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UNCLAS SECTION 01 OF 10 SEOUL 001058 
 
SIPDIS 
 
E.O. 12958: N/A 
TAGS: PREL PGOV MARR ECON KPAO KS US
SUBJECT: SEOUL - PRESS BULLETIN; July 6, 2009 
 
TOP HEADLINES 
------------- 
 
 
Chosun Ilbo 
ROK's Trade with China Decreasing While Taiwan's Trade 
with China Increasing 
 
JoongAng Ilbo 
North Korea Spends 420 Billion Won on Missile Launches 
 
Dong-a Ilbo 
Foreign Companies in ROK Surveyed: They Give 
ROK 6.5 Points in Terms of Business Friendliness 
 
Hankook Ilbo 
North Korean Missiles Become More Accurate 
 
Hankyoreh Shinmun 
ROKG to Serve as Mediator, Is "On Strike" for Two Months 
in the Face of Impending Chain of Bankruptcies 
Triggered by Ssangyong 
 
Segye Ilbo 
ROK's Foreign Currency Market Stabilized 
 
Seoul Shinmun 
Survey: 33.8% Companies Intend 
to Switch Irregular Workers to Regular Workers 
 
 
DOMESTIC DEVELOPMENTS 
--------------------- 
 
Following North Korea's July 4 missile launches, the ROKG said that 
it was a provocative act that clearly violates UN Security Council 
Resolutions that bars all North Korean activity related to ballistic 
missiles. (Hankyoreh, Segye, Seoul, All TVs) 
 
 
INTERNATIONAL NEWS 
------------------ 
 
North Korea fired seven short-range missiles on July 4 as the U.S. 
celebrated its Independence Day. (All)  An ROKG source said that 
five of the seven missiles landed in the same area in waters between 
the Korean Peninsula and Japan, demonstrating a higher level of 
precision than in previous launches.  (JoongAng, Hankook). 
 
In the wake of North Korea's July 4 missile launches, the ROK, Japan 
and European countries condemned the launches. Russia and China 
expressed concern over an escalation of tension in the region. 
(Chosun, Hankook, Hankyoreh, Segye) 
 
ROK experts believe that North Korea spent approximately 340 million 
dollars on missile launches this year and spent a total of 700 
million dollars when costs of its second nuclear test are included. 
(Dong-a, JoongAng, Seoul) 
 
According to U.S. diplomatic sources, the U.S. will call for 
stronger sanctions against North Korea at the ASEAN Regional Forum, 
which will take place in Phuket, Thailand, starting July 21. 
(Chosun) 
 
According to a Washington source, the U.S. government discovered 
some North Korean bank accounts in Malaysia, through which it 
suspects payments were made for the shipment of weapons.  The U.S. 
is seeking to freeze the accounts.  (Hankook,JoongAng, Chosun, 
Hankyoreh, Segye, MBC, KBS). 
 
According to a ROK military source, there is a possibility that 
North Korea's Kang Nam freighter may return home today after being 
 
SEOUL 00001058  002 OF 010 
 
 
trailed by a U.S. Navy destroyer and suddenly reversing course in 
late June.  (Dong-a, JoongAng, Hankook) 
 
Philip Goldberg, the U.S. coordinator for the implementation of a UN 
Security Council Resolution that punishes North Korea for its May 25 
nuclear test is in Malaysia to seek help in implementing financial 
sanctions against North Korea. (Chosun, Hankook) 
 
 
MEDIA ANALYSIS 
-------------- 
 
-N. Korea: Missile tests 
------------------------ 
Most ROK media gave wide attention to North Korea's July 4 missile 
launches.  Conservative Chosun Ilbo noted in a front page story that 
North Korea launched seven ballistic missiles on July 4, U.S. 
Independence Day.  Citing an ROK military official, the newspaper 
said that five of the seven missiles landed in the same area in 
waters 420km away from the launch site, demonstrating a higher level 
of precision than in previous launches.  Chosun Ilbo, however, 
citing a military expert, commented in that same article that the 
missile launches, which were intended to draw U.S. attraction, 
failed in that regard since the North fired short range missiles, 
not long-range missiles which could strike the U.S.  Citing experts, 
the newspaper said in an inside-page article that the July 4 missile 
launches apparently came as a result of growing hardline voices 
within the North Korean military, rather than from political and 
diplomatic considerations. 
 
