North Korean Economy Watch

UPDATE: Here is the CIA video that was released (YouTube).

From today’s Washington Post:

A video taken inside a secret Syrian facility last summer convinced the Israeli government and the Bush administration that North Korea was helping to construct a reactor similar to one that produces plutonium for North Korea’s nuclear arsenal, according to senior U.S. officials who said it would be shared with lawmakers today.

The officials said the video of the remote site, code-named Al Kibar by the Syrians, shows North Koreans inside. It played a pivotal role in Israel’s decision to bomb the facility late at night last Sept. 6, a move that was publicly denounced by Damascus but not by Washington.

Sources familiar with the video say it also shows that the Syrian reactor core’s design is the same as that of the North Korean reactor at Yongbyon, including a virtually identical configuration and number of holes for fuel rods. It shows “remarkable resemblances inside and out to Yongbyon,” a U.S. intelligence official said. A nuclear weapons specialist called the video “very, very damning.” (Washington Post)

What has been the level of cooperation between Syria and the DPRK?

But beginning today, intelligence officials will tell members of the House and Senate intelligence, armed services and foreign relations committees that the Syrian facility was not yet fully operational and that there was no uranium for the reactor and no indication of fuel capability, according to U.S. officials and intelligence sources.

David Albright, president of Institute for Science and International Security (ISIS) and a former U.N. weapons inspector, said the absence of such evidence warrants skepticism that the reactor was part of an active weapons program.

“The United States and Israel have not identified any Syrian plutonium separation facilities or nuclear weaponization facilities,” he said. “The lack of any such facilities gives little confidence that the reactor is part of an active nuclear weapons program. The apparent lack of fuel, either imported or indigenously produced, also is curious and lowers confidence that Syria has a nuclear weapons program.”

U.S. intelligence officials will also tell the lawmakers that Syria is not rebuilding a reactor at the Al Kibar site. “The successful engagement of North Korea in the six-party talks means that it was unlikely to have supplied Syria with such facilities or nuclear materials after the reactor site was destroyed,” Albright said. “Indeed, there is little, if any, evidence that cooperation between Syria and North Korea extended beyond the date of the destruction of the reactor.”

Syria denies it was building nuclear facilities.

Read the full article here:
N. Koreans Taped At Syrian Reactor
Washington Post
Robin Wright
4/24/2008; Page A01

Institute for Far Eastern Studies
NK Brief No. 07-10-2-1

DPRK-U.S. RELATIONS
North Korean and U.S. officials kicked off the month of September with meetings held in Geneva on the 1st~2nd. The bilateral talks focused on how to implement the February 13 agreement. After two days of talks, U.S. Assistant Secretary of State Christopher Hill stated he is “convinced” the North will disable nuclear programs by year’s end, a timeline offered by the DPRK negotiators. North Korean press reported that the DPRK would be removed from the U.S. terrorism roster and sanctions imposed under the Trading with the Enemy Act would be lifted in return.

On September 7, Hill announced that North Korea had invited nuclear experts from the United States, Russia, and China to the DPRK in order to survey nuclear facilities and recommend dismantlement plans. The experts examined North Korean nuclear sites from September 11 to September 16.

On the same day, U.S. President Bush stated Washington would consider a peace treaty with North Korea in return for the North’s abandonment of nuclear arms.

On September 17 it was reported that North Korea had admitted that it had earlier procured materials needed to build uranium enrichment centrifuges. The admission regarded the import of 150 tons of hard aluminum pipes, enough for 2,600 centrifugal separators.

On September 20, the DPRK was removed from Washington’s list of countries producing illegal drugs. The North was added to the list in 2003.

On September 28, U.S. President Bush authorized 25 million USD worth of energy aid for North Korea. These funds could be used to provide the DPRK 50,000 metric tons of heavy fuel oil, equal to the amounts provided by China and South Korea as part of the February 13 agreement.

DPRK-JAPAN RELATIONS
Two days of talks between North Korean and Japanese diplomats began on September 5 in Mongolia, with both sides expressing confidence that there would be progress. Wartime compensation issues were discussed, although Japan continued to link normalization of relations with kidnapping issues.

Following the talks, North Korea stated that kidnapping issues were resolved with Japan, while Japan stated that both sides reiterated existing positions. On the same day, Japan rejected a DPRK request to allow North Korean ships to dock in Japan in order to pick up aid for flood victims.

On September 30, Chief Cabinet Secretary Nobutaka Machimura said Japanese economic sanctions on North Korea would be extended for another six months due to “basically no progress” on abduction issues.

DPRK-SYRIA ARMS COOPERATION
Reports began coming out of Israel in early September that reconnaissance flights over Syria had taken pictures of North Korean nuclear supplies and materials. Following Israeli air strikes, it was reported that Special Forces had entered Syria and confiscated material that appeared to be of DPRK origin. Conflicting reports stated that the facilities struck were missile storage facilities, rather than of a nuclear nature. North Korea has denied any nuclear cooperation with Syria.

