SEOUL - PRESS BULLETIN; July 8, 2009

UNCLAS SECTION 01 OF 06 SEOUL 001081

SIPDIS

E.O. 12958: N/A
TAGS: PREL PGOV MARR ECON KPAO KS US
SUBJECT: SEOUL - PRESS BULLETIN; July 8, 2009

TOP HEADLINES
--------------

Chosun Ilbo, Dong-a Ilbo, All TVs
Simultaneous "Cyber Terror" Attacks on Major Internet Sites
at Home and Abroad

JoongAng Ilbo
Blue House, Defense Ministry Homepages Attacked

Hankook Ilbo, Segye Ilbo, Seoul Shinmun
Unreasonable Tax Cuts Cause Unreasonable Tax Increases;

In a Desperate Attempt to Restore Fiscal Health, ROKG Seeks
to Levy More Taxes on Landlords, Smokers and Drinkers

Hankyoreh Shinmun
ROKG Found to Have Used Obsolete Data for Environmental Impact
Assessment of Four-Rivers Restoration Projects


DOMESTIC DEVELOPMENTS
--------------

An unnamed ROKG official said yesterday that the ROKG plans to begin
talks to revise the Atomic Energy Agreement with the U.S. around
October and to seek U.S. agreement on the ROK's self-production of
low-enriched uranium, the fuel required to operate nuclear reactors.
(JoongAng, Dong-a, Hankyoreh, Segye, Seoul, all TVs)

The USFK said yesterday that it will open a three-day humanitarian
assistance and disaster relief multilateral conference from July
8-10 at Yongsan Garrison in Seoul to brace for a possible collapse
of North Korea. (Chosun)

James J. Przystrup, a senior research fellow at the Institute for
National Strategic Studies (INSS),in a July 7 seminar hosted by the
Korea Research Institute for Strategy, called for Seoul and
Washington to establish a contingency plan for an emergency in North
Korea because there is increasing uncertainty about the North.
(JoongAng)


INTERNATIONAL NEWS
--------------

President Barack Obama, when asked in a July 7 CBS interview how
precarious the security situation is in the wake of North Korea's
nuclear tests and the new sanctions that resulted, said: "I don't
think that any war is imminent with North Korea. I think they
understand that they would be overwhelmed in a serious military
conflict with the U.S." (Chosun)

Under Secretary of Treasury for Terrorism and Financial Intelligence
Stuart Levey will visit China and Hong Kong this week to step up
efforts to cut off sources of hard currency for the North Korean
regime. (Dong-a, Hankook, Segye, all TVs)



MEDIA ANALYSIS
--------------

-N. Korea
--------------
Conservative Chosun Ilbo quoted President Barack Obama, when asked
in a July 7 CBS interview how precarious the security situation is
in the wake of North Korea's nuclear tests and the new sanctions
that resulted, as saying: "I don't think that any war is imminent
with North Korea. I think they understand that they would be
overwhelmed in a serious military conflict with the U.S."


SEOUL 00001081 002 OF 006


Most ROK media reported on Under Secretary of Treasury for Terrorism
and Financial Intelligence Stuart Levey's visits to China and Hong
Kong this week to step up efforts to cut off sources of hard
currency for the North Korean regime. Conservative Dong-a Ilbo's
headline read: "U.S. Poised to Squeeze N. Korea's Financial Belt
from China to Southeast Asia"

Regarding USFK Commander Gen. Walter Sharp's supposed remarks that
Washington could discuss revising the bilateral agreement
restricting the range of the ROK's ballistic missiles, a Dong-a Ilbo
editorial argued: "North Korea has fired 18 missiles this year,
including a long-range missile that flew 3,200 km. ... Military
experts have raised fears, with one saying, 'North Korea now has the
capacity to attack key military targets across South Korea.' This
is a threat as serious as the North's nuclear weapons. Seoul's
missile capacity lags far behind Pyongyang's. Under the (current)
agreement, the ROK cannot develop ballistic missiles with a range of
300 km or more and weighing 500 kilograms or more. Seoul has the
technology but cannot adequately tackle Pyongyang's missile threat
due to the missile agreement with Washington."

President Obama's Visit to Russia
Right-of-center JoongAng Ilbo carried an analysis that said that
President Obama earned two things during his visit to Russia: First,
by wining Russian concessions to allow U.S. troops and weapons bound
for Afghanistan to fly over Russian territory, President Obama can
save $133 million in military spending annually. Furthermore, by
successfully concluding negotiations with Russia, President Obama
has removed concerns about his lack of diplomatic experience.