Conservative Dong-a Ilbo  said in an inside-page report that experts 
believe that North Korea did not launch Intercontinental Ballistic 
Missiles (ICBM) this time based on the judgment that its 
brinkmanship tactics will no longer work, and reserved an ICBM 
launch as the last card to play.  Citing other experts, Dong-a Ilbo 
noted that North Korea is not yet technically capable of firing the 
ICBM which is presumed to have been updated from Taepodong II 
missiles. 
 
Moderate Hankook Ilbo, citing an expert on North Korea, reported in 
an inside-page story that North Korea did not fire long-range 
missiles this time due to strategic considerations.  According to 
the newspaper, the expert believes that North Korea wants to keep 
ramping up tensions in the region while pressuring the U.S. 
step-by-step. 
 
Right-of-center JoongAng Ilbo said in a front-page analysis that 
according to military experts, North Korea spent 420 billion won, or 
about 330 million dollars, on missile launches this year and spent a 
total of 700 million dollars when costs of its second nuclear test 
are included.  The newspaper cited a Blue House official saying that 
300 million dollars can feed all North Koreans for one year. 
 
Chosun Ilbo editorialized: Through a recent series of missile 
launches, Pyongyang showed that it has succeeded in improving its 
missile technology, and if Pyongyang wants, its missiles are now 
accurate enough to hit major facilities in the ROK.  North Korea 
could aggravate the situation further by staging military 
provocations against the ROK or conducting a third nuclear test. 
 
 
JoongAng Ilbo editorialized: The North's recent acts of bellicosity 
seem to be related to its succession concerns, but the North should 
change its way of thinking and pay more attention to its citizens' 
welfare. It should turn the money it spends on missile launches into 
a fund to feed its people. 
 
Hankook Ilbo editorialized: It is noteworthy that the U.S. 
disregarded (North Korea's provocations) without any public comment. 
 Some observers say that the U.S. took this attitude in order not to 
be embroiled in North Korea's attention-grabbing strategy, but it 
may be more accurate to say that Washington's ignorance is designed 
to keep the focus of its strategic game with North Korea on the 
nuclear issue by not responding to every short-range missile launch. 
 
SEOUL 00001058  003 OF 010 
 
 
 
 
 Hankyoreh Shinmun editorialized: North Korea's scud missiles can 
strike all ROK regions and part of Japan and therefore are 
apparently aimed at the ROK and Japan, which lead the hard-line 
moves against North Korea.  North Korea timed its missile launches 
to coincide with the U.S. Independence Day but did not fire 
long-range missiles that can provoke the U.S. in order to sound out 
U.S. intentions. 
 
-North Korea: Goldberg Trip 
--------------------------- 
In a related development, Chosun Ilbo reported that Philip Goldberg, 
the U.S. coordinator for the implementation of a UN Security Council 
Resolution that punishes North Korea for its May 25 nuclear test, is 
in Malaysia to seek help in implementing financial sanctions against 
North Korea.  According to the newspaper, the U.S. government 
discovered some North Korean bank accounts in Malaysia, through 
which it suspects payments were made for the shipment of weapons. 
The U.S. is seeking to freeze the accounts. 
 
 
OPINIONS/EDITORIALS 
------------------- 
 
CHINA SYNDROME 
(JoongAng Ilbo, July 3, 2009, Page 47) 
 
By Senior Columnist Kim Young-hie 
 
China must act now in alliance with the international community to 
thwart North Korea's nuclear ambitions before it's too late. 
 
Let's say we agree that the sanctions imposed by the United Nations 
Security Council on North Korea are stern and comprehensive.  Let's 
say that Washington's and Tokyo's independent financial sanctions 
effectively block North Korea's cash flow and its needs for 
international financial transactions.  Without China's active 
participation, however, the sanctions on North Korea won't 
significantly impact North Korea's leadership or force it to change 
its mind and return to the Six-Party Talks.  Several sets of 
statistics concerning economic relations between North Korea and 
China clearly confirm this. 
 