DPRK-UAE RELATIONS
North Korea established ambassador-level diplomatic ties with the United Arab Emirates on September 18. A joint statement said the two countries aim to “enhance understanding and boost the links of friendship and cooperation between their two peoples.” Ties with such an oil-rich nation on friendly terms with Washington could be significant as the North moves to dismantle nuclear facilities.

ROK-DPRK ECONOMIC COOPERATION
It was reported on September 4 that stock prices of South Korean companies engaging in inter-Korean economic cooperation have shot up on news that the DPRK will dismantle nuclear programs. This includes not only those companies operating in the Kaesong Industrial Complex, but also firms involved in providing electricity and other projects planned in exchange for the North’s denuclearization.

On September 20 it was announced that the ROK government plans to request a 50 percent increase for inter-Korean cooperative projects in next year’s budget. The Ministry of Planning and Budget will request 822 million USD for cross-border projects, as well as 580 million USD for humanitarian assistance.

On September 27, it was reported that the ROK government was reviewing a proposal to jointly develop Nampo, Haeju, Najin, Sunbong, Wonsan, and Shinuiju. The North has requested development of heavy industries, while South Korea seeks cooperation on light industrial projects.

SIX-PARTY TALKS
The latest round of six-party talks opened in Beijing on September 27, with both the U.S. and DPRK negotiators promising progress. On September 30, talks were ended to allow delegates to return to their home countries to work on a ‘nuts and bolts’ joint statement. U.S. delegate Hill stated the delegates were close to agreeing on a definition of facilities, and that the proposed joint statement was very detailed. Before returning to Pyongyang, Kim Kye-gwan was quoted as saying that the North can report nuclear programs, but will not declare nuclear weapons by the end of the year. An ROK official stated that the North’s position was acceptable to Seoul. Negotiators are also thought to have agreed to begin removal of ten core devices from three nuclear facilities beginning in November. The joint statement is scheduled for release on October 2.

DPRK FLOODING
Acting UN Coordinator to the DPRK Jean-Pierre de Margerie stated on September 3, “The level of damage to infrastructure, to communications, to crops, to farmland and to households, is considerable,” but also pointed out, “The [DPRK] government has improved its level of cooperation by giving us unprecedented access to the field to conduct our assessments of the damage.”

ESPIONAGE IN THE DPRK
Li Su-Gil, spokesman for the DPRK National Security Service, reported on September 5 that several foreigners had been arrested along with a number of DPRK citizens accused of spying for a foreign country; Specifically, for having “collected official documents and information on the DPRK’s important military facilities, and spread the idea of so-called democracy and freedom to the people.” The identities and nationalities of those arrested were not revealed.

Israelis seized nuclear material in Syrian raid
Sunday Times (London)
Uzi Mahnaimi and Sarah Baxter
9/23/2007

Israeli commandos seized nuclear material of North Korean origin during a daring raid on a secret military site in Syria before Israel bombed it this month, according to informed sources in Washington and Jerusalem.

The attack was launched with American approval on September 6 after Washington was shown evidence the material was nuclear related, the well-placed sources say.

They confirmed that samples taken from Syria for testing had been identified as North Korean. This raised fears that Syria might have joined North Korea and Iran in seeking to acquire nuclear weapons.

Israeli special forces had been gathering intelligence for several months in Syria, according to Israeli sources. They located the nuclear material at a compound near Dayr az-Zwar in the north.

Evidence that North Korean personnel were at the site is said to have been shared with President George W Bush over the summer. A senior American source said the administration sought proof of nuclear-related activities before giving the attack its blessing.

Diplomats in North Korea and China believe a number of North Koreans were killed in the strike, based on reports reaching Asian governments about conversations between Chinese and North Korean officials.

Syrian officials flew to Pyongyang, the North Korean capital, last week, reinforcing the view that the two nations were coordinating their response.

N.Korea calls Syria nuclear ties report “conspiracy”
Reuters
9/18/2007

North Korea said on Tuesday recent media reports that it may be providing help to Syria’s nuclear activities were groundless conspiracy fabricated by those who oppose the North’s improving ties with Washington.

The Washington Post reported last week that intelligence had led some U.S. officials to believe Syria was receiving help from North Korea on some sort of nuclear facility. The New York Times ran a similar report.

“This is sheer misinformation,” the North’s official KCNA news agency quoted an unnamed Foreign Ministry spokesman as saying, referring to the reports.

The North made a pledge in October 2006 not to engage in nuclear proliferation and it still stood, the spokesman said.

North Korea last week hosted a team of nuclear officials and experts who made a rare road trip to Pyongyang and to the country’s main nuclear complex at Yongbyon north of the capital in what was seen as a gesture to improve ties with the United States.