JoongAng Ilbo editorialized: "By reaching an historic agreement with
Russian President Medvedev on nuclear arms reduction, President
Obama made it clear that a 'nuclear-free world' is not merely
rhetoric but a practical goal the human race should pursue. ... The
U.S. and Russian leaders have come closer to fulfilling the
obligations required by the Nuclear Non-Proliferation Treaty (NPT),
thus securing the justification to call on other countries to comply
with their obligations under the NPT. This is why this agreement
must and will be a significant first step toward a 'nuclear-free
world.'"

-Uighur Riots in Xinjiang
--------------
Conservative Chosun Ilbo noted in an inside-page report that
Beijing's invitation of foreign journalists to Urumqi, Xinjiang's
capital and the site of the unrest, is a radical departure from its
previous practice of blocking foreign access whenever there were
large incidents or ethnic clashes in the country. Chosun wrote in
the headline: "China's Opening of the Site of Unrest is a Scheme to
Highlight the Violence of Uighurs."

Right-of-center JoongAng Ilbo wrote in an editorial: "The Uighurs
are the most proactive people among the 55 minority ethnic groups in
China in seeking independence from China. Accordingly, if the
current riots and Beijing's strong crackdown continue in the
Xinjiang Uyghur Autonomous Region, the region will inevitably be
plunged into extreme chaos. Furthermore, given that certain forces
in neighboring Muslim countries support the Uighurs' independence,
the situation might escalate into a new instability in international
politics."

Left-leaning Hankyoreh Shinmun, in an editorial entitled "Uighur
Incident: the Problem Lies in Beijing's Discrimination and Exclusion
of Uighurs," argued: "Unless China makes proactive efforts to
respect the national identities of minority ethnic groups and to
reduce economic discrimination against them, the volatile situations
in the Xinjiang and Tibetan regions will continue. It is high time
for China to reexamine its policies toward minority ethnic groups."


OPINIONS/EDITORIALS
--------------

ROK NEEDS A STRONGER MILITARY

SEOUL 00001081 003 OF 006


(Dong-a Ilbo, July 8, 2009, Page 31)

U.S. Forces Korea commander Gen. Walter Sharp (was reported to have)
recently said Washington could discuss a revision to the bilateral
agreement restricting the range of Korea's ballistic missiles. He
(purportedly) said this at a briefing to assistants to ruling and
opposition party lawmakers. Back in April, Prime Minister Han
Seung-soo told the National Assembly, "It is time for a revision to
the missile agreement to be seriously discussed at the (South)
Korea-U.S. defense ministers meeting." Sharp's comments can be seen
as a positive U.S. response to Han's statement. (Editor's Note: We
understand General Sharp made no such comment.)

Additionally, North Korea has fired 18 missiles this year, including
a long-range missile which flew 3,200 kilometers. Most of them,
however, were short-range missiles with a range between 100 and 400
kilometers. Military experts have raised fears, however, with one
saying, "North Korea now has the capacity to attack key military
targets across South Korea." This is a threat as serious as the
North's nuclear weapons. Seoul's missile capacity lags far behind
Pyongyang's. Under the agreement, South Korea cannot develop
ballistic missiles with a range of 300 kilometers or more and
weighing 500 kilograms or more. Seoul has the technology but cannot
adequately tackle Pyongyang's missile threat due to the missile
agreement with Washington.

The missile restriction dates back to the Park Chung-hee
Administration of the 1970s. When South Korea began developing
missiles, the U.S. intervened to restrict their limit to 180
kilometers. The range was extended to 300 kilometers through a
revision in 2001, but the gap between the two Koreas is expanding.
Even just to deter North Korea's missile threat, the restriction to
the missile range must be lifted. Now that Washington has admitted
the need for revision (Editor's Note: we do not believe this is
correct),the two sides must promptly begin steps to revise the
agreement. The two sides are hoping, at the latest, to come up with
tangible results at the Security Consultative Meeting scheduled for
October.