According to The Washington Post, North Korea gets 90 percent of its 
energy from China.  The energy source it doesn't depend on its 
neighbor for is coal.  North Korea turns to China each year for food 
aid to supplement shortfalls in its own crop production.  It's 
thought that more than 45 percent of the food North Koreans consume 
comes from China.  This food supply is referred to as an import but 
in reality it's aid.  Pyongyang gives nothing in return except 
perhaps access to some mineral resources.  The Washington Post 
reported that during the past year trade between North Korea and 
China increased by 41 percent, and North Korea's trade with China 
accounted for 73 percent of North Korea's entire trade volume.  This 
means that China is throwing the country a lifeline that will keep 
the North at minimum survival levels despite the imposition of 
sanctions.  When the UN Security Council discussed Resolution 1874 
and the imposition of sanctions on North Korea, China changed the 
wording that  said that the UN resolution "demands" that its member 
countries inspect North Korea's cargo vessels on the high seas to 
"calls upon."  This change weakened the measure's binding power 
because member countries could decide whether to act or not. 
 
Most people know that China strongly opposes North Korea's nuclear 
armament, but North Korea will not give up its nuclear ambition just 
because the rest of the world, including China, opposes it.  But 
China is not convinced that we need big sticks to force the 
communist country to abandon its nuclear program.  China says 
wielding a stick is not its goal, so it takes no action to actively 
promote the resolution and its sanctions.  Of course, others also 
know that getting tough with Pyongyang is not a goal in itself; it's 
a measure to bring North Korea back to the table.  President Lee 
Myung-bak and U.S. President Barack Obama have made this clear.  Yet 
 
SEOUL 00001058  004 OF 010 
 
 
China still makes insufficient efforts.  The country simply refuses 
to pursue further efforts. 
 
A reliable news source reports that the United States is trying to 
raise China's participation in sanctions on North Korea from the 
current 15 percent to 75 percent.  But even 75 percent will be not 
sufficient.  If China's participation is below that level, it will 
be difficult to change North Korea's reckless and provocative 
policies with financial sanctions.  The source explained the 
differences in the points of view between South Korea, the United 
States and China as to why North Korea is obsessed with developing 
nuclear arms and long-range missiles.  According to his analysis, 
the United States gives a lot of weight to North Korea's domestic 
situation; China thinks North Korea went ahead with nuclear 
development because the United States did not treat North Korea with 
enough respect; and South Korea's view lies somewhere in between. 
 
The United States' view gives the impression that it blames North 
Korea for the halt in the denuclearization process.  If the reason 
why North Korea stopped implementing the agreement reached at the 
Six-Party Talks is due to problems inside North Korea, there is not 
much else that the other five member countries can do.  If Kim 
Jong-il wants to develop nuclear weapons and missiles, display them 
as the great achievement of Kim Il-sung's family, pass on his power 
to his son Jong-un and establish succession, no carrots from the 
outside world will work.  That is the weak point of Washington's 
view. 
 
China's perception is old-fashioned and cannot explain why North 
Korea has changed since last summer.  It also wants to hold the 
United States accountable.  Another well-informed source said the 
problem is that China hopes the current stalemate will continue. 
And South Korea's view, lying somewhere between the United States' 
and China's, can be said to be most realistic, because North Korea 
must have broken the Six-Party agreement and forged ahead with 
nuclear and missile development because of domestic reasons as well 
as outside factors. 
 
What's clear now is that North Korea's nuclear development has 
gained momentum.  If not blocked, its stock of nuclear weapons and 
missiles could grow too large to cut back over the next six months 
or a year.  We're then left with the unsavory situation of a major 
threat to the geopolitics of Northeast Asia and, from China's point 
of view, to China's national security.  If China opposes North 
Korea's nuclear armament but does not participate in implementing 
measures to denuclearize it, China should be held responsible for 
playing the role of an onlooker.  China maintains that it has no 
influence over North Korea, but no one believes that anymore. 
China's perception that North Korea's possession of nuclear weapons 
is better than its collapse goes against the progress of history. 
China must act to help thwart North Korea's nuclear ambitions before 
it is too late. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
THE DILEMMAS OF THE N. KOREAN PROBLEM 
(Chosun Ilbo, July 6, 2009, Page 30) 
 
By Columnist Kim Dae-joong 
 
We can assume three things about the North Korean nuclear problem. 
The most important one is that the regime will not abandon its 
nuclear weapons under any circumstances.  This is all but accepted. 
The conditions the North has set forth for abandoning them are only 
for show, while the regime believes that it has survived only 
because of the nuclear development programs and that they are needed 
to ensure the hereditary rule of the Kim family.  That means there 
is little to hope from the various approaches now under discussion 
such as the six-party denuclearization talks. 
 