North Korea has suspended operation of the Yongbyon complex under a February deal in return for 50,000 tones of heavy fuel oil from South Korea. It is set to receive additional 950,000 tones by taking further disarmament steps this year.

“The DPRK never makes an empty talk but always tells truth,” the Foreign Ministry spokesman said, using the North’s official name, the Democratic People’s Republic of Korea.

“The above-said story is nothing but a clumsy plot hatched by the dishonest forces who do not like to see any progress at the six-party talks and in the DPRK-U.S. relations.”

U.S. President George W. bush, who once lumped North Korea with Iran and pre-war Iraq as members of an “axis of evil,” has offered a peace treaty with the North if Pyongyang completes nuclear disarmament.

South Korea said on Monday a new round of the six-way talks would not be held on September 19 as widely expected.

South Korean officials have declined to confirm speculation that Pyongyang was upset by reports about its ties to Syrian nuclear activities or failure by China to begin shipping heavy fuel oil under the February pact.

Israel has refused to comment on what U.S. officials and diplomatic sources have described in news reports as an air raid inside Syria this month that may have targeted weapons headed for Hezbollah guerrillas in Lebanon or a suspected nuclear site.

Syria said it could retaliate for the September 6 violation of its territory and has denied reports that Damascus may have received North Korean nuclear aid.

From the Korea Herald:
9/10/2006

The United States has had some success in limiting North Korea’s export of missiles by persuading other countries not to buy them, a senior administration official says.

Washington has long sought to stop such sales and stepped up its initiative after Pyongyang tested a string of missiles in July, including a long-range missile.

“As a direct result of our policies, we have cut off North Korea from several of its customers for ballistic missiles,” Robert Joseph, the Bush administration’s top nonproliferation official, told Reuters.

“We have made it more difficult for the North to ship missiles and have made it more likely that these shipments will be exposed. The risk of exposure further turns off customers,” he said in a recent interview.

He said Yemen committed not to buy more North Korean missiles after taking delivery of a shipment of 15 Scuds in 2002 and Libya promised to forgo North Korean missiles as part of a 2003 agreement in which it abandoned its weapons of mass destruction and missile programs.

Some U.S. officials say Pakistan and Egypt also are no longer buying from Pyongyang, leaving Iran and Syria as the major missile customers.

Some other U.S. officials and experts are skeptical of the effectiveness of the Bush administration policy.

Jonathan Pollack, chair of the Asia-Pacific Studies Group at the U.S. Naval War College in Rhode Island, welcomed the close scrutiny the U.S.-led program had brought on North Korea’s activities but said the results were difficult to measure and it was probably too soon to draw firm conclusions.

The U.S. strategy includes a crackdown on banks that aid the North’s illicit activities and the “proliferation security initiative” in which some 88 member nations share intelligence and practice interdicting weapons shipments.

In addition, potential buyer nations now may find their U.S. aid curtailed if they buy weapons from North Korea. Pakistan, Iraq and Egypt are major recipients of U.S. assistance.

After Pyongyang tested seven missiles in July, the United Nations called on countries to avoid supporting the missile program. Missile sales earn the impoverished state hundreds of millions of dollars in hard currency.

One long-range missile crashed soon after launch during the July tests, but the other medium range missiles hit their target areas, U.S. officials and experts said.

U.S. Defense Secretary Donald Rumsfeld has said North Korea - which claims itself to be a nuclear weapons power - is more dangerous as a proliferator than as a military threat to neighbor South Korea.

Pyongyang has been working on missile production for three decades and is the leading supplier of ballistic missiles to the developing world, experts say.

The chief exports are variations of Soviet-origin Scud missiles, regarded as fairly reliable and accurate but based on technology advanced military powers would consider obsolete.

North Korea’s oldest and most loyal customer has been Iran, which helped finance Scud development, according to various U.S. studies. The connection dates to the Iran-Iraq war of the 1980s when Pyongyang tested and shipped missiles to Tehran.

North Korea, as well as China, provided ballistic missiles, cruise missiles and their production facilities to Iran, Iraq, Syria and Egypt, U.S. government reports say. Libya and Pakistan have also been missile customers.

Arms connections between North Korea and Iran are very strong, with the former regime being the main supplier of ballistic missile technologies to Tehran, a senior U.S. nonproliferation official said Wednesday.

Undersecretary of State Robert Joseph, in charge of arms control and international security, was cautious about going into intelligence.

“But I can say that the connections between North Korea and Iran are very strong,” he said at a news conference with the foreign press.

“And North Korea has been, I think, the principal supplier to Iran of ballistic missile technologies,” he said.

Suspicions about exchanges of personnel, technology and equipment between Pyongyang and Tehran on missile development date back decades. Joseph noted that a number of revelations about such ties have already been made public.