenichiro Sasae Director for North American Affairs Kanji Yamanouchi Director for Northeast Asia Affairs Shigeo Yamada Embassy of Japan Political Counselor Taisuke Mibae Deputy Director for Northeast Asia Affairs Mondo Yamamoto (Notetaker) ¶27. (U) This cable was cleared by Under Secretary Burns. RICE