The second assumption is that China has no intention of pressuring 
North Korea to the extent of threatening the survival of the regime. 
 
SEOUL 00001058  005 OF 010 
 
 
 Other parties, the United States in particular, have stressed 
China's role and expect Beijing will apply pressure on the North 
whenever the problem reaches an impasse.  But Beijing does not want 
the North Korean regime to collapse.  It does want Pyongyang to be 
more conciliatory and seek coexistence with its neighbors, but it 
cannot afford to abandon the North even if it fails to do so. 
 
China is naturally concerned about the enormous blow it would 
sustain if the North Korean regime crumbled and hundreds of 
thousands or millions of North Koreans escaped to its three 
northeastern provinces.  And if the North Korean regime falls, 
Beijing will not tolerate a situation in which it shares borders 
with South Korea or the U.S. across the Apnok (or Yalu) and Duman 
(or Tumen) rivers.  China intervened in the 1950-53 Korean War for 
the purpose of blocking the U.S. threat of advancing to Manchuria, 
and that purpose remains. 
 
The third postulation is that Washington will not permit the North 
to keep its nuclear weapons under any circumstances.  The U.S. won't 
sit idle when rogue countries like North Korea have nuclear weapons 
but refuse to take responsibility for them.  That is why it wants to 
discuss conditions while keeping the path to negotiations open, and 
that is why it is responding to Pyongyang's belligerent nuclear 
tests and missile launches with sanctions and diplomatic pressure. 
They may push Pyongyang over the brink. 
 
The question is if the U.S. is considering a military option as 
well.  For now, the chances are nil.  With the Iraq war fresh on its 
mind and the situation in Afghanistan becoming more difficult and 
costly, the U.S. cannot afford another front against the North. 
 
North Korea knows this.  It keeps test-firing missiles in the wake 
of its second nuclear test to achieve recognition as a nuclear power 
at home and abroad, taking advantage of the U.S. dilemma.  The North 
is also aware that Beijing, though it outwardly backs the UN 
sanctions, will not finally abandon the North, because it does not 
want a Northeast Asia without the buffer of North Korea.  That is 
another reason why Pyongyang continues the nuclear game.  It 
believes that both Washington and Beijing have their hands tied. 
 
But what is it the South can assume about the North?  For one thing, 
the South lives with the threat of North Korean nuclear weapons over 
its head.  In a situation where the North will not give up its 
nuclear weapons and the global powers are unable to force it, South 
Korea can do almost nothing on its own.  If we are to escape being 
hit by the North's nuclear weapons, we have to do whatever the North 
wants.  Living a life of humiliation, giving the North Korean regime 
money, food and whatever else it wants, regarding them as a "peace 
insurance," as a former president said.  Buying peace with a lump 
sum may be tolerable, but being held hostage indefinitely would be 
unbearable. 
 
Another assumption is that escape from such captivity would mean 
paying a high military price.  This is the most dangerous 
assumption.  If sanctions from Washington and Beijing really bite, 
the North may well seek a way out in military retaliation against 
the South.  In that case, the South will have to confront the 
North's military provocations head-on. 
 
But there is a variable, namely a change inside the North Korean 
regime, and a subsequent shift in the perception of North Koreans. 
An abrupt change in the North Korean leadership linked to Kim 
Jong-il's health, undercover political struggles within the 
leadership and new perceptions of the population will no doubt shake 
the North's system enormously.  This is the most interesting factor. 
 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
ARMS ARE NOT THE ANSWER 
(JoongAng Ilbo, July 6, 2009, Page 42) 
 
 
SEOUL 00001058  006 OF 010 
 
 
North Korea is persisting with its brinkmanship strategy, but the 
effective value of that strategy ends here.  It believes that it 
will get what it wants through its nuclear tests and missile 
launches or the use of provocative language.  Its launch of seven 
Scud-type missiles on July 4 is a prime example of that.  Meanwhile, 
the international community, including Korea and the United States, 
has differed in the approach to North Korea, as the North appears 
poised to apply its past success to present strategy. 
 