In order to prepare for North Korea's nuclear and missile threats,
the ROKG will invest 178 trillion won implementing the "mid-term
National Defense Plan for 2010-2014" starting next year. The point
of the plan is to build a system to shield computers and
telecommunications equipment from electromagnetic waves caused by a
nuclear explosion and to introduce the Global Hawk unmanned
high-altitude aircraft. On top of this, if we can extend our
missile range to 550 kilometers and put the whole of North Korea
within striking range, our deterrence against the North will be
bolstered considerably. The Joint Vision for the ROK-U.S. Alliance,
which President Lee Myung-bak and U.S. President Barack Obama agreed
to at their summit in Washington last month, says, "The Republic of
Korea will take the lead role in the combined defense of Korea,
supported by an enduring and capable U.S. military force presence on
the Korean Peninsula, in the region and beyond." There is no reason
to believe that Seoul cannot spearhead missile defense.

The two allies need to further develop their alliance into one that
aims to attain strategic goals for the Asia-Pacific region and the
globe, beyond the Korean Peninsula. To do that, South Korea's
military capacity must be boosted to a level where it can
effectively deter North Korea's military threat.

(This is a translation provided by the newspaper, and it is
identical to the Korean version. As noted, our understanding is
that General Sharp made no such comments, so the article should be
read with that caveat.)


U.S.-RUSSIA AGREEMENT SHOULD BE THE FIRST STEP TOWARD A
'NUCLEAR-FREE WORLD'
(JoongAng Ilbo, July 8, page 42)

The U.S. and Russia, which control 95% of the world's nuclear
arsenal, agreed to a big framework for reducing additional nuclear

SEOUL 00001081 004 OF 006


weapons. During a July 6 meeting, U.S. President Barack Obama and
Russian President Dmitry Medvedev signed a memorandum of
understanding, containing a draft of a replacement pact for the
Strategic Arms Reduction Treaty- 1 (START-1),which will be
effective at the end of this year. The draft calls on the U.S. and
Russia to limit their arsenal of strategic nuclear warheads to
between 1,500-1,675 each, and their Intercontinental Ballistic
Missiles (ICBM) for delivering nuclear bombs to a range of 500 to
1,100 within seven years.

At present, the U.S. and Russia possess about 2,200 and 2,800
strategic nuclear warheads, and about 1,190 and 810 strategic
delivery vehicles, respectively. If the new agreement is
implemented, the number of strategic nuclear warheads will be
significantly reduced to three-fifths the current level and the
number of the ICBM will be reduced by half until the end of 2016.
The agreement is a historic landmark in strategic nuclear
disarmament which began in the 1980s.

There remain some hurdles before the U.S. and Russia sign the final
agreement. The most contentious issue between two countries,
deployment of a U.S. Missile Defense (MD) system in Eastern Europe,
has yet to be resolved. During the summit, President Obama
requested that Russia wait for some time before reviewing this
issue, but it is unlikely to be settled unless the plan itself is
rolled back. There is a possibility that deployment of the MD
system in Poland and the Czech Republic may hinder the progress of
the new nuclear reduction agreement. As it is said that the "devil
is in the details," verification processes may become a final
variable. It is hoped that the two leaders will overcome these
obstacles, and that their commitment to nuclear reduction will yield
substantial results within the year.

"A nuclear-free world" is an ideal President Obama openly professed
in Prague in April. By reaching an historic agreement with Russian
President Medvedev on nuclear arms reduction, President Obama made
it clear that a 'nuclear-free world' is not merely rhetoric but a
practical goal the human race should pursue. Five nuclear
countries under the NPT, the U.S., Russia, China, Britain and
France, should bear the responsibility for ultimate
denuclearization. The U.S. and Russian leaders have come closer to
fulfilling the obligations required by the Nuclear Non-Proliferation
Treaty (NPT),thus securing the justification to call on other
countries to comply with their obligations under the NPT. This is
why this agreement must and will be a significant first step toward
a 'nuclear-free world.

A meeting for reviewing the NPT will be held next year. If the U.S.
and Russia sign the final agreement, much more intense pressure will
be placed not only on NPT members but also countries which have
sought nuclear development outside of the NPT system. During the
meeting, the U.S. and Russia strongly urged North Korea and Iran to
accept international calls for denuclearization. North Korea should
take the U.S. and Russia's historic agreement on nuclear reduction
seriously. Denuclearization and non-proliferation are the norm and
"moral law" of the international community in the 21st century.


