Wednesday, July 11, 2001
RALPH A. COSSA
North Korea’s demand
for compensation
is disingenuous
North Korea, in its response to the Bush administration's call for a resumption of dialogue, has insisted that the first topic be American "compensation" to Pyongyang for delays in construction of two nuclear energy-producing light water reactors. Similar extortion efforts were rejected during the Clinton administration and certainly should once again fall on deaf ears.The reactors are being provided through the Korean Peninsula Energy Development Organization (KEDO), a U.S.-South Korea-Japan consortium established to implement the 1994 Agreed Framework between the United States and North Korea under which Pyongyang agreed to freeze its nuclear research operations in return for two reactors less able to produce material for nuclear weapons. The 2003 target date for completion is out of reach now. The most optimistic forecasts are that it will be at least another five years (if ever) before the first reactor becomes operational.
Construction has fallen hopelessly behind for several reasons, most attributable to North Korea. This includes an initial delay of almost a year as North Korea objected to KEDO's plan to use reactors made in South Korea. Since Seoul is footing the lion's share of the cost, it seemed reasonable that it build the reactors, which Pyongyang accepted begrudgingly. North Korea's 1998 Taepo-dong missile launch that overflew Japan caused another delay as Tokyo threatened to withhold its $1 billion contribution due to public outrage.
A recent delay was caused when, probably for the first time in North Korean history, workers went on strike, demanding higher wages than those already contracted with KEDO. To KEDO's credit, the striking workers were replaced by Uzbek laborers, thus denying Pyongyang a lucrative source of hard currency while perhaps teaching North Korean officials a lesson about contracts.
Even if the delays had not been self-inflicted, Pyongyang's demands for "compensation for the electricity loss from the delay in building (the reactors)" would still be disingenuous since Pyongyang is already being compensated.
The Agreed Framework calls for providing 500,000 metric tons of heavy fuel oil annually to North Korea "to offset the energy foregone due to the freeze of the DPRK's graphite-moderated reactors, pending completion of the first (reactor) unit."
KEDO continues to provide this fuel oil which, in reality, is more useful than the reactors since North Korea has yet to begin building the electrical grid needed to transmit the electricity to be generated by the reactors.
The Bush administration has stated that the United States will fulfill its obligations under the Agreed Framework so long as Pyongyang honors its commitments, as it has thus far.
The real moment of truth, however, is the requirement for the North to "come into full compliance with its safeguard agreement" with the International Atomic Energy Agency (IAEA), which must occur by the time "a significant portion of the (reactor) project is completed, but before delivery of key nuclear components."
The IAEA is charged with certifying the peaceful use of nuclear energy under the Nuclear Non-Proliferation Treaty. North Korea's threat to withdraw from the treaty caused the showdown between Washington and Pyongyang that was resolved after former President Jimmy Carter's intervention, through the 1994 Agreed Framework.
While Pyongyang legitimately can put off verification of its past activities since a "significant portion" has yet to be completed, Pyongyang must also realize that IAEA certification, which requires "verifying the accuracy and completeness of (North Korea's) initial (pre-1994) report on all nuclear material" in North Korea, could take from two to four years.
Thus far, Pyongyang has not allowed the IAEA to begin this verification task -- the most recent attempt, in May, was rejected by North Korea. The Bush administration has argued that the verification should be allowed to commence to demonstrate Pyongyang's good faith as KEDO's construction proceeds.
Otherwise, the project will be further delayed -- or doomed -- when the "full compliance" moment of truth arrives.
Ralph A. Cossa is president of the Pacific Forum,
a nonprofit research institute based in Honolulu.