The recent missile launch, conducted on America's Independence Day, 
was aimed at attracting the attention of the administration of U.S. 
President Barack Obama.  However, the U.S. flatly ignored it.  There 
was not even a comment from the White House or the Department of 
State.  Although President Obama mentioned the Iranian nuclear issue 
at his Independence Day speech, he did not say a word about the 
North Korean issue.  Instead, the Obama administration is tightening 
the reins by taking steps to enforce the sanctions against North 
Korea.  Obama has even emphasized that tougher action on North Korea 
may be taken.  Meanwhile, the State Department said the tests were 
"not helpful" and that North Korea should "fulfill its international 
obligations and commitments."  A special task force that traveled to 
China to enlist its help in applying the sanctions is known to have 
investigated suspicious North Korean bank accounts in Malaysia. 
 
Of course, North Korea will withstand the hardships the sanctions 
impose, because it has maintained an independent economy while 
becoming increasingly isolated from the international community for 
more than six decades.  And because China, which is worried about 
American influence on the Korean Peninsula, is not likely to be 
willing to cut back on the assistance it provides to North Korea, 
North Korea is likely to escape the worst effects of its isolation. 
 
The question is whether the leaders in Pyongyang will get what they 
want, despite the hardships they must endure, by resorting to arms. 
The answer is no.  As long as North Korea is a nuclear weapons 
state, normalizing its relationship with the U.S. is nearly 
unthinkable.  We are at a loss to explain how they can continue to 
endure international isolation and substandard economic conditions. 
Will North Korea leave the matter of protecting its citizens' 
welfare unresolved for years to come?  The North's recent acts of 
bellicosity seem to be related to its succession concerns, but the 
North should change its way of thinking and pay more attention to 
its citizens' welfare. It should turn the money it spends on missile 
launches into a fund to feed its people. 
 
(We have compared the English version on the website with the Korean 
version and added some sentences to make them identical.) 
 
 
¶N. KOREA'S MISSILE LAUNCHES REQUIRE A CALM RESPONSE 
(Chosun Ilbo, July 6, 2009, Page 31) 
 
North Korea on Saturday fired seven missiles into the East Sea from 
a launch site near Wonsan, Kangwon Province.  They are said to be of 
the Scud C variety with a maximum range of 500 km, new Scuds with a 
range of 1,000 km, and a Rodong missile that can hit targets 1,300 
km away.  Last Thursday, North Korea fired four KN short-range 
missiles at a launch site near Hamhung.  It has launched 18 missiles 
so far this year, including the long-range rocket launched on April 
¶5. 
 
Seoul estimates North Korea spent US$700-800 million on these 
provocations this year, with $300-400 million spent on the nuclear 
test, $300 million on the long-range rocket launch, $4 million to 
fire each Scud missile and $10 million to fire each Rodong missile. 
The South Korean government and the World Food Programme estimate 
that North Korea suffers from a shortage of a little under 1 million 
tons of food each year.  By last summer's prices on the 
international markets, it costs around $300 million to buy 1 million 
tons of food.  The money North Korea spent on its nuclear test and 
missile launches in the first half of this year is enough to cover 
two years worth of food shortages. 
 
The North was attempting to show off its military might by firing 
 
SEOUL 00001058  007 OF 010 
 
 
seven missiles on July 4, America's Independence Day.  It also fired 
seven missiles, including a long-range missile, on July 4 2006. 
Just after being inaugurated early this year, U.S. President Barack 
Obama proposed dialogue with North Korea, but he recently said he 
wants to break the previous pattern of rewarding North Korea's 
provocations, shifting direction in favor of sanctions and pressure. 
 In response, North Korea has embarked on a series of missile tests 
that demonstrate its ability to hit South Korea and Japan. 
 
Obama warned recently that Washington could implement further 
sanctions, in addition to those provided in a UN Security Council 
resolution, while appointing Philip Goldberg as a special envoy 
handling the U.S. sanctions.  Goldberg traveled to China to seek 
Beijing's support for the UN sanctions and to Malaysia to negotiate 
the freezing of suspected North Korean accounts there.  The standoff 
between Washington and Pyongyang is expected to continue. 
 