ROK-U.S. MISSILE GUIDELINES SHOULD BE REVISED TO RESPOND TO N.
KOREAN MISSILES
(Chosun Ilbo, July 8, page 35)

During a policy meeting with National Assembly Defense Committee
advisers in Seoul, a senior official at the ROK-U.S. Combined Forces
Command (CFC) said that if the ROK wants to revise the ROK-U.S.
missile guidelines, the two sides could discuss the issue, possibly
at their annual Security Consultative Meeting (SCM). The ROK-U.S.
missile guidelines deal with mutual cooperation in missiles, but at
the same time restricts the range of ROK missiles. When signed in
the 1970s, the guidelines restricted the ROK's missile capacity to a
180 kilometer range and with a 500 kilogram payload. In 2001, the
missile pact was renegotiated to extend the permitted range of
missiles to 300 kilometers.


SEOUL 00001081 005 OF 006


While the guidelines have hampered the ROK from enhancing its
missile capabilities, North Korea has emerged as a missile power.
In the early 1980s, North Korea began to manufacture Scud missiles
and successfully deployed 600 Scud B's with a range of 300km and
Scud C's with a range of 500km, and 200 Rodong missiles with a range
of 1,300km. Considering that the long-range rocket, which North
Korea launched on April 5, traveled 3,200km, there is a high
possibility that North Korea will possess Intercontinental Ballistic
Missiles (ICBM) soon.

Five of the seven Scud and Rodong missiles that the North fired on
July 4 traveled 420 kilometers and splashed into a targeted area in
the East Sea (Sea of Japan). The accuracy of the four KN
short-range missiles launched on July 2 was found to have improved
considerably as well. North Korea now has the capability to hit
accurately a target in all of the ROK and Japan. On the contrary,
the ranges of the ROK's Hyunmoo I and II and ATACMS missiles are too
short to target major military facilities throughout North Korea.
Military experts say that only when a ballistic missile has a range
of more than 700 kilometers can it hit any target in North Korea
from the rear areas of the ROK.

ROK-U.S. missile guidelines provide that "(the Agreement) shall be
revised when security conditions change." North Korea conducted two
nuclear tests and dramatically improved its missile range and
accuracy. This suggests that security conditions have fundamentally
changed.

The U.S. is adhering to its position that it will transfer wartime
operational control to the ROK in April, 2012, as scheduled. With
the shift of wartime operational command drawing nearer, the ROK and
the U.S. should swiftly find ways to correct an imbalance between
missile capabilities of the ROK and the North, starting from a
revision of the missile guidelines. The ROK's survival depends on
whether the ROK is equipped with the capability to counter a North
Korean missile.


FEATURES
--------------

FOCUS IS ON WHETHER THE ROK WILL BE ALLOWED TO PRODUCE ITS OWN
LOW-ENRICHED URANIUM
(Dong-a Ilbo, July 8, 2009, Page 8)

By Reporter Kim Young-sik

Seoul plans to talk with the U.S. around October to revise the
Atomic Energy Agreement.

The ROKG reportedly plans to begin talks to revise the Atomic Energy
Agreement with the U.S. as early as October and seek U.S. agreement
on the ROK's self-production of low-enriched uranium and
reprocessing of spent fuel rods.

An ROKG official stressed on July 7 that this move is for economic
reasons, saying, "We will revise the ROK-U.S. Atomic Energy
Agreement so that the ROK, the world's sixth-largest country in
terms of nuclear power generation, can expand the use of atomic
energy and should not have difficulty exporting (the energy.)" He
added, "If we are allowed to enrich uranium-235 to 2-5 percent, it
will also be helpful to our nuclear energy exports. I am not saying
that only enrichment and reprocessing are the goals of negotiations,
but ultimately, there should be no problem in Korea becoming an
atomic energy power."

In particular, the ROKG will reportedly persuade the U.S. that
"pyro-processing," which the ROK has studied to reprocess spent
nuclear fuel, is a fuel recycling, not reprocessing, measure. Cho
Hyun, Ambassador for Energy and Resources at the Ministry of Foreign
Affairs and Trade, who heads the ROK delegation to the negotiations
over the revision of the ROK-U.S. Atomic Energy Agreement, said on
July 7, "We have decided to have negotiations with the U.S. to
revise the Atomic Energy Agreement within this year. The talks will

SEOUL 00001081 006 OF 006


begin in October or November." The ROK and the U.S. have agreed to
negotiate for a revision of the ROK-U.S. Atomic Energy Agreement,
which expires in March, 2014.


STEPHENS