From rice to nukes, Koreas find little unity

A huge banner dominated by a smiling image of late North Korean leader Kim Il Sung hangs above the entrance of the newly built railroad station in the special economic zone here.

The station, though, is empty. No trains are visible on the single track to South Korea, two miles south, and no one expects service any time soon despite a blaze of publicity that accompanied the only test run of a train on May 17.

"The North Korean military did not want the railroad connection," says Kim Tae Woo of the Institute for Defense Analyses in Seoul. "They have another agenda."

The failure to inaugurate North-South rail service suggests the frustrations in persuading North Korea to fulfill its obligations on a wide range of issues, none so difficult as the agreement of Feb. 13, under which the North was to have shut down its five-megawatt nuclear reactor at Yongbyon, 60 miles north of Pyongyang.

North Korea, under terms of the deal signed by the two Koreas, China, Japan, Russia, and the US, had 60 days to shut down the reactor and move to a more difficult phase, acknowledging all of its nuclear facilities and getting rid of them along with nuclear warheads made at Yongbyon. The North in turn would receive billions of dollars in aid, mostly to power and improve its electrical grid.

These steps – as well as other confidence-building measures – are on the table this week as South and North Korean officials meet in ministerial-level talks in Seoul. North Korea's state councilor, Kwon Ho Woong, talked Tuesday about "the green of spring" as a "good sign," but the talks may be rocky. At issue is whether North Korea will live up to any deal without demanding concessions that may just lead to more demands.

South Korean officials are targeting issues ranging from opening the railroad to freeing South Koreans held in the North, including Korean War prisoners whom the North refuses to acknowledge, to living up to the nuclear agreement.

North Korea is expected to press for shipments of rice, suspended while the South waits for the reactor shutdown. Oblivious to the views of South Korean conservatives that no deal will work, North Korea blames the delay on frustration in recovering $25 million from accounts in a blacklisted bank in Macao.

Few analysts believe the North's demands will stop there. "We should be prepared against a scenario after settlement of that issue," says Mr. Kim. "That is a decoy being used by North Korea. If we pay too much attention, we are playing their game."

Macao lifted the freeze on the account, imposed after the US labeled it a conduit for counterfeiting and barred firms dealing with the bank from business in the US. North Korea, however, demands transfer of the funds through a foreign bank, but none, including the Bank of China, wants to cooperate. Until one relents, North Korea remains an outcast from the international financial system.

Still, US envoy Christopher Hill hopes North Korea can "implement their part of the deal" very soon – and is on his way to Beijing this week to try to persuade China to prod North Korea. While Mr. Hill looks for "signals" of North Korean cooperation, North Korea on Friday again showed off its military potential by firing a short-range Silkworm missile off its east coast. South Korean officials played down the test, calling it a routine "training exercise," but analysts say the timing was not coincidental.

On the same day, South Korea's President Roh Moo Hyun and his wife launched a sophisticated destroyer capable of firing on targets on sea, land, and in the air with help of an advanced Aegis-class radar system. "The North Koreans want to project their will to destroy any vessel," says Kim Tae Woo. "It's just a political action."

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