Through a recent series of missile launches, Pyongyang showed that 
it has succeeded in improving its missile technology, and if 
Pyongyang wants, its missiles are now accurate enough to hit major 
facilities in the ROK.  North Korea could aggravate the situation 
further by staging military provocations against the ROK or 
conducting a third nuclear test.  There are rumors that North Korea 
is in the midst of a power transfer from Kim Jong-il to his third 
son Jong-un after the North Korean leader fell ill last summer, 
highlighting mounting uncertainties within the regime.  Some rumors 
say military hawks have surrounded the North Korean leader. 
 
The South Korean government has no choice for now but to focus on 
international cooperation to stop the North.  At the same time, 
Seoul must be meticulous in gathering intelligence about North 
Korea, while preparing detailed responses to specific provocations 
by the communist country.  The key is to make accurate predictions 
and handle the situation calmly. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
¶N. KOREA'S MISSILE LAUNCHES ONLY WORSENS CHANCES FOR DIALOGUE 
(Hankyoreh Shinmun, July 6, 2009, Page 27) 
 
North Korea launched a group of seven short-range missiles Saturday. 
 It was a continuation of Tuesday's show of military force when it 
fired four missiles that flew short ranges of less than 100km. 
Defense officials are presuming the latest missiles to be either 
Scud or Rodong-type missiles whose firing range has been reduced to 
400 kilometers and 500 kilometers. 
 
Up until now, North Korea has occasionally fired surface-to-air or 
surface-to-ship missiles, but this launch of surface-to-surface 
missiles is the first since July 2006.  Then, as now, the atmosphere 
of confrontation between North Korea and the U.S. was at its height, 
and North Korea launched seven Rodong and Scud-class missiles, 
including one long-range Taepodong-2, during the U.S. Independence 
Day holiday.  Unlike then, however, North Korea did not fire a 
long-range missile this time. 
 
This latest launch is being interpreted as an attempt by North Korea 
to strengthen its military deterrence ability amid a situation of 
confrontation, while demonstrating the political determination of 
not bowing to the pressure of sanctions by the international 
community.  In addition, North Korea's scud missiles can strike all 
ROK regions and part of Japan and therefore are apparently aimed at 
the ROK and Japan, which lead the hard-line moves against North 
Korea. 
 
North Korea timed its missile launches to coincide with the U.S. 
Independence Day but did not fire long-range missiles that can 
provoke the U.S. in order to sound out U.S. intentions.  However, if 
pressure against North Korea grows more severe, there is also a 
possibility that North Korea might escalate tensions to levels it 
has previously warned of with the launch of an intercontinental 
ballistic missile or with an additional nuclear test.  Whenever 
 
SEOUL 00001058  008 OF 010 
 
 
pressure against it has strengthened, North Korea's response has 
been to resolve the problem through a show of force. 
 
These missile launches, however, are an act of provocation in 
contravention to United Nations Security Council Resolutions 1817 
and 1874, which demand that North Korea cease all activity related 
to ballistic missiles.  Even China and Russia, nations that have 
friendly relations with North Korea, have said that the country must 
stop engaging in any measures that might harm stability in Northeast 
Asia.  This can be read as an indirect expression of dissatisfaction 
with North Korea's recent short-range missile launch activities. 
 
North Korea must stop engaging in activities that worsen the 
situation and bring about its own isolation.  Also, the nations 
participating in the six-party talks, including South Korea and the 
U.S., and the international community must leave behind their 
ineffective hardline policy focused entirely on sanctions and seek 
out a plan to resolve the issue substantially through dialogue as 
soon as possible.  With the U.S. government not yet having presented 
a picture of its North Korea policy, the role the South Korean 
government plays is particularly important. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
NUCLEAR REPROCESSING FOR PEACEFUL PURPOSES 
(Dong-a Ilbo, July 3, 2009, Page 31) 
 
Foreign Minister Yoo Myung-hwan said yesterday, "There is a need to 
revise the nuclear agreement between (South) Korea and the United 
States for a short period of time."  He was trying to say that Seoul 
will negotiate with Washington to allow reprocessing of leftover 
material at nuclear power plants at a time when South Korea needs 
more nuclear power to cope with climate change and high oil prices. 
 
 
South Korea abandoned nuclear reprocessing in 1974 under a nuclear 
agreement with the United States, but some have continued to press 
for a revision of the bilateral accord.  Now seems like the right 
time to revise the agreement in a way that brings economic and 
industrial benefits under the basic principle of "peaceful use." 
The revision process is expected to start in 2012, two years before 
the agreement expires. 
 
More than 10,000 tons of nuclear fuel have been produced in South 
Korea from 20 nuclear power plants.  The country will run out of 
storage room for such material by 2016.  The plants use 4,000 tons 
of uranium per year and produce 700 tons of fuel.  If reprocessed, 
94.4 percent of the spent fuel can be recycled as an energy source, 
which is both economically and environmentally helpful. 
 
To achieve "peaceful nuclear sovereignty," Seoul needs recognition 
from the international community about nuclear reprocessing. 
Washington is said to be opposed to the revision.  U.S. Under 
Secretary of State for Arms Control and International Security, Rep. 
Ellen Tauscher, said in a paper submitted to Congress that the U.S. 
cannot allow South Korea and Taiwan to conduct nuclear reprocessing, 
a right which the U.S. has given to the European Union, India and 
Japan. 
 
The 1992 inter-Korean declaration on denuclearization, however, was 
an inevitable measure to stop North Korea's nuclear development.  It 
is a declaration that has lost its effectiveness in the wake of 
Pyongyang's second nuclear test and declaration as a nuclear 
country.  Of course, South Korea is suspected of wanting to arm 
itself at a time when North Korea is showing its nuclear ambition. 
So Seoul must persuade the international community that it has no 
plan to use nuclear power as a weapon, only for peaceful purposes. 
 
South Korea, which has 20 nuclear power plants, is the world's 
fifth-largest producer of nuclear energy and ranks sixth in terms of 
safe management of nuclear material.  .  Under the Non-Proliferation 
Treaty, all member nations must guarantee the use of nuclear power 
 
SEOUL 00001058  009 OF 010 
 
 
for peaceful purposes.  Even Japan, which bans the manufacturing, 
retention and import of nuclear weapons under its "peace" 
constitution, has reprocessing facilities for nuclear waste.  Japan 
was one of the villains of World War II, so it is unfair for South 
Korea to be continually banned from reprocessing nuclear fuel. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
TREAD CAREFULLY ON NUCLEAR PACT 
(JoongAng Ilbo, July 4, 2009, Page 34) 
 
Speaking to international and local press, Foreign Minister Yu 
Myung-hwan said that South Korea should revise its nuclear power 
accord with the United States in the near future to incorporate its 
commercial needs for supplying and reprocessing nuclear fuel.  In 
sum, the country is looking to get back its rights to complete the 
nuclear fuel cycle through the self-enrichment of uranium and the 
recycling or reprocessing of used nuclear fuel.  The basic direction 
is right; however, a more prudent approach seems necessary in 
handling this type of matter. 
 
Economically speaking, completion of the nuclear fuel cycle makes 
sense for the Republic of Korea, which is the fifth-largest 
commercial nuclear energy producer in the world.  After all, 40 
percent of the nation's electricity comes from nuclear reactors. 
According to the pact with the United States in 1974, South Korea 
cannot domestically enrich uranium and reprocess used nuclear fuel 
without the consent of Washington.  The pact was meant to ease 
concerns over the potential military use of nuclear power.  Korea 
has the technology and know-how to design nuclear plants and make 
nuclear fuel, but it must import nuclear fuel, which costs a huge 
amount of money.  The country also must dump waste from 700 tons of 
nuclear fuel - generated from 20 reactors - in water tanks due to 
the ban on recycling.  Waste levels have already reached 10,000 tons 
and will overwhelm storage capacity by 2016.  Thus, recovering our 
peaceful nuclear sovereignty makes sense when viewed only from the 
economic side.  Furthermore, renegotiating the terms of the pact is 
necessary anyhow, as the current agreement with the United States 
expires in 2014. 
 
Still, it is not desirable for the government to publicly declare 
the need for Korea to be able to reprocess nuclear fuel.  North 
Korea has conducted two nuclear tests, nullifying the 1992 
inter-Korean agreement to keep the peninsula free of nuclear 
weapons. Nevertheless South Korea's call for completing the nuclear 
cycle leaves a lot of room for misunderstanding.  It could trigger a 
diplomatic collision with Washington, as the U.S. State Department 
has already publicly voiced opposition to changes to the existing 
pact. So the argument to opposing the United States might lead to 
conflict. 
 
To attain sovereignty in the commercial use of nuclear power, we 
need to gain trust from the international community first, as Japan 
did.  The government should not join the populist cry for nuclear 
deterrence out of impulse. Discretion is most desired in perilous 
times. 
 
(This is a translation provided by the newspaper, and it is 
identical to the Korean version.) 
 
 
NORTH KOREA GOING ON ITS OWN ROAD 
(Hankook Ilbo, July 6, 2009, Page 35) 
 
North Korea reaffirmed its intention to go its own way by launching 
seven short-range missiles off its eastern coast on July 4.  The 
modified Scud missiles and Rodong missiles that the North test-fired 
are weapons targeting the ROK and U.S. forces in Japan.  The North 
flaunted its "self-defense striking power against any possible 
invasion" once again.  Pyongyang also seems to have intended to 
improve its missile accuracy.  We should calmly figure out North 
Korea's true intention and cope with it appropriately. 
 
SEOUL 00001058  010 OF 010 
 
 
 
The ROK military and government were right to closely track the 
missiles and analyze their performance.  Observers say that as shown 
by the fact that five of the seven missiles landed in the designated 
no-sail zone after travelling about 450 kilometers, missile accuracy 
has improved.  In addition, observers speculate that considering the 
speed of three missiles, they are variants of Rodong missiles with a 
range of 1,500 kilometers.  This can be interpreted as meaning that, 
despite its saber-rattling, North Korea has no intention of 
ratcheting up tensions by firing a missile toward Japan. 
 
North Korea's missile launches, of course, constitute a blatant 
defiance of the UN Security Council Resolution.  This is why Japan, 
China, Russia, the U.K., and France strongly condemned the North for 
its provocations.  However, it is noteworthy that the U.S. 
disregarded (North Korea's provocations) without any public comment. 
 Some observers say that the U.S. took this attitude in order not to 
be embroiled in North Korea's attention-grabbing strategy, but it 
may be more accurate to say that Washington's ignorance is designed 
to keep the focus of its strategic game with North Korea on the 
nuclear issue by not responding to every short-range missile 
launch. 
 
The U.S. is pressuring the North more strongly than expected.  The 
key is to choke off revenue to North Korea by banning its arms 
export and blocking its overseas financial transactions.  In the 
past, too, when dealing with a nuclear-possessing state like the 
North, the U.S. focused its efforts on implementing economic 
sanctions and preventing nuclear proliferation.  The Obama 
Administration is taking the same line.  In light of this, it is not 
desirable for us to put too much emphasis on a security crisis and 
military readiness.  On the other hand, it is also reckless to worry 
about the possibility of the ROK being alienated from any future 
U.S.-North Korea talks and only criticize the ROKG. 
 
For quite a while, the North will go its own way, and the U.S. will 
continue to apply pressure on the North.  Therefore, we need to wait 
for any further developments in a resolute and calm manner. 
 
 
ROK-EU FTA SHOULD SERVE AS BENCHMARK FOR KORUS FTA 
(JoongAng Ilbo, July 6, 2009, Page 42; Excerpts) 
 
There is a growing possibility that the ROK and the EU will soon 
strike a Free Trade Agreement (FTA).  The successful conclusion of 
the ROK-EU FTA talks is expected to serve as a lever to make 
progress in the ROK-U.S. FTA, which is awaiting ratification after 
the conclusion of the negotiations between the two governments.  If 
the benefits of the ROK-EU FTA become visible while no progress is 
made in the ROK-U.S. FTA, it will be difficult for the U.S. to drag 
its feet on the ratification of the deal any longer.  The U.S. will 
also feel burdened by the fact that the ROK and the EU reached an 
agreement on the auto sector while the U.S. has been making an issue 
of it.  If the ROK-EU FTA is reached and then quickly ratified, it 
will give the ROK some breathing room before the ROK-U.S. FTA is 
ratified.  This is because the ROK, while benefiting from trade 
expansion with the EU through the FTA, can sit and watch the U.S.'s 
response.  The ROK-EU FTA will also have a positive impact on the 
ROK's trade negotiations with China and Japan, which are currently 
at a standstill. 
 
 
STEPHENS